How to Raise Funds For Your Startup Despite Coronavirus
Damilola Faustino
With the coronavirus pandemic, you would think venture capitalists and angel investors would stop scouting for African startups to invest. This is wrong.
In the past few months, African startups in different sectors have raised significant dollars and more are still coming as the coronavirus lockdown is gradually being eased across Africa.
African startups that recently raised funds
1.) Tomato Jos: Tomato Jos, an agro-processing company focused on the local production of high-quality tomato paste for the African market announced that it had completed a EUR 3.9 million ($4.2m) Series A round.
2.) BusyMed, a South African healthtech startup raised undisclosed funding from LionPride, a Venture Capital Investor. The investment was facilitated by HAVAIC.
3.) 54gene, a Nigerian genomic startup, raised a $15-million investment led by Adjuvant Capital to allow the company to scale operations in support of generating novel insights from human genetics research.
4.) uLesson, a Nigerian-based education technology startup, has announced participation in its seed funding round by Founder Collective, a marquee seed-stage venture capital fund.
5.) Brimore, an Egyptian direct end-to-end distribution Startup has closed $3.5 million pre-Series A round led by Algebra Ventures.
6.) Finnfund invested $1 million in Kasha, a Rwandan-based e-commerce platform improving women’s access to genuine health, hygiene, and self-care products in East Africa.
7.) East Africa Fruits Co., a Tanzanian company addressing food distribution challenges to improve efficiencies in the farm-to-market sector, announced that it closed Series A equity funding totaling $3.1 million.
8.) Flutterwave, an African fintech startup raised a $35 million Series B funding round co-led by Grey Croft & eVentures. The round was joined by CRE Ventures, FIS, Visa, Green Visor, and Endeavor.
As a founder, you too can raise funds…here is how
There is no doubt that it is difficult to raise funds during this coronavirus pandemic. So far, in the WeeTracker Q1 funding report, 86 deals were announced. They estimate that total funding from these disclosed deals totaled $245.13 million.
Regardless this should not deter you. In fact, it should be a morale booster because even Venture Capitalists are setting up venture funds and raising huge sums to support African startups.
Novastar announced that it closed its Novastar Ventures Africa Fund II at US$108 million to support startups in both East and West Africa.
Harambe Entrepreneur got $1 million from Cisco Systems Inc. and a foundation of South African businessman Jonathan Oppenheimer to support African technology startups and help kick-start the return of venture capital to the continent following the coronavirus outbreak.
Raising funds:
1.) Find tech ways to run your business and do not stop innovating
The new normal is working from home. The question you should ask yourself is how do I run my business despite the coronavirus? The simple answer is technology. Deploy an affordable tech strategy to make your customers know you are still existing.
2.) Apply for funding and join accelerators
There are unlimited funding opportunities out there for African startups. You have to apply for these them. Also, apply to join accelerators.
3.) Disclose your funding needs to your network
If you need funding, reach out to friends and network. They may connect you to an investor especially if you have a solid pitch and scalable product to back up your funding claims.
The fundraising way you share is great. I appreciate this fundraising way.
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