The new fund, Aions Seed Fund I, combines R60m from the High Impact Seed Fund of Funds (HISFoF) and a further R40m committed by the Technology Innovation Agency (Tia).
Access to capital remains one of the biggest challenges facing South African startups, particularly those that have moved beyond the idea stage but are not yet ready to attract large-scale investment.
While later-stage funding often attracts the bulk of venture capital activity, many startups struggle to secure funding during the critical period between early traction and Series A investment.
Aions Ventures said the fund is designed to support businesses during this phase while providing operational and strategic support alongside capital.
The fund will target startups operating in sectors including the digital economy, climate and environmental sustainability, energy innovation linked to the just transition, and alternative water solutions.
According to the company, the objective is to back businesses that have demonstrated early market traction and are ready to scale.
Aions Ventures said its approach extends beyond providing capital, with support focused on governance, commercial development and financial discipline.
The firm has previously invested in several startups using its own balance sheet and has also supported businesses through enterprise and supplier development programmes.
The fund forms part of a broader effort to strengthen South Africa's innovation ecosystem and improve access to early-stage capital.
The High Impact Seed Fund of Funds is a R300m initiative managed by the SA SME Fund and backed by the Technology Innovation Agency and E Squared Investments.
TIA said the initiative aims to help address persistent funding gaps that prevent promising innovations from reaching commercial scale.
The SA SME Fund said allocating capital through experienced fund managers allows it to support a wider pipeline of scalable businesses and strengthen the country's startup ecosystem.
With the fund now operational, Aions Ventures said it is actively engaging founders seeking capital to expand businesses in technology, sustainability, energy and water-related sectors.
