Japanese venture capital firm Uncovered Fund has joined forces with Tokyo-headquartered Monex Ventures to set up a new $20 million fund targeting startups in Africa and the Middle East.
The Uncovered Monex Africa Investment Partnership (UMAIP) will back early-stage companies with cheque sizes starting at $100,000 and rising to $2 million. Investments will be focused on four areas – finance, sustainability, mobility and distribution – with sub-sectors including agritech, logistics, climate tech, mobile payments and digital retail.
Uncovered Fund, founded in 2020, has already backed 29 entrepreneurs across 17 countries. Its portfolio includes Nigerian communications platform Termii, Francophone Africa-focused logistics provider Gozem, automotive technology company Autochek and e-commerce and fintech platform Chari.
“With this new fund, we are proud to welcome Monex, one of Japan’s leading financial institutions, as a partner,” said Takuma Terakubo, chief executive of Uncovered Fund. Half of the capital will be reserved for follow-on rounds, with ticket sizes of between $1 million and $2 million.
For both Uncovered and Monex, the aim is not only to provide finance but also to create a bridge between African startups and corporate Japan. The fund will seek to open up opportunities for partnerships, acquisitions and expansion into Japanese markets.
The launch reflects a broader shift in Japan’s engagement with Africa. Several Japanese VC firms have stepped up their activity in recent years. Samurai Incubate Africa, for instance, has raised two funds totalling more than $18 million since 2018. Verod-Kepple Africa Ventures, meanwhile, closed a $60 million fund earlier this year with backing from heavyweight Japanese investors including Toyota Tsusho, Sumitomo Mitsui Trust Bank and the Japan International Cooperation Agency (JICA).
Corporate venture capital arms are also taking a keen interest. Sony Ventures has set up a $10 million entertainment fund for African startups in gaming, music and media.
Japan’s pivot towards venture-led investment in Africa comes as the continent’s innovation ecosystem gathers momentum. With Africa’s population set to reach 2.5 billion by 2050 and the majority of its consumers accessing services via mobile devices, sectors such as digital finance, clean energy and electric mobility are seen as primed for rapid growth.
As Kohei Muto of Double Feather Partners has noted, African markets have the potential to leapfrog traditional business models, creating space for technologies such as electric vehicles and battery-as-a-service – areas where Japanese companies already have deep expertise.
The UMAIP fund therefore represents more than just another investment vehicle. It is another signal that Japanese investors increasingly see Africa not simply as a recipient of aid, but as a frontier for business and technological collaboration.