Tech start ups across Africa are set to benefit with up to $500,000 in equity, catalyst,catalytic and non-dilutive capital from the 54 collective venture companies for the next five years, a move aimed at spurring growth and financial inclusivity of business ventures.
While announcing the deal, the firm’s CEO, Bongani Sithole, said entrepreneurs can access up to $250,000 in equity funding, supported by low-interest loans of up to $150,000 that are paid back at a price round with a major focus in partnership with African-based investors.
“54 Collective is a Panafrican, and our focus is to ensure we invest in all the 54 states in the continent. Over the next five years we are going to do 105 investments across Africa, and we are intentional to look at parity in terms of more women-owned businesses.”Sithole said.
According to the firm’s investment principal, Eunice Wambui, they are also prioritising the growth of women-led ventures, with a target to fund at least 50% of women entrepreneurs across the 54 African countries who can access lower interest rate loans for start-ups ranging up to $150,000.
“We know that talent is equally distributed across genders, but when you look at business, that’s not the case. That’s why we want to ensure women have more access to capital. The reason why we want to move from 45% to 50% funding of women-owned businesses is that in terms of how we support them, we provide them with 250,000 USD equity capital at 5% and an additional 150,000 USD at a 2.5% interest rate.”said Wambui.
Kenyan entrepreneurs have received around $6 million in funding from 54 Collective since 2018, demonstrating the company’s strong support of the developing startup landscape in that nation.
African tech-enabled business projects in the fields of fintech, Health-tech, Agritech, logistics, and e-commerce are eligible for funding from the company.
“It’s important to understand a business quite intimately; that’s why we have local employees to help us understand local businesses. From our own perspective, we are sitting at 25% of total investments in Kenya, and we are very bullish about the Kenyan market.” stated Sithole
The firm has already partnered with business ventures across 8 African countries, among them South Africa, Egypt, Nigeria,Kenya and Senegal.
Over 500,000 young entrepreneurs in Africa are also set to benefit under the company’s entrepreneurship academy, where business owners below 35 years old will have access to needed knowledge and resources to accelerate their entrepreneurship journey.
Under the 12-week program, youth entrepreneurs will be able to explore Explore, a digital platform providing essential knowledge and tools to help entrepreneurs turn ideas into businesses, and the Business Support Accelerator, designed to accelerate SME growth and foster a community of like-minded entrepreneurs.
