While there are many reasons to invest in Africa but investors should 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 firms might need to reevaluate their business plans, just as Nestle did last year in 21 African countries. Many countries also have deficits. It will take strong and resourceful investors to plug these gaps and bring more prosperity to Africans.
The $71 million investment by TLcom Capital. TIDE Africa Fund
The latest venture of TLcom Capital has closed at a reported $71 million. The funds’ predecessor closed in January of last year, and TLcom, Bio, CDC Group and Sango Capital contributed five million dollars. The first fund was invested in tech companies in Kenya and Nigeria. TIDE Africa II will focus on fintech companies in East Africa. 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 and $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 create more than a dozen tech-related companies on the continent, including Twiga Foods, and a logistical trucking business. The investment firm’s team is comprised of Omobola Johnson, a former Nigerian minister of communication technology.
TIDE Africa is an equity investment fund that invests in growth tech companies in SSA. It will invest between $500,000 to $10 million in companies that are at the beginning of their development with a particular 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. In Kenya, for example, TIDE has invested in five companies with high growth in digital technology.
Omidyar Network’s $71 million TEEP Fund
The Omidyar Network, a US-based company that invests in philanthropy, hopes to invest between $100 and $200 million in India over the course of five years. Pierre Omidyar, co-founder of eBay was the fund’s founder and has invested $113 Million in 35 Indian companies. The fund invests in India’s consumer internet, entrepreneurship , as well as financial inclusion. It also has investments in property rights, transparency in government, transparency of the government, and companies that have a social impact.
The Omidyar Network’s TEEP Fund makes investments that are designed to improve access and accessibility to government information. Its goal is to identify nonprofits that utilize technology to develop public information portals and tools for citizens. The network believes that open access to government information improves public awareness of government processes, and in turn creates a more involved society that holds officials accountable. Imaginable Futures will use the funds to invest in non-profit and for-profit companies that focus on education and healthcare.
Raise
If you’re looking to raise funds for your African start-up, you need to look for a business with an emphasis on Africa. TLcom Capital, a fund manager based in London is one of these companies. Its African investments have attracted the attention of angel investors, and the team has raised funds in Nigeria and Kenya. TLcom recently announced the launch of a brand new $71 million fund, which aims to invest in 12 startups before they achieve revenue.
The capital market is increasingly aware of the potential of Africa venture capital. Private investors are increasingly realizing the potential for growth in Africa and don’t need to be restricted by institutional investors. This means that raising funds has never been simpler. Raise allows businesses to close deals in a fraction of the time, and is free from the restrictions of institutions. There is no standard way to raise money for African investors.
Understanding how to get investors investors view African investments is the first step. While YC hype is appealing to investors of all kinds, it’s important that you look beyond the Silicon Valley giant and Agenda 2063 of the African Union. African companies are now searching for the YC signal to make contact with US investors. Kyane Kassiri is an Tunisian venture capitalist, has recently discussed the importance of the YC signal when it comes to raising money for African investors.
GetEquity
Founded in July 2021, GetEquity is a Nigeria-based investment platform aimed to make it easier for startups to access funding in Africa. It aims to make financing African startups more accessible to everyone by providing capital-raising tools and world-class capital for all startups. It has already assisted numerous startups to raise more than $150,000 from investors from all over the world. In addition, it also offers a secondary market to investors to buy other people’s tokens.
Like equity crowdfunding investing in early-stage companies is a highly exclusive venture that is usually only available to the top individual angel investors and capital institutions and syndicates. It is not accessible to family and friends. However, new companies are making an effort to break this privileged system by making it easier to access startup funding in Africa. The platform is available on iOS and Android devices and is free to use.
The GetEquity blockchain-based wallet is now available for investors. This allows investors to invest into startups in Africa. With the help of crypto funds, investors can invest in African startups for as little as $10. Although it’s a small amount, it’s still substantial in comparison to traditional equity financing. Following the recent demise of Paystack by Spark Capital GetEquity has become an ideal platform for investors from Africa who want to invest in Africa.
Bamboo
Bamboo’s first hurdle is convincing young Africans to invest in the platform. At present, investors in Africa were restricted to a few limited options including foreign direct investment (FDI) or crowdfunding and old finance companies. Only about a third have invested in any platform. However the company claims it’s expanding into other regions of Africa and plans to launch in Ghana in April 2021. As of this writing, how to get investors more than 50,000 Ghanaians have signed up for the waitlist.
Africans have limited alternatives for saving money. The value of the currency is decreasing against the dollar because of an inflation that is close to 16 percent. Investing dollars can help you protect yourself from inflation and falling dollar. One platform that allows Africans to invest in U.S. stocks is Bamboo which has seen rapid growth in the past two years. Bamboo plans to launch in Ghana in April 2021 and already has more than 50,000 people waiting to be able to access.
Once registered, investors can cash in their wallets using as little as $20. Funding can be done through credit cards, bank transfer, how to get investors in south africa and payment cards. Then, they can trade stocks and ETFs and receive market updates. Bamboo’s platform is bank-level secure so anyone from Africa can use it as long as they have a valid Nigerian Bank Verification number. Professional investment advisors may also benefit from Bamboo’s services.
Chaka
Nigeria is a major hub for legitimate business and investment. The film and entertainment industry in Nigeria is one of the largest in Africa. The growing fintech industry has led to an increase in startup formations and VC activity. One of the most prominent backers of Chaka, Iyinoluwa Aboyeji, told TechCrunch that the country’s progressive trends will ultimately open doors to a whole new set of investors. In addition to the investment of Aboyeji, Chaka has also secured seed-funds from the Microtraction fund, which is led by Y Combinator CEO Michael Seibel.
The degrading relationship between the US and China has increased Beijing’s interest in African investments. The trade war, along with growing anti-China sentiment have made it more appealing for investors to look beyond the US to invest in African companies. Although Africa is home to many emerging economies, most markets are too small for venture-sized businesses. African entrepreneurs must be ready to adopt an expansion-minded approach and develop a cohesive expansion story.
The Nigerian Stock Exchange is overseen by the Central Securities Clearing System, which makes it a secure and secure location to invest in African stocks. Chaka is free to join, and you’ll receive a 0.5 percent commission for each trade. Cash withdrawals are able to take up 12 hours. On the other hand, withdrawals for sold shares can take up to three working days. In both instances the cash received for sold shares is settled locally.
Rise
Africa is experiencing positive news from the increase in investors looking to invest. The economy of the country is stable, and its governance is sound, which attracts foreign investors. This has raised the standard of living in Africa. Africa is still a risky investment area. Investors should be cautious and do their research. There are many opportunities for investment in Africa however, the continent must improve its infrastructure to attract foreign capital. In the coming years, African governments should work to create more conducive environments for business and enhance the business environment.
The United States is more willing to invest in the economies of Africa via foreign direct investments. In 2013, U.S. governments helped in the development of a major healthcare financing facility in Senegal. The U.S. government also helped secure investment in cutting-edge technologies in Africa, and helped pharmacies in Kenya and Nigeria stock high-quality medicine. This investment could lead to jobs and build long-term relationships between the U.S.A and Africa.
While there are plenty of opportunities in the African market for stocks, it is vital to know the market and carry out due diligence to ensure that you do not lose money. If you’re a smaller investor, it’s a smart idea to invest in exchange-traded fund (ETFs) which track an array of Sub-Saharan African businesses. For U.S. investors, American depositary receipts (ADRs) are an easy method to trade African stocks on the U.S. stock market.
