Olumide Soyombo, one of Nigeria’s active angel investors, has launched Voltron Capital, a Pan-African venture company to improve access to funds for African tech startups.
Soyombo, who has invested in 33 startups, including Stripe-owned Paystack, PiggyVest, TeamApt, etc, since he began investing in 2014, co-founded Voltron Capital with Abel Choi, a U.S. based entrepreneur and investor.
In an interview with Techcrunch, Soyombo said Voltron be investing in about 30 startups, mostly in pre-seed and seed stage across Africa tech space in order to “address the severe lack of access to early-stage funding for African tech companies.”
He explained that investment will range from $20,000 to $100,000 with focus on startups in Nigeria, Kenya, South Africa and North Africa.
Soyombo started investing in startups via LeadPath, founded with a friend Kazeem Tewogbade in 2014, after taking the startups through a Y Combinator-like three months accelerator program. However, he quickly discovered that there were no investors to pitch the new startups to. Therefore, LeadPath started writing another check to ensure the startups get started.
“In 2014, three months after we found out that there was no investor to put them in front of. So you’d have to write another check yourself,” Soyombo stated. “We quickly saw that the accelerator model didn’t work, so we started investing individually. It’s funny how things have changed since then.”
Speaking on his reach in Nigeria’s tech ecosystem, he said “I get the privilege of seeing many deals before most people see them. I’ve built that network within the startup ecosystem and reputation as an angel always ready to help. So obviously, that helped me see many deals very quickly.”
Soyombo who sees his job as bridging the gap that existing between African tech startups and access to funds, said the perception of tech investing changed when Stripe acquired Paystack and Flutterwave attained Unicorn status, suddenly everyone is scared to miss out.
“There’s a bit of FOMO now,” he said. “People, including high net worth individuals, tell me to carry them along anytime I’m investing, and then I have startups looking for capital as well. But then again, I’m not trying to get a full job by managing a full fund, which is why we’ve structured it this way.”
Awabah Accepted Into Techstars London Accelerator Programme
Awabah, a digital platform that provides African self-employed people with access to pensions, has announced its inclusion in Techstars London’s accelerator program.
The startup provides micro-pension services for people in the informal sector and for those whose employers are not legally obliged to withdraw and transfer a pension. It will join nine other startups in the 2021 class and secure funding from the Accelerator when it has its sights on African expansion.
The Lagos-based company founded by Tunji Andrews, Tina Ajishebiyawo and Gboyega Olatunde builds wealth for the informal, especially self-employed, the population of Africa by ensuring that they can plan a decent life after retirement.
Founded in November 2020, Awabah gained over 700 customers in the first two months and has since committed to advancing the cause of future financial inclusion and security in Africa.
The company’s motto is “Those who know better can do better”. This means that building financial literacy is a big part of the customer acquisition strategy. It relied heavily on digital town hall meetings to meet, train and attract customers.
In July 2021, the company raised $ 200,000 in angel support from early-stage investors such as ODBA and Co Ventures and Correlation Capital. This new funding helped Awabah launch its services in Lagos and Ibadan. The startup plans to offer services in 5 additional Nigerian cities over the next 6 months.
Andrews believes the company is gaining a lot of acceptance because of its approach to customer acquisition. They operate out of Lagos and Ibadan and are in the process of establishing a presence in Ghana. Awabah already sees itself as the solution to Africa’s wealth redistribution challenges. The company has teamed up with 3 Pension Fund Administrators (PFAs) in Nigeria and hopes to increase these to 5 by the end of 2021. The partnerships will coincide with the launch in multiple cities to give millions more access to the AWABAH benefit.
“To put it simply, Awabah is an aggregate of tools for wealth creation that is sorely lacking on the continent. We bind the financial service providers on board, break their products into bite-sized pieces, sprinkle a bit of the Awabah magic on them and give this leverage for our customers. What’s even bigger is that our services are completely free to the customer. Financial services should liberate, not enslave, “said Tunji Andrews.
On the back, the Awabah model has many advantages. Nigeria has 70 million people in its workforce (people who are ready and able to work). Of these 70 million, 23 million are unemployed and a further 11 million are employed in formal occupations; This leaves 36 million Nigerians in some form of self-employment or entrepreneurship without a pension. Given the sharp decline in economic growth and the increasing scarcity of resources, we believe that Africa’s current job market will be extremely tough in old age if they don’t take retirement provision seriously.
Nigerians in the informal sector can see the real value by paying N100 weekly into a pension fund that brings in real returns of 4.5% per year for the rest of their working lives.
According to the Africa Asset Management 2020 report by PricewaterhouseCoopers (PWC), total assets under management in 12 selected African countries were US $ 293 billion in 2008, which has more than doubled to the US $ 634 billion by 2014. For 2020 US $ 1.1 trillion is expected 12 countries are: South Africa, Morocco, Mauritius, Namibia; Egypt, Kenya, Botswana, Ghana, Nigeria; Angola, Algeria, Tunisia).
Ajishebiyawo firmly believes that reducing poverty depends on helping people in the informal sector manage and increase their wealth. She insists that the reduction depends heavily on having access to various tools to generate income that is either infrequent or so frequently spent on everyday consumables.
“It’s not that people in informal jobs are too illiterate to control their finances; on the contrary, they manage highly complicated budgets with fragile margins. Effective retirement provision and savings help our customers to deal more effectively with the problems they are stuck in an inefficient cycle. ” Nigerians and Africans alike have money – but their income is unpredictable and uncertain; Awabah will fix that. “
Health Tech Startup 54gene Launches Trust to Amplify Africa’s Capacity in Scientific Research
54gene, the health technology company centered on advancing the field of African genomics to unlock scientific discoveries as well as improve diagnostic and treatment outcomes within Africa and the global community, is creating a trust which it will use to invest up to 5 percent of future proceeds from the company’s commercial drug discovery program.
The creation of the trust is part of its Commitment to Africa in establishing a more sustainable and thriving cyclical ecosystem across Africa’s scientific development space, as well as ensuring better quality healthcare delivery for the communities in which the company operates.
54gene is focused on creating a pipeline of novel drugs for global populations, based on insights drawn from the healthcare and research ecosystem in Africa and wants to ensure that the 1.5 billion people in Africa benefit from its endeavors.
While ensuring Ethical, Legal, Social Implication (ELSI) guidelines are rigorously followed, 54gene is focused on advancing better health outcomes for global populations through precision medicine and addressing the unmet need for novel therapeutics in healthcare.
The company has created a proprietary platform that powers drug discovery through its substantial bio- and data-repository of deeply phenotyped and diverse datasets. It has the potential to power understanding across multiple disease areas such as cancers, neurodegenerative diseases, sickle cell, autoimmune and rare diseases, and infectious diseases.
The new trust has been designed to enable a consistent provision of better diagnostics and medicines for Africans as well as amplifying capacity building within the scientific research space across Africa.
“The biggest challenge in drug discovery in Africa is adequate infrastructure and the extensive need for capacity building.
“As we work on delivering on our promise of precision medicine for Africans and the global population, we are striving to ensure that our work involves current African scientists and leaders in the field as well as supports the creation of more skilled Africans in science and additional jobs across the continent.
“This initiative is designed to continue fostering partnerships within the African scientific body, to reflect the leadership of Africans in global drug discovery research, and to generate sustainable healthcare delivery systems that will ultimately benefit African communities participating in the scientific work that advances better outcomes for all.
It is the inclusion of African talent that will make our drug discovery work successful in bridging the disparity gap within genomics data. Africa has the ability to contribute far beyond the 1 percent in global drug discovery that is currently taking place within the continent, and we believe 54gene will help accelerate those contributions.“
The 54gene trust will be managed by an advisory committee. As the company’s commercial operations grow, the demonstrated Commitment to Africa and creation of the trust will ensure an African footprint and sustainable growth in global drug discovery across the continent.
Global Startup Funding Spikes 157% in Q2 Surpassing a Record $150B
The global startup funding has skyrocketed in recent quarters hitting new historical levels despite the economic effects of the coronavirus pandemic. The recent funding shows that the sector has recovered from the health crisis.
According to data acquired by Finbold, the global startup funding spiked 157% between 2020 Q2 and 2021 Q2 from $60.7 billion to a record $156.2 billion. During the first half of 2021, the funding stood at $292.4 billion.
In the first three months of the year, the funding was at $136.2 billion, a growth of 35.6% from the 2020 Q4 figure of $100.4 billion. Notably, the funding surpassed the $100 billion mark for the first time in Q4 2020. Over the last five years, the lowest funding for startups was recorded in 2016 Q2 at $37 billion.
Startups adapting to changing human behaviour benefit
The report highlights some of the conditions around the funding activity amid the economic turmoil. According to the research report:
“Although the pandemic initially dampened the funding activity, businesses quickly adapted to changing consumer behavior, sparking a massive comeback in funding with robust activity in sectors like healthcare and technology.”
The funding has also played a key role in driving the valuation of most startups. For instance, in Q2 2021, the global number of unicorns stood at a record 136.
Moving forward, several sectors will benefit from the funding, especially for those that have adapted to the changing consumer behavior like health and technology.
Furthermore, the cryptocurrency sector is also likely to witness an influx of investors, considering that several venture capital firms have raised significant amounts specifically targeting the industry.
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