Mission-driven and underrepresented start-up founders in Africa are set to benefit from a new pre-seed investment programme announced by Flourish Ventures, a global venture capital firm. The sector-agnostic programme will invest capital in tech start-ups through its affiliate Madica.
Madica also promises founders tailored mentorship and world-class company-building support. Over the next three years, it seeks to back between 25 and 30 African entrepreneurs with up to $200 000 each, coupled with multi-year programmatic support.
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The new investment programme aims to address systemic challenges faced by early-stage founders in Africa, such as limited access to capital, industry networks, mentorship, and structured training, explains Emmanuel Adegboye, head of Madica.
“Although investment is booming on the continent, funds are often disproportionately targeted at a few well-networked entrepreneurs and skewed towards the more prominent tech hubs,” said Adegboye.
“Unlike other programmes, Madica is sector-agnostic and intends to double down on providing hands-on support, extensive resources, access to networks and more. This is why, in addition to $6M of investment capital, we have reserved an equal amount for programmatic support.
“We encourage founders across the continent to apply for our programme. We believe Africans have an unmatched entrepreneurial spirit, and one of Madica’s core goals is to ensure a level playing field for every African founder.”
A central element of the programme will be a carefully curated panel of seasoned African operators who will mentor Madica founders. Based on the belief that strong mentorship is a central feature of the most vibrant start-up ecosystems, Madica will provide this mentor community with rewards tied to company success.
To further cultivate this sense of community, Madica intends to share a part of its financial returns with the broader ecosystem. In pioneering some of these unique features in an investment programme, Madica hopes to promote a vibrant and more equitable funding environment on the continent.
Madica, short for “Made in Africa”, is an Africa-wide initiative and invites founders from across the continent, including those outside the large tech hubs of Nigeria, Kenya, Egypt and South Africa.
Further, Madica will prioritise companies led by local founders, women, and those focused on frontier sectors to shore up gaps in funding on the continent. For example, African-educated CEOs raise significantly less than their foreign-educated counterparts in both number of deals (44%) and in amount (28%).
Start-ups with a women CEO fare far worse, as they are overlooked in favour of start-ups led by male CEOs, with 93% of the 2021 funding in Africa going to the latter.
To be eligible for the programme, mission-driven start-ups must:
- have a minimum viable product (MVP);
- have founder(s) who are engaged full time; and
- have received little or no institutional funding.
Ameya Upadhyay, venture partner at Flourish Ventures, added, “Madica is an investment in the African venture ecosystem, with the audacious goal of creating a broader systemic shift. Through Madica, we intend to develop a cadre of mentors, create world-class programming, crowd-in follow-on capital and leverage Flourish’s global presence to extend the reach of local networks. These will eventually benefit other participants in the ecosystem – start-ups, investors, and policymakers.”
Upadhyay said, “We hope that Madica can help change the narrative around African start-ups – lower the perception of risk, attract more capital, inspire more founders, and garner more media attention”
Madica operates an open application process so founders can apply without an introduction. The programme will work with partners such as incubators, accelerators, and angels to identify and support entrepreneurs.
All applicants will undergo the same evaluation procedure, and investments will be made on a rolling basis throughout the year. Applications are now open, and interested start-ups can find out more and apply by visiting Madica’s website.
Madica will be attending AfriLabs Annual Gathering from 26 to 28 October 2022 in Lusaka, Zambia to meet founders, network with the African tech community and talk more about their innovative programme.