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With the global pandemic impacting African SMEs and startup’s financial revenue, Ventureburn has highlighted three crowdfunding platforms that aim to assist African startups.
NaijaFund, Women Fund, and Afrikstart are crowdfunding platforms that assist African startups
Crowdfunding is a method of raising money for businesses, people, projects, or charities through collective donations. According to Investopedia, crowdfunding can be understood as the “use of small amounts of capital from a large number of individuals to finance a new business venture.”
Individuals or organisations contribute an amount via the internet to support projects or ventures.
Traditional methods of funding a startup such as applying for a loan at a bank with an applied interest rate can become a costly option for many local entrepreneurs.
Crowdfunding allows entrepreneurs to connect and network with potential investors beyond private funding and venture capitalist firms. In a symbiotic relationship, some crowdfunding platforms offer potential rewards or profit to those who donate.
Three African crowdfunding platforms
NaijaFund is a Nigerian crowdfunding platform that uses technology to simplify the donation process. The aim of the platform is to connect startups and small and medium enterprises (SMEs) to potential investors via their website.
Individuals or organisations can use the NaijaFund website to create campaigns that specify what their cause is and explain in great detail what they intend to do with the money raised.
NaijaFund accepts donations from people or groups all over the world who want to invest in Nigerian tech startups and contribute to their growth.
The Nigerian crowdfunding platform can be used to raise money for business ideas, school fees, medical expenses, etc. The Fund will automatically deduct 10% from each donation that the Nigerian Startups receive.
The processing fee is an additional two percent which will also be deducted from the donations received by the startups which act as a transaction fee.
WomenFund is a crowdfunding platform dedicated to providing seed funding for women, girls, and disabled-led campaigns. This platform is for individuals or organisations that are looking to start or expand projects in South Africa.
The platform aims to make the process of seed funding seamless. WomenFund is available to seed planting and incubator campaigns are education, entrepreneurship, small business development, nonprofits and NGOs, frail care, workplace access, leadership development, and community upliftment-based.
WomenFund describes Crowdseed funding as a vital resource that funds respective projects through contributions from a large group of individuals or organisations. The advantage of creating a campaign and registering for crowdfunding is that it provides an opportunity for entrepreneurs to request funding from a larger audience all around the world.
The registration process is simple as individuals or organisations fill out a form providing personal details. Once completed, the Born 2 Serve panel must approve the campaign before it goes live. Individuals or groups will have access to their own dashboard which will allow them to add campaigns. Lastly, WomenFund incorporates social media platforms to accelerate the campaigns on its platform through sharing campaigns with friends and family.
Afrikstart is a Pan-African crowdfunding platform that provides funding, training, and mentoring for African entrepreneurs. The aim of the platform is to encourage African entrepreneurs to start funding to grow their businesses and alleviate poverty through job creation.
Afrikstart offers an innovative solution that combats the lack of seed funding received by young entrepreneurs. Its aim is to alleviate the mass unemployment rate amongst the youth through entrepreneurship.
African women entrepreneurs struggle to meet their financial needs while managing small and medium enterprises. Afrikstart’s crowdfunding platform plans to contribute to closing the gender gap in Africa’s business ecosystem.
The platform offers technical assistance and provides business advice to entrepreneurs who need assistance with networking and entrepreneurship skills to accelerate business growth.
The funding platform is reward-based and accepts direct donations. The eLearning opportunities provided include interactive courses available online that focus on subjects around entrepreneurship and management. Experienced business professionals from Africa and across the world provide mentoring for entrepreneurs.
Featured image: Skitterphoto via Pixabay