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GETTING CAPITAL TO START UP OR EXPAND A BUSINESS IN AFRICA
By ELFRIDA KORIPAMO
Africans are driven and very well filled with ideas to start up or expand their own businesses, but the fundamental problem with business start-ups in Africa remains the availability of capital.
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Business start-up funding remains one the most difficult problems people face in getting their business in motion. However, the lack of financial means should not be the basis for giving up on your business ideas or dreams.


There are different ways to raise capital in Africa and the lack of capital issue is largely due to the lack of awareness on where and how to raise capital. Apart from getting funding from  sources that are within your reach like family, friends, banks and traditional lenders which are arguably not always reliable, one of the main problems Africans face is that many are not aware of certain local and international organisations that provide funding for businesses or business start-ups.


Capital and funding is also not limited to the areas mentioned above, but partnership in business can serve as another effective means towards fund raising.Capital inflow to Africa as at the year 2015 for tech starts ups only was up to $276.5 million dollars, and this amount rose to about $366.8 million dollars in 2016, as seen on smart starter.com


This article would showcase a few successful entrepreneurs in Africa, and how they explored different means to raise capital to start up or expand their business.


Jason Njoku


He a Nigerian entrepreneur and the co-founder of Iroko TV an online on demand movie platform, which was described by Forbes as the “Netflix of Africa” Starting up his business, was made possible by the contribution £90,000 from his business partner. The incredible performance of Iroko TV led to the attraction of foreign investors such as the Investment AB Kinnevik a Swedish venture capital investor and Tiger Global a private equity firm based in New York. Through partnerships and investors Jason has been able to grow and expand his business.  


Dr Aly El-Shafei



 He is an Egyptian Academic and a professor of Mechanical Engineering. In 2017 he was awarded the innovation price for Africa and was given $100,000 which is used for to further his invention to create an industrial prototype. In 2009 he won the European Union’s Research development and Innovation programme which he was awarded €240,000. This goes to say that whatever your area or specialisation is, there are a lot of competitions and contests where thousands of dollars can be won  alongside the experience and knowledge to be gained which can be beneficial to your business.


 


SOME TOP INESTORS AND ORGANAISTAION INVESTING IN AFRICA INCLUDE



  1. The Chan Zukeberg Initiative by the Facebook Founder Mark Zukerberg Pricilla Chan his wife. In 2016 $24 million dollars was invested in start-ups to train African engineers and programmers and source them out to tech companies in Europe and USA.

  2. Tony Elemelu Entrepreneurship Programme

  3. Innovation Price for Africa

  4. International Finance corporation

  5. Africa Women’s development Fund


There are so much more Organisations that offer capital and funding to businesses. Moreover, most investors would not be willing to invest in any business without seeing some commitment or seriousness towards the desired project. It is important to note that as an aspiring entrepreneur or business owner, it is essential to know what type of business investment or capital to attract to your business, and study how to do that.


 


Further information on Different forms of raising capital can be found on Smallstarter.com


Till next time!


PNA Business 


 


Photo credits:


trends44


howwemadeitinafrica

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