Why TLcom’s Eloho Omame says African tech is compounding

Much of the conversation about African venture capital in the last three years has been about what it lacks. Funding is down from its 2021-2022 peak. Exits are scarce. Small cheques that grow companies have thinned out, and startups with strong teams and revenue have shut down.

But Eloho Omame, a partner at TLcom Capital, an Africa-focused venture capital (VC) firm managing over $250 million, has been making a different argument. 

In a recent essay, she wrote that African venture is compounding, arguing that the building blocks needed to build and scale companies on the continent are more solidly in place today than they were a decade ago and that this changes what investors can reasonably underwrite. 

Her claim is not that the market is easy but that the market now has a decade of accumulated evidence about what works and that this evidence is itself an asset.

Omame’s argument is well-founded. Across its two funds, TLcom has deployed around $100 million, led 80% of its deals, and has invested actively at the early stage. Its portfolio includes Pula, the agricultural insurance business in its first fund, and FairMoney, one of the largest companies in its second.

Omame also co-founded FirstCheck Africa and sits on the boards of HUB2, Illa, Talstack, and Zone. Before venture capital, she spent years in banking and as a founder herself.

In this conversation, Eloho Omame explains what a decade of “school fees” bought the ecosystem, how TLcom assesses AI in a business model when every founder claims to be using it, and why her firm will not approve an investment without first naming who is likely to buy the company. Daisy Liech, TLcom’s director of portfolio and strategy, also adds how the firm supports companies outside of capital.

This interview has been edited for length and…