OpenseedVC, a new early-stage venture capital firm, has secured the first close of its $10 million fund. The firm focuses on backing startups launched by experienced operators (individuals heavily involved in running a startup) in Africa and Europe. This focus on operator-led ventures reflects a growing trend in the VC landscape, with the belief that founders with deep industry experience have a higher chance of success.
Traditionally, venture capitalists (VCs) have relied on a variety of factors to evaluate potential investments, including market opportunity, team expertise, and product potential. However, there’s increasing recognition that the founder’s experience plays a crucial role. Data suggests that a lack of business acumen and domain knowledge in founders is a significant contributor to failed VC investments.
Operator VCs, led by former startup operators themselves, are believed to be better equipped to assess these factors. They can not only evaluate the business idea but also understand the challenges and opportunities specific to the industry based on their own experiences. While there’s no definitive proof yet, recent research indicates that operator VCs outperform traditional VCs in terms of successful investments.
This model, however, has seen less adoption in Europe and Africa compared to Silicon Valley. OpenseedVC aims to bridge this gap by applying the operator-centric approach in these regions.
Investing in early-stage operators
OpenseedVC’s first close, according to Founder and General Partner Maria Rotilu, is “well into the millions,” with fundraising still ongoing. The final close is expected within a year. The firm plans to invest in at least 60 startups over the next five years.
OpenseedVC goes beyond simply providing capital. Speaking on the launch of OpenseedVC Fund, Maria Rotilu said, “As an operator, and investor, I have encountered incredibly talented and experienced operators, and the challenges faced as they try to launch their startups. Operators have the advantage of domain expertise, and unique insight into large problems that can be tackled with innovative technology. Those who are visionaries coupled with the ability to execute, scale, build teams and have the grit required to solve difficult problems — these skills, especially in the current market, are highly relevant to building technology start-ups that solve real problems, and create scalable value for the global economy and our investors. The experience seasoned operators bring in terms of business building, combined with the dynamism and hustle that founders possess, is the focus for OpenseedVC”
The focus is on early-stage companies, particularly pre-seed ventures (the very earliest funding stage for startups). OpenseedVC offers seed funding of up to $150,000 to startups in sectors like future of commerce (including B2B software, AI, and fintech), future of work (productivity), and digital health.
The firm prioritises specific founder profiles within its operator-focused approach. These include domain experts (operators with experience in high-growth tech companies) and second-time founders who have previously built and exited a startup. OpenseedVC has already made two investments, one in an AI-powered supplier dispute resolution software company (details undisclosed) and another in Intron, a speech-to-text transcription model focused on underserved accents, starting with Africa.
Diversification and female-led focus
OpenseedVC is committed to building a diversified portfolio across geography, industry, and gender. Rotilu, who has a background in computer science and experience as an operator and investor across Africa and Europe, highlights the importance of gender diversity in venture capital.
The firm actively seeks to support startups with female co-founders, aiming for a 50/50 balance in co-founding teams. This aligns with a broader trend of increasing female-led VC firms globally, which can ultimately lead to more funding for female-led startups.
What we think about the the VC
OpenseedVC’s focus on operator-led startups in Africa and Europe fills a gap in the VC landscape of these regions. By providing early-stage funding, mentorship from experienced operators, and a commitment to diversity, OpenseedVC positions itself to play a significant role in fostering successful startups in these growing tech ecosystems. The coming years will reveal how effective the operator-centric approach is in identifying and supporting high-growth startups in Africa and Europe.
