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Venture capital firm seeks disruptive blockchain firms

Sibahle Malinga
By Sibahle Malinga, ITWeb senior news journalist.
Johannesburg, 24 Jul 2019

Newly launched black-owned blockchain venture capital firm, South African Digital Assets Partnership (SADA), aims to promote the adoption of blockchain technology and crypto-currency in Africa, by supporting projects that solve African challenges.

Introduced this week, the Johannesburg-based investment firm is focused solely on funding and supporting ventures, tokens, businesses and projects related to blockchain technology, digital currency and digital assets.

It is founded by South African-born tech entrepreneur Zamo Tshabalala, with blockchain industry entrepreneurs and crypto-currency experts who serve as board members.

These includes Congolese blockchain entrepreneur John Lombela, founder and CEO of Cryptovecs; Mendy Nkosi, co-founder of crypto-currency firm GA Capital; Scott Botha, founder of digital asset company The Burn Token; and Hein Schmidt, founder of crypto accounting firm Blueline Accounting Group.

SADA is owned by private shareholders, with its significant shareholder being Goodness Andrew Financial Group.

Through the SADA Blockchain Fund, the company says it has invested in innovative projects such as SA’s first digital asset, the Digital Rand, with the company scouting for more disruptive Africa-based blockchain businesses.

“SADA is looking to invest in blockchain companies that are disruptive and offer scalable solutions for the African continent, predominantly in the financial sector,” says Tshabalala.

“We also have a key focus in the telecoms, mining, energy and insurance industries, to name a few. We have identified multiple projects, and meticulous due diligence is done before any investment is made.”

SADA's Blockchain Fund is funded by a group of high net worth individuals, the Zimbabwe Investment Authority, and private equity and venture capital companies.

As part of the Blockchain Fund, SADA runs and manages various funds, which it says are strategically positioned to cater for different types of blockchain businesses throughout the African continent.

These include its entry-level flagship fund called Africhain Fund; a Crypto-currencies 30 Index Fund aimed at retail investors; and a high-end flagship fund called the A-Team Capital Fund, for high net worth individuals such as financial advisors, fund managers and investment houses.

Apart from Digital Rand, the venture capital firm says it is looking at supporting companies such as Mazzuma, a mobile money payment system that utilises a distributed secure infrastructure and crypto-currency, to enable seamless payments.

Fundraising to support revolutionary projects

SADA says it is engaging international partners who will help the company to raise an estimated $10 million for its blockchain fund.

“Among the major challenges facing crypto-currency businesses, is getting through the bad publicity caused by many fraudulent platforms, scams and individuals, as we've seen the past three years,” Tshabalala points out.

“Regulatory uncertainty, access to capital and support are among other challenges hindering blockchain businesses. SADA focuses 100% on the rapidly evolving digital asset sector, maximising our investors’ capital growth through a proprietary and actively managed investment strategy, while placing a key focus on businesses changing the African economy through blockchain.”

To further understand the complex regulations guiding the South African financial landscape, SADA says it is guided by financial service provider Olwevu Group and is also a member of various blockchain associations, including the South African Financial Blockchain Consortium, which has members such as MMI Holdings, Standard Bank and reputable financial players in SA.

“We understand the importance of regulation with the prevalence of scams that have swept throughout Africa in the last four years.”

SADA says it will host its first Blockchain Start-Up Bootcamp and a block-party in February 2020, which will see the company host a challenge for blockchain start-ups.

“SADA is also planning to expand to six African countries in the next 18 months (Zimbabwe, Mauritius, Kenya, Nigeria, DRC and Botswana). At a later stage, we also plan on setting up our international office in Dubai. We aim to be the biggest blockchain VC company on our continent, with plans to invest in over 60 projects within the next 32 months in Africa.”