Latest news with #Zepz
IOL News
5 days ago
- Business
- IOL News
Venture capital in Africa poised for measured rebound in 2025, with South Africa leading the charge
Following a 46% drop in African VC funding in 2023, 2024 showed early signs of stabilisation. According to internal valuation memos from Endeavor's Harvest Fund II, African equity funding declined just 2% year-on-year in 2024, totalling $2 billion (R36bn). Venture capital (VC) across South Africa and the broader African continent is entering a period of cautious recovery and renewed opportunity, after two years of contraction and recalibration. After a turbulent period in 2022 and 2023, 2024 was a year of recalibration. Now in 2025, we're seeing signs of resilience and reawakening across African venture capital. The key differentiator has been quality, due to founders who are building real businesses with disciplined capital use, strong unit economics, and scalable platforms. Following a 46% drop in African VC funding in 2023, 2024 showed early signs of stabilisation. According to internal valuation memos from Endeavor's Harvest Fund II, African equity funding declined just 2% year-on-year in 2024, totalling $2 billion (R36bn). This suggests the market may be bottoming out. Quarter four 2024 was particularly strong, driven by three late-stage megadeals - TymeBank ($250 million), Zepz ($267m), and Moniepoint ($110m) - which accounted for nearly half of the continent's total funding. While the volume of deals was still low, the return of nine-figure rounds was a key indicator that investor confidence is cautiously returning. In South Africa specifically, funding totalled $459m, which is down from prior years, but far less volatile than in other regions. TymeBank's record-setting round helped maintain confidence, and the overall investment narrative was bolstered by the country's macro stability: moderated inflation, improved energy security, and post-election momentum boosted investor sentiment. Looking ahead, Endeavor expects the market to slowly but steadily rebound in 2025. Globally, easing inflation and anticipated interest rate cuts are likely to unlock capital previously sidelined. This trend is expected to extend into Africa, though the continent still awaits its AI boom, which was the dominant driver of venture capital globally in 2024. 2025 won't be a return to frothy 2021 valuations, but it will be a year where high-quality African startups, especially in fintech, enterprise tech, and healthtech, regain their growth footing. We're already seeing founders shift their strategies and extending runway, focusing on breakeven, and selectively raising from aligned capital. Endeavor's Harvest Fund II portfolio exemplifies this trend. Across 17 companies, 2024 saw average revenue growth of 49% (4 year CAGR), driven by standout performers like Tyme, Onafriq, and Sendmarc. The fund is now fully deployed, and its successor, Harvest Fund III, secured R190 million in its first close in late 2024, surpassing initial targets and drawing in blue-chip investors like Standard Bank, Allan Gray, and the SA SME Fund. But in this cautious environment, not all capital is created equal. What we're seeing is a flight to trusted, strategic capital. Endeavor's rules-based co-investment model, backing only rigorously vetted, founder-led companies with strong inflection points, has given investors greater confidence in a period where diligence is more critical than ever. Endeavor South Africa continues to curate a pipeline of over 135 high-growth companies through its rigorous international selection process, positioning Harvest Fund III to deploy into a diversified and thoroughly validated portfolio across the continent. While macro headwinds remain, Endeavor sees African innovation as a long-term megatrend. There is no shortage of talent or ambition here. The bottom-up drivers of digital adoption, financial inclusion, and youth entrepreneurship are firmly in place. What we need now is the patient capital and partnerships to fuel the next chapter of scale. With a global network of over 5,000 mentors, deep access to capital, and a mission-driven investment thesis, Endeavor is positioning its entrepreneurs to navigate the complexities of the current cycle while building for the future.
Yahoo
02-04-2025
- Business
- Yahoo
UK payments firm Zepz rakes in $165m
UK-based remittance company Zepz has secured a $165m growth financing package, which includes a $110m revolving credit facility led by HSBC Innovation Banking. This package also includes a $55m term facility underwritten solely by HSBC Private Credit. The move is subject to financial covenants, such as maintaining minimum EBITDA and an adjusted quick ratio, according to UKTN. An "accordion" feature within the facility allows Zepz, subject to lender approval, to request an increase of the revolving commitment by up to an additional $60m. The new financial arrangement replaces a previous revolving credit facility expired on 29 November 2024. In 2023, the facility's interest rate was a substantial 14.73%, according to WorldRemit's accounts. Zepz CFO Barrie Morris said: 'By lowering borrowing costs, this facility improves our financial flexibility and ensures we can continue delivering high-quality, cost-effective services. 'The additional capital allows us to strengthen our operations, supporting our long-term growth and commitment to our customers.' Zepz operates two remittance brands, WorldRemit and Sendwave. In June last year, Zepz raised $267m in a Series F round, led by venture capital firm Accel, with TCV and Leapfrog also participating. The shares from this round carry a 14.5% annual dividend, accruing daily and compounding semi-annually. In February this year, Zepz made headlines for reportedly laying off dozens of IT workers and closing business units in Poland and Kenya, affecting roughly 200 staff members. This equates to approximately 20% of its global headcount of 1,000 as of January. Zepz confirmed the headcount reduction to CNBC, stating that the decision was made to 'sustainably support the next phase of long-term strategic goals and continued growth.' "UK payments firm Zepz rakes in $165m" was originally created and published by Electronic Payments International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
