The specialized venture capital company ‘Uncovered Fund’ has formed a $20M strategic alliance and joined forces with the corporate investment arm of Monex Ventures. It is a noteworthy development highlighting Japan’s mounting involvement in Africa’s brisk technology scene. Through this partnership, there is an intention to set up an investment vehicle of ¥3 billion (about $20 million) focused on investing in early-stage companies in the Middle East North Africa (MENA) region and further into Africa.
The newly created investment vehicle, called ‘Uncovered Monex Africa Investment Partnership,’ joins conscious investments into a startup developing digital and physical infrastructure solutions on the African scene. The $20M to African startups fund has identified four main investment areas: financial technology, distribution networks, mobility solutions, and sustainability projects.
The setting up of this fund coincides with a decline in venture capital activity in Africa. Industry insiders have recently revealed that venture capital fell to $2.2 billion in Africa in 2024, a figure 25% short of what it was in 2023, forcibly pointing toward an ever-bleaker financial environment plaguing startup ecosystems everywhere.
There was a funding adjustment of $1.2 billion for 313 transactions; however, in the third quarter of 2024 alone, there were only $507 million worth of funds raised for 108 deals, according to the African Capital Association. On a more hopeful note, the fund’s proponents hope to see emerging demographic and digital revolution trends becoming opportunities for further growth.
Projected demographic data points toward long-term prospects, with estimates to touch 2.5 billion people by 2050. Mobile internet users will also increase tremendously, with demand for digital infrastructure being positively generated by scaling in numbers from 500 million to 1.1 billion by 2030 on the African continent. The fund’s distinguished approach, however, lies in organizing a structured alliance between its portfolio companies and established Japanese firms looking for expansion opportunities outside Asia-Pacific Markets.
