The Oui Capital Mentors Fund II, the second fund from Oui Capital, launched today. The Africa-focused VC firm wants to increase its footprint in the African tech ecosystem. Olu Oyinsan, Oui Capital’s managing partner, spoke to TechCabal about their plans for the second fund.
Oui Capital’s portfolio currently backs 18 companies, in line with its mission to support African tech entrepreneurs who are building for the continent. But according to Oyinsan, there is still room for improvement.
“We’ve done 18 investments – roughly 5 deals a year – but I don’t count that as a fast deployment cadence for a seed fund such as ours.”
He adds that the firm has been very intentional about the companies Oui Capital chooses to back with seed funding. Their portfolio companies include alternative startups like Herconomy, a female-focused community-based fintech, and AWA Bike, a bike-sharing company.
Oyinsan wants to expand Oui Capital’s focus to North Africa and francophone Africa, signalling the firm’s first investment in these regions. The firm has also invested in companies from Nigeria, Kenya, Senegal, Egypt, and South Africa.
“Even though our base is in West Africa, these two regions are strategically important to building a diversified African portfolio. We can cross-pollinate our learning and distribution to create value across the continent.”
Oyinsan and Francesco Andreoli co-founded and launched Oui Capital in 2018. The pair previously co-founded an internet startup called Wifi Monkey. Oyinsan started his career in commercial banking with Guaranty Trust Bank before acquiring an MBA in finance and strategy from Hult Business School. He returned to Nigeria in 2017 after consulting with Forrester Research and the Early Stage Practice at Silicon Valley Bank.
He mentioned to TechCabal that Oui Capital’s strategy with the new fund is to invest across four key themes:
- digital commerce
- enterprise software
- fintech, including crypto-based solutions
- And human capital.
Oyinsan added that the firm would select 30 companies for the new fund and write initial checks of up to $750,000 with reserves in place for follow-on investments.
According to Oyinsan, Oui Capital distinguishes itself by the type of support that it offers to companies. For younger companies, the firm functions as a sounding board for strategy formulation, go-to-market strategy, and even helping to identify some early hires.
“As they start to gain traction, we help introduce them to follow on investors and help with operational support through our experienced team and our pool of mentors. Our mentor pool is a group of senior executives and entrepreneurs committed to giving our portfolio companies operational support.” Oyinsan adds that most of these mentors are also investors in the fund.
Oyinsan says the new fund will vet early-stage startups and grade them using four broad categories. The first category focuses on the team and how well-suited the team is to build the solution and deal with the unknown. The second focuses on the market potential of the company. The final two categories are customer-focused; they measure consumer enthusiasm and satisfaction with how well the solution works.
Oyinsan added that the fund investors also had to match Oui Capital’s pre-selected categories. The investors were either established venture capital funds, general partners of other private equity and venture capital funds, experienced entrepreneurs, or select business leaders and executives. Investors in the new fund include a mix of global venture capital funds such as Angur Nagpal’s Vibe Capital, D Global Ventures, Boston- based One Way Ventures and Ground Squirrel Ventures. The investor list includes Foundry Group’s Partners- Brad Feld, Seth Levine & Ryan McIntyre, Gbenga Oyebode, Tosin Eniolorunda, Alitheia Capital’s Tokunboh Ismael, and Idris Alubankudi.
The new $30 million fund aims to invest in more tech and tech-enabled companies in Sub-Saharan Africa at pre-seed and seed stages.
“We’re very excited to be back in the market with a bigger fund to fuel the growth we see from tech and tech-enabled companies on the African continent,” said Oyinsan. “We will be the leading investor backing the most promising companies on the continent and be a source of positive signals to follow-on investors worldwide. We want to drive more capital to our ecosystem and establish that the African opportunity is real and very profitable.”