Open Startup's new vehicle to finance African startups in health, climate and artificial intelligence

Tunisia-based Open Startup launched a decade ago as an entrepreneurship competition for university students. It has evolved into an accelerator for African deep tech startups. The accelerator is launching Openers First, its first special purpose vehicle, which aims to raise $3 million to support startups in health, climate, artificial intelligence, blue tech, agtech, energy and insurance, and get past the proof of concept stage. It will provide local currency SAFE notes of between $20,000 to $50,000.

The solutions sitting in labs and research centers “could completely transform the way we access health and other services,” if they had early funding, Open Startup’s Houda Ghozzi said. “Africa has always been using and spending money on technologies that are coming from the Western world.” It secured backing from the AfricaGrow Fund, German development bank KfW’s small business-financing initiative. Open Startup is still in talks with other development financiers and foundations to secure financing.

If African countries committed at least 1% of their GDP to research and development, the health sector alone would generate $668 billion over 20 years and nearly five million jobs, according to a Center for Disease Control study.

“This [R&D] is exactly what builds development and we’re not pressing on the right buttons,” Ghozzi says. The firm wants to demonstrate that deeptech companies “hire scientists with salaries that are decent enough for them to stay in Africa,” Ghozzi says.

Open Startup portfolio company Egypt-based Reme-D, which produces diagnostic tools for human and animal diseases, raised half a million this year from the Global Innovation Fund. Female-founded Reme-D joined Open Startup with around 10 employees, and has grown to employ 47 scientists, over half of whom are women. Open Startup’s portfolio also includes South Africa-based vaccine manufacturer Fluorobiotech.