Early-stage VC Antler has raised a new fund as it expands its geographic footprint.
The new fund, which targets East Africa, closed on $13.5 million. Its investors include Baillie Gifford, International Finance Corporation and family offices such as Canica.
Singapore-based Antler has said it is seeing many more opportunities in areas such as Africa, Southeast Asia and even Europe, as previous barriers to company creation have eased.
“Africa is also exciting as its return to investment potential is strong,” said Magnus Grimeland, founder and chief executive officer of Antler. “We’ve made about 50 investments [in the entire region] so far, but we’re probably going to double that this year. We’re mainly working in East Africa, but there are many exciting opportunities in West Africa, too, with Egypt becoming a big technology hub.”
He added that countries such as Egypt have a depth of engineering talent that start-ups can tap without going to larger cities.
Antler first began running a fund in East Africa in 2019. Since then, it has made 14 investments and plans to make 35 new investments over the next three years. Its model is to work with either companies that want to build with Antler from scratch or fund start-ups in the earliest stages.
Africa is not the only geography capturing the interest of the venture industry.
Grimeland told Venture Capital Journal that Antler wants to expand in more regions, especially as there has been a boom in start-ups all over the globe. In addition to Africa, the firm is interested in Latin America and Southeast Asia, and expanding in Europe. Globally, the VC aims to invest in 200 start-ups in 2022.
Much of this interest comes as it becomes easier for businesses to set up shop in many regions, growing availability and talent as well as more disruption opportunities.
“The reason why [these emerging markets] are more interesting now is that regulations are changing in many emerging markets, so it’s easier for founders to start businesses,” Grimeland said. “It’s easier for them to incorporate, for example, in Latin America. It used to be a 25-step process to set up a company. Many of the old regulations are changing.”
He added Antler sees a lot of exciting potential investments in Mexico and Brazil, though Grimeland said the market is far more extensive than those two countries alone.
Grimeland said the same thing is happening in Europe and Southeast Asia, where rapid digitalization has leapfrogged old systems. He pointed specifically to Vietnam and the Philippines, where venture firms see lots of potential due to opportunities around Web3, education and logistics.
Grimeland said Antler plans to set up hubs in different regions to take advantage of the proximity to other countries where innovation is being developed.
In July 2021, Antler set up offices in Canada. It now has a presence in 15 countries. Its portfolio companies include cryptocurrency platform Alpha Impact, agritech company TradeBay and real estate ad automation software BrightBee.