African Business Conference
We had the pleasure of participating in an insightful panel discussion hosted by the Africa Business Club (ABC) at The Johns Hopkins University - Carey Business School in Washington DC on April 13th. The event brought together industry experts and thought leaders to explore the opportunities and challenges surrounding AI adoption in Africa.
Moderated by Daniel Irowa-Omoregie, M.D., the panel delved into various aspects of AI implementation across the continent. Our own Sunga Mkwezalamba represented Stradford Venture Partners on the panel, alongside Chidube Ezeozue from Google and Sherif Nessim of Jedar Capital.
The discussion covered critical topics such as building data models in environments with limited digitization, the readiness of data to train intelligent local AI models, the availability of AI talent in Africa, and the infrastructure challenges that need to be addressed.
We extend our gratitude to the organizers and the entire JHU ABC team, including Laura M. Buhnange and Renald Appiah, for orchestrating such a well-organized conference. It was a privilege to be a part of the event and to engage in meaningful conversations with fellow panelists and attendees alike.
Stay tuned for more updates from Stradford Venture Partners as we continue to explore and contribute to the advancement of AI technologies in Africa and beyond.
SVP’s collaboration with SMBee
We’re excited to announce our collaboration with SMBee to connect start-up founders with direct financial advisory services. SMBee is a corporate finance and M&A advisory firm providing support to start-ups, SMBs and their investors.
This is a great opportunity for those looking for:
Capital raise support;
Financial model development;
Deal due diligence support; and / or
M&A advisory.
Visit SMBee's site at sm-bee.com to learn more, and contact SMBee at contact@sm-bee.com or info@stradfordventurepartners.com to begin your advisory journey.
Navigating Nairobi's Ecosystem for Our Investors
We’re excited to share our recent journey through Nairobi's vibrant startup ecosystem, where we had the privilege of meeting remarkable investors, accelerators, and founders. This visit significantly contributed to our mission of securing promising deal flow and nurturing local partnerships.
DISCOVERING NAIROBI'S INNOVATION POWERHOUSES
Our journey led us to iHub Nairobi, a renowned innovation hub and hacker space that has been instrumental in shaping Nairobi's tech landscape. Antler, another key destination on our trip, further enriched our experience. As a global leader in launching and scaling startups, Antler aligns perfectly with our mission to drive innovation and transformation in Africa.
Our conversations with iHub, Antler, and other visionary entities have yielded promising leads and investment prospects. These interactions have been instrumental in our due diligence process and the vetting of potential deals. We are committed to thoroughly evaluating each opportunity to ensure it aligns with our investment goals and values.
A HEARTWARMING NETWORKING SOCIAL
Additionally, we hosted a heartwarming networking social at Artcaffe in the vibrant Nairobi business district. This impromptu gathering brought together members from Kuza Initiative and others interested in private investments, fostering discussions about exciting investment opportunities in Nairobi.
We’re excited to share our recent journey through Nairobi's vibrant startup ecosystem, where we had the privilege of meeting remarkable investors, accelerators, and founders. This visit significantly contributed to our mission of securing promising deal flow and nurturing local partnerships.
Joining Forces with Africa Blockchain Institute: Empowering the Next Wave of Blockchain Innovators
Last week marked an exciting milestone for Stradford as we proudly announced our collaboration with the Africa Blockchain Institute's esteemed incubation program. This unique four-month initiative is strategically designed to provide aspiring entrepreneurs with the essential support they need to develop and launch their groundbreaking blockchain projects in Africa. We are delighted to be a part of this journey, contributing our expertise, mentorship, and resources to empower participants and transform their innovative ideas into tangible realities.
Joining the Africa Blockchain Incubation Program: At Stradford, we firmly believe in the transformative power of blockchain technology and its potential to revolutionize industries across Africa. This shared vision and commitment to fostering innovation have led us to team up with the Africa Blockchain Institute (ABI) in their highly regarded incubation program.
The Africa Blockchain Incubation Program Overview: The Africa Blockchain Incubation Program is a carefully curated, intensive program spanning four months. Designed to provide aspiring blockchain entrepreneurs with a comprehensive roadmap to success, this program offers a unique blend of training, mentorship, and valuable resources.
Training: During the incubation period, participants will have access to a wide array of specialized training modules, equipping them with the knowledge and skills required to navigate the intricacies of blockchain technology. From understanding the fundamentals of decentralized systems to learning about smart contracts and distributed ledger technology, our aim is to empower participants with the necessary tools to develop and refine their projects.
Mentorship: We understand that mentorship plays a pivotal role in shaping entrepreneurs' journeys, which is why our team of experienced professionals is dedicated to guiding and supporting program participants. Through regular one-on-one sessions, we will provide invaluable insights, practical advice, and industry connections, helping participants refine their strategies, overcome challenges, and make informed decisions along the way.
Resources: In addition to comprehensive training and mentorship, participants will gain access to a wide range of resources that are vital for transforming ideas into successful ventures. Our firm, in collaboration with the Africa Blockchain Institute, will offer participants access to a network of strategic partnerships, potential investors, and technical experts. This ecosystem of support will provide a solid foundation for participants to grow their projects and increase their chances of long-term success.
Conclusion: Our partnership with the Africa Blockchain Institute's incubation program represents a significant step forward in our commitment to fostering blockchain innovation across Africa. By combining our resources, mentorship, and expertise, we aim to empower program participants and enable them to drive tangible change in their respective industries.
We are excited to embark on this transformative journey with the Africa Blockchain Institute, and we look forward to witnessing the growth and success of the talented individuals who will join us in this incubation program. Together, we will shape the future of blockchain technology in Africa, and create a thriving ecosystem of innovation and entrepreneurship.
Fundraising 101: Africa-Focused Founders
Join us for an insightful dialogue led by industry experts as they delve into the world of raising capital for African founders. In this educational YouTube video, our esteemed panelists provide valuable insights and practical advice on navigating the complexities of fundraising in African markets.
Featuring a distinguished lineup of speakers, including Sunga Mkwezalamba, Co-Founder and Principal at Stradford Venture Partners; June Odongo, CEO of Senga Technologies; Eunice Ajim, Founding Partner at Ajim Capital; and Alisha Golden, Investment Manager at Techstars Toronto, this discussion covers crucial aspects of the fundraising process.
The panelists engage in a thought-provoking conversation on the following key topics:
Understanding the Current Market: Gain valuable insights into the current landscape for early-stage companies in Africa. Discover emerging trends, potential opportunities, and challenges that African founders face in securing funding.
Targeting Funding Sources and Start-up Accelerators: Learn effective strategies for identifying and approaching suitable funding sources and start-up accelerators in African markets. Discover how to position your venture to attract the right investors and gain access to valuable resources.
Developing a Winning Pitch: Discover the art of crafting a compelling pitch that captures the attention of investors. Our experts share their expertise on creating a persuasive narrative, highlighting unique value propositions, and presenting a comprehensive business plan.
Negotiating Deal Terms: Get insights into the intricacies of deal negotiations. Learn how to protect your interests, strike favorable agreements, and navigate the complexities of term sheets and investment contracts.
Don't miss this engaging and educational dialogue designed to empower African founders in their quest to raise capital. Subscribe to our channel for more expert insights and join the discussion on unlocking the potential of African entrepreneurship.
Fundraising 101: How African Founders Can Raise Private Capital
RSVP at the link below: Stradford Venture Partners and Kuza Initiative are excited to bring our second free virtual speaker series focused on introducing private investment options for Africa-focused founders.
This is a great opportunity for entrepreneurs to connect with potential investors, and for investors to understand available opportunities in Africa.
RSVP at the link below: Stradford Venture Partners and Kuza Initiative are excited to bring our second free virtual speaker series focused on introducing private investment options for Africa-focused founders.
This is a great opportunity for entrepreneurs to connect with potential investors, and for investors to understand available opportunities in Africa.
https://events.eventnoire.com/e/fundraising-101-how-african-founders-can-raise-pri
Venture Capital for African Startups
Stradford Venture Partners and Kuza Initiative recently launched a venture capital series aimed at demystifying the Topic of Venture Capital. It was a thought-provoking program lined up with interesting content and speakers; Eghosa Omoigui and Marsha Wulff. If you missed the live recording, you can catch up on the discussion in the attached youtube link.
RSVP today for our webinar series: Venture Capital for Africa
We are excited to launch a webinar series for identifying investment opportunities in Africa and connecting African entrepreneurs to private equity funding. RSVP by clicking here.
U.S. - Africa Leaders Summit
The highly anticipated U.S. - Africa Leadership Summit was held last week in Washington, DC. The Summit, attended by President Biden and Heads of State from Africa, reinforced our investment thesis and focus on Africa. Key takeaways:
- Africa’s energy sector has endless potential for returns
- Africa’s investment climate has made amazing improvements (generally in the area of policy) which are, and will continue to, improve deal speed
- The young population presents the most resourceful area for entrepreneurship and human capital in the world, and we are seeing this in the area of FinTech
- There is an increased appetite globally for investing in Africa, and the time is now
Evaluating Cybersecurity in FinTech Investments
Cybersecurity and data protection are a priority when evaluating FinTech companies because of the sensitivity around the data they use. This report focuses on the current state of cybersecurity and data protection in Africa and primary questions we recommend when evaluating FinTech investments in Africa.
Current State of Cybersecurity in Africa
According to Nigeria’s TechCabal research company, Africa is losing $4 billion annually to cybercrime. Many of these losses are related to preventable employee mistakes, such as responding to phishing attacks. For this reason, cybersecurity and data protection is critical in ensuring an easy and smooth flow of business for FinTech companies.
Advancements in FinTech have closed the digital gap between Africa and the rest of the world. Africa’s connection to the rest of the finance world has increased the importance of Africa adopting data protection and privacy laws at par or better than the rest of the world. And Africa has responded: law firm Mayer Brown reports 33 out of 54 countries in Africa have data protection laws, and we anticipate the rest to follow in the decade.
Although Africa has seen significant advancements in its data protection laws, we encourage FinTech founders not only to rely on new local regulatory requirements to secure their data, but to follow industry standards, seek industry certifications in cyber security, and to learn from the mistakes of other companies in this space. Doing so can encourage customer and investor trust, which is paramount for early-stage companies.
Due Diligence:
In doing your due diligence, we recommend the following minimum questions to evaluate the reliability of a target or portfolio company’s cybersecurity profile:
Investment: Does the company have a dedicated compliance officer and policies and procedures for cybersecurity?
Experience: Has the company experienced a security incident in the previous 5 – 10 years and has it been resolved?
Standards: Does the company observe PCI DSS and industry requirements?
Technology: Does the company implore ISO/IEC 27001 and other technical protections for its uses of data?
Protection: Does the company have cybersecurity insurance?
Authors: Sunga Mkwezalamba, Imaaculate Odwera
REF:
FinTech Data Protection and Privacy: Principles for Digital Threats (crosscountry-consulting.com)
https://www.bakermckenzie.com/en/insight/publications/guides/africa-data-security-and-privacy-guide
https://techcabal.com/2022/05/06/africa-cybercrime-cyber-africa-forum/
FinTech
FinTech in Africa: Why we see massive potential
70% Of the world’s $1 trillion mobile money market is held in Africa, and there’s much room to grow. With digital becoming a way of life in Africa, the stage is set for the next phase of FinTech growth. Of the ~650 million adults in Africa, nearly 60% do not have a traditional bank account. Further, 90 percent of Africans still rely cash instead of banking cards for transactions. This fact alone supports investors deploying capital in Africa’s FinTech sector.
Despite a slowing global tech economy, Africa’s FinTech market has experienced steady growth. Venture capital continues to invest in Africa’s Tech sector regardless of the instability in the markets. In fact, the number of investments in this space has doubled since 2021. Investors have been targeting firms in Egypt, Kenya, Nigeria, and South Africa. Inflows to other African locations additionally has grown by 382 percent year-on-year compared to 2021.
What’s Next?
African FinTech companies and other stakeholders, including governments and investors, have an opportunity to consider how the sector can achieve sustainability over the long term. The current moment has shown fruitful as Africa has produced unicorns in the FinTech space—surpassing billion-dollar valuations—and the profitability of many ventures is precarious. The stage is now set to unlock the sector’s potential.
As FinTech matures, financial services on the Continent are at an inflection point, and several African countries have a significant opportunity to capitalize on the momentum of recent years to unlock further potential.
Authors: Sunga Mkwezalamba, Immaculate Odwera
Ref:
Office Hours
Are you an entrepreneur based in Africa or focused on economic development in Africa? Sign up for our Office Hours beginning January 7th for free business and legal consulting. Sign up here: https://calendly.com/d/yyn-2hd-8sy
Solar
Over 50% of Africans do not have access to electricity
Africa has the most potential for solar energy in the world
To achieve access to electricity for all persons on the continent by 2030, experts suggest Africa needs less than 1% of the global energy investment today
Over 50% of Africans do not have access to electricity
Africa has the most potential for solar energy in the world
To achieve access to electricity for all persons on the continent by 2030, experts suggest Africa needs less than 1% of the global energy investment today
Stratford Venture Partners (“SVP”) is a US-based firm that invests in Africa-focused companies. SVP was founded in 2021 by a group of lawyers interested in transforming Africa. Our thesis is simple, we focus on companies in the pre-seed, seed, series A phase in the following sectors: FinTech, CleanTech, Pharma.
This report focuses on solar, which we like because it’s affordable for Africans and has impressive potential for investors. Solar tends to be the cheapest of all renewable technologies and the costs for solar in Africa are declining.
Content:
Market
Opportunity
Risk
Startups to watch
1. Market. Over 50% of Africans do not have access to electricity (~600 - 700 million people). In contrast, in the U.S. only (0.0002 or ~60,000 people) do not have access to electricity. The circumstances are dire - the Rockefeller Foundation predicts Africa will progress at the slowest rate for energy adoption by 2030. Despite Africa having 60% of the world's best solar resources, it currently only harnesses only 1% of its solar generation capacity.
But there’s hope - countries such as Ghana, Kenya and Rwanda are on track for full access energy by 2030, offering success stories other countries can follow. To achieve access to electricity for all persons on the continent by 2030, experts suggest Africa needs less than 1% of the global energy investment today (or $25 billion).
2. Opportunity. The World Economic Forum reports that Africa has the most potential for solar energy in the world. Africa’s current solar production is .6% of available energy sources. However, by 2050, BP predicts that number to jump significantly to 30%. This is a significant opportunity for investors to be involved in the growth of solar in Africa.
The International Energy Agency reports that as its population and incomes grow, demand for modern energy in Africa will expand a third by 2030. The potential for growth in the region and global solar industry is huge. Experts estimate African solar capacity could reach one-third of the current global total by 2030, and he potential for global impact is significant - according to the German Aerospace Centre, a solar farm covering just 0.3% of North Africa could supply the entire European Union’s power demand, which is twice that of Africa.
In addition to the growth potential, countries are providing exemptions to taxes and policies that may restrict foreign investment to support local investment in renewables.
3. Risk. Investing in Africa has many opportunities, but there are risks to consider which are multifaceted and too comprehensive for this report. In short, to safeguard our investments, we look at the political and currency stability, and human capital. We use this to distill potential investment regions. For instance, the following developed markets show potential for solar investments: Algeria, Egypt, and South Africa.
4. Startups to watch. Over the last 10 years startups in Africa’s off-grid solar sector have attracted over $2.3 billion in funding, and with the largest share of the financing has gone to just seven pay-as-you-go (pay-go) Africa-based scaleups (Sun King, Zola Electric, M-Kopa, Bboxx, d.light, Engie Energy Access and Lumos). This year, 86% of the total debt-equity funding raised by startups in Africa’s pay-go solar sector went to SunKing, M-Kopa and d.light, and Bboxx.
Authors: Sunga Mkwezalamba, Immaculate Odwera
Sources: