P1 Ventures, a venture firm with a focus on African markets, has successfully reached the initial closing of its second fund, amassing $25 million in investments.
The funding includes contributions from prominent African industrial conglomerates, private companies, funds, and general partners affiliated with global funds based in the United States and Europe.
P1 Ventures anticipates completing its fundraising by early next year, as stated by Founder and General Partner, Mikael Hajjar.
Established in 2020 by Mikael Hajjar and Hisham Halbouny, P1 Ventures initially concentrated on sectors such as e-commerce, fintech, health tech, and SaaS with its first fund of $11 million.
With the infusion of this second investment, the institutional venture fund intends to maintain its focus on these industries while incorporating Artificial Intelligence.
P1 Ventures’ debut AI investment has been directed towards Nkoloso.ai, a Zambian startup leveraging satellite imagery and AI for data collection and agricultural land monitoring.
This investment marks one of two AI startups and five portfolio companies backed by the Dubai-based venture capital firm from its second fund.
Hajjar believes that integrating AI into agriculture and fast-moving consumer goods (FMCG) underscores Africa’s potential to utilize this emerging technology, mirroring how mobile money surpassed the need for traditional debit and credit card infrastructure in the continent. Furthermore, AI exemplifies how African companies can create globally impactful products.
According to Hajjar, “We believe that AI will be Africa’s next big leapfrog opportunity, just as fintech transformed the continent and disrupted the banking sector. We believe AI will have a similar impact on sectors like retail, healthcare, and the creative economy.”
He emphasized that the most promising aspect of AI is its potential for global expansion. Investing in Africa often involves challenges associated with operating within a single market and managing currency fluctuations. AI’s appeal lies in its capacity to establish businesses with a focus on exports.
Hajjar pointed to success stories like Instabug from Egypt and InstaDeep, a subsidiary of BioNTech, both African-founded software and AI companies serving a global clientele in the U.S., Europe, and beyond.
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P1 Ventures’ Entrepreneur-In-Residence Program and Startup Incubation
P1 Ventures, with offices in Lagos and Cairo, has recently launched an Entrepreneur-In-Residence program, which has been instrumental in securing financial support for Nkoloso.ai.
Both partners, drawing upon their extensive industry experience, oversee this venture studio. The studio’s strategic objective is to nurture four additional startups over the next four years, led by founders capable of achieving product-market fit and successful product scaling.
Hajjar emphasized the firm’s commitment to supporting innovative startups often overlooked by others, stating, “We go off the beaten path and back the underdogs; we invest where no one else does.”
This approach is reflected in P1 Ventures’ early investments in startups operating within French-speaking African markets, including Yassir, a mobility startup in Algeria that evolved into a super app; Chari, a B2B e-commerce platform in Morocco; and Djamo, a payment startup in Ivory Coast.
These emerging companies have become the best-funded startups in their respective countries. Yassir, the company’s initial investment, stands out as one of the most valuable startups in Africa and the Middle East.
P1 Ventures primarily focuses on seed-stage investments but considers itself a multi-stage investor and occasionally participates in Series A and B rounds when opportunities arise.
Despite the initial fund’s limited size, P1 Ventures has played a role in providing smaller investments in later expansion stages for companies like Yassir and Egyptian fintech MoneyFellows.
Conclusion
This active support in securing follow-on investments, talent acquisition, and expansion strategies underscores P1 Ventures’ commitment to the growth and success of its portfolio companies.
The firm’s institutional track record and valuable insights into building category-defining businesses set it apart in the African GP (General Partner) landscape, enabling strategic investment decisions and meaningful support for its startups, including facilitating connections for funding rounds and acquisitions.
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