African Women CEOs Talk About How They Raised $1M In 2021
According to The Big Deal, less than 1% of all VC dollars went toward startups with one or more women founders last year, details investments in Africa. However, on a more positive note – depending on how you look at it, founding teams counting women and men as members raised 17% of VC investments in Africa in 2021.
But the lack of investment in women-founded startups isn’t new.
If we took a look back almost a decade ago – according to Briter Bridges, another publication that tracks VC investments in Africa, only 3% of the total funding raised by startups in Africa since 2013 has gone to all-women co-founded teams.
So despite total funding for women-founded companies reaching $834 million in 2021, according to Partech Africa — a VC firm and data tracker of African investments — and the number of women in venture capital increasing, their representation remains relatively small against male-run startups.
Last year, 11 women-led startups secured over $1M in a single round of funding, a record in Africa. They include Jessica Anuna, founder and CEO, Klasha, Tebogo Mokwena, co-founder and CEO, Akiba Digital, Fara Ashiru Jituboh, co-founder and CEO of Okra.
But at what point did they begin looking for investors for their company?
Speaking to Jessica Anuna, founder of Klasha, [a technology company that allows international merchants to receive payments online in local African currencies]. Jessica “was cognizant that women only received less than 1% of venture funding globally, but that wasn’t at the forefront of my mind as I started my journey or pitched to VCs or angels.
“In fact, it wasn’t something I thought about at all, probably because I was new to raising money and didn’t fully grasp some of the biases that existed.”
“I’ve always been bullish about shipping products that created an impact during my career, so I knew if we had a strong enough product-market fit, we would get funded,” she told TechCrunch.
Asked when she thought it was best to start looking for funding, she admitted that it was “right at the start, our first institutional check was from Techstars in Dubai six months after we started the company. They believed in the team, vision, mission and the opportunity of building streamlined cross-border commerce solutions for African consumers.
“The market opportunity was there; e-commerce is less than ten years old in Africa, with a 3% penetration rate and a 27% personal consumption rate in Africa, the second-highest after Asia.
Tebogo Mokwena, CEO, Akiba Digital
Asked the same question, Mokwenda, who owns a South African-based fintech building an alternative credit scoring infrastructure, told TechCrunch she “only started looking for investors when I had confidence in our business model and needed investment to fuel it to scale. It took us two years of bootstrapping to get to a pre-seed raise in 2021.”
Convincing investors to back a business is not easy.
But Mokwena told Tech Crunch: “There have been studies that show that women-led businesses perform better than male-led businesses in terms of metrics that matter. However, male-led companies get valued more because of vanity metrics and overall biases that exist.
“This is not a fight I choose to fight, mainly for my sanity, but because most of us (and I mostly speak for myself here) have to conform to speak and portray ourselves in a way that makes us is less threatening to the “bro” culture to be seen in the same light.”