Key Takeaways
- • The Tanzania Startup Association (TSA) presented plans on 20 October 2026 for a USD 50 million Tanzania Venture Capital Fund, targeting a further USD 180 million in private co-investment for startups and SMEs.
- • Government funding of USD 7.5 million (15%) is planned, with the remaining 85% to come from private institutional investors, pension funds, and development finance institutions (DFIs).
- • The fund is structured as a fund of funds to anchor 18 local and regional venture funds, targeting businesses past angel investment but not yet bankable for traditional bank loans.
- • The fund is one of four pillars identified by the Capital Markets and Securities Authority (CMSA), alongside policy and tax reform, fund manager development, and enterprise development.
- • Officials cited a gap in the equity ticket range of USD 50,000 to USD 1 million, where Tanzanian businesses lack local financing mechanisms and collateral for bank lending.
Summary
The Tanzania Startup Association (TSA) presented plans for a USD 50 million Tanzania Venture Capital Fund in Dar es Salaam on 20 October 2026. The fund targets a further USD 180 million in private co-investment for startups and small and medium-sized enterprises (SMEs). According to TSA Operations and Program Lead Praygod Japhet, the fund is designed for businesses that have progressed beyond angel investment but are not yet mature enough to qualify for traditional bank loans. TSA is targeting 15% of the initial capital, or USD 7.5 million, from a government allocation, with the remaining 85% to be raised from private institutional investors, pension funds, and development finance institutions. Japhet said the initial capitalisation is meant to anchor 18 local and regional venture funds, which together would mobilise the additional USD 180 million.
The fund is one of four pillars identified by the Capital Markets and Securities Authority (CMSA), alongside policy and tax reforms, fund manager development, and enterprise development. The CMSA drafted capital market regulations and benchmarked models in India and Ghana. CMSA Director for Research, Policy and Planning Alfred Mkombo described the target segment as the "middle bit of the market," with equity ticket sizes of USD 50,000 to USD 1 million, which he said lacks a local financing mechanism. In February 2025, the Financial Sector Deepening Trust (FSDT), with European Union funding, had called for advisers to design a venture capital fund together with the CMSA and the Ministry of Finance.
The plans were presented on the second day of Tanzania Startup Week 2026, running 19 to 23 October 2026 and co-hosted by TSA with the Ministry of Finance, the CMSA, and the Ministry of Industry and Trade. Finance Minister Ambassador Khamis Mussa Omar delivered the keynote, linking financing to Development Vision 2050, which aims to grow the economy from approximately USD 100 billion to USD 1 trillion by 2050. Omar reported GDP growth of 5.6% in 2024 and 5.9% in 2025, with 6.3% targeted for 2026, inflation below 5%, and private sector lending growth of 33% in the year to August. He noted that the industrial sector has not yet benefited substantially from private credit growth.
World Bank Country Manager for Tanzania Firas Raad framed the need for equity finance around labour market pressure, noting that about 2 million young Tanzanians enter the labour market each year while 400,000 leave, a gap of roughly 1.6 million. World Bank Senior Financial Sector Specialist Aun Ali Rahman explained the fund-of-funds structure, saying it avoids reliance on a single fund manager and seeks to build the market across the capital value chain. TSA CEO Zahoro Muhaji reported that Tanzania's startup ecosystem attracted more than USD 400 million in investment over the last five years and is projected to surpass USD 120 million in 2026. Tanzanian startups raised USD 52 million in the first half of 2026, placing the country fifth in Africa for startup funding, according to figures reported in July 2026.
The fund is one of four pillars identified by the Capital Markets and Securities Authority (CMSA), alongside policy and tax reforms, fund manager development, and enterprise development. The CMSA drafted capital market regulations and benchmarked models in India and Ghana. CMSA Director for Research, Policy and Planning Alfred Mkombo described the target segment as the "middle bit of the market," with equity ticket sizes of USD 50,000 to USD 1 million, which he said lacks a local financing mechanism. In February 2025, the Financial Sector Deepening Trust (FSDT), with European Union funding, had called for advisers to design a venture capital fund together with the CMSA and the Ministry of Finance.
The plans were presented on the second day of Tanzania Startup Week 2026, running 19 to 23 October 2026 and co-hosted by TSA with the Ministry of Finance, the CMSA, and the Ministry of Industry and Trade. Finance Minister Ambassador Khamis Mussa Omar delivered the keynote, linking financing to Development Vision 2050, which aims to grow the economy from approximately USD 100 billion to USD 1 trillion by 2050. Omar reported GDP growth of 5.6% in 2024 and 5.9% in 2025, with 6.3% targeted for 2026, inflation below 5%, and private sector lending growth of 33% in the year to August. He noted that the industrial sector has not yet benefited substantially from private credit growth.
World Bank Country Manager for Tanzania Firas Raad framed the need for equity finance around labour market pressure, noting that about 2 million young Tanzanians enter the labour market each year while 400,000 leave, a gap of roughly 1.6 million. World Bank Senior Financial Sector Specialist Aun Ali Rahman explained the fund-of-funds structure, saying it avoids reliance on a single fund manager and seeks to build the market across the capital value chain. TSA CEO Zahoro Muhaji reported that Tanzania's startup ecosystem attracted more than USD 400 million in investment over the last five years and is projected to surpass USD 120 million in 2026. Tanzanian startups raised USD 52 million in the first half of 2026, placing the country fifth in Africa for startup funding, according to figures reported in July 2026.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.