In a session organised by Ingressive Capital in partnership with Oracle For Startups, Founder Institute, VC4Africa, and Global Startup Ecosystem, some of the best Investors in Africa share insights on startup investing from an Investors Perspective and also addressed how Investors can be better.
Here are some highlights from the panel on Investing from an Investors Perspective;
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Be a great founder with a great team; ‘a great idea in the hands of an incompetent founder/team will fail, while a shity idea in the hands of a great founder/team will scale’. These were words by Mimshach Obioha, Former Executive Director at Ventures Platform Hub, a company focused on impacting and innovating the lives of Entrepreneurs in Nigeria.
Beyond striving to build a company that will change the world, it is important that to be a founder with zeal, purpose and have a team of people who believe in the dream and are willing to put in the hard work. Investors invest in people too.
2. Get your documents right; in Mo Felata’s words, ‘before going to an investor, get your valuation right, determine how much equity you are willing to give, and prepare a data room with relevant documents’.
Mo is the Director of programs at Ventures Platform Hub, from his experience grooming founders, he mentioned that founders need to be prepared. Don’t go to a pitch without crossing all your Ts and dotting your Is. Ensure your pitch deck has all the important information, some of which he mentioned includes; having a problem slide, solution slide, value slide, business model, team slide, traction slide and money slide.
When you send a deck by email to an investor, send an investors deck not a pitch deck, because you won’t be there to pitch, he said.
3. Have a clear vision for the company; Ed Zimmerman Startup/VC lawyer at Lowenstein Sandler emphasised that how important it was for founders to have a clear vision of what they were building and have solid plans on how to get there.
Also, he urged founders to document everything, “protect your intellectual property”, he said. When asked about the best place to incorporate a company that would attract investors, Ed advised ‘if you are a startup in Africa aiming to eventually raise funding from any investor located outside Africa and making occasional deals in Africa, then Delaware U.S. might be the best place to incorporate your business.
These were powerful pieces of advice from our first panel moderated by Elly Mathenge, Strategic Business Head Oracle Africa
For our second panel, we had Maxime Bayen (Senior Ventures Builder BFA Global),Tosin Durotoye (CEO/ Principal Consultant, Conselia Advisory Practice) Adeboye Idowu (Director, Portfolio & Investments, Founder Institute Lagos) Uwem Uwemakpan (VP, Fund Operations Ingressive Capital) as moderator discussing “Investor 101” – How to be better investors.
The discussion started out with each panelist highlighting that at the early stage, startup investing is more about the founder and what they’ve done in the past than the company. In the words of Max, “when backing an early stage company, you are betting on the team, founder and C.E.O.”
Adeboye buttressed this same point by saying “more than the idea, it is the person behind the idea”. This gave founders a need to look inward and ask themself the question, “Am I worth investing in?”
While investors were burdened with the task of performing due diligence on startups and their founders. It is important to note that not only did investors have diligence to perform, founders also needed to do a background check on investors before taking more from them.
Max mentioned that 1% equity today could be worth a lot of money tomorrow, so founders needed to be careful when raising money.
Speaking to investors, Tosin was of the opinion that it was unfair for African founders to be compared with Silicon Valley. “Comparing African startups with Silicon Valley is not fair to founders who are trying to make an impact with little or no resources”.
So rather than compare, she implored investors to not just give funds but also be involved in supporting, and mentoring.
As final words to the audience, our panelist each advised them to start work on the ideas they have, put them out there, take feedback and keep building. The session ended with founders inspired and ready to do the work needed to get your companies to the next level.
If you would like to watch the full video, click the link for our ‘Startup & Investment Event’ and don’t forget to share.
