Entrepreneurs and investors from Silicon Valley are missing a great deal of opportunities to invest in innovative African startups, according to Edward Desmond, chief operating officer at Verizon Communications, the American multinational telecommunications conglomerate. Desmond was in Kenya for Startup Battlefield Africa, a startup pitching event organised by TechCrunch, one of the most popular tech media publications in the world and sponsored by Facebook.
“Silicon Valley does not understand the context of Africa, so we see it as an opportunity to fill the gap,” Bloomberg quoted Desmond as saying.“We are here to connect the money guys around the world with opportunities here,” Desmond said.
African startups in the tech sector raised funding in excess of US$129 million in 2016, with the number of startups securing funding up by 16.8 per cent compared to the previous year, according to data compiled by Disrupt Africa, an African startup information portal. The report reveals South Africa, Nigeria and Kenya were the top three destinations for tech investors in 2016, both in terms of numbers of deals and total amount of funding. Sector-specific research shows the fintech sector received the most funding; while the agri-tech sector saw the biggest percentage growth as compared to the previous year.
“We decided to bring the Battlefield to Sub-Saharan Africa because its tech market is on the rise – the region has produced its first unicorn in the shape of Jumia, exits are increasingly frequent, and global venture capitalists are taking note. Our judges were impressed by the high quality of the finalists, their creativity and their focus on solving real problems, often with limited resources,” said Ned Desmond, chief operating officer (COO) at TechCrunch.
At Startup Battlefield Africa 15 companies were shortlisted from an initial 700 that sought funding. The winner selected as “Sub-Saharan Africa's Most Promising Startup”, was Lori Systems, a Kenyan-based logistics platform that is revolutionising the cargo-transport value chain in Africa. Dubbed the “Uber” for trucks, Lori Systems connects truck owners to customers needing haulage. Asides the $25,000 equity-free fund, Lori Systems also won an all-expense paid trip for two to San Francisco to compete in TechCrunch’s flagship event — Disrupt SF 2018, in San Francisco.
SynCommerce, a company providing services for e-merchants won the top prize in gaming and entertainment while AgroCenta, which helps 8,000 farmers to improve the agricultural value chain was chosen as the winner of the social good category. Startup Battlefield alumni include Mint, Dropbox, Yammer, TripIt, Getaround and Cloudflare.