Ex-Vodacom executive eyes R3.5 billion AI fund

Former Vodacom executive Romeo Kumalo’s investment firm plans to raise a $200 million (R3.5 billion) fund to back artificial intelligence-focused companies across Africa, as it bets on a wave of innovation following its profitable exit from Optasia.

Kumalo’s private equity vehicle, LLH Capital, was among the earliest backers of Optasia, a financial-technology and AI platform that made its debut on the Johannesburg Stock Exchange on Tuesday with a valuation of about $1.4 billion.

“This IPO has shown us what the future is for technology and companies driven by artificial intelligence in Africa,” Kumalo said in an interview with Bloomberg, suggesting that the capital-raising exercise could happen in the next 12 to 18 months.

The move underscores growing investor interest in Africa’s nascent AI ecosystem, as local startups harness machine learning to improve access to finance, health care and logistics.

Kumalo, who was previously the chief operating officer of Vodacom’s international operations, has been among the continent’s advocates for scaling homegrown tech ventures. 

Other large African mobile money and fintech firms weighing listings include TymeBank, Flutterwave and Airtel Money, each valued at more than a billion dollars.

Meanwhile, Chronos Capital — Optasia’s largest shareholder, whose partners include South African business veterans Michael Jordaan and Roger Grobler — reaffirmed its long-term commitment to the company, which operates in 38 countries providing microloans and cash advances to underbanked customers.

“We think Optasia can be the biggest lender at the bottom of the pyramid in the world,” Grobler said.

“The myth is poor equals bad credit; the reality is if the product fits the job, people repay. AI-led, just-in-time credit creates a flywheel — more trade, more repayment, more trust — and that’s how prosperity compounds across the continent.”