Non-profit Engineers Without Borders (EWB) Canada has delayed the launch of fundraising for its US$24 million Hummingbird Impact fund as a result of the impact of the COVID-19 pandemic.
Disrupt Africa reported in March on the launch of Hummingbird Impact by EWB Canada, which said its new investment vehicle would provide early institutional capital and portfolio support to for-profit and impact-driven African tech ventures.
The gender-lens impact investment fund was set up with the intention to “catalyse and de-risk innovative and highly-scalable solutions to bring systemic change to an undercapitalised and biased system”. EWB said at the time that Hummingbird believes local and female founders are best positioned to unlock opportunities for women and marginalised populations in Africa.
Hummingbird initially set out to raise a US$20 million blended-finance impact fund, which it intended to complement with a US$4 million technical assistance facility to accelerate the growth and impact performance of its portfolio. However, in the context of the global pandemic, CEO Boris Martin said EWB has now decided to delay the launch of fundraising for Hummingbird until the first quarter of 2021.
Meanwhile, Hummingbird Impact founding partner Muthoni Wachira (read our interview with her as part of our “Meet the Investor” series here) has left the company. EWB said it is currently focused on actively supporting its current seed stage venture portfolio, which includes Kenyan agri-tech startups LishaBora and FarmDrive, Zambian asset financing business Rent to Own, Ghanaian mobile engagement platform Viamo, and Ugandan credit provider Numida.
Though concerns over the impact of COVID-19 on tech startup funding in Africa are well-documented, there has until now been limited evidence of a decline in funding as startups continue to raise enough investment to keep 2020 on course to be the best year on record in that regard. However, with VC firms that have active funds committed to investing this capital, the major impact of COVID-19 is likely to only really become evident when VC firms attempt to raise new funds from limited partners (LPs). EWB Canada’s decision to postpone fundraising for Hummingbird Impact demonstrates the challenges it was facing in this regard, and is not good news at all for other VC firms or the ecosystem at large.