2020 was a good year for some tech actors. And for investors like TLcom Capital, a sub-Saharan Africa-focused VC firm, this year was the busiest in terms of new investments, leading rounds in API fintech startup, Okra; automotive startup, Autochek; healthtech platform, Ilara Health; and enterprise software, Shara. Techpoint Africa caught up with Andreata Muforo, a partner at TLcom Capital, to understand how the pandemic impacted African VC investments this year, the notable happenings in the continent’s ecosystem, and some takes on what to expect next year. Amount of capital coming to VC has been growing year-on-year, which has been great. When the pandemic hit, it dipped in the second quarter, and I believe it had a significant impact. If you think about it, the first quarter of this year was higher than the last quarter of 2019.
First couple of months to understand what impact the pandemic would have on our portfolio companies. And this is why I think most investors hardly made any new investments. Most of us were trying to get our houses in order before going back out to look for other investments. COVID-19 also played a part as some companies decided not to raise because their performances were affected or they didn’t feel they’d get the growth that they wanted. Fintech’s domination stems from the fact that it’s a core service to any business, so the opportunity in that space is gigantic because if you’re to transact in any way, you need fintech. Another thing is that there are so many things in fintech. We have payments, lending, wealth management, and remittance among others. Nigeria, Kenya, South Africa, and Egypt — will continue to dominate. Egypt has grown quite quickly in the last two to three years. It wasn’t on the map like the other three for some time, but it’s growing rapidly. the pandemic is a public health and economic issue, it will produce stronger entrepreneurs. When I think about its impact on the African tech ecosystem, I see how it has made founders learn to generate revenue when people are cutting back. They’ve also had to manage their costs and motivate their employees at a very difficult and uncertain time.