Hello friends! Axel from Gilion here.
The wheels keep turning in the world of finance and lending with megafunds, unicorns and startup funding. Let’s dig in!
Megafunds are a thing again, especially when supporting credit
General Catalyst recently announced a massive $8B fund, and while the $4.5B dedicated to core VC funds is impressive, the $1.5B earmarked for their “creation strategy” really stands out. This arm focuses on building companies from scratch alongside seasoned founders, operating at a scale that redefines startup creation and acceleration. With megafunds and unique credit-based funding strategies, like those from General Catalyst, are we seeing an over-saturation of late-stage investing?
General Catalyst also stands out in that they offer not only equity but a debt-like product that supports predictable user acquisition. They recently released a thought piece on this strategy, which aligns well with the shift toward more flexible financing options for founders.
Africa’s unicorn herd grows
Africa welcomed its fifth unicorn, Moneipoint, a corporate finance platform that raised a $110M Series C round. Notably, all African unicorns to date are fintechs, highlighting the region’s potential for tech to leapfrog traditional banking infrastructure.
But with only five unicorns in all of Africa—fewer than my small home country, Sweden—the resource gap is clear. Moneipoint’s story, despite their impressive 26 million payments processed daily, also illustrates how African tech companies often face an uphill battle in raising funds. This raises important questions: how can emerging markets better attract investment, and what resources are most needed?
Startup Challenges 2024: Fundraising, Customers, and the Push for Growth
A recent Slush survey found that founders are particularly concerned with fundraising (63%) and customer acquisition (49.6%), although these priorities vary by sector. For instance, cybersecurity and edtech companies are laser-focused on customer acquisition, while proptech is prioritizing revenue growth. Investors, however, are more focused on regulatory risks and financial data protections, while AI dominates their radar as the biggest industry trend—climate change and regulatory shifts don’t seem to get as much attention.
As we look ahead, it’s worth asking: after AI, what’s the next major wave?
One last thing before we go..
Gilion on the future of startup funding
Before I go, a quick mention of a recent opinion piece of mine featured in Dagens Industri. I discuss how private credit—loans from non-bank actors—and AI are reshaping the global financial system, offering new ways for founders and tech companies to access capital. I’d love for you to give it a read if you're interested in where funding is headed next!
As we continue exploring the fast-evolving world of tech and finance, I’d love to hear your thoughts. What role should founders, investors, and policymakers play in tackling these growing challenges in the tech ecosystem?
/Axel
