Nigeria’s start-ups jostle for LAN seed funding
By Kokumo Goodie, Lagos, Nigeria
About five start-up entrepreneurs with great business ideas have been selected and are currently jostling for investment support from members of the Lagos Angel Network (LAN) to grow their businesses to the next stage.
In a pitch event held yesterday at the newly-refurbished Digital Bridge Institute (DBI), Oshodi Lagos, some of the shortlisted companies showcased their business ideas to some members of the group. Fix My Gadget, Cashenvoy, BookNowNow, SkinIT and Giga layer are some of the start-ups that made the shortlist.
The companies have already passed through a screening round enabling them to pitch for LAN investment.
The LAN brings together high net worth individuals seeking to invest in and mentor Nigerian technology start-ups. Members, of which there are currently 16, they are expected to commit at least N1 million per year to the investment pool. There is however no upper limit in their commitment abilities.
The project, like the Lagos Innovation Hotspots Map, Silicon Lagoon and others is backed by INNOVATE LAGOS, the Lagos Innovation Advisory Council which was launched by Babatunde Fashola, the State Governor, in September 2011.
An IT expert and one of the brains behind the project, Tomi Davies said: "LAN business angels will invest seed capital in the start-ups to finance their business ideation, product development and market entry". According to him, the LAN creates a forum where members can effectively evaluate promising early-stage investment opportunities, get support for the required due-diligence process and monitoring of their portfolio of investments till the next round of funding or other exit.
Currently, start-up entrepreneurs in Nigeria have little or no access to equity investment beyond their friends and families. In other countries, Angels come into start-ups when the businesses are either too risky for traditional debt or equity instruments or they do not have the required track record or cash flow for microfinance lending. The Lagos Angel Network is structured to drive job creation through innovation and venturing.
Entrepreneurs apply through the networks web portal at www.lagosangelnetwork.com or directly to the secretariat.
“We select entrepreneural teams with great business ideas who need extra resources such as human capital, access to networks, new markets, mentioning or finance to develop and grow their business to the next stage” he explained.
Selected businesses are then subjected to a thorough screening round of their business operations and plan based on a proprietary frameowrk called POEM which is an acronym for the start-ups Proposition, Organisation, Economics and Milestones. Shortlisted entrepreneurs from this round will then pitch to Angels for investment.
Confirmed shortlisted companies for this event include: Fix My Gadget - a repairs and maintenance of electronic equipment and gadget insurance service (extra warranty cover), Cashenvoy - an electronic payments aggregation and processing, electronic wallet provision and mobile POS devices, BookNowNow - an automation service for event venue booking, hotel booking and restaurant reservation, as well as listing/repository services for hotels, restaurants, event venues and meeting places in Nigeria, SkinIT- a gadget customization service for individuals and corporate organisation. A unique way to help owners of laptops, smart phones and other gadgets beautify and protect, Giga layer- a world-class hosting business aimed at improving the hosting experience in Nigeria and Africa at large.
Although coming behind its peers on the continent including Ghana (Ghana Angel Investment Network), South Africa (Angel Hub) and Kenya (Kenya Angel Investors), as the first members only club dedicated to the funding and mentoring of start-up and early stage businesses in the country the Lagos Angel Network puts Nigeria on the Angel investors map, he added.