€60m available for needy African startups

Without money, nothing can be done.

Most people who aspire to establish a business will confirm the above statement to you wholeheartedly.

Yet, those who know the right way to source funding eventually get it, and now there’s an opportunity for some to get funding from a €60m fund made available by Janngo.

The only caveat is that the whopping sum is meant for technology startups from seed through growth stage across Africa and targets at least 50% of startups founded, co-founded or benefiting women.

Aren’t the women just lucky?

That said, the initiative is part of Janngo’s broader commitment on financing the SDGs in Africa, as a member of the Goalkeepers Community and the Global Future Council on the New Economic Agenda of the World Economic Forum.

In Africa, only 3 million jobs are created every year when at least 20 to 30 million jobs will be needed to absorb its fast growing labor force in the coming years. In this context, unlocking entrepreneurship is a critical lever to massively increase the supply of decent jobs and bridge the unemployment gap, both in the formal and informal sectors.

“In 2050, we’ll be roughly 2.2 billion people in Africa, which means that we need to find now massive ways to feed, educate, house, care for and employ more than 1 billion people in less than 30 years. We believe traditional development models have failed because they were unbalanced and unsustainable either only focusing on commercial returns or too heavily aid-based : our thesis strikes the right balance between delivering solid returns to our investors while being socially accountable, solving key market failures and leveraging technology to help leapfrog development. That's our ikigai (http://bit.ly/2TFUOVm), our reason for being, as janngo means tomorrow or future in Fulani,” Fatoumata BA, Executive Chair, Janngo, and Managing Partner, Janngo Capital, said.

African women are known to be the most entrepreneurial in the world with a 26% total entrepreneurial rate in Sub-Saharan Africa where they are twice as likely to start a business than elsewhere (Source : Roland Berger).

Yet, they are encountering a $42bn funding gap currently, according to the African Development Bank. Additionally, the larger the ticket size, the harder it is for women in emerging markets to get access to capital with only 10% of them able to raise money from Series A vs 49% at seed stage.

“At Janngo, we believe that talent is equally distributed between men and women but opportunities aren’t, especially in terms of access to capital. That is why we are proud to be a female-led fund investing 50% of our proceeds in startups founded, co-founded by or benefiting women,” BA explained further.

With the €60m investment vehicle 100% dedicated to African startups achieving both in economic performance and social impact, Janngo’s commitment is paving the way for SDGs financing in the venture capital space in Africa.

The €60m includes a €15m ticket from the European Investment Bank, the world’s largest multilateral financial institution and the biggest provider of climate finance.

“Thanks to the support of the EIB, we will be able to invest between €50,000 and €5 million from seed through growth stage in startups all across Africa demonstrating the ability to deliver financial and social returns.

“Every past investment and every startup in our deal flow is mapped against the 17 SDGs. Their ability to create jobs for women, young people and green jobs is also assessed. We act not only as financial partners but as operating partners with a very hands-on and long-term approach as well as an ecosystem thinking.

“That is why we have engaged with stakeholders sharing the same vision through our partnership with the EIB, our contribution to the WEF conversation on Financing the SDGs during Davos and our commitment to the Goalkeepers community. We have a decade to deliver on the Goals and the clock is ticking. We need more than a positive capitalism, we need a stakeholder capitalism,” BA concluded.