A New Dawn for SMEs and DeepTech: Capital Flows to the Rescue
May 21, 2025, 5:34 pm
In the ever-evolving landscape of global finance, two recent initiatives stand out like beacons of hope. They aim to empower struggling small and medium enterprises (SMEs) in Africa and foster innovation in the DeepTech sector across Europe. The International Finance Corporation (IFC) and TLG Capital have joined forces to launch the TLG Africa Growth Impact Fund II (AGIF II), a $75 million lifeline for SMEs. Meanwhile, Berlin-based Lunar Ventures has unveiled its €50 million Fund II, dedicated to pre-Seed investments in DeepTech. Both funds reflect a growing recognition of the need for targeted financial support in specific sectors.
The AGIF II Fund is a response to a pressing crisis. One in four SME loans in Africa is under stress. This statistic paints a grim picture. Yet, amid the turmoil, the entrepreneurial spirit remains unbroken. The AGIF II Fund aims to provide a local capital lifeline to up to 20 SMEs. It will collaborate with African banks to ensure that these businesses can weather macroeconomic shocks. The focus is on critical industries: manufacturing, healthcare, agriculture, and telecommunications. These sectors are the backbone of many economies, and their resilience is vital.
The fund is backed by notable institutions like Swedfund, Norfund, and the UK Foreign, Commonwealth & Development Office. With a commitment of up to $20 million from the IFC, AGIF II is not just about money. It’s about strategic support. The fund combines capital with advisory services from firms like McKinsey and BDO. This dual approach aims to strengthen SMEs, equipping them with the tools they need to thrive.
In contrast, Lunar Ventures is setting its sights on the future. With its new €50 million Fund II, the firm is doubling down on DeepTech. This sector is where technology meets fundamental scientific challenges. The fund is designed for technical founders who are solving essential problems. Backed by institutions like Isomer Capital and Exor’s Lingotto, Lunar Ventures is carving a niche in a crowded market.
DeepTech has seen a meteoric rise. In the past decade, capital flows into this sector have grown tenfold, reaching $15 billion. Yet, the landscape is not without its challenges. Many founders seek partners who understand the science behind their innovations. They want investors who are in it for the long haul, not just for quick returns. Lunar Ventures positions itself as that partner. Its team of engineers, operators, and PhDs is dedicated to supporting technical builders from day zero.
The firm’s first fund backed 25 companies, many of which have gone on to attract significant investment from major US VCs. This track record speaks volumes. It demonstrates Lunar’s ability to identify and nurture talent before it becomes mainstream. Fund II is already making waves, with investments in cutting-edge projects like AI drug discovery and space robotics. These themes are not just buzzwords; they represent the future of technology.
Both funds share a common thread: the need for specialized knowledge. In the world of finance, generic solutions often fall short. The AGIF II Fund understands the unique challenges faced by African SMEs. It tailors its approach to meet those needs. Similarly, Lunar Ventures recognizes that DeepTech requires a different kind of investment strategy. It seeks to bridge the gap between technical expertise and financial backing.
The AGIF II Fund is more than just a financial initiative. It’s a lifeline for businesses struggling to navigate a turbulent economic landscape. By focusing on local capital solutions, it empowers SMEs to build resilience. This approach not only helps individual businesses but also strengthens entire economies. When SMEs thrive, communities flourish.
On the other hand, Lunar Ventures is a testament to the power of foresight. By investing in DeepTech at the pre-Seed stage, it positions itself at the forefront of innovation. The firm’s commitment to understanding the science behind the technology sets it apart. It’s not just about funding; it’s about fostering a culture of innovation.
As both funds embark on their journeys, they face a common challenge: the need for adaptability. The economic landscape is ever-changing. New challenges will arise, and both AGIF II and Lunar Ventures must remain agile. They must be willing to pivot and adjust their strategies as needed.
In conclusion, the launch of the AGIF II Fund and Lunar Ventures Fund II marks a significant moment in the world of finance. These initiatives reflect a growing understanding of the need for targeted support in specific sectors. They recognize that SMEs and DeepTech founders are not just numbers on a balance sheet. They are the lifeblood of economies and the architects of the future. As these funds begin to deploy their capital, the hope is that they will not only support individual businesses but also inspire a wave of innovation and resilience. The road ahead may be challenging, but with the right support, the future looks bright.
The AGIF II Fund is a response to a pressing crisis. One in four SME loans in Africa is under stress. This statistic paints a grim picture. Yet, amid the turmoil, the entrepreneurial spirit remains unbroken. The AGIF II Fund aims to provide a local capital lifeline to up to 20 SMEs. It will collaborate with African banks to ensure that these businesses can weather macroeconomic shocks. The focus is on critical industries: manufacturing, healthcare, agriculture, and telecommunications. These sectors are the backbone of many economies, and their resilience is vital.
The fund is backed by notable institutions like Swedfund, Norfund, and the UK Foreign, Commonwealth & Development Office. With a commitment of up to $20 million from the IFC, AGIF II is not just about money. It’s about strategic support. The fund combines capital with advisory services from firms like McKinsey and BDO. This dual approach aims to strengthen SMEs, equipping them with the tools they need to thrive.
In contrast, Lunar Ventures is setting its sights on the future. With its new €50 million Fund II, the firm is doubling down on DeepTech. This sector is where technology meets fundamental scientific challenges. The fund is designed for technical founders who are solving essential problems. Backed by institutions like Isomer Capital and Exor’s Lingotto, Lunar Ventures is carving a niche in a crowded market.
DeepTech has seen a meteoric rise. In the past decade, capital flows into this sector have grown tenfold, reaching $15 billion. Yet, the landscape is not without its challenges. Many founders seek partners who understand the science behind their innovations. They want investors who are in it for the long haul, not just for quick returns. Lunar Ventures positions itself as that partner. Its team of engineers, operators, and PhDs is dedicated to supporting technical builders from day zero.
The firm’s first fund backed 25 companies, many of which have gone on to attract significant investment from major US VCs. This track record speaks volumes. It demonstrates Lunar’s ability to identify and nurture talent before it becomes mainstream. Fund II is already making waves, with investments in cutting-edge projects like AI drug discovery and space robotics. These themes are not just buzzwords; they represent the future of technology.
Both funds share a common thread: the need for specialized knowledge. In the world of finance, generic solutions often fall short. The AGIF II Fund understands the unique challenges faced by African SMEs. It tailors its approach to meet those needs. Similarly, Lunar Ventures recognizes that DeepTech requires a different kind of investment strategy. It seeks to bridge the gap between technical expertise and financial backing.
The AGIF II Fund is more than just a financial initiative. It’s a lifeline for businesses struggling to navigate a turbulent economic landscape. By focusing on local capital solutions, it empowers SMEs to build resilience. This approach not only helps individual businesses but also strengthens entire economies. When SMEs thrive, communities flourish.
On the other hand, Lunar Ventures is a testament to the power of foresight. By investing in DeepTech at the pre-Seed stage, it positions itself at the forefront of innovation. The firm’s commitment to understanding the science behind the technology sets it apart. It’s not just about funding; it’s about fostering a culture of innovation.
As both funds embark on their journeys, they face a common challenge: the need for adaptability. The economic landscape is ever-changing. New challenges will arise, and both AGIF II and Lunar Ventures must remain agile. They must be willing to pivot and adjust their strategies as needed.
In conclusion, the launch of the AGIF II Fund and Lunar Ventures Fund II marks a significant moment in the world of finance. These initiatives reflect a growing understanding of the need for targeted support in specific sectors. They recognize that SMEs and DeepTech founders are not just numbers on a balance sheet. They are the lifeblood of economies and the architects of the future. As these funds begin to deploy their capital, the hope is that they will not only support individual businesses but also inspire a wave of innovation and resilience. The road ahead may be challenging, but with the right support, the future looks bright.