IFC plans to invest up to $5 million in Sturgeon Emerging Opportunities II, LP, a fresh venture capital fund managed by Sturgeon Capital. This investment aims to foster digital economies and bolster the growth of early-stage tech startups across Central Asia. The fund, Sturgeon Emerging Opportunities Fund II, will concentrate on sectors like fintech, business-to-business platforms, agritech, healthtech, and ed-tech. Its goal is to assist budding entrepreneurs in expanding their businesses, enhancing operational efficiency, and generating sustainable job opportunities in the targeted regions.
“We believe technological innovations can help solve some of the key challenges in emerging markets, including job creation and financial inclusion”, said Kiyan Zandiyeh, Sturgeon’s founding partner. "We are delighted to have IFC join the first close of Sturgeon Emerging Opportunities II as the first institutional investor. We look forward to working with IFC and our other investors to support tech startups and address a significant funding gap in the region’s tech ecosystem".
The fund's primary focus will be on investments within Central Asia, with a keen eye for potential opportunities in other emerging markets like Egypt and Pakistan. Sturgeon Capital anticipates significant growth potential in the tech startup sector across these regions, estimating a potential annual digital revenue of nearly $300 million by 2030, which could benefit over half a billion individuals. Nevertheless, local tech startups frequently encounter obstacles in securing funding to initiate and expand their offerings.
“Venture capital is gaining traction across Central Asia, but it’s still a nascent market underserved by foreign investments”, said Wiebke Schloemer, IFC’s Director for Türkiye and Central Asia. “By investing in funds like Sturgeon, IFC aims to bring much-needed capital to the most innovative local businesses. This support will enable them to scale and pave the way for more institutional and private investors, replicating the successes we have seen in other regions”.
IFC's investment in Sturgeon is aligned with its Startup Catalyst program, designed to bridge funding disparities in underserved venture capital landscapes. This initiative entails investments in incubators, accelerators, and seed funds concentrated on emerging markets. It specifically aims to address funding gaps in high-risk markets, including some of the world's poorest and most fragile nations. Since its inception in 2016, the program has empowered over 2,800 entrepreneurs, 700 of them women, across 24 countries through 21 funds.