OpenseedVC, a new operator-led fund seeking to be the first investors in seasoned operators starting their technology companies across Africa and Europe, has officially launched, announcing the first close of its USD$10 million (approx. UGX37.57 billion) angel-style early-stage fund
The fund, backed by LPs such as founders, operators, and HNIs across Africa, Europe, and the US, will offer up to USD$150,000 (approx. UGX563.6 million) starter cheques, along with access to its robust network of over 50+ seasoned industrial experts to support founders just starting their tech startups from scratch.
In addition, OpenseedVC will also invest mainly in the Future of Commerce i.e. B2B Software, Artificial Intelligence (AI), Fintech, and the Future of Health & Work to align the inherent impact of the portfolio with the UN Sustainable Development Goals (UN SDGs).
The fund will primarily invest in founders in Africa and Europe and aims to invest in at least sixty (60) startups over the next five (5) years.
OpenseedVC is the brainchild of General Partner, Ms. Maria Rotilu, whose vision is to invest early in the growing number of experienced founders who aspire to launch their tech startups. Maria believes that OpenseedVC founders at the earliest stages get much-needed capital & conviction, and the added benefit of a community of experienced operators to support from start to launch.
The fund has made its first two investments in the Future of Commerce and Health —the first is an AI-enabled supplier dispute resolution software in the UK and the second is a foundational speech-to-text transcription model for underserved accents, starting with Africa.
ALSO READ: TRANSFORMING EDUCATION WITH AI TRANSCRIPTION
Speaking on the launch of OpenseedVC Fund, Ms. Maria Rotilu said, “As an investor, I have encountered incredibly talented and experienced founders, and the challenges faced as they try to launch their startups. They have the advantage of domain expertise and unique insight into large problems that can be tackled with innovative technology.”
Rotilu further stated, “Those who are visionaries coupled with the ability to execute, scale, build teams, and have the grit required to solve difficult problems — these skills, especially in the current market, are highly relevant to building technology startups that solve real problems, and creating scalable value for the global economy and our investors.”
Rotilu emphasized that the experience seasoned startup founders bring in terms of business building, combined with the dynamism and hustle that founders possess, is the focus for OpenseedVC.
“The current difficult fundraising climate is especially harsh for early-stage founders, but we believe incredible companies are born in the most difficult macroeconomic climates,” said Rotilu. “We want to be first believers in these experienced founders to give a great head start, with capital and an extensive operator network that support from start to launch of their technology companies.”
Also read:
Maria Zubeldia, Director of the Entrepreneurship Centre at Saïd Business School, University of Oxford adding to Rotilu’s remarks said, “Our goal is to foster a supportive ecosystem for exciting early-stage startups in which to develop and scale, and it is gratifying to see Rotilu carry this ethos forward with the launch of OpenseedVC.”
“I look forward to following the development of the fund,” added Zubeldia.
Global ecosystem data reveals that up to 9 out of 10 startups fail, with the lack of necessary expertise and business acumen of founders identified as a major contributing factor. This has in part led to a 45% failure rate for VC investments.
OpenseedVC operates at a sweet spot where startups with strong potential for success, partly based on the founder’s relevant execution ability, receive support. This approach ensures that capital is directed towards businesses more likely to solve real, scalable, and impactful problems effectively.
The fund is open to:
- Domain experts / Seasoned founders at high-growth technology companies, including first-time founders
- Second-time founders who’ve built and exited a previous startup
All applications to OpenseedVC will undergo the same evaluation process, and investments will be made on a rolling basis throughout the year (CLICK HERE TO APPLY FOR THE FUND).
According to the Global Startup Ecosystem Report by Startup Genome, the number of tech startups globally has been steadily increasing year over year, with the report accounting for 3.5 million startups in 2023. Figures show that in 2020 there were over 300,000 new tech startups established globally, underscoring the development of a critical mass of strong operator talent pipeline emerging from within the tech startup ecosystem.
With global early-stage equity funding experiencing a significant contraction of as much as – 54% YoY (-33% YoY in Africa), the OpenseedVC fund offers a much-needed opportunity for operator talent to access the support they need.
Furthermore, with just 8% of VC firms in Europe and Africa being led by former operators, compared to nearly half of US VCs, the OpenseedVC operator-led fund represents a positive development. Founders have an opportunity to collaborate with investors who possess a profound understanding of product and company development and can empathize with them throughout their journey.
The unique Africa and Europe-focused fund also allows for the exploration of synergies between Afro-European VC ecosystems, similar to what is more prevalent in the US-Africa VC space.
ALSO READ: SEED, GRANTS, AND FUNDING ROUNDS: WHAT’S THE DIFFERENCE?