Oui Capital, a pan-African venture capital firm based in Lagos and Massachusetts, has announced the completion of the first closing of its $30 million second fund, dubbed Oui Capital Mentors Fund II, as it seeks to strengthen its presence on the continent.
Individual and venture capital investors participated in the second fund. Individual investors include Foundry Group partners Brad Feld, Seth Levine, Ryan McIntyre, Gbenga Oyebode, Alitheia Capital’s Tokunboh Ismael, Idris Alubankudi, and TeamApt CEO Tosin Eniolorunda.
Olu Oyinsan and Francesco Andreoli founded the firm in 2019 with the launch of its debut fund at $10 million. Since its inception, Oui Capital has made 18 investments in technology sectors ranging from fintech to logistics and mobility, e-commerce to healthcare, and enterprise software. TeamApt, MVX, Akiba Digital, Duplo, Ndovu, Maad, Intelligra, Aifluence, and Pharmacy Marts are a few examples.
Last year, the firm invested in eight startups across the continent, and this second fund indicates the VC’s intention to maintain that pace. The second $30 million fund, like the first, will support Sub-Saharan African startups in the pre-seed and seed stages. So far, the firm has completed its first close at slightly more than $11 million, and the final close is expected to be completed by Q4 2022.
Oui Capital’s managing partner Oyinsan, in an interview, explained that the firm’s first fund delivered early solid returns, with a MOIC (multiple on invested capital) of more than seven times. He stated that one of the reasons the firm was able to achieve this is because of the “sparks” that determine which startup to invest in or not: team, market, customer and tech knowledge, and customer enthusiasm.
What Oui Capital Partners are Saying
“We go above and beyond with the founders with whom we work, which is the reason we have a smaller portfolio than many seed funds.” “However, there is a critical distinction between a VC’s responsibilities as an investor and those of a fund manager,” he explained.
“Being an investor breeds the type of fervent optimism and support described earlier. Being an effective fund manager also entails having the fiduciary responsibility to know when to stop devoting scarce resources to problems that may prove too difficult to solve and instead devote these resources to higher-performing companies in your portfolio to minimize losses and maximize investor value.”
The Oui Capital Team
According to Oyinsan, the firm will seek to cover the entire spectrum of investments before Series A, including bridge rounds, an activity that will be accelerated, especially given the current venture capital crunch.
With the funds, Oui Capital intends to write initial checks of up to $750,000 (a tenfold increase over the ticket size of its first fund), with reserves set aside for such follow-on investments. “Expect us to be leading many more deals across the ecosystem and vocalizing firm initiatives — all things we’ve been doing quietly for the past four years, but now looking to double down on with the new fund,” Oyinsan added.
Commenting on Eniolorunda’s LP participation, Peter Oriaifo, principal at Oui Capital said, “It’s a great feedback loop for us as a VC firm and speaks to the strength of our working relationship with TeamApt in the years even before our investment in the company. The founder-investor relationship is a testament of our work to back a founder at the seed stage and to see the company succeed to a point where they want to pay it forward.”
How Oui Capital Mentors Fund II Will Be Invested
The firm is eager to make novel investments in startups that it believes will be winners in their respective countries and sectors. Oui Capital cites Maad (the first B2B marketplace for fast-moving consumer goods in Senegal) and Pharmacy Marts (an Egyptian B2B marketplace for pharmacies) as examples.
As a result, Oui Capital has made at least one investment in Nigeria, Kenya, Senegal, Egypt, and South Africa. The firm intends to make additional investments in North Africa and Francophone Africa, two regions that saw increased startup and venture capital activity last year, when African tech funding reached record highs in correlation with global numbers.
“Our pan-African strategy has made us the fund of choice for global LPs seeking exposure to the broader Africa opportunity without having to get into the weeds of understanding different regions separately,” Oyinsan said. Angur Nagpal’s Vibe Capital, D Global Ventures, Boston-based One Way Ventures, and Ground Squirrel Ventures are among the global VCs involved in this second fund.