While there are many reasons to invest in Africa however, investors must be aware that the region will test their patience. The African markets can be unstable and time horizons might not always be effective. Even the most sophisticated companies may need to reconsider their business plans, as Nestle did last year in 21 African countries. Many countries also have deficits. It will require strong and resourceful investors to fill these gaps and bring greater prosperity to Africans.
The $71 million investment by TLcom Capital. TIDE Africa Fund
The latest venture from TLcom Capital ended at $71 million. The predecessor fund closed in January of this year. Five million dollars were donated by Sango Capital, Bio, CDC Group and TLcom. The first fund invested in tech companies in Kenya and Nigeria. TIDE Africa II will focus on East African fintech companies. The investment firm also has offices in Nigeria and Kenya. The portfolio of TLcom includes Twiga Foods, Andela, uLesson, and Kobo360. Each company is worth between $500,000 to $10 million.
TLcom is a Nairobi-based VC firm with more than $200 million in under management. Omobola Johnson is the company’s Managing Partner. He has helped to launch more than a dozen tech companies on the continent, including Twiga Foods, and a logistics company for trucking. The team of the investment firm includes Omobola Johnson, who was a former Nigerian minister of technology and communication.
TIDE Africa is an equity fund that invests in growth-stage tech companies in SSA. It will invest between $500,000 and $10 million in companies that are at the beginning of their development and will focus on Series A and II rounds. The fund will be primarily focused on Anglophone Africa but it plans to invest in Eastern, and Southern African countries. TIDE for instance, has invested in five high growth digital companies in Kenya.
Omidyar Network’s $71 million TEEP Fund
The Omidyar Network is a US-based company that invests in philanthropy that aims to invest between $100 and $200 million in India over the next five years. The fund was established by eBay co-founder Pierre Omidyar and has invested $113 million in 35 Indian companies since the year 2010. In India the company invests in consumer internet, entrepreneurship financial inclusion, transparency in government, property rights, and firms with social impact.
The Omidyar Network’s TEEP Fund makes investments that are designed to improve access to government information. Its objective is to identify non-profit organizations that make use of technology to create public information portals and tools for citizens. The network believes that having open access to government information enhances the public’s awareness of government processes, how to get funding for a business which in turn leads to a more engaged society that holds government officials accountable. Imaginable Futures will use the funds to invest in non-profit and for-profit companies that focus on healthcare and education.
Raise
If you’re planning to raise funds for your African start-up, you need to look for a company with an African-centric focus. One such company is TLcom Capital, a fund management firm that is based in London. Its African investments have attracted the attention of angel investors, and the company has raised funds in Nigeria and Kenya. TLcom recently announced the launch of a new fund totalling $71 million to invest in 12 startups prior to reaching profitability.
The potential of Africa venture capital is increasingly being acknowledged by the capital market. Private investors are becoming more aware of the potential of Africa for growth and don’t have the restrictions of institutional investors. This means that raising funds has never been simpler. Raise helps businesses to close deals in half the time and is also free from the restrictions of institutions. But there’s no one right method of raising funds for African investors.
The first step is to understand the mindset of investors regarding African investments. Although many investors are attracted to YC hype, it’s crucial to think beyond this Silicon Valley giant and the African Union’s agenda 2063. African startups are now looking for the YC signal to make contact with US investors. Kyane Kassiri is a Tunisian venture capitalist, recently talked about the importance the YC signal when it comes to raising funds for African investors.
GetEquity
GetEquity, investors looking for projects to fund in namibia an investment platform that is based in Nigeria was founded in July of 2021. It aims at democratizing the funding of startups in Africa. Its goal is to make funding for African startups accessible to all through the provision of capital raising tools and world-class capital for all startups. The platform has already helped startups raise over $150,000 from a diverse range of investors. It also offers secondary markets for investors to buy tokens from other investors.
Like equity crowdfunding, investing in early-stage companies is a very exclusive activity. It is usually only available to the most prominent individual angel investors, capital institutions and syndicates. It’s not typically accessible to family members or friends. New companies are trying to change this unwelcome arrangement by making it easier to obtain funds for startups from Africa. The platform is accessible on iOS and Android devices and is completely free to use.
GetEquity’s blockchain-based wallet is now open to investors. This makes it possible to invest in startups in Africa. With the aid of crypto funds investors can invest in African startups starting at just $10. Although this is a modest amount, it’s still substantial when compared to traditional equity financing. With the recent acquisition of Paystack by Spark Capital, GetEquity has grown into a powerful ecosystem for investors looking to invest in Africa.
Bamboo
The first hurdle for Bamboo is to convince young Africans to invest in the platform. Investors in Africa had limited options before now the crowdfunding platform, How To Get Investors In South Africa foreign direct investments (FDI) and old finance companies. Only about a third of investors have invested in any platform. The company has announced that it is expanding into other African countries, and plans to launch in Ghana by the end of April 2021. As of this writing more than 50,000 Ghanaians have signed up on the waitlist.
Africans do not have many options for saving money. The value of the currency is declining against the dollar due to inflation of close to 16 percent. Investing dollars can help you protect yourself from inflation and a falling dollar. Bamboo, which has seen rapid growth in the past two years, is a platform that allows Africans invest in U.S. stock options. It plans to launch in Ghana in April 2021, and already has over 500 users who are waiting to get access.
Once registered, investors are able how to get investors in south africa fund their accounts with just $20. You can add funds to your wallet using credit cards, bank transfer, or payment cards. After that, they can trade ETFs and stocks and receive regular market updates. Since Bamboo’s platform is secure at the bank level it is accessible by anyone in Africa who can provide an acceptable Nigerian Bank Verification Number. Professional investment advisors can utilize Bamboo’s services.
Chaka
Nigeria is a major hub for legitimate investment and business. The film and entertainment industry in Nigeria is among the largest in Africa. The country’s growing fintech sector has resulted in an explosion in the number of startups and VC activity. TechCrunch interviewed Iyinoluwa Abodeji who is one of Chaka’s top backers. She stated that the country’s progressive tendencies will eventually open doors for a new class investors. Chaka also received seed-funds from Microtraction which is managed by Michael Seibel, CEO of Y Combinator.
Beijing has been more interested in African investments due to the deteriorating relationship between the US and China. The trade war, along with the rising anti-China sentiment have made it more attractive for investors to look outside of the US to invest in African companies. Although the continent of Africa is home to a variety of emerging economies, the majority of markets are not big enough for venture-sized companies. African entrepreneurs must be ready to adopt an expansion-minded perspective and build a coherent expansion story.
The Central Securities Clearing System oversees the Nigerian Stock Exchange, making it a secure and safe platform to invest in African stocks. Chaka is free to join and offers the benefit of a 0.5 percent commission on each trade. Withdrawals of available cash can take up to 12 hours. The withdrawal of shares that have been sold, on the other hand can take as long as three days. Both are handled locally.
Rise
Africa is seeing positive news due to the rise in investors who are willing to invest. The country’s economy is stable and its governance is sound, which draws international investors. This has raised the standard of living in Africa. However, Africa is still a risky place to invest, so investors must be cautious and do their homework. There are many opportunities to invest in Africa. However Africa needs to make improvements to draw foreign capital. African governments must work together to create a more business-friendly environment and enhance the business climate in the next few years.
The United States is more willing to invest in the economies of Africa through foreign direct investment. In 2013, U.S. governments helped develop a major financing for healthcare facility in Senegal. The U.S. government also supported investments in new technologies in Africa and helped pharmacies in Nigeria and Kenya supply high-quality medications. Such investment can create jobs and foster a long-term partnership between the U.S. and Africa.
There are many opportunities to invest in the African stock market, it is vital to understand the market and do due diligence to ensure you don’t make a loss. If you’re a smaller investor it is a good option to invest in an exchange-traded fund (ETFs) which track a wide range of Sub-Saharan African businesses. American depositary receipts (ADRs) that are issued by the United States, make it simple to trade African stocks on the U.S. stock exchange.