How two unicorns tech startups are attracting Venture Funds to Africa
These two tech companies are considered jewels by many global venture capital investors, both individual and corporate.
These tech startups are the Africa Internet Group of South Africa and Interswitch Inc. of Nigeria. There are being described as Unicorns of Africa and are expanding in coverage.
At present, Africa Internet Group (AIG) is valued at $1 billion with subsidiaries across major industries. The tech company is described as “a highly visible, symbolic and substantive marker.”
“It shows that there’s enough by way of demand, as well as a platform that [AIG] is able to put in place to justify that marker,”David Hsu, Professor of Management at Wharton Business School, Unversity of Pennyslevnia.
AIG is the parent company of a network of 10 consumer-driven Internet businesses: Jumia (an e-commerce platform), Zando (shoes and clothing), Hellofood (a food delivery service), Kaymu (an online resale marketplace), Lamudi (a real estate classified platform), EasyTaxi (a cab-hailing service), Jovago (a hotel booking portal), Every jobs (a jobs classified site) and Carmudi (a car-selling platform).
AIG was started in 2012, and now operates in 23 African countries. Major investors in the company are MTN, Rocket Internet, Millicom, Orange, Axa, Goldman Sachs and CDC.
Of the subsidiaries, Jumia has been noted the major revenue earner for the group, with most of its success record in Nigeria.
Another financial technology company is making a wave and attracting Venture Funds to expand its scope into other African countries. The Fintech startup is based in Nigeria, Interswitch Inc.
Interswitch was also founded in 2012 by Mitchell Elegbe, as a digital bank and debit card provider. The company has as one of its backer, Helios Investment Partners that paid $96 million in 2010 for a 52% stake in the company.
Bloomberg reported that Interswitch is considering IPOs in London and Lagos later in the year. By going public in both countries, the firm will have greater access to more capital markets.
In March 2017, TA Associates, a global growth investor headquartered in Boston announced the acquisition of minority stake in Interswitch from Helios Investment Partners for an undisclosed amount.
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