Pan-African venture capital firm Ventures Platform has closed its second fund at $83 million, surpassing its earlier target of $75 million, as the Lagos-based early-stage investor expands beyond Nigeria into Kenya, South Africa and Egypt.

Ventures Platform, which backs early-stage founders across fintech, healthcare, software-as-a-service (SaaS) and other sectors, has already deployed capital from the new fund into five companies in those newer markets, founding partner Kola Aina told TechCrunch. Fund II will write checks of up to $3 million, and the firm expects to deploy the capital over the next three to four years.

“We’re particularly interested in where AI changes the economics of serving African markets,” Aina said, pointing to artificial intelligence’s potential to reduce the cost of delivering services and ease labour shortages in sectors the firm backs.

Ventures Platform’s larger, broader second fund

Fund II follows Ventures Platform’s debut $46 million fund, raised in 2022, which focused mainly on pre-seed and seed-stage investments. The new vehicle is both larger and broader in scope, with the firm now looking to back founders “where technology can address essential needs and build large, enduring businesses,” according to Aina.

Aina said the fundraise took about a year and a half to complete and comes amid a tougher funding environment across the continent. African startups have raised roughly $930 million across more than 200 deals so far this year, down from $1.16 billion across 447 deals over the same period last year, according to figures he cited.

He said Fund II was closed as limited partners (LPs) have been asking for stronger evidence of returns rather than backing the broader African growth story, as many did in previous years.

“LPs are asking harder questions about performance, portfolio construction, liquidity, manager discipline, and differentiation,” Aina said.

About 70% of Fund I’s LPs returned to support Fund II, Aina said. Backers include the European Bank for Reconstruction and Development, Norway’s development finance institution Norfund, and Ghana’s Ashesi University Foundation.

Aina said the current funding climate, while more selective, is healthy for the ecosystem, because it puts more pressure on firms to show how they source deals, support founders and differentiate themselves across markets.

“Three years ago, there was still a significant amount of curiosity around the African opportunity. Today, LPs expect proof,” he said, adding that pan-African reach alone no longer counts as a strategy.

Investors now want clarity on access to local talent, market-specific execution, and “why you have the right to win,” he said.