Orange increases investment in Africa's cyber security market

Orange tightens
up security

Cyberdefense centre
in Morocco.

Friday, Nov 16th

Proparco secures US$5m stake in TLcom TIDE Africa Fund

Proparco secures USm stake in TLcom TIDE Africa Fund

Private sector financing institution Proparco, a division of Groupe Agence Française de Développement, has acquired a US$5 million stake in the TLcom TIDE Africa Fund to support African start-ups focused on sustainable development.

The TLcom TIDE Africa Fund (Technology and Innovation for Developing Economies) provides financing for innovative businesses in Sub-Saharan Africa that harness technology for sustainable development.

Proparco has stated on its website that the investment forms part of the first round of funding of almost US$40 million involving the European Investment Bank (EIB) and the African Development Bank (ADB).

The financing institution believes mobile phone penetration is critical to sustainable development and the role played by tech start-ups.

"With over 600 million smartphone users forecast in Africa by 2020, mobile phones have become key vectors in development that can help in unlocking access to basic goods and services (i.e., energy, healthcare, education, transport, and everyday consumer goods)," it says.

Start-ups solving African problems

According to Colin Timmis, South Africa Head of Accounting for New Zealand-based software company Xero, it is crucial for African start-ups to develop solutions for African problems. "It's the same thing with every kind of business, it's whatever solves the African problem, and they've got to think about what the needs in their markets are and develop solutions for the locals.

"If a start-up is developing Fintech products, the needs of SA, Ghana or Uganda are not the same, as the Fintech needs of Europe."

To illustrate his point, Timmis refers to a loan app in Kenya named Tala, whose credit model allows the company to evaluate an applicant's creditworthiness and capacity using the data on their mobile devices. The app is aimed at servicing people who have no formal credit or banking history.

"Their solution was developed for unbanked people, people that don't have a banking history, how do you get a loan if you don't have a bank account, so you have to look at the needs of the community where you live."

Funding on the rise

Disrupt Africa's Tech Startups Funding Report 2017 says investment in African tech start-ups hit the highest levels since records began in 2017, with 159 start-ups raising in excess of US$195 million.

Recently, a Kenya-based start-up, and provider of solar-powered cold storage units for smallholder farmers and traders in Sub-Saharan Africa, SolarFreeze was awarded a three-month programme worth approximately US$50,000 in acceleration services and cash.

Global venture capital firm Partech Ventures announced the launch of a new Dakar-based Partech Africa fund which it says will be exclusively dedicated to the fast-growing tech ecosystem in Africa.

The fund has already secured above US$70m in commitment towards its target size of US$120m. It intends to focus on early-stage tech-focused ventures that require funding of between US$600 000 and US$6m in order to exploit emerging market opportunities.


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