The Africa-focused venture capital (VC) firm, Echovc, has launched a fund that seeks to support blockchain startups on the continent. While global blockchain funding has been on a decline over the past year, Echovc founder Eghosa Omoigui claimed that investing now enables the VC to get in “at lower entry valuations on average than in prior years.”
Startups Offering Blockchain-Based Solutions Qualify for Funding
The pan-African venture capital firm, Echovc, recently said it had launched an $8 million fund which is dedicated to Africa’s blockchain startups. According to the company’s blog post, the fund known as the Echovc Chain will be accessible to startups that are attempting to solve the continent’s challenges using the blockchain.
As noted in a report by Techcabal, Echovc’s new fund has been launched at a time when global funding for crypto and blockchain startups has been declining. The drop in funding has already forced some entrepreneurs to sell their startups.
Echovc Targets Underserved African Countries
Yet, despite this plunge in funding, Eghosa Omoigui, the founder and general managing partner at Echovc, is quoted in the report suggesting that now is the ideal time to fund startups because doing so allows the VC “to invest at lower entry valuations on average than in prior years.” The founder added:
While this has somewhat reduced VC appetite for crypto investing, we continue to remain excited about the useful applications of crypto and blockchain in Africa, and believe that crypto founders in Africa will continue to build for functionality to solve problems in Africa.
Meanwhile, the Techcabal report also revealed that Echovc has deployed over $41 million across 36 startups globally. In Africa, the VC firm has mainly targeted startups in the so-called underserved markets such as Kenya, Nigeria, South Africa, and Uganda. Startups that leverage blockchain to power foundational fintech infrastructure are among the firms being targeted. Firms focused on blockchain functionality and decentralized autonomous organizations also qualify for funding.
According to Echovc, once the funds are fully deployed, its portfolio of companies will have increased to between 12 and 20 companies.
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