2 stories you might’ve heard before, 1 wish to be Catalytic
Many college students 👨🎓 dream of changing the world 🌍 (sometimes this dream competes with wanting to be excellent at an obscure drinking 🍻 game), I remember being the weirdo figuring out how to begin a career delivering global commercial inclusion for underserved communities — guys were Googling Goldman, I was Analysing Accion. Spoiler Alert: I didn’t and haven’t joined Accion 😂
Fast forward to more recent years, I’ve been incredibly lucky 🍀 to be a part of a community of inspired 💡 entrepreneurs, investors, policy makers, ecosystem builders and corporate innovators operating in some of the coolest markets out there. Individuals who are thoughtful not just about the commercial success of what they’re building, but why they’re building and how.
One thing I feel especially grateful for are the stories I’ve been a part of and have been shared with me.
I’d like to share 2 common stories that have come up so often in these communities — bear with me, I have a point:
2 Short Stories — you might’ve heard before
Energy Erica:
She has amazing sheer will, magnetism 🧲 with world class technical 👩🔬 co-founders who you knew could build something great if combined with the right amount of capital. She and her co-founders put in $20k into the business from their own savings. She hits initial success winning a handful of customers in her first few months, the technology works!
Erica takes this success to begin fundraising and is told by institutional investors she needs to prove more, the team doesn’t have the capital to do it.
After not drawing a salary for months, she decides to accept an investment from an angel investor who insists on 30% of her business and a board seat for $30k. It was either that or shut down the business.
Success again! Erica pays her team to prove the concern points raised by the investors she wants to join her on her journey.
She goes back to the investors and they’re now unable to invest because of the level of control / voting shares she has ceded to her angel investor. 🤦♀️
She’s proven the points and geared her business for rapid scale — does she now push on to try and find other investors to back this scale or does she spend money she doesn’t have to re-gear her business for slower, revenue funded growth? 🤷♂️
Changemaker Chinedu:
She has a crystal 👓 clear understanding of the real underlying challenges facing their communities — and the resulting market opportunity 💰, who have the trusted 🤝 networks locally to deliver on a solution.
Because of her story, her conviction, her insights she wins a $10k grant to take things forward. One key aspect of what Chinedu wants to build involves Data Science. She discovers she’s unable to hire a data scientist in Nigeria for $10k for what she needs to get done and none of the potential co-founders she’s been speaking to have the skillsets she needs.
She jumps on a plane to Europe / the US to pitch at another social challenge competition — she figures she could meet potential data scientists in the hubs in those cities and win another $10k.
She doesn’t win this time and wasn’t able to convince the data science professionals she met in those 3 days to build this in Nigeria with her.
What should Chinedu do next? Pitch at another challenge? Find a “good enough” technical co-founder and begin building?
So What? 🥁
These 2 stories encapsulate 3 levers of the environment that startups operate in that I have built conviction on can create a step change in world class, regional and global startups born in Africa (and emerging markets):
- Capital: There’s a sizeable amount of capital available ($1.2bn deployed to African startups in 2018) and has been mandated to go to startups in Africa (and yes, they are easier to access if have access to certain networks) much of it is in the later stage, what’s available at pre-seed is sometimes not enough to move the needle or costly. Investors want to deploy, we need to do more to reduce barriers to that pace of deployment increasing — especially into platforms that can be catalytic towards other startups and businesses.
- Deep Expertise: Most fields of deep technical expertise are building up real fast in Africa, but it’s not growing fast enough to meet the needs and imagination of the entrepreneurs. We need initiatives to both rapidly build up local talent and bring in global talent to fill the gaps Africa’s tech companies need.
- South-South Context: Many challenges African tech entrepreneurs are solving are being addressed in another emerging markets, from Asia to Latin America — we need to do more to cross-pollinate solutions, insights, research, talent between emerging markets.
I’d like to focus my energies on just these 3 levers in the next few years and so with that…
I’m really pumped to be sharing that I will be joining the Catalyst Fund ⚡️ to lead their growth 🚀 initiatives.
Based out of Boston 🇺🇸, the Catalyst Fund will deliver $100k of pre-seed capital completely equity free AND between $100–200k of hands on active support from experts across the world in data science, credit scoring, customer acquisition, financial services regulations, strategy, core banking systems — many of whom have founded companies (like our Director, Maelis Carraro with RemitMas and our Advisor, David Del Ser with FrogTek), all of whom thrive on working and living across emerging markets.
We focus on startups addressing Financial Inclusion (college idealistic dreams come true for me! 🎉) and will invest in some of the most exciting fintech hubs in emerging markets — Mexico 🇲🇽, Nigeria 🇳🇬, South Africa 🇿🇦, Kenya 🇰🇪 and India 🇮🇳. We will invest in a small number of companies over the next few years — and I can’t wait to get deeply hands on with each and every one of them.
From zero-fee cross border payment startup, Chipper Cash ($2.4m raised in last round) to B2B informal retail supply chain startup, Sokowatch ($2.5m raised in last round) to a platform that could transform how developers build on USSD, Hover — the team has worked with some pretty stellar startups — but we’d love to get more of the ecosystem involved! So that’s you!
Join our Catalyst Circles 👋🏼
Founders — if you’re building a startup which has an impact on financial inclusion in any of our focus markets and think we could help you get to that $1m fund raise, reach out, share your deck — let’s jump on a call.
Investors — if our mandates overlap with yours and you’d like to co-invest in some of our companies or have companies in or out of your portfolio who you think could benefit from our deep dive support and equity free capital, I’d love to speak to you about our circle of investors — a global community of investors in financial inclusion startups from the Americas to Africa to Asia. Our founding members include Accion, 500 Startups, Anthemis, Flourish, Quona Capital and Grey Ghost Ventures.
Corporates — if you’re an internal innovator and would like to run a POC with leading startups in financial services to explore what it could mean for your customers or would like to recommend one you’d like to work with, our hands on support can help with driving that POC to success within your organisation. We will work with your teams to define how shared value can be achieved with our startups and walk with you through execution. As part of our circle of corporate innovators, you’ll also receive exclusive material from us with insights and learnings to accelerate startup collaboration, be invited to curated roundtables with your peers in global banks operating in emerging markets and more — all to help you accelerate your ability to create shared value with startups.
Hubs / Accelerators — if you’re a hub or a program that would like to join our circles and explore creative collaboration opportunities let’s definitely brainstorm them. Our experts for example are passing through all our markets all the time and would love to engage with our partner communities through MasterClasses.
Talent — our portfolio is always hiring so if you’re keen to work with a startup in the financial inclusion space in emerging markets, I’d love to hear from you!
