A London-based private equity firm, Apis Partners, has raised $157 million for a new fund focused on fintech startups in Africa and South Asia.
At a time when private equity investments in developed markets are so popular, the early success of the inaugural Apis Growth Fund in raising capital suggests that the appetite for fintech investments has extended to the developing world.
The fund, launched in June 2014, is targeting fintech firms working in areas such as payments, savings and investments, credit and insurance within Africa and South Asia.
In addition to the growing interest in fintech investment, which totalled $12.2 billion in 2014, the fund is also seeking to exploit the policies of financial inclusion in so-called growth markets. Of the 2.5 billion people without access to banking services, 2.2 billion reside in growth markets.
The inaugural fund has attracted investment from a diverse range of investors including international banks like Italy's Intesa Sanpaolo, South African asset manager Old Mutual and a number of development finance institutions such as CDC in the UK and Swedfund, as well as a number of private investors.
Apis co-founder Matteo Stefanel believes that this diversity in the investor base is an endorsement of the firm’s strategy in targeting emerging markets. "We strongly believe that the next wave of business-model innovation in financial services will come from growth markets. As income in these markets continue to rise, so will demand for financial services, representing an unique opportunity for those entrepreneurs creating innovative and cost-effective solutions. We aim to back those entrepreneurs."