(Bloomberg) -- Africa’s largest early-stage venture capital fund exceeded targets as it raised $154 million from investors including the European Investment Bank, Allianz SE and the Visa Foundation.

TLcom Capital, which runs TIDE Africa Fund II, will use the money to expand into Egypt and invest in startups tackling the continent’s “biggest and most complex challenges with innovative solutions,” the company said in a statement on Monday.

The fund has already made its first investments in Cairo-based ILLA, a middle-mile logistics platform, and in South Africa-based LittleFish, an ecommerce platform, according to the statement. 

TLcom Capital also plans to deploy significant capital into female-founded African tech startups, similar to TIDE Africa Fund I, Maurizio Caio, founder and managing partner at the VC firm, said in an interview.

‘Ideal Opportunity’ 

Africa’s demographics “present an ideal opportunity” for expansion as its economies are mostly based on millions of small and medium-sized businesses, quick to adopt new innovations across multiple core sectors such as financial services, logistics, energy, health and education, Caio said. 

Its young, tech-savvy population is increasingly using mobile phones to bridge gaps in services. This has opened a lucrative and fast-growing space in sectors such as banking and health care for startups and more established players.

The capital raise may offer some relief to African technology and startup firms after VC inflows plunged last year. According to a recent report by London-based African Private Capital Association they fell 31% in 2023 to $4.5 billion from a year earlier. 

Read More: Venture Capital Inflows to Africa Drop 31% as Headwinds Weigh

The report attributed the decline to economic headwinds including weak currencies and high inflation, which prompted foreign investors to pull back from African economies.

“Across Africa, access to capital remains limited, especially for early-stage startups,” Ambroise Fayolle, vice-president at the EIB, said in the statement. “Africa’s startup ecosystem has the potential to drive inclusive economic growth and foster positive social change, which the EIB is happy to support,” he said.

TLcom Capital, Africa’s largest seed and series A investor, has more than $300 million under management and backs 17 startups including Andela, one of the continent’s six unicorns, uLesson, an edutech platform and Terragon Group, a data and marketing company. 

Read More: SoftBank-Backed Andela Becomes $1.5 Billion Unicorn

Other investors in TIDE Africa Fund II include DEG Impact’s joint venture AfricaGrow, and Bertelsmann.

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