World Bank arm pumps Sh600m into tech firms
Thursday, February 21, 2019 7:46
By VICTOR JUMA
The International Finance Corporation (IFC) is set to invest Sh600 million in technology-based companies in Kenya and other African markets. FILE PHOTO | NMG
The International Finance Corporation (IFC) is set to invest Sh600 million in technology-based companies in Kenya and other African markets, underlining the institution’s increased interest in local start-ups.
The money will be channelled through fund manager TIDE Africa which will identify and fund the firms.
This marks the latest investment in the sector in which IFC has committed more than $1.5 billion (Sh150 billion) worldwide.
Some of the local firms in which IFC has invested in the past one year are Africa’s Talking and food delivery firm Twiga Foods.
“IFC is considering an equity investment of up to $6 million (Sh600 million) in TIDE Africa Fund,” the international financier said in disclosures.
“Majority of TIDE’s investments will be concentrated in Anglophone Africa: Kenya, Nigeria, Ghana and South Africa, and the remaining allocation will be deployed in other Western, Eastern and Southern African countries, with a sectoral focus on consumer services, financial services, and enterprise technologies.”
TIDE has invested in five high growth digital companies in Kenya and Nigeria, IFC said.
Increased interest in local tech firms has enabled the companies to fund their growth, with some founders also cashing in by selling part of their stakes in the deals.
Twiga Foods last year raised Sh700 million from a consortium of investors including IFC and TLCom.
Through Twiga platform vendors can order and pay for fresh food and vegetables from farmers, resulting in lower prices by eliminating layers of middlemen.
TIDE, owned by UK-based venture capital firm TLcom Capital LLP, specialises in Sub-Saharan Africa where it makes investments of between $500,000 (Sh50 million) and $8 million (Sh800 million) in tech-enabled companies.