Onajite Emerhor sits in her living room in Lagos, Nigeria, where she has been working since the start of the pandemic. “I did my hair and makeup myself this time,” she jokes, as she sits down with The Keyword for an interview about the blossoming startup scene in Africa and her role as Head of Google for Startups Accelerator Africa.
It’s been an exciting few months for Onajite and her team. They had been preparing for the Google For Africa virtual event that took place on October 6, where alongside other big announcements, they unveiled the 50 startups who received the Google for Startups Black Founders Fund in Africa.
First, some background
It’s no secret that, despite the growth of investment in Africa, startups still struggle to land venture capital. And a lot of that money goes to non-African expatriates on the continent. In fact, in 2020, 82% of African startups reported difficulties in accessing funding.
The Google for Startups Black Founders Fund in Africa invests $3 million to fund startups on the continent, providing 50 startups in Africa with up to $100,000 in equity-free cash awards. The winners also receive up to $220,000 in Google Ad Grants and Cloud credits, as well as mentorship, technical and scaling support from Google. Applications for this year’s awards opened in June 2021, and after months of review, 50 founders have been selected for the program.
According to Grow for Me founder Nana Opoku Agyeman-Prempeh, one of the Fund’s recipients, international interest in the startup scene should hopefully prompt investors on the ground to take notice: “If Google is paying attention to African startups, local investors should be paying attention as well.”
The challenges, according to the founders
Different industries have different challenges. One big area of growth for African startups is the agricultural technology field (or “agritech”). However, Nana Opoku says that the difficulties in raising agritech capital can often come down to educating investors about the impact technology can have on the farming industry.
There’s also an additional barrier to funding as a female entrepreneur in Africa. Medsaf founder Vivian Nwakah, another Fund recipient, reflects that this is no easy task: “As a Black and female founder, I have had to work a thousand times harder and do so much more to prove myself in comparison to some of my counterparts. When you look at what I had to have ready and the numbers I had to show to even get a $5,000 check, compared to my male counterparts, there is a huge disparity.”
A lot of it also comes down to investor confidence. While it’s common in the United States to raise money simply based on an idea, Tatenda Furusa of Imali Pay, a founder and recipient of the Fund, says that’s not the case locally: “In Africa, that experience is not enough to convince investors, and the journey to access funding has not been easy.”
The future of the startup scene
The startup scene in Africa is growing every day, but there are still some big shifts that need to happen to sustain it — from building investor confidence, to creating an ecosystem where startups are set up to succeed. As Onajite points out, “startups are critical to socioeconomic development and progress across so many sectors, from farming to healthcare. The startup ecosystem also needs continued growth and funding for tech hubs, accelerators and incubators, and ongoing interest and investment from tech companies like Google.” Attracting and training digital talent in the continent also remains a challenge, as well as internet accessibility and connectivity.
Despite these hurdles, Onajite remains hopeful for Africa's startup scene: “We’re seeing progress. And with continued global and local support, big ideas and new products will continue to follow.”