Norrsken22, an Africa-focused venture capital firm, has reached final close at $205 million—$5 million more than its goal—to back African startups that are ready to scale, otherwise called growth-stage startups. 

First launched in January 2022 and reaching the first close at $110 million, the Norrsken22 African Tech Growth Fund counts wealthy Swedish founders including Skype co-founder Niklas Zennström, iZettle co-founder Jacob de Geer, and Delivery Hero co-founder Niklas Östberg as limited partners; Flutterwave co-founder and CEO, Olugbenga Agboola also invested in the tech growth fund. According to TechCrunch, approximately 59% of the funding came from a consortium of 30 unicorn founders globally.

Institutional investors in the fund include Standard Bank Group Ltd., Norfund, British International Investment, the International Finance Corporation, and the US International Development Finance Corporation.

In October African-focused venture capital firms announced deals worth $144.3 million (excluding grants) per data from funding tracker Africa: The Big Deal. Since January deals worth $1.3 billion have been announced compared to $2.9 billion in 2022 and $3.3 billion in 2021, according to the same report. 

At the same time, the pace of growth-stage investments in African startups has declined; in 2023 there have been only 26 Series A and onwards deals disclosed according to analysis of data from Africa: The Big Deal. This compares unfavourably with 69 deals in the same category in 2022, and 76 in 2021. Large deals from the continent’s Series A and onwards firms used to make up the bulk of venture capital investments as investments and valuations raced upward globally. “We used to markup valuations almost every quarter,” one seed-stage venture capital investor told TechCabal.

Seed-stage venture capital firms have raised millions from local and international limited partners to find and back early-stage companies, but the continent’s pool of dedicated growth-stage capital has remained limited. Norrsken22 is one of the few growth-stage funds dedicated to backing African startups. Its sister asset manager, Africa Seed Fund is currently in talks to raise additional capital to support early-stage companies building out another end of the pipeline.