Africa represents 18% of the world’s population, yet only 1% to 2% of global venture capital reaches the continent. Moreover, the majority of Venture Capital funds investing in Africa are based outside the continent and often lack a deep understanding of local market dynamics. With a growing recognition of the need to move away from models developed in the US and Europe and to define a distinctly African approach, for the past 4 years, ASI has delivered an academic course for African fund managers to help fuel a new era of investment through the Boost Africa TAF programme.

Small and medium-sized enterprises (SMEs) form the backbone of African economies. Early-stage firms with high growth potential, together with innovative companies entering expansion phases, are vital drivers of innovation, diversification, and job creation. While these businesses begin small, successful ones rapidly scale up, boosting employment and revenues. It is during this “growth stage” that much of Africa’s new economic activity is generated.

Venture Capital (VC) funds play a critical role in enabling this growth, particularly for technology-driven firms. However, African VC funds operate within ecosystems that present unique challenges. High failure rates are common, as early-stage companies often lack track records, market presence, and experienced management. Transaction costs are also high because weak information systems and limited market data make due diligence and deal sourcing time-consuming.VC funds also face low conversion ratios since only a small share of sourced companies ultimately receive funding. Limited access to follow-on capital and difficulties in exiting investments further constrain returns. In addition, currency and interest rate risks erode profits, as funds often borrow in hard currency but lend in local currency.

These challenges make it difficult for early-stage VC funds to generate sustainable, risk-adjusted returns. Silicon Valley models have proven ill-suited to African realities, which calls for more context-specific approaches.

In response, the Boost Africa Technical Assistance Facility (TAF), in collaboration with the Saïd Business School at the University of Oxford and Africa Grow (DEGImpact), launched an executive course tailored for Africa-focused VC managers. The annual in-person programme brings together more than 40 leading fund managers, half of them women, for a week of peer learning, strategic dialogue, and capacity building. Designed for funds investing in early and growth-stage technology ventures, it strengthens skills and fosters a more inclusive and connected VC ecosystem.

To date, over 150 fund managers representing most active VC funds in Africa have joined a vibrant alumni community committed to collaboration, knowledge sharing, and advancing the continent’s venture capital landscape.

Why it matters

The African Venture Finance Programme (AVFP) plays a crucial role in shaping the future of venture capital on the continent. By bringing together fund managers who live and invest in Africa, the course helps build a uniquely African VC model that reflects local realities, challenges, and opportunities rather than importing approaches from other regions. It provides a platform for meaningful dialogue between fund managers and development finance institutions (DFIs), fostering stronger partnerships, greater access to capital, and improved understanding of how best to support Africa’s high-potential entrepreneurs. Through collaborative sessions, participants explore key trends in the African investment landscape, share insights on persistent challenges such as limited access to follow-on funding or currency risks, and exchange practical solutions designed for African markets. The course also nurtures a vibrant and inclusive community of investors who continue to collaborate long after the programme ends. This growing network of fund managers, DFIs, and ecosystem builders strengthens connections across countries and sectors, helping to create a more resilient and self-sustaining venture capital ecosystem. Ultimately, the AVFP empowers African investors to shape their own narrative, drive innovation, and unlock the full potential of the continent’s entrepreneurial talent.

EVIDENCE

• Africa’s entrepreneurial ecosystem secured 487 deals in 2024, according to the African Private Capital Association. This included 427 venture capital deals with a value of $2.6 billion and 60 venture debt deals worth $1 billion.
• Boost Africa was created to unlock Africa’s entrepreneurial potential by providing technical support to fund managers and addressing an early-stage financing gap.
• The programme has supported six venture capital funds as well as more than 70 companies and mobilised over €380 million in capital for startups across the continent. Moreover, 94% of Boost Africa-supported founders were able to raise $1 million or more in funding – nearly double the rate of comparable entrepreneurs.

The Boost Africa programme has given me a very good opportunity and has opened my mind to the possibilities of investing in Africa – Modester Inawendi, Seedstars Africa Ventures

At a time when Africa’s entrepreneurial ecosystem is rapidly evolving, the African Venture Finance Programme equips fund managers with the tools, networks, and critical thinking needed to shape the future of capital on the continent. This isn’t just about growing funds—it’s about reimagining what finance can do when it’s grounded in context, community, and long-term value creation. – Aunnie Patton Power, Programme Director for AVPF, University of Oxford.