Safaricom to Set up Subsidiaries to Invest in Kenyan Startups

Safaricom Senior Management
Source: Safaricom

Safaricom shareholders have approved two new subsidiaries dedicated to empowering and investing in Kenyan tech startups with one subsidiary dedicated to investing in seed-stage and another in growth-stage startups.

These significant developments, approved at Safaricom’s 15th Annual General Meeting (AGM) by shareholders, represent a momentous step towards supporting tech entrepreneurs, fostering innovation, and fortifying Safaricom’s role as a key enabler of the Kenyan tech community.

Safaricom is not new in the venture capital space. The company created Spark Venture Fund in 2014 to empower and nurture seed-stage startups across Kenya. The fund’s portfolio includes Shupavu 291 by Eneza Education, Sendy, Ajua and Soko Fresh, and iProcure.

Accelerating Safaricom’s Mission Towards Becoming a Tech Company

According to a statement by Safaricom, this new entity will act as the main investment vehicle for all strategic investments undertaken by the company. With the mandate to invest in mature, strategically aligned entities, the newly formed private limited liability company will help accelerate Safaricom’s mission toward becoming a tech company by 2025.

Safaricom CEO, Peter Ndegwa said: “We are committed to empowering the tech ecosystem in Kenya and beyond, and this strategic move will enable us to broaden our investments, embracing both seed-stage and growth-stage start-ups. Incorporating these subsidiaries is pivotal to realizing Safaricom’s purpose to become a purpose-led technology company.”

In addition, the new companies will accelerate the business entry into new customer segments within the consumer, financial services, enterprises, and SME space and will “help unlock new business models and value chain opportunities.”

Peter Ndegwa added: “We will be looking to invest in and support early-stage companies especially, in emerging technologies such as analytics, Machine Learning, Artificial Intelligence, and the Internet of Things. We will be launching the call for applications in the coming weeks.”

Mr Adil Khawaja, Chairman of the Board said: “We thank our shareholders for their unwavering support in establishing the new subsidiaries. By investing in tech entrepreneurs and initiatives that align with our strategic mission, we aim to continue to transform lives by connecting people, opportunities, and information while driving innovation, creating value, and leaving a lasting impact on society.”

Kenyan Tech Startups Funding in 2022

Last year saw Kenyan tech startups’ investment funding from global investors increase massively.

According to a report by Disrupt Africa, Kenyan tech startups raised $574,809,000 in 2022. This represented a 96.9% increase from the amount of $291,983,000 raised in the previous year!

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