A $30 million fund has been launched by Rali cap, an early-stage venture capital firm focused on emerging markets fintech. The firm, which was previously known as Rally Cap Ventures, reached its first close of $20 million (its initial target) last month before raising the fund size, indicating strong LP appetite.
The two-year-old VC fund makes pre-seed and seed investments in B2B and API-first fintechs across Africa, Latin America, and South Asia. It plans to close the second round by the end of June.
According to Hayden Simmons, the general partner who founded Rali cap in 2020, the firm was first a collective before becoming a fund.
He has a decade of hands-on experience working in business development and partnership roles for emerging market fintechs such as Migo, Novi, and Juvo.
Simmons saw potential in bringing together a group of “experts” (primarily operators and angel investors) to collaborate on deal discovery, due diligence, and founder support via Slack and invest in emerging market fintechs.
This collective has nearly 240 individual LPs after two years. Fintechs like Wave, Block, MercadoPago, Rappi, Flutterwave, Yoco, Visa, Plaid, Stripe, and Coinbase, as well as e-commerce platforms like Jumia and Shopify, have executives and managers among them. About 40% of them are based in the United States, with the rest spread across Africa, Latin America, and Southeast Asia, where they spent more than $6 million last year.
However, most collectives with this or a similar strategy eventually aim to build and run funds (Future Africa and AngelList are two examples), which is what rali_cap found itself doing soon enough.
Last year, rali_cap raised $2 million, money it has since deployed. And as a fintech-focused firm, it ensured the limited partners for this new $30 million fund came from firms with an affinity toward fintech.
They include Breyer Capital, Propel VC, Better Tomorrow Ventures, FT Partners, Bain Capital, Lateral Capital, a few family offices, HNIs and a multibillion-dollar crossover fund also known for investing in smaller funds.
Rali_cap has backed 12 African startups, 13 Latin American startups and 7 Asian startups. They range from banking-as-a-service and card issuance players to open finance and SME digitization platforms, including Belvo, Mono, Minka, Stitch, Union54, Pomelo, Simetrik, Brick and Abhi. Meanwhile, some of rali_cap’s LPs have taken part in follow-on early- and growth-stage rounds of these startups.