Sumitomo Mitsui Banking Corporation (President & CEO: Akihiro Fukutome, hereinafter "SMBC") has entered into an investment agreement with Novastar Ventures Africa People and Planet Fund III, L.P. (hereinafter the “Fund”), which is managed by Novastar Ventures Ltd. (hereinafter "Novastar Ventures"), one of Africa's first and largest venture capital firms, established in 2014.
According to United Nations’ estimates, Africa's population will account for 25% of the world's population by 2050, and economic growth is expected to continue. On the other hand, with the rapid population growth and urbanization, the delay in the development of social infrastructure such as food and agriculture, logistics, finance and legal systems that support growth has become an issue. Under these circumstances, African startups are creating new services related to fintech, mobility, green tech, etc., and playing an important role in the development of social infrastructure and supply chains, and in turn in the design of medium-term social structures by actively taking risks through the challenge of technological innovation. In addition, not only Western companies, but also Japanese and Asian companies are expanding into Africa, and the number of collaborations with local startups is increasing, and which implies the increasing importance of the African market as a starting point for global economic growth and new business flows.
With more than a decade of experience, Novastar Ventures is one of the first and largest global Venture Capital investing in Africa, with over $200 million of assets under management. Leveraging local insights and networks, Novastar Ventures partners with bold entrepreneurs building businesses in Africa with the potential to transform markets and sectors and create inclusive value for people and the planet - for good. Novastar Ventures’ portfolio companies not only provide essential services that support the infrastructure of local communities, but also develop technologies that contribute to solving environmental and social challenges, such as removing and avoiding greenhouse gases, improving soil health and enhancing biodiversity.
Sumitomo Mitsui Financial Group Co., Ltd. (President & Group CEO: Toru Nakashima) has set "Create social value" as one of the basic policies in its current Mid-Term Management Plan. In addition, the "Social Value Creation Investment Fund" (*1) has been established as a framework to support the co-creation and development of businesses with customers and the development of new technologies and industries which contribute to the creation of social value through risk-taking.
Through LP investment in this fund using the "Social Value Creation Investment Fund", we will support the growth of startups, which are the driving force behind economic growth and solving social issues in the African market. In the medium term, we will also contribute to the development of new businesses and products that contribute to the creation of social value while supporting Africa's economic growth through collaboration with startups.