Soyombo’s Voltron Africa invested in one startup every week of 2022. Here is our analysis
Could Olumide Soyombo’s Voltron Africa have been the most prolific local VC firm on the continent for 2022? Here is a list and an analysis of all the 53 startups that Voltron invested in.
Voltron Capital is a venture capital firm co-founded by entrepreneur-cum-angel investors, Olumide Soyombo and Abe Choi.
Before coming together to found Voltron, Soyombo and Choi had collectively invested in over 41 startups as angel investors; Soyombo had invested in 26 startups while Choi invested in 15.
Launched in the third-quarter of 2021, Voltron is on a mission “to back extraordinary entrepreneurs out of Africa solving important problems in large markets”. Their investment thesis is to back exciting founders in large markets, where large markets mean large exits, and investing early means large multiples.
With Voltron’s Fund 1, they intended to invest $20,000 – $100,000 in 30 startups headquartered in Nigeria, Kenya, South Africa and Northern Africa. But surpassed that.
If you are reputable for angel investing, you will get a lot of inbound and your initial expectations will be stretched.
Of the tons of inbounds that Voltron received they were able to meet with 500 companies, which implies that they met two startups every working day.
Including public holidays, there were 260 working days in 2022, this is after removing 53 saturdays and 52 sundays.
I asked Olumide how his team was able to achieve this and he explained that they have really good signal. “Most of our deal flow is from founders we have backed and other co-investors”, says Olumide Soyombo.
By September 2022, Voltron closed Fund 1 having invested in 53 startups, a 10% acceptance rate reminiscent of what we see from top business schools. In 2016, Harvard Business School’s acceptance rate was 12%, Wharton had 9% and Columbia had 18.2%.
By investing in 53 startups, Voltron Africa is on par with, and possibly ahead of the most active investors of 2021—Launch Africa and Kepple Africa. According to this report, Launch Africa and Kepple Africa invested in over 44 and 31 deals, respectively.
True to fashion, the 53 startups are run by non-solo founders totalling 113. Thus, each startup that Voltron invested in had at least two co-founders, one of which is most likely a technical co-founder. In February 2021, Olumide told Benjamindada.com that he prefers to invest in a group of founders, featuring a technical co-founder. Here is an excerpt from that article:
What specific characteristics do you look for in the founders you invest in? Are you looking for technical founders?
I usually like teams more than solo founders. And I think technical co-founders are key. I prefer technical founders/co-founders because it reduces the raise amount. Imagine if you have to raise for your development and you are outsourcing to a dev shop or to India. That increases the amount that is needed to raise to prove viability. So yes, we like technical founders as part of the team.
Also, they backed all these startups, but one, at the pre-seed stage.
All the startups Voltron invested in are headquartered in seven African countries—Nigeria, Kenya, South Africa, Morocco, Senegal, Rwanda, and Uganda.
The first three are members of the “big four”, so that’s expected. But it’s interesting to find that Rwanda and Uganda made the list, as they had very low startup funding activity in 2022. According to our Africa startup funding tracker, there was only one disclosed investment activity for startups headquartered in Rwanda and three in Uganda.
The startups in Voltron’s Fund 1 are operating in 14 key industries that include Financial Services (43.4%), Crypto (11%), Education and Healthcare (7.5%).
Comparing the ratio of investments in Voltron’s portfolio to the continent’s average, they were fully aligned with the rest of the industry when it comes to investment in HealthTechs (7.5%). Closely aligned in EdTechs (5%) while being very bullish on Crypto (3.9%) and fintechs (30%).
More than 30% of Voltron’s portfolio companies (portcos) have been accepted into top global accelerators like YC, and Techstars. Thereby, attracting the attention of tier 1 venture capitalists.