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Correction (5 March): An earlier version of this article had it that the investor would offer an additional $50 000 convertible note at a $1-million valuation cap in those investee companies that show significant progress.
Microtraction partner Dayo Koleowo subsequently contacted Ventureburn to point out that the new deal replaces the entirety of the previous deal including the additional follow-on. The story has been amended to reflect this.
Lagos-based early-stage investor Microtraction has announced that it has increased the amount it typically invests in startups from $15 000 per deal to $25 000, while also reducing the percentage equity it takes from 7.5% to 7%.
Microtraction — which was founded in 2017 by Yele Bademosi and is headed by partner Dayo Koleowo (pictured above) — made the announcement in a blog post on Medium yesterday.
“We believe our financial investment is a small part of the benefits of being a Microtraction portfolio company. But we also understand that startup costs have increased over the years with a maturing African market.
Nigerian investor Microtraction has increased its ticket sizes from $15k to $25k
“In order for companies we invest in to stay focused on building their product without having to worry about fundraising soon, we thought it best to increase our investment by $10 000,” the investor said in the blog post.
Microtraction as a current portfolio of 12 investments.
In February last year Koleowo revealed that the investor is looking to invest in startups located outside Nigeria (see this story).
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Featured image: Microtraction partner Dayo Koleowo (Supplied)