Africa is often painted as a land of extremes—potential and challenges, wealth and poverty, innovation and stagnation. But those of us who are deeply invested in this continent know that the reality is more nuanced. At a recent event at Funema, we delved into this duality, exploring what it truly means to invest in Africa and support its entrepreneurs.
Entrepreneurs as the Heart of Impact Investing
Evelyn Castle's announcement of eha Impact Ventures's investment in Blueroomcare Business —a Funema portfolio company focused on making mental health care more accessible and affordable for African women—set the tone for the event. This isn’t just about funding businesses; it’s about addressing real market needs that matter. Both Olusola Osinoiki of Josh Leadership and Toni Campbell of Kinfolk Venture Capital , veterans in tech and investment, echoed this sentiment. They underscored a principle we sometimes overlook: entrepreneurs are not mere recipients of investment; they are our customers. And like any good business, our job is to build relationships and support them in solving the problems they are passionate about.
Balancing Philanthropy and Market Returns
One of the recurrent themes was the delicate balance between philanthropy and market returns. Toni aptly pointed out that our work as investors shouldn’t aim to replace philanthropy but rather complement it by focusing on returns. Sola, also a Senior Venture Partner at Funema reinforced this by highlighting the need for founders to adopt a return-on-investment mindset. He shared a success story about a founder who turned a determined focus on generating revenue into a 100% return within a year—proof that impact and financial success are not mutually exclusive.
This dual approach—valuing both impact and profitability—resonates deeply with the African context. It’s a reminder that while goodwill is valuable, sustainable change in Africa requires ventures that can stand on their own financial feet.
Partnerships, Commitment, and the Pursuit of Cash Flow
The discussions also steered towards the significance of partnerships and commitment in the entrepreneurial journey. Sola emphasised that a committed founder can make all the difference, a sentiment echoed by Oche Bridgeford, MSRE, a partner at Funema, who stressed the fundamental goal of any business: to make money. Toni’s perspective added another layer—seeing the business through the lens of an investor. It’s not just about raising valuations; it’s about maximizing cash flow, a metric that often gets overshadowed by the chase for the next funding round.
Transparency and Communication: Building a Healthy Ecosystem
Investment in Africa isn’t just about capital; it’s about building a healthier ecosystem. OCHE highlighted the critical need for connection and communication among investors, founders, and all stakeholders involved. Toni added that transparency is key—information flow between investors and founders can dismantle the misconceptions that often plague the African investment narrative. It’s about changing the lens through which we view the continent, from one of high risk to one of high growth and innovation.
Market Needs Over Sectors: A Shift in Focus
When it comes to starting a business in Africa, Toni advised founders to focus on solving market needs rather than getting hung up on specific industries. Whether it’s Agritech, Logistics, Power, Innovation, or Medicine, the priority should always be on addressing tangible problems in the market. This approach not only builds stronger businesses but also aligns with the continent’s most pressing challenges. Toni’s point that not every business needs venture capital rings especially true in Africa—sometimes, the best path forward is organic growth rooted in community-based solutions.
Shifting the Narrative: Africa as a Land of Opportunity
The discussion wrapped up on a powerful note—changing the narrative around investing in Africa. Yes, there are challenges: regulatory hurdles, contract enforcement issues, and sometimes a lack of diversification. But there’s also incredible potential for g
