Denis Opudo
The year 2017 saw African tech startups hitting a milestone in funding. It saw 159 companies all over Africa getting a combined total funding of $195 million. The move was due to the ability of African tech startups to attract more investors. The question now comes in when we have to tell what type of investors that these startups were in a position to attract. The fact is that the traditional link between return focused and impacts are fading away. Many are saying that most of the African investments are impact investment.
The impact investment scene has widened in the recent past. It now includes funds with many definitions of financial and impact returns. This is according to Accion’s director of investment Amee Parbhoo. Many impact investors say that there is a small difference between them and those that go for money. But there is an increasing partnership between the two types. Accion Venture Lab offers seed funding and support to fintech startups. This develops better quality, better access or minimizes the cost of financial services. This is in reference to therefore the underserved population.
The groups of African companies in Accion are coming up with solutions. These solutions cater to the underserved group. For that matter, Accion Venture Lab is in a position to attract co-investors who work in line with their objectives. Raising seed capital was a problem to many African countries. This called for those in the space to work together. The early-stage fund is the most collaborative part. It means that stage requires sharing of information, offering insight and working with the company once it has received investment to make sure that it succeeds. The change has been impacted also by startups. Farmcrowdy in Nigeria is one of those startups that have felt the impact of the shift.
The company has realized a change in its returns. The company currently runs an impact and return model. This handles both the offering service side and achieving the best at the same time. Moreover, it is influential to both the return and impact focused investors. All the parties involved should now come together to offer solutions to the people.
