More American investors backing African startups

By Nicel Jane Avellana

Feb 23, 2014 09:16 PM EST

An increasing number of US-based high tech firms and venture capital investors are investing in African startups, TechCrunch reported.

Investors are clearly thinking of Africa based on recent developments, including the 16 Botswana-based mobile apps that Jim Goetz spoke of when he gave his view on the WhatsApp purchase by Facebook and the alliance Microsoft has forged with three African incubators. This is also signified by the setting up of new innovation centers in Lagos and Casablanca by IBM and the summit sponsored by the African Development Bank which tackled ways to effectively engage the private sector, the report said.

CrunchBase data showed that last year was the busiest in the African continent in terms of technology investments. The number of entrepreneurs in Africa is also increasing. For example, the IBM Innovation Centers located in Lagos and Casablanca will provide new tech startups with access to the technology and expertise of the Armonk, New York-based technology giant when it comes to big data, cloud computing and analytics. They also gain the advantage of skills training as well as support for business and marketing, the report said.

IBM Researcher and Vice President of Science and Technology Solomon Assefa told TechCrunch, "In the last decade we've seen a lot of transformation [in Africa]. There's increased stability and a lot of bandwidth that's come on line, tremendous economic growth, plus a lot of infrastructure being built and a lot of foreign investment."

This is also the view held by other executives working for the biggest corporations in the US. In February last year, Microsoft rolled out its 4Afrika program which recently chose five startups for its lending initiative, the report said.

Intel Capital is also planning to invest millions of dollars in startups in Africa. While Managing Director and Head of the firm's Eastern Europe, Middle East, Africa and Russia/CIS Investment Group Marcin Hejka would not tell TechCrunch the exact amount they intend to invest in the continent, he said, "This is the message I give my team in Africa: behave like there is no limitation [on capital]."

© 2023 VCPOST, All rights reserved. Do not reproduce without permission.

Join the Conversation

Real Time Analytics