By Aduragbemi Omiyale
An equity bridge fund, Knight Fund, tailored for early-stage companies, has been launched by Zedcrest Capital, a statement from the investment firm has confirmed.
It was disclosed that African founders looking for last-ditch follow-on capital access to local funding required to consolidate on existing operations, grow, expand, and scale product offerings have access to $10 million.
Zedcrest explained that the Knight Fund was inspired by the current slowdown in start-up funding for African founders as global investors retreat to focus on their core markets.
The global economy is facing the worst economic downturn since the Great Depression – record high inflation rates, decline in public market valuations from interest rate hikes to combat inflation, Russia/Ukraine tension disrupting global supply chains, etc; resulting in venture funding pull back for high-quality technology start-ups looking to raise follow-on capital required to transition to next phase of growth.
Before now, African founders’ strength rode on their doggedness and ability to thrive despite operating in a less enabling environment – bootstrapping till there is traction or minimizing burn rate to increase runway – Africa’s seasoned operators watched aghast as new founders got caught up in the quest for the next big exit from future funding round or acceptance to top global accelerators to ride the wave of unicorn status in the shortest possible time.
“Zedcrest is positioning itself as the Knight in shining armour as we fill the funding gap through our maiden edition African focused Knight Fund,” the firm said.
It stated that the strength of Knight Fund’s thesis is deploying local capital to technology start-ups with strong unit economic fundamentals, robust corporate governance, internal processes and the shortest time to breakeven as it looks to support local innovative founders.
