Uncap, a venture capital firm with offices in Munich and Nairobi, has introduced a groundbreaking $33 million fund aimed at fostering the growth of small and medium-sized enterprises (SMEs) across Africa.The Unconventional Capital fund presents a unique non-dilutive, revenue-based financing model that provides crucial support to early-stage businesses without requiring equity stakes.
Co-led by Esther Ndeti, Uncaps Investment Principal, and Franziska Reh, the companys CEO, the fund will collaborate with key partners to unlock new growth opportunities for African businesses. These partnerships include O-Farms, a circular agriculture program run by Bopinc and funded by the Ikea Foundation, and SAIS, an agritech initiative supported by the German Federal Ministry for Economic Cooperation and Development (BMZ) and implemented by GIZ.
The fund has garnered support from global institutions, including the Bill Melinda Gates Foundation and the Bayer Foundation. This backing underscores the potential impact of Uncaps innovative approach to SME financing in Africa.
Ndeti and Reh, serving as Managing Partners, emphasize the funds goal of transforming SME financing by creating a supportive environment for African businesses. This is particularly crucial as SMEs constitute approximately 90% of businesses on the continent, often in underserved areas.
Traditional venture capital models typically require founders to dilute their ownership to secure financing. In contrast, Unconventional Capitals revenue-based financing allows businesses to receive necessary support while maintaining full operational control. This flexibility is especially valuable for companies navigating the challenges of early-stage growth.
