The United Nations Development Programme (UNDP) has launched an ambitious $1 billion innovation fund, named the “Timbuktoo Africa Innovation Fund,” aimed at bolstering business startups across Africa. This significant initiative was announced during a special session at the ongoing World Economic Forum in Davos, Switzerland, with the participation of African leaders and global corporate figures.
The fund was presented by notable dignitaries, including President Paul Kagame of Rwanda, President Nana Akufo-Addo of Ghana, Wamkele Mene, Secretary General of the African Continental Free Trade Area Secretariat, and UNDP Administrator Achim Steiner. It is poised to become the world’s largest financing facility that synergizes catalytic and commercial capital to support Africa’s burgeoning startup ecosystem.
This development is seen as a crucial step in igniting the African Startup Revolution, leveraging the continent’s significant youth demographic and a wealth of innovative talent. The launch event, attended by global corporate leaders and African financial institutions, marked a major milestone in promoting innovation and entrepreneurship in Africa.
In his address, President Kagame announced Rwanda’s immediate contribution of $3 million to the fund, which will be based in Kigali. Emphasizing the potential of African youth, he stated, “We cannot accept that another generation of African young people do not have the tools to reach their full potential. With Timbuktoo’s billion-dollar target, we can create more opportunities for Africa’s youth to put their talent and creativity to good use.”
Echoing these sentiments, Ghana’s President Akufo-Addo highlighted the importance of establishing the right structures to empower young Africans in creating innovative businesses, contributing to job creation and sustainable economic growth. He expressed his excitement for the continent’s future and the prospects of fostering an environment where innovation and ingenuity are nurtured and shared prosperity is achieved.
The Timbuktoo Africa Innovation Fund, promoted by the UNDP, aims to address critical gaps within the African startup ecosystem by collaborating with governments, investors, corporations, and universities. It endeavors to support startups through various means, including startup-friendly legislation, global-class startup building, de-risking capital to increase investment, and establishing UniPods – University Innovation Pods – across Africa.
Currently, Africa contributes only 0.2% to the global startup value, in stark contrast to its 2% share in global trade value. The majority of venture capital entering Africa is foreign, with a significant concentration in just four countries (Nigeria, Kenya, South Africa, and Egypt) and predominantly in the fintech sector.
The Timbuktoo fund aims to mobilize and invest $1 billion in catalytic and commercial capital to transform 100 million livelihoods and create 10 million new jobs. Its unique approach blends commercial and catalytic capital to de-risk private investment. It adopts a pan-African strategy to support startups while focusing on the entire ecosystem, which includes enhancing connections between government policies, universities, corporates, development partners, and investors.
This initiative is a game-changer for the African continent, promising to catalyze economic growth, foster innovation, and provide a platform for young African entrepreneurs to thrive. As the continent grapples with challenges such as unemployment and underdevelopment, the Timbuktoo Africa Innovation Fund offers a beacon of hope and a pathway to harnessing Africa’s vast potential for sustainable and inclusive growth.
