Getting investment in your start-up is the dream of any start-up founder. Whether it’s from an angel investor, a venture capitalist or even your parents who want to believe in you at any cost, it’s a huge achievement to be celebrated.
Like a beautiful woman being wooed by a potential suitor, start-ups from Lagos seem to be enjoying the attention of investors and getting a fair share of investments for the African startup market. Andela recently received an investment of $40m in Series C Funding led by pan-African venture firm, CRE Venture Capital. On the other hand, even with recent spotlight from the media, the start-ups from the South South and South Eastern region seem to be struggling to get noticed by the investors. Some players in the start-up community in Southern Nigeria even feel that they are being overlooked by these investors.
In a short chat with him, Mr Chinenye Mba-Uzoukwu, MD/CEO Infographics, however holds a differing view. In his opinion, start-ups from the South South and South East need to make themselves more attractive and visible to investors. At the recently concluded Stakeholders conference for start-ups in the South-South and South East held at Imo State, he said
“An investor cannot just refuse to come to the region. By nature, that is who an investor is. He is putting his investment and hoping to make some returns. Why wouldn’t he want to come if the opportunity is there? We need to make ourselves more attractive to the investors and that includes making ourselves more visible. When we say start-ups in the region feel ignored, maybe it’s because they haven’t done enough to make themselves know that they cannot be ignored. It has a lot to do with understanding the mind of the investor, which is strange because most of the South-South and South-East is driven by entrepreneurship. But then, you ask yourself, why haven’t we taken that entrepreneurship into the digital realm which is the way it should be?”
One way he suggests for them to stand out is to look inwards for product differentiation. Wondering why the region has failed to tap into its inherent strengths such as entrepreneurship and export it into the digital realm, he believes it is because our macro economy in terms of policies and infrastructure does not support the digital economy. Thus the onus is on Start-ups to bridge this deficit and work extra hard to make themselves attractive to investors
“We have all the elements of entrepreneurship in place. We have a long history and culture around entrepreneurship. We are willing to take the risk. We are willing to go anywhere. You see these people across the South-East and South-South who are actually innovating, starting businesses and launching new businesses. However, with regards to the digital economy they haven’t done that”
Mr. Mba- Uzuokwu also advises start-ups against the copycat and replica syndrome that seems to have struck a lot of Nigerian start-ups. According to him, start-ups need to leverage on their knowledge of their local environment and generate solutions that address those issues. He gives an example of the futility of creating a replica of Uber, in a city predominantly driven by motorcycles. He believes that for start-ups to attract investors, they need to create a business case for investors to come and invest.
“We haven’t done the needful. When we get to the point where we have done the needful, we will start to see things turning around. There are businesses that will be built in the South South and South East and will not survive here because all the necessary elements don’t exist to support that business. If you are a start-up and you address something fundamental that exists in Yenagoa, for instance, shipping, environmental management and also a lot of things there, be that but don’t be an Uber in Yenagoa. We build a technology just because we can build it and make a business case for it as opposed to going the other way round.”
The former General Manager for Microsoft Anglophone West Africa is of the firm opinion that start-ups need to understand what the drivers are for investment and for building sustainable quality around their businesses. Universities in the region also need to contribute by churning out more developers in order to attract the right investors who will have access to readily available young resources.
When asked what needs to be done in summary, Mr. Mba- Uzoukwu’s response is simple. Create but don’t just ideate.
Adaora Okoli is Publisher and Founder of Techcultureng