In order to promote entrepreneurs developing agricultural and climate solutions, Novastar Ventures, a pan-African venture capital business, has received a $25 million equity investment from the US International Development Financing Corporation (DFC).
The $80 million East Africa Fund and the $108 million Africa Fund II, which allowed the company to enter West Africa, are followed by the third fund, which is Novastar’s third fund. TradeDepot, Moniepoint, Turaco, MoKo, and the agtech company iProcure were just a few of the firms that received funding from the company’s prior fund.
In the future, the VC company will be trying to build on this experience and utilize the same tools and methods to promote sustainable, planet-positive, mass-market business models across Africa that the rest of the world can benefit from, according to co-founder and managing partner Andrew Carruthers.
The Nairobi and Lagos-based venture capital firm hopes to gather around $200 million, making it one of the largest funds in the area, however it is uncertain what other limited partners committed to.
The VC firm plans to use the capital to support entrepreneurs in cleantech sectors such as clean utilities, electric mobility, and smart logistics. In addition, Novastar will support companies working in the field of climate technology that “deploy regenerative forestry, agriculture and aquaculture, biofuels, and biochar, that maintain biodiversity, improve soil health, and trap carbon” while expanding the market for smallholder farmers. More money is being made available by the VC company for clean tech businesses in Africa, which were the second most supported in the continent last year, after fintechs.