Uncovered Fund, a Tokyo-based venture capital firm with portfolio companies like Piggyvest and Lemfi, has partnered with Monex, a Japanese financial services firm, to invest $20 million in startups across Africa and the Middle East, with cheque sizes ranging from $100,000 to $2 million.
The fund, Uncovered Monex Africa Investment Partnership (UMAIP), will invest between $100,000 and $500,000 as its initial ticket size in 30 companies and reserve half of its fund size for follow-on rounds with $1-2 million cheques. The fund will also raise debt in Japan, given its low interest rates, and provide debt financing to fintech startups.
“Monex was one of our LPs back when I was at my previous firm,” Takuma Terakubo, Uncovered’s CEO, told . “It is a major Japanese financial institution and also operates Japan’s largest crypto exchange. They have long been interested in investing in Africa and are looking to leverage Japan’s financial strength to support African fintech and crypto-related companies.”
The UMAIP fund mirrors Tokyo’s recent cautious investment push into Africa as the country cautiously moves from aid toward de-risked private investment. Last week, Japan’s government signed an agreement with the African Development Bank to provide $5.5 billion in loans to African businesses in three years. The Nigerian government is also set to establish a $40 million fund to invest in early-stage technology startups, with half of the fund coming from Japan’s overseas development assistance arm, the Japan International Cooperation Agency.
Equally managed by Uncovered and Monex, the fund saw participation from Japanese financial institutions, trading houses, automotive companies, and logistics firms. Given its diverse limited partners’ base, the fund is sector-agnostic with a preference for fintech, mobility, retail, logistics, and climate tech startups.
“We focus on businesses that can leverage the scale advantages of Africa’s vast market and population, such as fintech, retail, the supporting logistics sector, and mobility,” Terakubo said. “We are also paying close attention to climate tech, which can harness Africa’s abundant land and solar potential.”
The fund will invest in startups building infrastructure-like functions, and connect these startups to Japanese companies for partnerships, acquisitions, and funding.
“We not only provide access to Japanese technology and business know-how, but also monitor and track the outcomes of these connections to ensure long-term value creation,” Terkaubo said. “Regarding climate tech, we will support enabling Japan to trade carbon credits issued by African startups in the future.”
The UMAIP fund will focus on Egypt in North Africa and will mostly back consumer-focused businesses in the country. “Egypt represents one of the largest markets in Africa with strong consumer purchasing power,” Terakubo said. “We are focusing on business opportunities expanding from Egypt across the entire MENA region.”
Uncovered has previously invested in 29 early-stage African startups across 17 countries and the Middle East, with companies like Gozem, Autochek, Termii, Chari, and Yoco in its portfolio. Based on its learnings from the first fund, the firm decided to double down on fintech, mobility, logistics, and online retail for the UMAIP fund.
Another thing the firm will carry on is its annual Showcase Africa event, where it connects African startups to Japanese businesses and investors. So far, the firm claims to have connected over 500 Japanese businesses with 50 African startups.
“While mergers and acquisitions activity from the US and Europe may be more familiar to African startups, our aim is to bring opportunities for acquisitions from Asian companies, particularly Japanese corporates, into the African ecosystem,” Terakubo said.
Outside of Africa, the UMAIP fund will invest in scalable businesses that can expand across Asia and Latin America.
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