While there are many reasons to invest in Africa however, investors must be aware that the continent will test their patience. The African markets aren’t always stable and time horizons may not always work. Even highly sophisticated companies might have to revise their business plans, like Nestle did in 21 African countries in the last year. Many countries also have deficits. It will take the courage and determination of investors to fill in these gaps and bring greater prosperity to Africans.
TLcom Capital’s $71 million TIDE Africa Fund
The latest venture from TLcom Capital ended at $71 million. The fund’s predecessor was shut in January of this year. TLcom, Bio, CDC Group, and Sango Capital contributed five million dollars. The first fund invested in a dozen tech companies in Kenya, Nigeria, and South Africa. TIDE Africa II will focus on East African fintech companies. The investment firm has offices in Kenya and Nigeria. TLcom’s portfolio includes Twiga Foods, Andela, uLesson and Kobo360. The investment company makes between $500,000 and $10 million in each of the companies.
TLcom is a Nairobi-based VC company, has more than $200 million under control. Omobola Johnson is one of the company’s Managing Partner. He has assisted in the start more than a dozen tech businesses on the continent, including Twiga Foods, and a trucking logistics company. Omobola Johnson (a former minister of technology and communication in Nigeria) is part of the investment firm’s team.
TIDE Africa is an equity investment 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 B rounds. While the fund is focusing on Anglophone Africa, it plans to invest in Eastern and Southern African countries, too. In Kenya, for example, TIDE has invested in five digital companies with high growth.
Omidyar Network’s $71 million TEEP Fund
The Omidyar Network, a US-based philanthropic investing firm, aims to invest $100-$200 millions in India over the course of five years. Pierre Omidyar, co-founder of eBay, founded the fund and has invested $113 million in 35 Indian companies. In India, the firm invests in consumer internet, entrepreneurship, financial inclusion, transparency in government property rights, as well as companies with a social impact.
The Omidyar Network’s TEEP Fund makes investments that are designed to improve access to government information. Its mission is to identify nonprofits using technology to build public information portals and tools for citizens. The network believes that having open access to government information increases public awareness of government processes, which in turn leads to a more engaged society that holds government officials accountable. Imaginable Futures will invest the money in for-profit and nonprofit organisations that focus on education and health.
If you’re looking to raise money for your African startup, you should look for a business with a strong Africa-centric focus. One such company is TLcom Capital, a fund management firm that is based in London. Angel investors have been drawn to its African investments, and the company has raised funds in Nigeria and Kenya. TLcom recently announced the launch of a brand new $71 million fund that intends to invest in 12 startups before they reach revenue.
The appeal of Africa venture capital is increasingly being recognized by the capital markets. private investor looking for projects to fund, Www.5mfunding.Com, investors are becoming more aware of the potential of Africa for growth and don’t face the same restrictions as institutional investors. This means that raising money is never easier. Raise allows businesses to conclude deals in half the time and is without institutional limitations. There isn’t a single way to raise money for African investors.
The first step is to comprehend how investors think about African investments. Although many investors are attracted to YC hype, private investor looking For projects to fund it’s vital to look beyond this Silicon Valley giant and the Agenda 2063 of the African Union. African startups are now looking for the YC signal to engage with US investors. Kyane Kassiri, an Tunisian venture capitalist, has recently spoke about the importance of the YC signal when it comes to raising funds for African investors.
It was founded in July 2021. GetEquity is an investment platform in Nigeria aimed at democratizing startup funding in Africa. It hopes to make funding African startups accessible to the common man by providing the most advanced capital raising tools for any startup. The platform has already helped startups raise more than $150,000 from a variety of investors. In addition, it also provides a secondary market for investors to purchase other investors’ tokens.
In contrast to equity crowdfunding investing in early-stage businesses is a highly privileged activity that is typically only available to the top individual capital institutions and angel investors as well as syndicates. It is not usually available to family members or friends. However, new startups are working to change this privilege by democratizing access to startup funding in Africa. It is accessible for both Android and iOS devices. It is free to use.
The GetEquity’s cryptocurrency-based wallet is available to investors. This allows investors to invest into startups in Africa. With the help of crypto-based funds, investors can invest in African startups starting at just $10. Although this is a small amount, it’s still substantial in comparison to traditional equity financing. In the wake of the recent demise of Paystack by Spark Capital, GetEquity has transformed into a robust ecosystem for investors who are willing to invest in Africa.
The first challenge for Bamboo is to persuade young Africans to invest in the platform. In the past, investors in Africa were restricted to a few options which included foreign direct investments (FDI), crowdfunding, and the legacy finance companies. About a third of Africans have invested on any platform. The company says it is expanding into other African countries, with plans to launch in Ghana by April 2021. As of this writing more than 50,000 Ghanaians have signed up on the waitlist.
Africans don’t have many options for saving money. With inflation running at nearly 16 percent and the currency depreciating against the dollar. In investing in dollars, you can hedge against rising inflation and a falling currency. One platform that allows Africans to invest in U.S. stocks is Bamboo which has seen rapid growth over the past two years. Bamboo plans to launch in Ghana in April 2021 and has more than 500 users who are waiting to get access.
Once registered, investors are able to fund their wallets with as little as $20. You can fund your wallet with credit cards, bank transfer, or payment cards. Then, they can trade stocks and ETFs, and receive regular market updates. Bamboo’s platform has a bank-level security, so anyone in Africa can use it as long as they have an authentic Nigerian Bank Verification number. Professional investment advisors can also benefit from Bamboo’s services.
Nigeria is a hub for legitimate investment and business. Its movie and entertainment industry is among the continent’s biggest, and the country’s growing fintech sector has led to an explosion in the formation of startups and VC activity. TechCrunch interviewed Iyinoluwa Abodeji who is one of Chaka’s most prominent investors. She stated that the country’s progressive tendencies will eventually open doors for a new class 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.
Beijing has been more interested in African investments due to the deteriorating relationship between the US and China. Rising anti-China sentiments and the trade war has made it more appealing to investors to invest in African companies outside of the US. The African continent is home to large, emerging economies but most markets are too small to sustain venture-sized businesses. The business owners of Africa must be ready to adopt an expansion mindset and to lock in a coherent expansion narrative.
The Central Securities Clearing System oversees the Nigerian Stock Exchange, making it a safe and secure platform to invest in African stocks. Chaka is free to join, and business funding you will receive the 0.5 percent commission for each trade. Cash withdrawals can take up to 12 hours. On the other hand, withdrawals of sold shares can take up to three working days. In both cases, the cash for sold shares is settled locally.
The increase in investors willing to invest in Africa is a good thing for Africa. The country’s economy is stable and its governance is sound, which draws foreign investors. This has raised the standard of living in Africa. Africa is still a risky investment area. Investors should exercise caution and do their study. There are numerous opportunities to invest in Africa however, the continent needs to improve its infrastructure to draw foreign capital. In the next few years, African governments should work to create more business-friendly environments and improve its business environment.
The United States is more willing to invest in the economies of Africa via foreign direct investment. U.S. governments assisted Senegal in advancing a significant healthcare financing facility. The U.S. government also helped secure investment in cutting-edge technologies in Africa and also assisted pharmacies in Kenya and Nigeria supply high-quality medications. This investment can create jobs and help build long-term partnerships between the U.S.A and Africa.
There are numerous opportunities available on the African stock exchange. However, it is essential to know the market and conduct your due diligence to avoid losing money. If you’re a small investor, it’s a smart idea to invest in an exchange-traded fund (ETFs) which track the performance of a variety of Sub-Saharan African businesses. For U.S. investors, American depositary receipts (ADRs) are an easy way to trade African stocks in the U.S. stock market.