Novastar Ventures Secures $147M for Africa's Largest VC Fund

Novastar Ventures, one of the first and largest VCs investing in Africa, has announced the final close of its third fund, Novastar Ventures Africa People and Planet Fund III (NVIII), at $147 million.

With offices in Nairobi and Lagos, Novastar is one of the largest platforms dedicated to financing early and growth stage businesses in Africa. The firm backs startups that address proven demand for basic goods and services with innovative business models.

Having previously raised two funds, Novastar has been working on the Africa People & Planet Fund III, which secured a $40 million equity commitment from the Green Climate Fund (GCF) last November.

The fund, which invests in businesses that align the economic interests of Africa's growing population with planet-positive technologies, has now announced a final close at $147 million, which represents a 40 per cent increase on Novastar's previous fund and is among the largest Africa-focused venture capital funds raised to date.

NVIII marks an important evolution in Novastar's strategy. For the first time, Novastar will deploy capital on a pan-African basis, expanding beyond the East and West Africa focus of earlier funds, to partner with entrepreneurs across the entire continent.

The fund attracted commitments from both longstanding LPs and a highly-diversified global investor base. This includes a growing cohort of Japanese institutions alongside leading international development finance institutions, such as British International Investment, Norfund, Swedfund, Proparco and COFIDES, as well as private capital.

NVIII will invest in seed-to-scale, with initial ticket sizes ranging from $1million to $8 million. The fund has already backed six high-growth companies that are transforming their sectors. They include Breadfast and Chowdeck, two of the fastest-scaling food and grocery delivery platforms in their markets; Greenwheels and ARC Ride, pioneering the shift to electric mobility in Africa; MoPhones, expanding access to top-quality affordable smartphones; and Sistema.bio, a global leader in climate-smart solutions for family farmers.

"Novastar's investment approach has always focused on transformative businesses that generate lasting financial, social, and environmental value for the common good. NVIII is a natural progression of that strategy, leveraging over a decade of experience backing businesses addressing Africa's biggest challenges, while driving a sustainable development pathway for Africa, and the world," said Andrew Carruthers, co-founder and managing partner at Novastar.