Since moving to Africa in 2015, Aaron Fu has backed more than 100 companies and represented some of the most active investors on the continent. Now, he is focused on crypto, blockchain, and AI, leading early-stage venture investing at DCG.
Located in Stamford, Connecticut, DCG, or Digital Currency Group, invests in digital currency companies and blockchain startups, providing insights, network, and access to capital to help build and support bitcoin and blockchain companies.
The company, which formerly owned CoinDesk, started investing in Africa in 2021, and has made 23 investments on the continent so far, with 12 of those coming last year. Heading up this increase in activity is Fu, originally from Singapore, who told the latest episode of Disrupt Africa’s “The month in VC” podcast series he always thought of himself as a technologist, and had been building tech platforms back when he was 11 years old.
“My career however actually began in financial services, I worked in banking for eight or nine years. During that period I also built a ridesharing startup in Singapore, which was my first founder experience. We built that and scaled it to Myanmar and Cambodia – it was a lot of fun. I remember having to practice valuations and pitching in front of the mirror,” Fu said.
“But I never started getting into venture until I moved to Africa. I was with Standard Chartered in Singapore and got sent across to Africa to lead our digital bank there. I started to do a little angel investing, and then joined a firm based in Hong Kong called Nest.”
That was the first venture firm he worked for, and he raised an Africa fund for them.
“We invested in a few companies on the continent, and tried to help them go a bit more global, get in touch with banks, but fast forward 10 years down the road I’ve backed more than 100 companies now across fintech, logistics, SaaS, a wide range of sectors,” Fu said.
Those investments have been made personally and via a few different vehicles, including Catalyst Fund and Sherpa Ventures, while he has also started investing in other emerging markets, like Latam and Southeast Asia.
“Now at DCG I get to look after the world – we haven’t done anything in Antarctica yet but it is exciting times,” said Fu.
Fu leads ventures at DCG, but what exactly does that mean?
“DCG is not new to investing in Africa but we’ve been doing so a little under the radar. We’ve been an investor since day one, we’ve always been investing in venture at early-stage. It is a core part of our DNA. We are known for being early checks into Coinbase and Kraken, but we have been investing in Africa for four or five years now. We have a significant portfolio, many companies you already know, like Stitch, AccessPay, tappi…” he said.
Where does the capital come from?
“DCG invests off our balance sheet, which gives us a tremendous amount of flexibility, not just in terms of the stage we invest in, but we are also able to follow-on all the way through to pre-IPO. We don’t have LPs in a traditional sense, but we do have a couple of shareholders,” said Fu.
So what type of investments is DCG looking for?
“We are very very founder-first. We care a lot about a team’s ability to execute, what they have done before, what kind of businesses they have built before, what is the ambition level? We really want to back founders that think big, think global, and try to use the best technology out there,” he said.
“We like coming in very early, sometimes pre-idea, and getting to know founders. And by the time they’re two years in, launching in their second market, or third product, we can then decide whether we want to lean in with significantly more capital and lead or co-lead the next round.”
Has Fu’s experience as a founder helped him when it comes to working with entrepreneurs from the other side of the table?
“100 per cent. I especially empathise with first time founders, it is a daunting thing to be doing. Having been a founder, having understood how crazy each and every day can be, how uncertain your future can be, I think that level of empathy is really important,” he said. “At the end of the day, you are really just working with the founding team, and they’re going through a lot. I really see myself as more than just a financial investor – almost part-time therapist, part-time gym coach, I’ve even given haircuts!”
DCG itself provides other support beyond just capital.
“For us, we listen a lot to what the founders need. There’s a very wide spectrum of services and ways in which we work with founders. At the highest level we are a sounding board for strategy. When it comes to the more hands-on, we support founders a lot with partnerships and go-to-market. Also people, in the earliest days you might need certain types of people, and we have a lot of professionals in our network,” said Fu.
Though it has diversified a little, he says crypto is still central to the firm’s mission.
“DCG does a little more than just crypto, but crypto is still at the heart of everything we do. We invest in crypto, fintech, and AI. If you think about moving money across different geographies in Africa or helping companies in Brazil settle with their trade partners in the US, a lot of these use cases could really leverage crypto in the short or long term. So we want to be the right partner to these builders, to help them think about how they can leverage crypto or blockchain to do better at what they are doing. AI is also an important part of what we do now and an area we are bullish about,” said Fu.
Africa, he says, is one of the regions with the most acute use cases for these technologies.
“In a geography like, say, Nigeria, where a lot of systems have been built on pretty legacy software, crypto and blockchain can come in,” Fu said.
What are DCG’s plans for 2025?
“2024 was an incredible year for us in Africa – this year we’re looking to ramp up more of the same. We want to invest in between 10 and 15 companies in Africa this year, and we’re looking forward to helping our investments from last year as well, maybe doubling down with more rounds,” he said.
