Carbon has introduced Disrupt Fund, a $100,000 Pan-African fund, to reduce the lack of funding holding back budding tech entrepreneurs on the continent.
In a statement issued by Carbon and seen by Nairametrics, the Fintech firm disclosed that it is committed to helping ‘Techpreneurs’ surmount funding challenges limiting their operations.
Details: Disrupt Fund was designed to invest up to $10,000 per startup (for 5% equity) and give access to Carbon’s API, allowing investees to leverage the lender’s growing customer base and innovative technology platform, to get to market faster.
It stated, “Acknowledging that its success is dependent on the growth of the tech ecosystem, Carbon expects the initiative to spark more collaboration and further investment that should drive growth across the ecosystem.
“Carbon is now accepting applications from companies with operations in Uganda, Kenya, Nigeria, Ghana, Cote d’Ivoire, and Egypt. Startups looking to apply for the fund must have a functioning product, post revenue and looking to operate in multiple countries. The fund has a wide investment mandate but target sectors include insurance, health, education which have not seen as much investment as the fintech space.”
Why it matters: Over 50% of startup funding in Africa in 2019 was channelled to fintech firms with the abundance of opportunities that exist in other sectors. For this reason, the special fund has been developed to tackle this head-on, making it easier for entrepreneurs across all sectors to access the funds and support their need to establish their solutions and achieve their business objectives.
Chief Executive Officer and co-founder, Carbon, Chijioke Dozie, said, “Common investor wisdom is to stay in your market and dominate. This assumes that you are expanding on your own but we believe that by collaborating and partnering deliberately, Carbon and other tech companies can scale faster and build more enduring platforms.
“There are many excellent companies across the continent looking for the kind of scale Nigeria offers and we are excited to partner with them to provide the support and financial investment they need. We are equally excited to expand beyond Nigeria and Kenya by working with a new generation of innovators across the continent and sharing our experience to tackle common obstacles to growth.”
“The investing environment for early-stage startups has improved in recent years. However, a key issue for most startups that have not been addressed is the cost of customer acquisition. A lot of money is spent on acquiring customers, mainly via social media, when a more collaborative approach among tech companies could be more efficient.
“Our fund will enable this collaboration, allowing others to market to our customer base and vice versa – a win-win for everyone. As the saying goes, ‘if you want to go fast, go alone. If you want to go far, go together,” Ngozi Dozie, another co-founder of Carbon, joined her words.
About Carbon: Since 2016, the Fintech has amassed 2.1 million users and disbursed more than $63.7 million in loans in 2019 and processed more than $140 million in transactions. In December 2019, the company announced its expansion into the Kenyan market, as well as its Carbon for Business platform, which provides startups, small and medium-sized enterprises (SMEs) and FinTechs with access to uncollateralized credit, secure online payments, reliable funds transfer, and fast KYC (know your customer) compliance obligations.