Self-agency is the key to venture capital in Francophone Africa — Quartz Africa


When it was announced recently that Fenty Beauty and Fenty Skin would be available in Africa, some fans rejoiced and others were disappointed. Those who were disappointed found themselves in countries that were not part of the official launch and got used to feeling left behind by international brands’ intentions to conquer African consumer markets.

There is indeed a tendency for brands to have a very distorted image of the African continent, an image that systematically overshadows the countries that are part of what is called “French speaking Africa.

The phrase is loosely used to describe 20-something countries in West and Central Africa where French is often spoken in urban centers and speaks directly to France’s colonial heritage. From a distance, these countries would appear to marketers as complex. Apart from the Democratic Republic of Congo, these countries have in common small territories and populations.

Francophone Africa attracts minimal venture capital funding compared to the rest of the continent

Investors often come to a similar conclusion. The African Venture Capital Association’s 2021 report (pdf) on private equity activity showed how the past year set new records with total deal value reaching $7.4 billion. West Africa was the most attractive region in 2021, attracting 33% of the total amount of market share, but the region owes its leading position to Nigeria, Africa’s largest economy.

The year 2021 has shown encouraging signs for French-speaking countries, with the region registering its first unicorn through Wave, a mobile money service provider which has taken on telecommunications giant Orange, forcing it to match its competitive service offering. of transactions. The startup’s $1.7 billion valuation sent an important signal to venture capitalists about lucrative deals that could exist beyond the imaginary language barrier.

It is no coincidence that the AVCA chose to launch the recent report in Dakar, Senegal. AVCA’s choice to make Dakar the “capital of private equity” for the week-long event according to Papa Ndiaye, founding partner and CEO of AFIG Funds, a global private equity fund management company, enabled investors to discover a whole ecosystem and a side of the continent that they had never seen before.

The presence of Senegalese Minister of Economy Amadou Hott at the opening ceremony highlighted the recent trend in the French-speaking region to appoint bilingual, business-savvy leaders to key government positions to woo investors.

Changing the perception of Africa as an investment destination

The question of perception remains a problem for all African economies. The apocalypse heralded at the very start of the covid-19 pandemic was a perfect illustration of the distorted lens that is too often used to look at Africa. So how do we change age-old misconceptions and deeply rooted myths?

Some, like Ndiaye, believe that infrastructure and institutions to ensure business continuity are important. Others, like Tidiane Dème, co-manager of the Partech Africa Fund, a technology fund exclusively dedicated to African digital markets, believe that the talent pool will be decisive.

Relying on perception alone may not be enough. African business remains largely under-reported by the media and without aggressive marketing campaigns backed by governments or international organisations, mobilizing investors to come for a visit may not be so obvious. The pandemic has only aggravated the skewed view of the continent.

Just as it is our responsibility to promote our own countries, our own creators, perhaps we should recognize that it is also our responsibility to invest in our own economies.

Senegal is leading the way in mobilizing domestic capital to finance its local ecosystem with several vehicles ranging from WIC Capital, a fund dedicated to women entrepreneurs, financed by women investors, the Dakar Network Angels or the recently launched model subscription fund. Wuri Ventures. These vehicles can not only serve as models for other countries to replicate, but can also play a direct role in becoming ambassadors for the region to hesitant institutional investors.


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