Grace Ashiru
Japanese companies are increasing their exposure to Africa’s startup ecosystem through a new US$147 million venture capital fund managed by Novastar Ventures. The fund has attracted backing from major Japanese names including Mitsubishi Corporation, Sumitomo Mitsui Banking Corporation, Toyota Ventures, SBI Holdings, Mitsui OSK Lines and the Japan International Cooperation Agency. According to Novastar partner Steve Beck, the investors are seeking deeper access to African startup opportunities and market knowledge, with co-investment rights also built into the arrangement.
The move reflects Japan’s growing interest in African innovation as businesses at home face slower domestic growth and low interest rates. Research cited in the report says that in 2025, more than 60 Japanese investors participated in over 190 startup deals across Africa. The new fund also comes at a time when African venture capital fundraising has been relatively weak, with firms raising only US$107 million in 2025, according to the Africa Venture Capital Association.
Novastar plans to focus heavily on green technology and climate-linked businesses. The firm has already used the fund to invest in companies such as Kenya’s electric bus maker BasiGo, EV fleet manager Greenwheels and battery-swapping venture ARC Ride. It has also backed Egypt’s Breadfast and Nigeria’s Chowdeck, and is now looking for new opportunities in South Africa. Other investors in the fund include British International Investment, Norfund, Swedfund, Proparco and Cofides.
