How To Investors Willing To Invest In Africa To Stay Competitive

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There are many good reasons to invest in Africa, investors should know that the continent will test their patience. The African markets are unstable and time horizons do not always work. Even the most sophisticated companies might need to revise their business plans, as Nestle did in 21 African countries last year. Many countries also have deficits. These gaps must be filled by bold and resourceful investors who can bring more prosperity to Africa.

TLcom Capital's $71 million TIDE Africa Fund

TLcom Capital's latest venture has closed at a reported $71 million. The fund's predecessor closed in January last year. Five million dollars were contributed by Sango Capital, Bio, CDC Group and TLcom. The first fund made investments in tech companies in Kenya and Nigeria. TIDE Africa II will concentrate on fintech companies in East Africa. The investment firm also has offices in Nigeria and Kenya. TLcom's portfolio comprises Twiga Foods and Andela as in addition to uLesson and Kobo360. Each company is worth anywhere from $500,000 and $10 million.

TLcom, founded in Nairobi, is a VC company with more than $200 million under control. The company's managing partner, Omobola Johnson, has helped launch over a dozen tech companies across the continent which include Twiga Foods and a trucking logistics company. Omobola Johnson (a former minister of technology and communication in Nigeria) is part of the team of the investment firm.

TIDE Africa is an equity fund that invests into growth-stage tech companies in SSA. It will invest between $500,000 and $10 million in companies in the early stages, with an emphasis on Series A and B rounds. Although the fund will focus on Anglophone Africa, it plans to invest in Eastern and Southern African countries, too. In Kenya for instance, TIDE has invested in five high-growth digital companies.

Omidyar Network's $71 million TEEP Fund

The Omidyar Network is a US-based foundation that invests in philanthropy and aims to invest $100-$200 million into India over the next five years. The fund was started by eBay co-founder Pierre Omidyar and has invested $113 million in 35 Indian companies since the year 2010. In India, the firm invests in consumer internet, entrepreneurship, financial inclusion, government transparency, property rights, and companies with a social impact.

The Omidyar Network's TEEP Fund makes investments that are designed to improve access and accessibility to government information. It is a way to identify non-profits that use technology to build public information portals as well as tools for citizens. The network believes that open access to government information increases the public's knowledge of government processes and contributes to an active 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

You should pick a business that is based in Africa if you are looking to raise funds for your African startup. 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 team has also raised money in Nigeria and Kenya. TLcom recently announced the launch of a new $71 million fund that intends to invest in 12 startups before they achieve revenue.

The capital market is becoming more aware of the benefits of Africa venture capital. Private investors are increasingly realizing the potential for Africa's growth and aren't restricted by institutional investors. This means that raising funds is much less difficult than it was in the past. Raise helps businesses close deals in half the time, and is free of institutional restrictions. There's no perfect method to raise money for African investors.

Understanding how investors view African investments is the first step. While YC hype appeals to a lot of investors however, it is important to think beyond the Silicon Valley giant and Agenda 2063 of the African Union. In the end, African entrepreneurs are seeking the YC signal before approaching US investors. Kyane Kassiri is an Tunisian venture capitalist, recently spoke about the importance of the YC signal when it comes to raising funds for African investors.

GetEquity

Established in July 2021, GetEquity is an investment platform in Nigeria aimed at democratizing startup funding in Africa. It wants to make financing African startups accessible to the common man by bringing top capital raising tools for any startup. It has already helped a number of startups to raise more than $150,000 from investors from all over the world. In addition, it also provides a secondary market for investors to buy other people's tokens.

Unlike equity crowdfunding investing in early-stage companies is a highly exclusive venture which is generally only accessible to the top individual angel investors and capital institutions, as well as syndicates. It's not typically accessible to family members and friends. However, new companies are trying to change this privilege by making it easier to access startup funding in Africa. The platform is accessible on iOS and Android devices and is completely free to use.

The GetEquity's cryptocurrency-based wallet is available to investors. This allows investors to invest in startups in Africa. With the help of crypto funds, investors can invest in African startups for as little as $10. While this may seem like tiny in comparison to traditional equity funding however, it's a significant amount of money. With the recent acquisition of Paystack by Spark Capital, GetEquity has developed into a thriving ecosystem for investors looking to invest in Africa.

Bamboo

Bamboo's first challenge is convincing young Africans to invest on the platform. Until now, investors in Africa were restricted to a few options including foreign direct investment (FDI) and crowdfunding and legacy finance companies. Only about a third of investors have been able to invest on any platform. The company says it is expanding into other African countries, and plans to launch in Ghana by the end of April 2021. At the time of 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% and the currency depreciating against the dollar. It is beneficial to invest in dollars to hedge against rising inflation and a falling currency. Bamboo has seen rapid growth over 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 more than 50,000 users waiting for access.

Once registered, investors are able to fund their accounts with just $20. You can fund your wallet using credit cards, bank transfer, or credit cards. Afterwards, they are able to trade ETFs and stocks and receive regular market updates. Since Bamboo's platform is secure at the bank level, it can be used by anyone within Africa that has an acceptable Nigerian Bank Verification Number. Bamboo's services can also be used by professional investment advisers.

Chaka

There are many reasons for why Nigeria is a hotbed for legitimate business and investment. Nigeria's film and entertainment industry is one of the largest in Africa. The country's expanding fintech ecosystem has resulted in an explosion in the business funding number of startups and VC activity. One of the most well-known supporters of Chaka, Iyinoluwa Aboyeji, said to TechCrunch that the country's modern trends will ultimately open doors to a whole new set of investors. Chaka also received seed-funds from Microtraction which is run by Michael Seibel, CEO of Y Combinator.

Beijing has been more interested in African investments because of the deteriorating relationship between the US and China. The trade conflict, as well as rising anti-China sentiment, have made it more appealing for investors to look outside of the US to invest in African companies. Although the continent of Africa has a number of developing economies, the majority of markets aren't big enough for venture-sized enterprises. African entrepreneurs should be prepared to adopt an expansion approach and develop a cohesive expansion story.

The Nigerian Stock Exchange is overseen by the Central Securities Clearing System, which makes it a safe and secure place to invest in African stocks. Chaka is free to join and provides the benefit of a 0.5 percent commission on every trade. Cash withdrawals that are available take up to 12 hours. On the other hand, withdrawals of sold shares can take up to three days. In both cases the cash payment for sold shares is settled locally.

Rise

The rise of investors willing to invest in Africa is a positive sign for Africa. The economy is stable and its governance is sound, which draws international investors. The growth has boosted the standard of living in Africa. However, Africa is still a risky investment area, so investors must take care and be careful. There are plenty of opportunities to invest in Africa. However Africa must make improvements to draw foreign capital. African governments must work together to create more business-friendly environment and enhance the business climate in the next few years.

The United States is more willing to invest in Africa's economies through foreign direct investment. U.S. governments assisted Senegal in the development of a major healthcare financing facility. The U.S. government also supported investment in new technology in Africa and assisted pharmacies in Nigeria and Kenya supply high-quality medications. This investment can help create jobs and help build long-term partnerships between the U.S.A and Africa.

There are many opportunities available in the African market for stocks it is crucial to know the market and conduct proper due diligence to ensure you don't lose money. If you're a modest investor, it's a smart idea to invest in an exchange traded fund (ETFs), which tracks the performance of a variety of Sub-Saharan African businesses. For U.S. investors, American depositary receipts (ADRs) are a convenient option to trade African stocks on the U.S. stock market.