Echovc, an Africa-focused venture capital (VC) firm, has launched a fund that seeks to support blockchain startups on the continent. Global blockchain funding has been on the decline over the past year, but Echovc founder Eghosa Omoigui argued that investing now will allow VCs to “get in at a lower entry valuation on average than in previous years.”
Startups offering blockchain-based solutions qualify for funding
Echovc, a pan-African venture capital firm, recently announced the launch of an $8 million fund dedicated to blockchain startups in Africa. According to the company’s blog postThe fund, called Echovc Chain, will be available to startups seeking to use blockchain to solve continental challenges.
As Techcabal reports, Echovc’s new fund was launched at a time when global funding for crypto and blockchain startups is declining. Declining funding has already forced some entrepreneurs to sell their startups.
Echovc targets unaffected African countries
However, despite this steep drop in funding, Echovc founder and general managing partner Eghosa Omoigui says that now is the ideal time to fund startups because VCs “can invest at lower entry valuations on average than in previous years,” He is quoted in the report as suggesting. The founders also add:
This has somewhat dampened VC appetite for crypto investment, but we remain excited about the useful applications of crypto and blockchain in Africa and believe African crypto founders will continue to build on functionality to solve African problems.
Meanwhile, the Techcabal report also reveals that Echovc has invested over $41 million in 36 startups around the world. In Africa, the VC firm primarily targets startups in so-called untapped markets such as Kenya, Nigeria, South Africa, and Uganda. Startups that leverage blockchain to develop the underlying infrastructure for fintech are also targeted. Companies focused on blockchain capabilities and decentralized autonomous organizations are also eligible for funding.
According to Echovc, once fully funded, its portfolio companies will grow to between 12 and 20.
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