Africa Finance Corporation (AFC) has approved about $100 million for investment in Africa-focused technology fund managers as part of its sustained initiatives aimed at increasing local institutional participation in the continent’s fast-growing venture capital ecosystem.
In a statement released on Monday, the corporation disclosed that the latest capital commitment was designed to address the lingering shortage of long-term institutional funding, which over the years, had been slowing the growth and scaling of African technology companies, despite increasing investor interest in the sector.
Speaking on the new capital support initiative, AFC President/CEO, Samaila Zubairu, said Africa’s youthful population and rapid adoption of technology presented a strong investment case for digital infrastructure and innovation.
He explained: “AFC’s US$100 million Africa-focused Technology Fund will accelerate the convergence of growing demand, rapid technology adoption, youthful demographics and the enabling infrastructure we are building.”
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According to him, digital infrastructure is crucial to Sub-Saharan Africa’s (SSA’s) transformation in terms of roads, rail, ports and power to enhance productivity, payments, logistics, services, data and cross-border trade, while creating jobs and industrial scale.
Noting that though Africa’s venture capital market has recorded significant growth in recent years, as African startups attracted about $3.8 billion in funding in 2025 alone, the finance corporation, however, observed that local institutional investors remained largely absent from many venture capital fund structures, as international investors continue to dominate the market.
The AFC disclosed that as part of the first phase of deployment of the $100 million investment, it had already made anchor commitments to Lightrock Africa Fund II and Future Africa Fund III.
It clarified that the investments positioned it across the full innovation lifecycle, ranging from early-stage venture capital to growth-stage technology scaling, adding that the current commitments represent the first tranche of a broader investment pipeline, with additional Africa-focused fund commitments expected in the near future.
Commenting on the AFC’s investment intervention, Managing Partner and CEO of Lightrock, Pal Erik Sjatil, described corporation’s latest investment as a reinforcement of an existing partnership focused on backing high-growth technology-enabled businesses across Africa.
According to him, the collaboration reflects a shared conviction in supporting scalable companies with strong fundamentals, proven business models and clear profitability pathways.
Future Africa, whose portfolio includes several notable African technology startups, expressed optimism that the AFC’s investment would strengthen innovation financing at the early-stage end of the market, particularly for startups operating in financial inclusion, digital infrastructure, consumer technology and education.
In his remarks, the Founding Partner of Future Africa, Iyin Aboyeji, said the investment signalled growing recognition of digital infrastructure as a key pillar of Africa’s economic transformation.
According to him, the corporation’s backing as the fund’s first multilateral development bank partner could encourage more development finance institutions, pension funds, insurers and other institutional investors to increase their exposure to Africa’s technology ecosystem.
The latest AFC’s investment is coming as Africa’s digital economy is projected to contribute more than $700 billion to the continent’s GDP by 2050, driven by a rapidly growing digital population and improving technology adoption by businesses.
