As African startups have launched over the past decade, pioneering local entrepreneurs have innovated their way past traditional obstacles on the continent, more boldly and rapidly than legacy companies. However, such innovation requires a significant amount of capital, as the ecosystem and customer needs evolve at such a rapid pace. This, in fact, is not the case. Which means it’s just as important to focus on non-financial resources in our mission to help startups achieve the scale that investors are looking for.
Ideally, founders should divide their time between three priorities: striking partnerships with large corporates from a commercialization standpoint, including customers that are B2C, hiring, and of course raising capital.
For context, most companies in a position to grow rapidly find that (a) taking outside money helps them grow faster, and (b) their growth potential makes it easy to attract that money. It is common for both (a) and (b) to be true in the creation of a successful startup
In the global context, almost all high-growth startups do raise outside money. For founders, these early cheques make a huge difference. They give startups at the earliest stage room to breathe as they navigate the most difficult period of any company’s life.
The results that Africa’s bootstrapping founders have achieved in the last 10 years have been incredible. But let us imagine how many good outcomes could have been phenomenal outcomes if there was more capital accelerating their progress. It would enable them to take bolder risks, strengthen their talent base, invest in stronger software, and develop Africa’s digital economy at an even faster rate.
In other words: a “leg-up” from a local and/or international investor could be the difference between folding, or doubling down on the solution to problems that founders set out to solve.
However, it is the founder’s role to:
- Build the right team
- Tell the right story
- Know which problem is being solved
- Be aware of regulatory issues
- Develop points of differentiation
- Understand where units of profitability would be rich
These are all obvious talking points for an investor, but not necessarily the focus of pre-seed and seed-stage founders.
This is where AFI bridges the gap between what founders are doing, and what investors want to see.
We identify the path to investment readiness, align stakeholders on both sides of the market, and connect the best companies with the most qualified investors. This ensures more early-stage startups across the continent are able to seize the opportunity to scale.