Intel Capital has entered the sub-Saharan Africa market with the aim of boosting venture capital opportunities and forming foundations for long-term economic growth.

"We are looking at opportunities across entire Sub-Saharan Africa," said Marcin Hejka, managing director, Eastern Europe, Middle East and Africa for Intel Capital. "Naturally we expect the bulk of investment opportunities to come from Africa's largest economies and most populous countries like South Africa, Nigeria and Kenya, but we are not excluding other countries."

Although Intel is looking at companies in all stages of development, it will focus on investments in companies in the expansion stage, which will complement efforts made in the last two years to fund startups and early-stage companies.

"Intel Capital is investing in the broad spectrum of technology opportunities including content, software and applications, consumer internet, e-commerce, data center and services; we are able to invest in technology companies at all stages of development, though majority of our investments happens at expansion stage," Hejka added.

Africa has received a lot of interest from global VCs in the last two years and Intel Capital's entry is expected to boost confidence for other investors to seek opportunities in the region. Investors such as Invested Development have been funding early stage mobile phone and alternative energy technologies while Venture Capital for Africa has been linking startups with VCs through an online portal.

"Intel's presence is a vote of confidence for high growth ventures across the continent and that is exciting; however, no one fund will make or break the industry and there is still a long way to go before any African market truly proves its potential," said Sean Smith, an analyst at Invested Development, a management fund that invests in early-stage startups.

Intel Capital is targeting Africa's long term growth and Hejka draws an analogy between Poland, his home country, and Africa.

"In the last 50 years we saw many regions and countries being able to emerge into a solid and wealthy economy with a strong technology sector, dynamic exports and rapidly growing GDP," said Hejka. "Many of them did it within one or two decades, the best know examples are BRIC (Brazil, Russia, India and China) countries but many other countries like Turkey or my home country Poland went through similar evolution often starting from levels similar to Kenya today."

However, VCs operating in the region face the challenge of a lack of understanding of what VC funding is expected to do.

"The largest challenge is the lack of understanding around the venture capital process," Smith said. "There seems to be no shortage of smart, motivated entrepreneurs, however, they often lack a deep understanding of many aspects of the venture capital game, from questions like 'How will we set the valuation of our company?' to 'Will my investors require me to sell the business or take it public? This confusion around the process itself makes it tough to focus on the more interesting aspects of building the industry."

The challenges and opportunities seem to be balanced out by the growing number of tech innovation hubs across the region, and the investors who give talks and workshops on venture capital. Such tech hubs exist in Cameroon, Tanzania, Uganda, South Africa, Zambia, Kenya, Nigeria, Ghana and Liberia, among other countries.