This Investor Balances Impact Investing and Gets Returns on Their Investments

by MMC
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During his work helping venture capital firms around the world access deal flow from Africa, Surayyah Ahmad realized that these local ecosystems lacked structure, which affected the quality of said deals. transaction flow. This prompted her to return to Nigeria from London in 2022 to work on fostering collaboration and building funding pipelines within the local ecosystem, particularly in Northern Nigeria, through her accelerator, TechTankLabs (TTLabs).

According to Ahmad, its focus on the North’s tech ecosystem is nothing short of strategic.

Nigeria’s population is expected to equal that of the United States by 2050, becoming the third largest country in the world, and a large part of this population will come from the north of the country.

“It’s a market ready for anything,” she said. “We want to make sure we start realizing this potential now, not in the next 20 years. »

In November, Ahmad, alongside Sanusi Ismail, founder of Kaduna’s first technology innovation hub, CoLab, announcement the launch of Aduna Capital, a $20 million fund aimed at discovering and nurturing young tech founders across Africa, with a focus on regions like northern Nigeria.

One of the main challenges in the North’s tech ecosystem is the lack of access to financing, as there are not enough venture capital firms in the region, according to this report. On the other hand, investors from other regions are generally hesitant to invest outside the Lagos tech bubble. This places contractors building in the North in a difficult position, with many resorting to development shops

and prioritizing being government entrepreneurs over scaling their startups.

“There are a lot of companies in Abuja, but they get carried away with contracting and setting up development workshops,” Ahmad explained. “Development shops were the highest category of companies in our survey, which makes sense since people develop software for the government. »

However, Ahmad believes this trend is slowly changing as the ecosystem sees more people recognizing the need for scalable products that are not dependent on government. She thinks it is important to invest in them.

According to Ahmad, now is the time to invest in some of these outliers because a few success stories will have a multiplier effect for the ecosystem.

“We are already starting to see examples of success with South Africa, which raised $3.7 million; And Flexi-Saf, which generates over $1 million in revenue,” Ahmad said in a call. “This kind of success sends a message to others, or even to the employees who work there, that they can create and evolve their products. The cycle continues and this is how we will begin to see a more vibrant ecosystem.

Ahmad also hopes that this growth will be facilitated by the presence of Nigeria’s new Minister of Communications, Innovation and Digital Economy, Bosun Tijani. Tijani recently launched the 3MTT program to train three million tech talents, simultaneously giving small tech companies the opportunity to apply to host interns.

“Having one of our own who understands the pain of the ecosystem is great, and I can see him already opening things up with the 3MTT program, giving small businesses the opportunity to apply as trainers,” said Ahmad. “This will automatically catalyze the ecosystem in Abuja and across the country, simply because some of these companies will have the initial market that they need to gain traction and be able to prepare for financing.”

Beyond funding, another major challenge in the North’s tech ecosystem is a lack of cohesion. This means that it is often difficult for entrepreneurs to connect with other stakeholders to gain knowledge or access opportunities and resources. Currently, there are only around 40 key ecosystem entities, including accelerators, venture capital firms and incubators, operating in the region.

This is something Ahmad struggled with in his early days in the ecosystem. She shared that many growth and funding opportunities were not discovered until later in her journey.

She told TechCabal: “As a young founder, I wish I knew what kind of support I have as a founder: any accelerators, incubators or programs. It’s very sad, but it’s also why we make sure that founders in the ecosystem here can access support, even if it’s not from us, but from other incubators and accelerators available in space.

Over the next five years, Ahmad seeks to grow TTLabs to become a major pipeline for deal flow from the region and connect the country’s underserved founders to venture capital firms in Africa. Their fund, Aduna Capital, targets investor returns of 5 to 10 times, striking a balance between impact investments and lucrative investor returns.

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