Top Tech Venture Capital firms in Nigeria
One of the major challenges entrepreneurs face in today’s world is the lack of appropriate funding to support their businesses, especially in Nigeria. Many great ideas are born with each passing day, however, some of them are only short-lived due to a lack of funds to grow the ideas into a full-blown business.
In developed economies, investors like venture capitalist firms, institutional investors, angel investors, and so on, have made access to funding more approachable to entrepreneurs. These investors are ready to back any startup as long as it has strong potentials for growth. Nigeria is not left behind as a few venture capital firms have emerged in recent times to support innovation, growth, and entrepreneurship in Nigeria.
Certain sectors of the Nigerian economy have shown strong signs of increased growth in the coming years, particularly the Tech sector. Recently, technology companies such as financial technology and agricultural technology companies have been in the spotlight for both foreign and local investors. According to a report, foreign investors accounted for $85.8 million out of the approximated $120.6 million invested in Nigerian startups in 2020.
Another recent report showed that over 80 percent of new businesses fail during the first year of operation due to lack of funding and other factors. Capital can be considered as the lifeline of any business, such that without it, a business is sure to fail. While several sectors of the Nigerian economy are already thriving, fundraising is still a major challenge that most entrepreneurs are faced with. The purpose of venture capital firms and other investors is to provide necessary capital support to startups in need.
What is a Venture Capital firm?
A venture capital (VC) firm is an institution that solely invests in a business or venture by providing the necessary startup capital or resources needed for growth. A venture capitalist can also be an individual with the same interest. VCs are recognized by the large investments they make in young startups or businesses with strong potentials for growth.
If you run a tech startup in Nigeria and seek to raise capital for your company, here are some VC firms to check out!
FirstCheck Africa is a female-focused VC that provides early funding for women in tech to start their businesses early enough. The firm’s goal is to create more opportunities for African women by investing in tech startups. Founded by Eloho Omame and Odunayo Eweniyi, FirstCheck plans to invest up to $25,000 in each female-led startup that it backs. The target is to help these women/startups raise a pre-seed round within 12 months.
Future Africa not only focuses on providing startups with seed capital but also coaching and community. Its goal is to build “an African future where prosperity and purpose are within everyone’s reach.” The company was founded by Iyin Aboyeji, and its mission is to connect passionate innovators and investors looking to tap further into Africa’s hidden treasures and creating global business opportunities out of them. Future Africa has so far invested in some Nigerian startups including Flutterwave, 54gene, Andela, Chaka, Eden, Evolve credit, Bamboo, Rise, among others.
Greentree Investment is a VC firm that focuses on the growth of individuals and their businesses. It is concerned with both the personal development and corporate development of an individual and their startups. The company which was founded in 2014 has an extensive portfolio of companies it has invested in including Big Cabal Media, Paystack, and Precurio.
GreeHouse Capital is an independent investment holding company founded by Venture Garden Group in 2016. The firm’s goal is to build the largest Fintech investment holding company in Africa as it focuses on direct investments in African technology companies and disintegrated banking services. Included in GreenHouse’s investment portfolio are Flutterwave, Max.NG, Riby, Rensource, and TalentBase.
Growth Capital Fund is powered by CCHub, Nigeria’s first social innovation fund. It is aimed at creating an unmatched record to scale for outliers driving social change to the country. Growth Capital supports early-stage and high-potential technology startups. Its participating investors include CCHub, Bank of Industry, Omidyar Network, and Venture Garden Group.
Ventures Platform is a Pan-African early-stage venture capital firm focused on investing in post MVPs. This firm invests in seed and early-stage companies that operate in markets with existing positive offline indicators. The firm was founded by Kola Aina, a committed angel investor and startup mentor. Ventures Platform has an array of Nigerian startups in its investment portfolio including Brass, Kudi, Mono, Thrive agric, Tizeti, Trove, Piggyvest, and many more.
LeadPath Nigeria is a seed capital fund that provides short, medium, and long-term funding to small and medium-sized businesses in high-growth technology areas such as software, and web and mobile technologies. The fund focuses on high-growth technology startups that are providing real economic solutions. Its investment ranges between $25,000 to $100,000 on average for seed investment and millions of dollars for follow-on funding series.
Echo VC is an early-stage-focused VC firm that targets its investments toward underrepresented groups including women and founders of African descent. It also serves underserved POC markets and solely invests in technology-driven startups to harness the hidden potentials on the power of technology to increase market value. Startups in their portfolio include hotels.ng, Netplusdotcom, Lori, Lifebank, Migo, among others.
TLCom is a technology-focused VC firm that backs technology startups that seek to leverage technology to find market solutions. This firm invests as much as $500,000 to $10 million in selected companies. It has so far invested in several Nigerian startups and companies including Andela, autocheck, ilara health, kobo 360, and uLesson.
Microtraction is a tech-focused VC that only invests in founders who are on the path to building a high-growth technology business in high-value markets. The firm typically invests $25,000 for 7%. Some of the startups they have invested in so far include Bitsika Africa, Buycoins, Cowrywise, Thankucash, sendbox and many more.
Other venture capital firms to lookout for include:
Lagos Angel Network (LAN)
SLA Accelerator
SPARK Capital
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