VC4Africa Mobilizes Investors Interested in Africa

Last month when Appfrica Labs relaunched Afridex, and I mentioned that more news was coming soon. Today I’m happy to make another big announcement on behalf of my team and our newest partner VC4Africa. The deal came about because of our mutual desire to support and promote for-profit investments into African startups and SMEs. Whereas Appfrica Labs deals specifically with software developers in East Africa, this partnership with VC4Africa will allow us to help Africans from all sectors of the market (agriculture, health, services etc.) to raise capital for their ventures.

VC4Africa began as a community of 5,000 investors, expatriates and diasporans who were looking for ways to invest in African markets. Company director Ben White wanted to leverage the communities enthusiasm, confidence and goals, and offer tools that allow them to mobilize their desires into action. Using Afridex.net as the underlying technology, we plan to offer one place to aggregate business information about the continent, make it all easily searchable and give potential options for taking action.

The differences between VC4Africa’s project and other existing platforms, are very specific. First, VC4Africa is targeting African markets exclusively (unlike more expansive global solutions like BidNetwork). Second, differing from platforms like Kiva or MyC4, VC4Africa isn’t interested at all in microfinance. Lastly as, a completely private sector, for-profit initiative, sustainability is our first priority. The goal is to offer solutions for investors and Venture Capitalists looking for an easy way to get informed about the opportunities in the sector, the financial particulars of individual companies and the entrepreneurs behind them. Rather than crowd sourcing small ammounts of capital from many individuals, VC4Africa’s will enable more traditional methods of investing using the web. The official press release appears below:

VC4Africa.com and Appfrica.org are announcing a formal partnership to mobilize and support the venture capital community of Africa. The new partnership aims to leverage their combined vision, resources, and networks in an effort to connect aspiring entrepreneurs in Africa with the skills, knowledge and connections needed to develop, grow and scale their business. More importantly, the partnership aims to promote social entrepreneurship by making it easier for the entrepreneurs to find the investors who may be looking for them.

Both parties believe that entrepreneurship should be the main driver in Africa’s economic growth, in particular the small and medium sized enterprises (SMEs) that provide much of Africa’s employment, income and hope for a better future. SMEs contribute around two thirds of national income and provide the foundation for a stable middle class in many African countries. They help form strong communities and are a powerful force for poverty reduction. SMEs play a significant role in building economic stability and sustainability for the future.

As Africa enters the new millennium it faces a challenge to provide better economic opportunities for citizens through sustained growth and alleviating the poverty that has long plagued the continent. The NEPAD (New Economic Platform for African Development) and the United Nations Millennium Goals for 2015, to which the EU-countries have all subscribed, have set out ambitious aims in this respect. The World Economic Forum in Davos and the G8 have also made the commitment to stimulate private and public investments in Africa. However, it’s our belief that the most meaningful impact will still come from grassroots entrepreneurship and local efforts.

It is important to support this bottom-up approach of citizens working to tackle local challenges and build on the idea that any person anywhere in the world might have the skills, knowledge and resources needed to make a difference. Ben White, founder of VC4Africa.com says, “There is a serious lack of information and tools in this area. South Africa as a market dominates the space. How can we serve entrepreneurs in the rest of the continent fighting to make a difference? I believe we can achieve a lot by bringing the right people and tools together.” Jonathan Gosier of Appfrica.org adds, “At Appfrica Labs we practice these ideas on a niche-level everyday, it gives me great pleasure to be able to support the entire sector on a macro-level through this partnership.”

Advancement in new media technologies introduces new opportunities for this process. We believe that now is the time to effect great social impact by maximizing the resources available. The VC4Africa.com project will build on Afridex.net (an online directory inspired by popular websites like Crunchbase.com, LinkedIn.com and GetSatisfaction.com and developed by the team at Appfrica Labs in Uganda). This engine provides a unique tool on which to build the VC4Africa community and kick starts a new process that seeks to empower investors and entrepreneurs with the tools and resources needed to make business decisions.

The partnership will leverage Afridex.net, a business information aggregator developed by Appfrica Labs Lead Developer, Moses Mugisha. Afridex was built in the Python framework Django and allows businesses to create profiles, monitor their brands and offers ‘portable widgets’ that allow people to write and blog about them. As part of the partnership, Afridex will build out a web community of various verticals (sme’s, agriculture, tech ect.) that allows for an easy to navigate index of companies that exist across the continent. The most innovative aspect of the community, however, will allow groups of would-be-investors with similar interests to raise venture capital funds. These crowdsourced funds can then be invested in the business of the group’s choice. By taking the general concept behind venture capital and leveraging this community of nearly 5000 expatriated Africans, as well as foreign and local investors, our aim is to offer a web application that allows for the constructive application of capital to the market.