For South African startups, getting customers is only half the battle. Even after people start paying for their products, raising enough money to grow can remain difficult. That is the funding gap Mamor Capital Ventures wants to target with its first venture capital fund.
The black women-owned and managed firm has raised R300 million ($18.8 million) in the first close of its inaugural fund, with the Public Investment Corporation (PIC), South Africa’s largest asset manager, as its anchor investor.
Mamor is still raising towards its R550 million ($34.375 million) target and says it will invest in South African technology companies that already have paying customers.
Mamor’s fund points to a bigger problem in South Africa’s startup market, where companies can have paying customers and a working business yet still struggle to find investors willing to fund their next stage of growth.
Mamokete Ramathe, founder and chief executive officer (CEO) of Mamor Capital, revealed that the firm spent more than three years raising the fund and found that many traditional investors, including pension funds and banks, remain cautious about venture capital.
Some investors, she said, have mandates or risk limits that make it difficult to invest in early-stage companies. Others still associate venture capital with backing businesses that have not yet proved that their products work.
“The fundraising journey reinforced that institutional appetite for venture capital in South Africa is still developing,” Ramathe told TechCabal in an interview on Monday.
Mamor is trying to reduce some of that risk by investing in companies that have already shown that customers will pay for their products or services. Ramathe said the firm does not require companies to be profitable before investing. Instead, it looks at whether they have paying customers, can retain them, have a market they can grow into, and have a realistic path to becoming profitable.
Southern Africa’s VC market recorded R13.35 billion ($834.4 million) in active investments across 1,325 deals in 2024, but limited exits and follow-on funding remain barriers. That puts Mamor in a market where capital is growing, while some founders still struggle to secure the next round.
She explained that a company may have moved beyond an idea and built a business, but still be too small or risky for a bank loan. At the same time, the market still has gaps in follow-on funding, with limited exits and funding for later-stage companies remaining a challenge
“There is a significant funding gap for early-stage, post-revenue businesses in South Africa,” Ramathe said.
Fuzlin Levy-Hassen, Mamor’s co-founder and chief financial officer (CFO), said the fund will focus on businesses with evidence of genuine demand rather than simply promising future growth.
“We are looking for businesses that have moved beyond proving an idea and can show real commercial demand,” Levy-Hassen said.
The fund will focus on areas including financial access, digital infrastructure and technology that Mamor believes can expand economic participation by helping more people and businesses access financial services and markets.
The PIC’s investment is significant because institutional investors have traditionally been cautious about putting money into venture capital, where returns can take years, and some investments can fail.
Leon Smit, the PIC’s acting chief investment officer, said the backing gives the organisation exposure to South Africa’s growing venture capital market while supporting transformation.
“Mamor Capital brings together an experienced investment team, a clear strategy, and a strong transformation proposition,” Smit said.
The PIC also believes institutional investors can play a bigger role in providing the long-term capital needed to develop South Africa’s venture capital market. There are signs that interest is growing. Ramathe said some institutions that are not yet investing are researching venture capital and looking at ways to participate in parts of the market where the risks are lower.
Ketso Gordhan, CEO of the South African Small and Medium Enterprise Fund, which invested through its High Impact Seed Fund of Funds, an early-stage venture capital investment vehicle, said increasing the number of local fund managers able to back technology businesses is important.
“Our investment is intended to strengthen the pool of local fund managers with the capability to identify and support promising technology businesses,” noted Gordhan.
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