Top of mind: Happy Sunday!
Africa’s tech entrepreneurs are making the great migration from the continent to the UK – and all for good reason. Today, we deep dive.
3 big things:
– London is Africa’s tech hub
– Flutterwave’s big bet
– Google backs Black Founders
Let’s get to it.
London is racking up the next generation of Africa’s tech entrepreneurs
The short: London, aka The Big Smoke, is becoming a major draw for Africa’s tech entrepreneurs.
Why it matters: The UK is ranked as the fifth-largest economy in the world and recorded the most VC activity across Europe in 2022, at €31 billion – with less than a fraction of that going to African startups.
But with the latest immigration stats and UK Venture Capital firms getting clued into Africa’s ecosystem, Africa’s tech entrepreneurs are moving some of their operations to the UK to access global opportunities and VC funding.
All aboard: The UK government recognised the tech industry as a primary driver of its economy and launched programs to boost the industry and attract international talent.
Before its acquisition by Founders Forum Group, Tech Nation was the premier program for granting residencies to non-UK tech entrepreneurs with exceptional talent. African founders were the biggest beneficiaries of this program and a significant part of the 2,500 visas issued by the government to entrepreneurs seeking to build global businesses in the UK.
The big move: For African VCs tapping into the UK market through Tech Nation, the goal is to connect their portfolio companies to UK investors.
Dayo Koleowo, a Partner at one of Africa’s leading Venture Capital companies Microtraction, tells me these moves are strategic:
“As an investor, my job is to make it easy for founders to raise money. This entails speaking to UK investors and educating them about Africa. Some UK investors are conservative, so they must be educated about the market and bridge the gap between Africa and the UK.
UK investors like Speedinvest and LocalGlobe – run by a father-son Duo Saul and Paul are investing and creating connections within the UK/Africa corridor, making it easy for more tech entrepreneurs to gravitate here – as opposed to the US, where it’s a lot harder and more expensive to move.”
Blaise Aboh, Founder of Traavu, which helps move tech talent and teams to the UK, says that some of these entrepreneurs need support with managing the mental hassle it takes to move countries. He’s built a business around a community of 317 Africans moving to the UK to set up competitive global tech companies.
“We help tech entrepreneurs understand their eligibility for Global Talent Visa endorsement by assessing their eligibility and profile and providing advisory services. When they get the visas, we simplify their move by helping them settle, advising on banking, how to build credit scores, taxation, renting, and helping them integrate into communities.”
Africa rising: Nigeria ranks high on the number of immigrants on the Global Talent Visa, spurred by challenges related to unemployment, security, access to funding and competitive opportunities.
A startup founder who moved their operations to the UK and spoke on the condition of anonymity tells me:
“The problem is, you reach a certain stage in your growth in Nigeria and hit a glass ceiling. There’s nowhere else to go. You either leave or stay small. So, I left.”
Despite this, many startups thrive on the continent, despite the regulatory environment. But some founders have moved their residential base and fly back and forth.
Pubs and hubs: London offers a unique opportunity for Africa’s tech entrepreneurs to scale their businesses, access new markets, connect with mentors and investors, and learn from best practices – many of these happening in pubs across the city. It is an excellent location for tech talent to seek opportunities.
Final thoughts: London has established itself as the European offsite for Africa’s tech players, and we’re set to see the figures double over the next five years. The city has a robust African diaspora community, a supportive ecosystem of accelerators, incubators, and networks, and a vibrant culture of creativity and diversity.
It’s a win for the next generation of Africa’s tech talent.
Flutterwave bags major partnership with Microsoft
The short: Flutterwave came out the gate with a significant partnership with Microsoft.
A first: This is the first time witnessing a significant partnership with a big tech company and Africa’s most valuable startup, Flutterwave. The partnership sets the stage for a 5-year relationship between these two conglomerates, with Azure being the bridge.
With this partnership, Flutterwave will serve its international clients spanning marketplaces like Uber and aggregators like Netflix.
What this means: Microsoft has a suite of products with African consumers – Azure, GitHub, OpenAI, office 365, and Teams. Microsoft needed a payments partner for its African operations, and Flutterwave stepped in to support Microsoft’s African business.
This partnership is a quid pro quo deal – Flutterwave will build on Azure, and Microsoft will integrate Flutterwave’s payment infrastructure for its Africa operations.
Microsoft recognises Africa as its frontier growth market and is investing heavily in capturing some of the market share from its competitor, Google. Microsoft will gain access to Flutterwave’s database of millions of users and businesses – giving Microsoft a leg-up in this partnership.
New platform, who this?: Flutterwave will migrate and develop products like Flutterwave for Business, Send by Flutterwave, Flutterwave Store, and Flutterwave for Fintech on Microsoft’s Azure cloud platform to connect African businesses to the global economy.
Final thoughts: The five-year deal is a sweet spot for testing out the efficacy of this partnership. And with Flutterwave’s growing client list and an uptick in digital transactions on the continent, we’re set to see tremendous growth at the five-year mark.
Google gifts African founders $150,000!
The short: Google doles out $150,000 to 25 African startups for its 2023 Black Founders Fund.
Black Fund steps in: Google’s Black Founders Fund is stepping in during a crucial “funding winter” in Africa’s ecosystem, especially for founders with limited access to venture funding.
Last year, Google funded an equal number of male and female-founded startups – but this cohort takes it up a notch, with 72% of the startups being women-led or co-founded by women.
Nigeria maintained its streak, leading with ten founders, while Kenya and South Africa had five and three founders, respectively.
Elevating: The Black Founders Fund will give 25 African startups $150,000 in non-dilutive cash awards and up to $200,000 in Google Cloud credits, ad support, and mentoring by industry experts and connections within Google’s network.
Final thoughts: The best startups need funding, and it’s been a slow year. Google is stepping in to give these startups an equity-free lifeline. And from what I’ve heard from Google Fund’s past cohorts, Google has been the best partner in scaling their businesses and offering guilt-free support.
It’s a win for the next generation of Africa’s tech talent. Long may it reign.
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