There are many reasons to invest, however investors should be aware that Africa is a place that tests their patience. The African markets are volatile and time horizons do not always work. Even highly sophisticated companies might have to re-evaluate their business plans, just as Nestle did in 21 African countries in the last year. Many countries also have deficits. These gaps will need to be filled by smart and resourceful investors who can bring more prosperity to Africa.
The $71 million investment by TLcom Capital. TIDE Africa Fund
The latest venture by TLcom Capital was closed at $71 million. The fund’s predecessor was shut down in January of this year. Five million dollars were donated by Sango Capital, Bio, CDC Group and TLcom. 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. TLcom’s portfolio includes Twiga Foods, Andela, uLesson, and Kobo360. Each company is worth $500,000 to $10 million.
TLcom is a Nairobi-based VC firm with more than $200 million in under management. The company’s managing partner, Omobola Johnson, has been instrumental in launching more than a dozen tech companies across the continent which include Twiga Foods and a trucking logistics company. The investment firm’s team includes Omobola Johnson, who was the former Nigerian minister of technology and communication.
TIDE Africa is an equity fund that invests in growing-stage tech companies in SSA. It will invest between $500,000 and $10 million in early-stage companies that are focusing 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 instance, TIDE has invested in five companies that are growing rapidly in the digital sector.
Omidyar’s $71 Million TEEP Fund
The Omidyar Network, a US-based company that invests in philanthropy, hopes to invest between $100-$200 million in India over the next five years. The fund was founded by eBay co-founder Pierre Omidyar and has invested $113 million in 35 Indian businesses since 2010. The fund invests in India’s consumer internet, entrepreneurship , and financial inclusion. It also invests in property rights, government transparency as well as government transparency companies that have social impact.
The Omidyar Network’s TEEP Fund invests in projects that enhance access to government information. It is a way to identify non-profit organizations that utilize technology to create public information portals and tools that are accessible to citizens. The network believes that having open access to government information increases the public’s understanding of government procedures, which results in a more active society that holds government officials accountable. Imaginable Futures will invest the funds in non-profit and for-profit organisations that focus on education and health.
It is important to choose a firm that is focused on Africa if want to raise funds for your African startup. One of these companies is TLcom Capital, a fund management firm that is based in London. Its African investments have caught the attention of angel investors, and the team has raised funds in Nigeria and Kenya. TLcom has announced the launch of a new fund of $71 million that will invest in 12 startups before they reach profitability.
The attraction of Africa venture capital is increasingly being acknowledged by the capital market. Private investors are increasingly seeing the potential of Africa’s development and don’t have 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 of institutional constraints. There’s no perfect way to raise funds for African investors.
Understanding how investors perceive African investments is the first step. Although many investors are attracted to YC hype, it’s important to consider the bigger picture of this Silicon Valley giant and the African Union’s agenda 2063. Therefore, African entrepreneurs are seeking the YC signal before approaching US investors. A Tunisian venture capitalist Kyane Kassiri recently spoke out about the importance of the YC signal when seeking funds for African investors.
Founded in July 2021, GetEquity is an investment platform in Nigeria aimed to make it easier for startups to access funding in Africa. It wants to make the process of financing African startups easy for the average person by providing the most advanced capital raising tools for any startup. The platform has already helped startups raise over $150,000 from a diverse range of investors. It also provides secondary markets for investors to purchase tokens from other investors.
In contrast to equity crowdfunding, investing into early-stage companies can be an extremely exclusive business. It’s typically only available to the most prominent individuals angel investors, capital institutions, and syndicates. It’s not typically accessible to family members or friends. New startups are seeking to change this unwelcome arrangement by making it easier for entrepreneurs to access financing for startups in Africa. It is available for Android and iOS devices. It is free to use.
GetEquity’s blockchain-based wallet is now open to investors. This allows investors to invest into startups in Africa. Investors can invest as low as $10 in African startups using crypto funds. While this is a tiny amount, it’s still substantial when compared to traditional equity financing. With the recent exit from Paystack by Spark Capital GetEquity has become an ideal platform for African Investors Looking for entrepreneurs who want to invest in Africa.
The first obstacle for Bamboo is to persuade young Africans to invest in the platform. Investors in Africa had only a few options prior to the present including crowdfunding, foreign direct investments (FDI) and traditional finance companies. Only about a third of investors have made a purchase on any platform. The company is now saying it is expanding into other African countries, and plans to launch in Ghana by the end of April 2021. More than 50, 000 Ghanaians are on the waitlist as of this writing.
Africans don’t have many options for saving money. With inflation hovering around 16%, the currency is depreciating against the dollar. A dollar investment can help protect yourself from inflation and falling dollar. Bamboo has seen rapid growth in the past two years, is a platform that lets Africans to invest in U.S. stock options. Bamboo is set to launch in Ghana in April 2021, and has more than 50,000 people waiting to be able to access.
Investors can fund their accounts starting at just $20 once they’re registered. You can fund your account using credit cards, bank transfers, or payment cards. Then, they can trade ETFs and stocks and receive market updates. As Bamboo’s platform is secure at the bank level and dependable, it can be utilized by anyone in Africa who can provide an official Nigerian Bank Verification Number. Professional investment advisors can use Bamboo’s services.
Nigeria is a major hub for legitimate investment and business. The entertainment and film industry is among the largest in the world and the country’s expanding fintech industry has resulted in an increase in startup formation and VC activity. TechCrunch spoke to Iyinoluwa Abodeji, one Chaka’s top backers. She stated that the trend towards progress in the country will eventually open doors for a new class investors. In addition to Aboyeji’s investment, Chaka has also secured seed-funds from the Microtraction fund which is managed by Y Combinator CEO Michael Seibel.
Beijing has been more interested in African investments due to the declining relationship between the US and China. The trade war, as well as rising anti-China sentiment, investors looking for projects to fund in namibia have made it more appealing for investors to consider investing outside of the US to invest in African companies. Although Africa is home to many emerging economies, most markets are too small for venture-sized firms. The business owners of Africa should be prepared to adopt an expansion mindset and to lock in a cohesive expansion narrative.
The Nigerian Stock Exchange is overseen by the Central Securities Clearing System, which makes it a secure and secure investment in African stocks. Chaka is free to join, and you will be paid an 0.5 percent commission for each trade. Withdrawals of available cash can take up to 12 hours. Refunds for shares that were sold however could take up to three days. In both cases the cash received for sold shares is settled locally.
Africa is enjoying positive developments from the increased number of investors willing to invest. The country’s economy is stable and its governance is solid, which attracts international investors. This has raised the standard of living in Africa. Africa is still a risky investment area. Investors should exercise caution and conduct their own research. There are many opportunities to invest in Africa. However, the continent must improve its infrastructure to attract foreign capital. African governments must collaborate to create a more hospitable environment for business and improve the business environment in the next few years.
The United States is more willing to invest in the economies of Africa via foreign direct investments. U.S. governments assisted Senegal in advancing a significant healthcare financing facility. The U.S. government also supported investment in new technology in Africa and also helped pharmacies in Nigeria and Kenya have access to high-quality medicines. This investment can create jobs and foster long-term partnerships between the U.S.A and Africa.
While there are plenty of opportunities in the African market for stocks it is important to be aware of the market and Investors looking For entrepreneurs perform due diligence to make sure that you do not lose money. If you are a small investor, it’s a good idea to invest in an exchange-traded fund (ETFs) that track various Sub-Saharan African businesses. For U.S. investors, American depositary receipts (ADRs) are an easy option to trade African stocks on the U.S. stock market.