By David Whitehouse
Posted on Tuesday, 22 February 2022 11:37, updated on Wednesday, 23 February 2022 10:26
France’s Digital Africa is looking for private partners to help accelerate its backing for African start-ups, CEO Stéphan-Eloise Gras tells The Africa Report.
Gras wants to work with early-stage funds to make pre-seed co-investments in Africa starting in 2023 or 2024. Digital Africa is in discussions with existing private-sector collaborators and new possible partners, she says. “Our DNA is closer to that of a venture-capital fund than development finance institutions” (DFIs).
Digital Africa is aiming to escape its French public-sector culture and become more responsive to African entrepreneurs on the ground. DFIs make large-scale investments but are less likely to provide quick, small-scale funding, Gras says. Digital Africa plans to make fast investments in the form of debt which can be converted into equity. The aim is not to pick long-term winners, but to make rapid exits within three to five years to allow support for other start-ups, Gras says.
READ MORE France’s Digital Africa seeks private-sector partners for start-up investing
The body was set up in 2018 by French President Emmanuel Macron to support African start-ups. Disputes over accountability led to the prospect of the association’s closure in 2021. The organisation will now work as a unit of Proparco, which in turn is part of the Agence Française de Développement (AFD), to invest 130m euros ($147m) through 2025.
Gras is looking for four main types of partners: DFIs, public institutions, private institutions and private companies. The partners that it has identified to date are from within a familiar orbit: the German development agency GIZ and non-profit NGO Silatech are being targeted for priority projects, according to a Digital Africa white paper.
New private-sector partnerships will be key if Digital Africa is to move beyond DFI territory.
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