• News
    • Latest news
    • News search
    • Health
    • Finance
    • Food
    • Career news
    • Content series
    • Try Devex Pro
  • Jobs
    • Job search
    • Post a job
    • Employer search
    • CV Writing
    • Upcoming career events
    • Try Career Account
  • Funding
    • Funding search
    • Funding news
  • Talent
    • Candidate search
    • Devex Talent Solutions
  • Events
    • Upcoming and past events
    • Partner on an event
  • Post a job
  • About
      • About us
      • Membership
      • Newsletters
      • Advertising partnerships
      • Devex Talent Solutions
      • Contact us
Join DevexSign in
Join DevexSign in

News

  • Latest news
  • News search
  • Health
  • Finance
  • Food
  • Career news
  • Content series
  • Try Devex Pro

Jobs

  • Job search
  • Post a job
  • Employer search
  • CV Writing
  • Upcoming career events
  • Try Career Account

Funding

  • Funding search
  • Funding news

Talent

  • Candidate search
  • Devex Talent Solutions

Events

  • Upcoming and past events
  • Partner on an event
Post a job

About

  • About us
  • Membership
  • Newsletters
  • Advertising partnerships
  • Devex Talent Solutions
  • Contact us
  • My Devex
  • Update my profile % complete
  • Account & privacy settings
  • My saved jobs
  • Manage newsletters
  • Support
  • Sign out
Latest newsNews searchHealthFinanceFoodCareer newsContent seriesTry Devex Pro
    • News
    • Entrepreneurship

    For startups based in Africa, investors often join founders in making the pitch

    An investment manager from the Global Innovation Fund joined the CEO of a Nigeria-based company at TechCrunch Disrupt, with both of them pitching, in what is emerging as a trend among investors supporting emerging market entrepreneurs.

    By Catherine Cheney // 12 September 2018
    Paga founder and CEO Tayo Oviosu (left) and Cellulant co-founder and CEO Ken Njoroge (right) speak onstage during day three of TechCrunch Disrupt. Photo by: Steve Jennings / Getty Images / CC BY

    SAN FRANCISCO — Tayo Oviosu, chief executive officer of Nigerian digital payments company Paga, took the stage in San Francisco last week at TechCrunch Disrupt, an annual conference focused on technology-enabled startups.

    Oviosu said he couldn’t wait to give Tim Draper, a well-known Silicon Valley venture capitalist who invested in Paga, an exit, “so he can tell that story.” Based on the current valuation of Paga, Draper may well have seen his investment grow 20 times, said Oviosu, in a talk where he outlined reasons others might consider investing not just in his company, but in Nigeria and on the African continent more broadly.

    Last week, Paga announced the close of a $10 million round, led by the Global Innovation Fund — a $200 million nonprofit innovation fund focused on projects that improve lives in developing countries. GIF takes a venture capital approach to investing, with a tiered financing model that offers funding in stages. That approach allows GIF to take bets on smaller, riskier, or unproven innovations and support organizations as they grow.

    To get these companies to a level of scale that might draw institutional investors to the opportunity, GIF provides risk tolerant capital. It also actively makes connections between the startups in its portfolio and later-stage investors, pointing to a trend among funders focused on startups serving the base of the pyramid.

    More on entrepreneurship:

    ► 4 winning tips for startups in sub-Saharan Africa

    ► Q&A: Supporting Africa's entrepreneurs

    ► How blended capital can help entrepreneurs make it through the missing middle

    Rakesh Apte, an investment director at GIF, told Devex he traveled from Washington, D.C., to San Francisco, California, for TechCrunch Disrupt to keep tabs on the technologies that might impact the populations GIF focuses on but primarily to support Oviosu — in part by connecting him with other investors.

    “There is very interesting dissonance between the opportunity and the risk that investors are willing to take,” Apte told Devex, in a San Francisco coffee shop where he sat at the counter with Oviosu, both of them wearing their conference badges.

    “Tayo’s business has continued to grow. It has already impacted 9 million customers. And those numbers are meaningful anywhere,” he continued. “And yet he suffers because it’s Nigeria, and there are these issues investors are unwilling to see past.”

    Before GIF invested in Paga, Apte talked with investors from large institutional funds to understand what they would be looking for in order to invest in the company. Part of the problem is most investors can only deploy large amounts of capital. They lack GIF’s flexibility — it can deploy private, government, and philanthropic capital in financial instruments ranging from venture debt, to convertible loans, to straight loans, and even some results-based financing.  

    Oviosu previously worked with Cisco, a multinational tech company based in San Jose, California, and has some network advantages over other Africa-based CEOs. But he too has faced a number of challenges raising money given where he is based.

    “There’s a venture firm here in the Valley, I won’t name names, but they’re investing in companies like Paga across emerging markets,” Oviosu told Devex.

    He said he tried to meet with a fintech investor from the firm at TechCrunch.

    “He said, ‘Out of respect for your time, I should note the firm is no longer investing in emerging markets,’” Oviosu said.

    On Friday, the moderator of “How African Founders are Enabling Tomorrow's Startups,” featuring Paga, asked Fope Adelowo of Helios Investment Partners, a private equity firm that invests exclusively in Africa, to make the case for investment on the continent to geographic agnostic venture capitalists who are only looking for returns.

    "I think simply growth. If you think about most of the sectors on the continent, most of them are still on the very early stage of adoption of technology. And what that does is it presents a significant opportunity,” said Adelowo.

    She gave the example of electronic transfers in Nigeria, which have grown 70 percent over the last five years. This represents the kind of growth that appeals not only to investors who prioritize social impact but also to venture capitalists who want to maximize financial returns.

    Adelowo acknowledged the infrastructure challenges that can stand in the way of investments across a number of sectors. But she said that from her perspective as an investor, technology-enabled distributed solutions, from solar to payments, are where the exciting opportunities are.

    Moving back to Africa to start a social enterprise? Read this first 

    More and more young Africans in diaspora are taking a leap to start their business and social enterprise on the continent. What has it been like for those who returned? What are the things to consider before making a move back to Africa? Three social entrepreneurs who have successfully launched a social impact business on the continent shared their experience and five tips with Devex.

    The moderator asked Oviosu why he went back to Nigeria, and he said that even if he were not from there, he would have gone. He spoke about the opportunity in a country of 180 million people, on track to be the third largest country in the world by 2050.

    Paga is an example of the kind of investment GIF seeks out not only because of the promise of impact but also because of the potential for learning, Apte said.

    The GIF team thinks about innovation very broadly, rather than focusing on a particular sector or geography, Apte added. But Nigeria is a place where there is an overwhelming population size fitting within its target demographic. And part of the appeal of Paga is that it has plans to scale, and is currently considering countries including Mexico, the Philippines, and Ethiopia.

    “Our thought process is: Let’s take smart bets in companies like Paga showing initial success and traction, and provide them growth capital to continue doing what they’re doing and scale their impact as they provide products and services, and learn from that and communicate the lessons learned to the broader development community,” he said.

    This kind of scale should also appeal to investors beyond GIF — those seeking to support companies whose customers live on less than $5 a day, but also to investors focused on maximizing returns. These types of examples fill the agenda of events such as the Emerging Markets Venture Forum, an annual event hosted by the International Finance Corporation at the World Bank. Focused on developing the ecosystem for emerging market entrepreneurs by supporting local funds in developing countries, the forum also encourages Silicon Valley funders across the spectrum from philanthropy to private equity to consider these markets.

    Omidyar Network joined the $10 million round for Paga led by GIF, together with Unreasonable Capital, an early-stage investment fund focused on emerging market entrepreneurs, Goodwell, an impact investment and advisory firm focused on financial inclusion for the underserved, and Adlevo Capital, the first private equity firm focused on investing in African technology-enabled companies.

    Omidyar Network also supports GIF, together with the United Kingdom’s Department for International Development, the United States Agency for International Development, the Swedish International Development Cooperation Agency, Australia’s Department for Foreign Affairs and Trade, and the Department of Science and Technology in South Africa.

    Last Thursday, Omidyar Network hosted a Meet the Entrepreneur event featuring Paga, where Arjuna Costa, a partner at Omidyar Network who focuses on financial inclusion, joined Oviosu for a discussion about their model.

    Financial inclusion at Omidyar Network represents about 20 percent of the $1 billion the firm has deployed. Costa led a conversation with Oviosu in a room of investors and others who were interested in learning more about the Paga model.  

    “Too many people still look to Kenya’s mobile money success as the answer to everybody else in Africa — nothing could be further from the truth,” read the invitation to the event. “The impact and opportunities that have evolved thanks to the incredible work FinTech players like Paga and others are doing to advance financial inclusion in Nigeria cannot be understated.”

    • Banking & Finance
    • Economic Development
    • Innovation & ICT
    • Private Sector
    • Central Africa
    • Southern Africa
    • Eastern Africa
    Printing articles to share with others is a breach of our terms and conditions and copyright policy. Please use the sharing options on the left side of the article. Devex Pro members may share up to 10 articles per month using the Pro share tool ( ).

    About the author

    • Catherine Cheney

      Catherine Cheneycatherinecheney

      Catherine Cheney is the Senior Editor for Special Coverage at Devex. She leads the editorial vision of Devex’s news events and editorial coverage of key moments on the global development calendar. Catherine joined Devex as a reporter, focusing on technology and innovation in making progress on the Sustainable Development Goals. Prior to joining Devex, Catherine earned her bachelor’s and master’s degrees from Yale University, and worked as a web producer for POLITICO, a reporter for World Politics Review, and special projects editor at NationSwell. She has reported domestically and internationally for outlets including The Atlantic and the Washington Post. Catherine also works for the Solutions Journalism Network, a non profit organization that supports journalists and news organizations to report on responses to problems.

    Search for articles

    Related Jobs

    • Finance Coordinator Vanuatu
      DT Global
      Port-Vila, Vanuatu | Vanuatu | East Asia and Pacific
    • Senior Operations Officer – Climate Lead (5 Locations Available)
      Panama | Latin America and Caribbean
    • Senior Operations Officer – Climate Lead (5 Locations Available)
      Mexico City, Mexico | Mexico | Latin America and Caribbean
    • See more

    Most Read

    • 1
      Opinion: Mobile credit, savings, and insurance can drive financial health
    • 2
      FCDO's top development contractors in 2024/25
    • 3
      Strengthening health systems by measuring what really matters
    • 4
      Opinion: India’s bold leadership in turning the tide for TB
    • 5
      How AI-powered citizen science can be a catalyst for the SDGs

    Trending

    Financing for Development Conference

    The Trump Effect

    Newsletters

    Related Stories

    The Trump Effect'That money is going to sink us': USAID-funded startups fight to survive

    'That money is going to sink us': USAID-funded startups fight to survive

    PhilanthropyFoundations own huge amounts of stocks. Are they using them for good?

    Foundations own huge amounts of stocks. Are they using them for good?

    Devex NewswireSpecial edition: The other Spring Meeting — where growth met purpose

    Special edition: The other Spring Meeting — where growth met purpose

    • News
    • Jobs
    • Funding
    • Talent
    • Events

    Devex is the media platform for the global development community.

    A social enterprise, we connect and inform over 1.3 million development, health, humanitarian, and sustainability professionals through news, business intelligence, and funding & career opportunities so you can do more good for more people. We invite you to join us.

    • About us
    • Membership
    • Newsletters
    • Advertising partnerships
    • Devex Talent Solutions
    • Post a job
    • Careers at Devex
    • Contact us
    © Copyright 2000 - 2025 Devex|User Agreement|Privacy Statement