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Lagos-based internet group SPARK, which invests in Nigerian startups, has raised US$2-million in seed-funding from a syndicate of international investors — based on a US$10-million valuation of the company that is just three months old.
Seventeen high net-worth individual investors contributed to the total investment made to the company, founded by Jason Njoku, Bastian Gotter and Mary Remmy-Njoku, all of iROKOtv — the Nigerian-content streaming service — fame. SPARK was launched as a US$1-million fund intended to revolutionise Nigeria’s angel investment ecosystem, with a focus on the startup scene.
SPARK defines itself as follows:
“We are not a fund and we are not an incubator; we are a company that builds companies. We focus on Lagos, Nigeria as the gateway to Africa. We focus on well-defined and scalable revenue models. We are a collection of internet people. We are SPARK.”
The US$2-million will be used to expand the company’s offices in Nigeria, first in Lagos, and then across the rest of the country. The investment will also form part of follow-on rounds of seed-investments for SPARK companies.
SPARK companies currently have 130 employees across nine launched startups. Njoku and Gotter have invested US$700 000 of second-round seed funding into three of these companies to enable them to expand faster, compete more effectively, and build upon their market-leading positions.
Jason Njoku, SPARK Managing Partner says, “we set out to grow the SPARK companies to be market leaders. This requires capital. Our companies are laser focused, totally exceeding our initial expectations and showing increasingly strong metrics…Bastian [Gotter] and I were impressed with their output, as were our investors, hence we have been able to raise the sum of US$2-million in nine days from high network individuals, a mere three months after the official Spark launch.”
Bastian Gotter, SPARK Managing Partner adds: “Capital here in Nigeria is prohibitively expensive for most, so startups tend not to be able to grow at the rate that is required to become a mature and profitable business. SPARK companies now have the capital behind them to invest in technology, good staff, building out their inventory — whatever is required to make them into a stronger long-term business. Jason and I have previously been vocal on the shortcomings of Nigeria’s business eco-system and how investment does not reach the right people. With this additional investment of US$2-million, we are now able to channel even more funds to the companies who will one day lead the continent’s internet space.”
SPARK companies currently collectively generate US$50 000 turnover each month, but this number is expected to increase quickly as each company gains more traction.