Entrepreneur's Corner

OpenseedVC Launches With First Close Of $10M Fund To Be First Investor In Operators Starting Their Technology Companies

BY Soko Directory Team · May 20, 2024 07:05 pm

OpenseedVC, a new operator-led fund seeking to be the first investors in seasoned operators starting their technology companies across Africa and Europe, has officially launched, announcing the first close of its $10M angel-style early-stage fund

The fund, backed by LPs such as founders, operators, and HNIs across Africa, Europe, and the US, will offer up to $150,000 starter cheques, along with access to its robust network of over 50+ seasoned experts, to support the operators just starting their technology companies from zero to one. OpenseedVC will also invest mainly in the Future of Commerce i.e., B2B Software, AI, and Fintech, Future of Health & Work to align the inherent impact of the portfolio with the UN Sustainable Development Goals.

OpenseedVC is the brainchild of General Partner Maria Rotilu, whose vision is to invest early in the growing number of experienced operators who aspire to launch their technology companies. Maria believes that OpenseedVC founders at the earliest stages get much-needed capital and conviction, but also the added benefit of a community of experienced operators to support from start to launch. The fund will primarily invest in founders in Africa and Europe and aims to invest in at least sixty start-ups over the next five years and operates an open application process so founders can apply without an introduction.

Rotilu, an experienced operator turned investor herself, has gained extensive market expertise across both Africa and Europe through scaling multinational technology start-ups like Uber and Branch to millions of users, as Country Manager, and General Manager respectively, as well as investing in global companies as a Principal & Fund Manager of the Octopus Ventures First Cheque Fund. Maria also served as Managing Director at the Oxford Seed Fund of Oxford University, one of the leading producers of unicorns in Europe.

The fund has made its first two investments in the Future of Commerce and Health themes, The first is an AI-enabled supplier dispute resolution software in the United Kingdom and the second is a foundational speech-to-text transcription model for underserved accents, starting with Africa.

Speaking on the launch of OpenseedVC Fund, Maria Rotilu says, “As an operator, and investor, I have encountered incredibly talented and experienced operators, and the challenges faced as they try to launch their startups. Operators have the advantage of domain expertise and unique insight into large problems that can be tackled with innovative technology. Those who are visionaries coupled with the ability to execute, scale, build teams, and have the grit required to solve difficult problems — these skills, especially in the current market, are highly relevant to building technology start-ups that solve real problems and create scalable value for the global economy and our investors. The experience seasoned operators bring in terms of business building, combined with the dynamism and hustle that founders possess, is the focus for OpenseedVC.”

“The current difficult fundraising climate is especially harsh for early-stage founders, but we believe incredible companies are born in the most difficult macroeconomic climates. We want to be first believers in these experienced operators to give a great head start, with capital and an extensive operator network that support from start to launch of their technology companies”

Maria Zubeldia, Director of the Entrepreneurship Centre, Saïd Business School, University of Oxford, added, “We are proud to have played a role in Maria’s journey through her time as Managing Director of the Entrepreneurship Centre’s Oxford Seed Fund, which provides MBA students at Saïd Business School the opportunity to gain investment experience. Our goal is to foster a supportive ecosystem for exciting early-stage start-ups in which to develop and scale, and it is gratifying to see Maria carry this ethos forward with the launch of OpenseedVC. I look forward to following the development of the fund.’’

Global ecosystem data reveals that up to 9 out of 10 start-ups fail, with the lack of necessary expertise and business acumen of founders identified as a major contributing factor. This has in part led to a 45% failure rate for VC investments. OpenseedVC operates at a sweet spot where start-ups with strong potential for success, partly based on the founder’s relevant execution ability, receive support.

This approach ensures that capital is directed towards businesses with a higher likelihood of effectively solving real, scalable, and impactful problems. The fund is open to:

Domain experts / Seasoned operators at high growth technology companies, including first time founders
Second time founders who’ve built and exited a previous start-up

All applications to OpenseedVC will undergo the same evaluation process, and investments will be made on a rolling basis throughout the year.

According to the Global Startup Ecosystem Report by Startup Genome, the number of technology startups globally has been steadily increasing year over year, with the report accounting for 3.5 million startups in 2023. Figures show that in 2020 alone, there were over 300,000 new technology start-ups established worldwide, underscoring the development of a critical mass of strong operator talent pipeline emerging from within the technology start-up ecosystem. With global early-stage equity funding experiencing a significant contraction of as much as – 54% YoY (-33% YoY in Africa), the OpenseedVC fund offers a much-needed opportunity for operator talent to access the support they need.

Furthermore, with just 8% of VC firms in Europe and Africa being led by former operators, compared to nearly half of US VCs, the OpenseedVC operator-led fund represents a positive development. Founders have an opportunity to collaborate with investors who possess a profound understanding of product and company development and can empathise with them throughout their journey. The unique Africa and Europe focussed fund also allows for exploration of synergies between Afro-European VC ecosystems, similar to what is more prevalent in US-Africa VC space.

About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system. Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory