The U.S.-based venture capital fund’s annual investment-readiness program, which is geared towards supporting African startups focused on financial health, is looking to fill a cohort of 10-12 companies from Ghana, Kenya, Nigeria, Rwanda, South Africa, Tanzania, and Uganda.
Applications for the program are now open, and Village Capital is searching for early-stage startups that apply fintech to sectors of interest such as agriculture, energy, education, and health.
The program is also interested in firms that address challenges within insurtech, pensions and savings, cooperative finance, and financial literacy; as well as leveraging data for credit scoring and consumer insights.
Selected startups will work through a specific curriculum over a three-month period during which time they will have the opportunity to engage with potential customers, strategic partners, mentors, investors, sector experts, and PayPal employees.
At the end of the program, Village Capital will offer the top two startups $50,000 investments, with their peers selecting the two best and most deserving companies within the cohort.
Supporting African fintech startups
In April this year the 2017 edition of the program came to a conclusion, with two financial inclusion-focused startups emerging as the top two out of seven, winning themselves $50,000 investments and gaining a great deal of knowledge and experience from the program, according to Ventureburn.
The two winning fintech startups were Kenya’s Olivine Technology, which developed a point of sale and stock management solution, and Nigeria’s Piggybank.ng, an app which enables users to reach their savings targets through a combination of discipline and flexibility.
Adedana Ashebir is the regional manager for Africa at Village Capital, and she is excited about the company’s role in uplifting the fintech sector across the African continent.
Ashebir told AFKInsider more about the Village Capital Fintech Africa 2018 program, in collaboration with PayPal.
AFKInsider: Have you been surprised by the quality of fintech startups from the African continent?
Adedana Ashebir: Not at all. It’s an exciting space on the continent right now.
AFKInsider: Why did you choose to make applications available to these specific countries (Ghana, Kenya, Nigeria, Rwanda, South Africa, Tanzania, and Uganda)?
Adedana Ashebir: The countries outlined are where we saw the most promising pipeline for the program. This is the second year we’re recruiting beyond East Africa.
AFKInsider: Will the Village Capital Fintech Africa program (in association with PayPal) be a long-term annual initiative?
Adedana Ashebir: PayPal has collaborated with us previously in our other emerging market practices (Latin America and India) as well as the United States and we’re grateful for the mentorship and resources they provide our entrepreneurs. Village Capital is excited to expand the collaboration to Africa.
AFKInsider: This year you undertook workshops in Ghana, Kenya and Nigeria, and next year you have expanded to other countries. Are there plans to continue expanding going forward, and which countries are you considering for 2019 and beyond?
Adedana Ashebir: Good question. Personally I would love to expand more in Southern and West Africa, we’ll see what makes sense for us moving forward.
AFKInsider: Once the investment-readiness programs is complete, will Village Capital or PayPal assist any of the startups in finding investors (over and above the two winners)?
Adedana Ashebir: Definitely. Village Capital supports our alumni companies where we can, particularly in making introductions and reviewing decks.
AFKInsider: What do many African fintech startups lack in order to achieve success and sustainability?
Adedana Ashebir: With support from the Gates Foundation, we did research on this exact topic – focused on startups in East Africa and India. We found that the four biggest barriers to scale for East African fintechs are talent, business model constraints, lack of debt capital, and investor bias. (Village Capital’s report can be read here)
AFKInsider: What are you hoping to achieve with annual programs of this nature on the continent?
Adedana Ashebir: There is a lot of opportunity in our various sectors of interest: agriculture, health, education, energy, and fintech of course. We find there is a great deal of miscommunication taking place between entrepreneurs and investors, they aren’t speaking the same language.
By helping the entrepreneurs we work with think as investors, both groups can have more productive conversations. We’ve received great feedback from alumni and portfolio companies thus far about the networking and mentorship provided during our workshops and I hope to expand our footprint across the continent.
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