At a time when Africa’s innovation economy is both growing and grappling with capital scarcity, the African Development Bank (AfDB) has elected a new leader who could redefine its approach to supporting startups and venture capital across the continent.

Sidi Ould Tah of Mauritania has been elected the ninth President of the African Development Bank Group, succeeding Nigeria’s Akinwumi Adesina, whose decade-long tenure was marked by expansive programs around infrastructure, agriculture and private sector financing. Tah will assume office on September 1, 2025, after being elected by the AfDB’s Board of Governors at the Bank’s Annual Meetings in Abidjan this week.

Tah’s election comes at a critical moment for the Bank and the continent’s burgeoning tech ecosystem, as stakeholders assess whether he will continue — and potentially expand — the AfDB’s growing role as a limited partner in Africa-focused venture capital and private equity funds.

A Track Record in Development Finance

With over 35 years of experience in African and international finance, Tah brings both multilateral and ministerial expertise. Most recently, he spent a decade as president of the Arab Bank for Economic Development in Africa (BADEA), where he oversaw a transformation that quadrupled the Bank’s balance sheet and earned it a coveted AAA rating.

His background includes setting up a $1 billion callable capital program at BADEA to bolster African multilateral development banks — an experience that suggests he understands both the structural and entrepreneurial needs of African economies.

Still, it remains to be seen whether Tah will prioritize venture finance in the same way his predecessor did. Under Adesina, the AfDB steadily increased its exposure to early- and growth-stage venture capital as part of a broader private sector development agenda.

AfDB’s Startup Portfolio: Progress and Pitfalls

The AfDB is not a venture capital firm in the traditional sense, but it has increasingly acted as a limited partner in funds that back startups. A review of the Bank’s 2023 financial statements reveals a portfolio of more than a dozen funds, spanning climate tech, innovation, gender-lens investing, and regional development.

Some of these funds have delivered solid returns. Nigeria-based Verod saw its carrying value jump from $4.2 million in 2022 to $7.5 million in 2023, while the gender-focused Alitheia IDF Fund rose from $4.2 million to $5.1 million in the same period. Janngo Capital, a pan-African fund with a strong tech tilt, also posted a sharp increase in its valuation, from $263,000 in 2022 to $2.8 million a year later.

Others, however, have struggled. Among them, the Cathay Africinvest Innovation Fund, launched in 2022 with $3.1 million in callable capital from the AfDB, dropped to a carrying value of just $308,000 in 2023 — a steep fall from $2 million the year before. The fund recently lost over $2.8 million on a failed investment in South African mobility startup WhereIsMyTransport.

A New President, A New Mandate?

With the Bank’s newly announced five-year strategy emphasizing “Making Africa’s Capital Work Better for Africa’s Development,” eyes will be on Tah to see whether he aligns with Adesina’s push into startup financing or takes a more cautious approach.

While Mauritania, Tah’s home country, has historically been absent from the African tech map, it recently made a bold move that may hint at his outlook on innovation policy.

On January 7, 2024, President Mohamed Ould Cheikh El Ghazouani signed the country’s first Startup Act, positioning Mauritania among a growing cohort of African nations — including Tunisia, Senegal, Nigeria, and Congo — that have adopted similar legislation. The move was widely viewed as the fastest enactment of a Startup Act on the continent.

Whether symbolic or substantive, Mauritania’s Startup Act signals a recognition at the highest levels of government that tech-driven growth will be key to future economic resilience.

“Equity investment will leverage innovations to leapfrog technologies and harness key opportunities that have the potential to scale across Africa,” said Stefan Nalletamby, Director of Financial Sector Development at AfDB, earlier this year. Nalletamby’s comments reflect a broader consensus among AfDB’s technocrats that startups play a vital role in solving continental challenges — from fintech to cleantech to logistics.

Under Adesina, the bank championed initiatives like the $618m Boost Africa program with the European Investment Bank (EIB), targeting early-stage startups.

The variability in AfDB’s fund performance highlights the inherent risk in Africa’s venture space — a reality exacerbated by limited exits, shallow capital markets, and uneven regulatory environments. But for a development bank, these are not reasons to exit; rather, they are reasons to calibrate.

As Tah prepares to take office, his challenge will be to strike a balance between the Bank’s mandate for inclusive growth and the high-risk, high-reward dynamics of startup investing. Unlike traditional investors, AfDB is uniquely positioned to de-risk early-stage capital, catalyze private sector funding, and help build the continent’s digital and green infrastructure from the ground up.

If Tah chooses to lean into that opportunity, his presidency could become a defining era for African startup finance.