As Nigeria’s startup culture becomes more attuned to the modern fast-changing business landscape, entrepreneurs are finding that there are more ways to achieve their aims than the restrictions of regularity and tradition suggest. If there’s one aspect of business in Nigeria that’s beginning to undergo this shift from the old to the new, it’s the funding of businesses.
Venture Capitalists are doing something for SMEs and startups, that the more well known financial institutions have only partially succeeded at; they’re injecting substantial amounts of money into them, in the belief that these relatively small but promising enterprises, will blossom speedily and yield considerable financial surpluses as rewards. What’s more, venture capital firms may also provide invaluable advice and technical support to the companies that they fund. All of this comes at a price: VCs (as they’re sometimes called) get a share of the company in exchange for their investment in it. This guarantees them a portion of the company’s profits (or losses).
If you’re looking for a venture capital firm to fund your startup, you may consider any of these six VCs.
This venture capital firm has a strong bias toward technology-driven businesses, as its investments show. Prominent among companies it has invested in are Interswitch, an electronic payment process service provider, and Paga, a Fintech startup that’s working to simplify payments processes in Nigeria.
But Adlevo does invest in companies that are at various stages of development. It requires that such companies have a strong management team and operate in a market with great opportunities for high, consumer driven growth.
Founded in 1994, this transnational private equity firm boasts a hard to ignore string of achievements. It manages assets worth $1.2 billion, has invested in over 140 small and mid sized companies in 25 African countries, and has offices in Lagos, Nairobi and London, as well as in France, Egypt and Tunisia.
AfricInvest puts its money into businesses in the construction, manufacturing, retail, financial services, agribusiness and technology sectors. It’s also interested in ventures operating in the pharmaceutical, healthcare, education, chemicals and logistics and transportation sectors.
Alitheia provides financial and non-financial support to early and growth stage companies in the financial services, clean energy and construction sector- a money backed nod to the future. Its funding comes from social investors, development finance institutions, pension funds, and foundations.
Apart from the financial jumpstart that Alitheia gives businesses, it also avails them of “hands-on strategic guidance and support”. In order to qualify for this support, companies must have capable management teams and a demonstrable high growth potential.
EchoVC has its tentacles spread across two continents. It invests in budding and growing technology startups in North America and sub-Saharan Africa, and leverages its connections with Silicon Valley to provide valuable strategic advice to the African (Nigerian) businesses it invests in.
EchoVC has funded a number of well known startups, including online print shop Printivo, and hotel listing site Hotels.ng.
If you would like to have EchoVC invest in your startup, you can submit your proposal to them via their website.
Unique Venture Capital (UVC) was established in 2004 by 5 Nigerian banks. It invests in SMEs operating in the agricultural sector, and has a record of lending support to poultry, fishery and piggery businesses. It also targets companies in the tourism and manufacturing sectors.
Businesses can access loans of up to ₦200 million from UVC’s SMEEIS funds.
Sahel Capital funds commercial establishments in the agribusiness sector. Since its incorporation in 2010, it has grown its profile as a uniquely agriculture focused private equity firm. In 2013 it was selected to manage the Fund for Agricultural Finance in Nigeria (FAFIN), a $100 million investment fund that provides capital and technical assistance to agricultural SMEs.
Agribusinesses with a track record of strong profitability, strong growth potential and competent management team are eligible for Sahel’s FAFIN loans.