LoftyInc Capital Secures $43M to Scale African Startups Beyond Early-Stage Funding
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LoftyInc Capital, one of Africa’s most prolific early-stage investors, has raised $43 million in the first close of its third fund, LoftyInc Alpha. The fund marks a strategic shift from pre-seed and seed investments to focusing on late-seed and Series A startups across Nigeria, Egypt, Kenya, and Francophone Africa.
This milestone comes at a time when African venture funding has shown resilience, experiencing only a slight decline last year despite global economic pressures, according to a report by Partech.
For over a decade, LoftyInc has played a key role in Africa’s startup ecosystem, backing early-stage companies that have grown into unicorns, including Flutterwave, Andela, and Wave. However, as Africa’s VC landscape evolves, startups face increasing difficulties in securing funding beyond the seed stage.
“We’ve seen many promising startups struggle to bridge the gap between seed and Series A,” said LoftyInc’s founder and managing partner, Idris Ayo Bello. “With this fund, we’re positioning ourselves as the partner that helps them scale and reach their next level of growth.”
Africa’s startup ecosystem saw a significant drop in average ticket sizes at Series A (-18%) and Series B (-27%) in the past year, making it harder for companies to secure follow-on investments. LoftyInc Alpha is designed to address this challenge by providing structured capital and strategic guidance to help startups navigate this critical stage.
A Strong Network of Investors
The first close of LoftyInc Alpha has attracted a diverse group of investors, including sovereign wealth funds from the Middle East and Africa, such as Egypt’s MSMEDA and Tunisia’s Anava Fund of Funds. Development finance institutions like FMO, Proparco (FISEA), AfricaGrow, IFC, and U.S.-based First Close Partners also participated, alongside African high-net-worth individuals and European family offices.
This backing reflects confidence in LoftyInc’s ability to identify and support high-potential startups across Africa.
A Track Record of Successful Investments
LoftyInc launched its first institutional fund in 2017 with $1.1 million, which was fully deployed in Nigeria and yielded a 5.7x cash return to investors, driven by successful exits, including Flutterwave and health tech company Reliance Health.
By 2021, the firm expanded its reach with a second fund, closing at $14.2 million and taking a pan-African approach. This expansion led to investments in key markets like Egypt, South Africa, and Francophone Africa.
Notably, LoftyInc’s second fund also received investment from Meta’s NPE team, marking the tech giant’s only known investment in an African VC firm.
More Than Just Capital
LoftyInc’s approach goes beyond funding. The firm leverages its extensive network and operational expertise to offer market access, business development support, and investor matchmaking.
With over 200 investments and 14 successful exits, LoftyInc continues to refine its strategy to meet the changing needs of African startups. Its latest fund, LoftyInc Alpha, is set to play a crucial role in helping startups transition from early traction to scalable growth, ensuring that more African companies successfully reach Series A and beyond.
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