The European Investment Bank (EIB) and the African Development Bank (AfDB) in partnership with the European Commission have launched Boost Africa, a EUR150 million (US$158 million) initiative to support 1,500 startups and SMEs across the continent.
The aim of Boost Africa is to foster the development of an efficient entrepreneurial ecosystem in Africa by supporting the earliest and riskier stages of the venture value chain, in an economically viable and sustainable way.
As a result of the initial combined investment of up to EUR150 million, the initiative is expected to leverage up to EUR1 billion (US$1.05 billion) in additional investments. Boost Africa’s investment programme will make equity investments in seed funds, business angels co-investment funds, accelerators’ follow-on funds and venture capital funds.
Meanwhile, its Technical Assistance Facility offers a pool of grant resources to provide capacity building and disseminate best practices for the investment readiness of intermediaries, the business and technical assistance, training of investee companies and entrepreneurs, and the creation of local investors’ networks.
An Innovation and Information Lab will also be launched to support the entrepreneurship ecosystem by fostering innovation, knowledge development and partnerships, and incubating and piloting promising new ideas, as well as assessing and disseminating best practices.
“Boost Africa will help Africa’s young population to gain hope and confidence that they can succeed in realising their dreams and aspirations,” said AfDB president Akinwumi Adesina.
“Africa’s future will be determined by the current youth and it is crucial that we create and support entrepreneurship opportunities for youth, generate success stories and show these as examples for other young people.”
EIB president Werner Hoyer said Boost Africa would support African entrepreneurship and innovation, and nurture the continent’s new talent.
“It is thus a concrete way of tackling the long-term factors fuelling poverty, instability and brain drain – many of which are at the origin of the migration crisis we all currently face -, and therefore make the Sustainable Development Goals a reality,” he said
“I am proud that the EU and its Bank, the EIB, are operating in such effective partnership with the African Development Bank and other DFIs to tackle the world’s pressing challenges.”
The first startups and high-growth SMEs are expected to be supported in 2017. Boost Africa leverages business and financial expertise from AfDB and EIB, as well as from a broad network of partners and stakeholders, to accelerate the growth and development of startups in Africa.
It will attract, make strategic use of and nurture a network of venture intermediaries for both financing and business development to boost African entrepreneurship. The comprehensive intervention approach is expected to contribute to the success and growth of startups in order to become significant businesses within their local environments.