54 Collective Shuts Down, Cuts Jobs

Africa-focused venture capital firm, 54 Collective has officially announced its closure after its partnership with Mastercard Foundation fell through after just 2 months.

54 Collective claims that the closure follows a significant funding cut from the Mastercard Foundation, one of its primary financial backers. The decision comes amid broader shifts in funding priorities within the development and investment landscape, leaving 54 Collective unable to sustain its operations

However, the VC firm, which has hubs in Johannesburg, Nairobi, and Lagos, said its $40 million venture capital fund UAF1 remains unaffected and will continue investing in African start-ups. Additionally, a multi-million-dollar pool raised in 2023 to support portfolio companies’ operations and gender equity initiatives in venture capital will still run.

The accelerator struggled to secure alternative funding after the Mastercard Foundation, which had been a key sponsor, redirected its focus toward other strategic initiatives. The loss of this financial support, combined with economic uncertainty and shifting investor priorities, ultimately led to the difficult decision to shut down.

One of the most significant 54 Collective contributions to the African economy has been its role in creating jobs. Through its accelerator programs, the organization helped startups scale their operations, expand their reach, and employ more people. The startups that 54 Collective supported have generated thousands of jobs across various sectors, including fintech, agritech, education, and transportation.

These businesses not only provided employment for their founders but also created a ripple effect across their industries by hiring engineers, marketers, customer support teams, and logistics personnel. In a region where youth unemployment remains a pressing issue, the closure of 54 Collective represents a setback for efforts to create sustainable job opportunities through entrepreneurship.

Some start-ups in 54 Collective’s Kenyan portfolio include the online ticket-booking start-up BuuPass, the fintechs Lipa Later and Zanifu, and the agri-tech ventures Shamba Pride and VunaPay.

The VC company said the Mastercard Foundation partnership has supported over 40 start-ups and created more than 17,500 direct and indirect jobs.