20th Annual Wall Street Project Economic Summit - International Finance - Venture Capital in Africa

Presenting on the subject of Venture Capital in Africa - Arben Kane - Managing Partner of Stacked Venture Builder & Dreamit Ventures

Presenting on the subject of Venture Capital in Africa - Arben Kane - Managing Partner of Stacked Venture Builder & Dreamit Ventures

Venture ideas that originate from different cultures represent new opportunities. Thinking outside of the box is a core value in the start-up world. The environment we live in creates the perfect breeding ground for a new generation of entrepreneurs.

"Necessity is the mother of all invention." - Plato

The total African venture capital spend in 2016 was over 200 Million, 10% of that is from the emerging Angel investor network. The same - if not double that amount is investment in the US every week, to give you some perspective.

Not surprisingly, South Africa, Nigeria and Kenya make up the bulk of the overall figure.

It is critical to understand that an angel investment network growth is an indicator that needs to be closely followed.

The entrepreneurs who achieved success through an exit (which is still just a small percentage), are reinvesting into their known community. Founder based capital still represents over 50% of the annual spend.

Their classmates or colleagues who are trying out their new ideas are able to do so not only with friends and family capital support but with an ever growing ecosystem of successful leaders who become mentors, also known as angels.

Outside capital needs to understand the culture on the ground or else, money and solutions have the potential to cause more damage without the consideration of social impact. Consider the following two scenarios with very different outcomes:

1. Tom's Shoes used the do-good strategy to gain visibility for their brand, but simultaneously destroyed the local shoemaker ecosystem that supported multitude of families.

2. A solar lamp company in Kenya made the oil lamp sellers their distribution partners, giving them a mobile subscription payment system - replacing the exact amount they charged for the weekly oil, with a reoccurring revenue stream.

Jobs based on the startup segment have grown over 20x since 2009. The top 5 verticals are: Information Technology, Agriculture, E-commerce, Mobile and Education.

From the Left: Mr. Sulaiman Damazio, Director, Diasporah Development – Brazil || Mr. Serge L. Vallet, CEO, EnovativeTV || Mrs. Maya H. Famodu - Founder | Ecosystem Architect | Ingressive || Reverend Jesse L Jackson, Sr., President & Founder, Rainbow PUSH Coalition || Dr. Zweli Mkhize, Treasurer General, African National Congress - South Africa || Mr. Arben Kane, Managing Partner, Stacked Venture Builder & Dreamit Ventures

From the Left: Mr. Sulaiman Damazio, Director, Diasporah Development – Brazil || Mr. Serge L. Vallet, CEO, EnovativeTV || Mrs. Maya H. Famodu - Founder | Ecosystem Architect | Ingressive || Reverend Jesse L Jackson, Sr., President & Founder, Rainbow PUSH Coalition || Dr. Zweli Mkhize, Treasurer General, African National Congress - South Africa || Mr. Arben Kane, Managing Partner, Stacked Venture Builder & Dreamit Ventures

Based on my experience building ventures in Africa, the capital is available there but the terms are not entrepreneur friendly - quite the opposite. I liken it to a loan-shark investment mentality. Very quickly a spirit of an idea results in lack of motivation because every offer becomes a potential for a bribe or opportunity for leverage. 

However, the feeling of empowerment is too strong - turning an idea into reality, and realizing that failure is just part of the path towards success. They are all elements that ignite something deep inside in each and everyone of us. In this process, we get to learn what we are really good at, and what we are lacking. A unflinching mirror of who we are and what we can achieve. The end product is just the first chapter of an unfolding story 

The mobile ecosystem in Africa is a massive resource. Mobile payments are the norm and ideas such as a “mobile micro payment mortgage loan venture” can grow from concept to execution within months. 

"An emerging market" - I have heard this phrase for many years now - a term that I would rather not use. To me, Africa is where it all started -  the birth place of innovation.