Whether you call them investors looking for projects to fund in kenya, private investors, seed investors, informal investors, business angels or angel funders, these are the names used to refer to angel investors in Kenya. Business angels are private individuals who invest financially in a start-up or company at a very early stage and at the same time support the founders with know-how and contacts. But until startups have found such a private investor who secures their basic financial resources and nurtures the company baby, a lot of sweat runs down their foreheads. We will therefore show you where to find angel investors in Kenya – and how to choose them correctly…
Angel investors in Kenya: Angel investors for startups from heaven
In contrast to venture capital companies, which focus more on growth financing, business angels invest in startups at an early stage – so-called early stage or seed investments. Typical for such a angel investor participation are not only the small sums of capital with which the business angels get involved (often only up to Ksh10,000,000, rather less), but above all the know-how that the angels bring with them.
In technical jargon one therefore also speaks of smart capital. Most business angels not only act as financiers, but also as consultants, start-up coaches and door openers who use their network to get the first important business alliances off the ground.
In addition, the Angel investors in Kenya are quite picky. A good business idea alone is far from opening their cash box. Founders also have to convince…
- with their management team.
- a clear vision.
- a recognizable monetization strategy.
- Product or service traction.
- a lucrative market.
- and through your own financial commitment.
Anyone who only hopes that others or the business angel will shoulder the financial risk alone will usually get nothing.
If all of these points are correct, however, the following questions arise from the founder’s perspective:
- How do I get such a business angel?
- Where can I find my personal business angel?
We have put together the most important tips and networks for you…
Where can I get investors for my business in Kenya? List of angel investors in Kenya
Kenyan startup funding can be successful by trying to focus on the following areas:
Startups have the opportunity to submit an executive summary of their business plan.
- start-up platforms
These include portals such as Crunchbase.com, where founders can present themselves and present their ideas. Crunchbase could be described as an international startup database that is continuously edited. A good tool to put yourself in the limelight and thus to lure the media and investors – business angels, for example – onto your trail. The AngelList belongs to the same category, is a mixture of Wikipedia and a social network: create a profile, network, research and look for investors – startups can do fundraising here and woo potential financiers directly. But: This does not happen on its own. Without regular updates and research, the search will come to nothing.
There are also so-called accelerators and start-up support programs.
Below are some of the people listed under angel investors in Kenya:
- Yaniv Gelnik
- Aadil Mamujee
- Ush Patel
- Daniel Goldfarb
- Mark Straub
- Donna Harris
Searching for angel investors in Nairobi could be a better solution to finding angel investors within Kenya. Some of the business sponsors in Kenya or those that lend funds include:
- Angel Networks
- Financial foundations
- Chandaria Foundation,
- Safaricom Foundation, and
- Agriculture Finance Corporation
- Venture Capitalists
- Industrial Development Fund
- The Industrial and Commercial Development Corporation (ICDC)
- Kenya Industrial Estate
- Women Enterprise Fund
- Uwezo Fund
- Youth Enterprise Development Fund
- Crowdsourcing Micro Lenders
How do business angels invest in Kenya?
You can approach business angels in the early stages of the company. Although you bear a high risk, you also participate in the great growth dynamics and the increases in value at the beginning.
Some angels invest alone in a startup, others join forces to form mini-networks in order to efficiently bundle their networks, strengths and capital.
Depending on the calculated company value, the company shares are then between 20 and 49 percent. Founders should not accept more in this phase.
However, business angels do not want to buy a season ticket with it. Your interest and investment time are limited. Typically, after four to seven years , angels look for a so-called exit, in which they sell their shares – at a profit, of course – to another investor (or on the stock exchange). In order to make your startup more attractive to private investors, you should also think about possible exit strategies for Angels. As a rule, this is achieved by planning further rounds of financing in the business plan.
How do I choose a business angel in Kenya?
In the beginning there is a focus on your own product. A brilliant idea, a solid business plan, a good presentation – these are the basic requirements for even being able to win over a business angel. You should definitely prepare a so-called one-pager (executive summary on one page) or a so-called pitch deck (maximum 15 pages) in which you outline the most important key data of the company. Anyone who shows up to investors without doing their homework looks unprofessional right from the start.
Which startups has the business angel supported so far? How many? How long has he been doing this? What else is he doing? When did he get on and off again? In short: what is his track record like? Obtaining information, looking at references, squeezing other people about him – you should take the time, because there are also some money vultures and rip-offs in the Engels industry. By the way, they are called Business Devils within the industry . Be wary of them. Tip: Never advance money in order to supposedly get some afterwards.
The chemistry must be right. A sentence made for phrase pigs, but no less true: Founders and angels spend a lot of time together, talking, advising, brainstorming, conferring – over the Internet or face to face. If you do that with someone you can’t stand, you’ll sooner or later lose interest. The private harmony must be right – you hear that again and again in the industry.
The world is networked like never before. However, physical proximity is still an advantage: A joint exchange between the founder and the angel investor can eliminate grievances faster than a round of Skype. Going to a trade fair together, door-knocking, discussing, drinking coffee, and so on… When Angel is a ten-hour flight away, all of that is more difficult.
The angel with the thickest checkbook is not always the best candidate. The more important question is often: How many shares and freedom of choice do I have to give up for this? Here it is important to carefully weigh up the need for financing and the scope for creativity. A business angel who supports you in the operative business and actively helps to build up a functioning company may be the better choice.
Your business angel is optimally networked with other investors, lawyers, recruiters and marketing people. Advantage: He has your back and brings you together with external experts so that you can concentrate fully on your core business. After all, as a founder, you not only want to benefit from your angel’s mammon, but also from his contacts – from someone who will advance your startup and make it better known. Can your business angel do something like that? But also important: If a business angel holds too many shares, he may not have enough time for you. Industry expertise and references in abundance do not always have to be an advantage.
On the one hand, it makes sense to focus on people who have a wealth of experience in the respective industry. Example: Angels who have previously invested in other fintechs and know the pitfalls of the industry are ideal for a fintech startup. On the other hand, it can also make sense to take off your blinders and approach business angels who have not yet had any industry experience. Private investors are curious and enthusiastic – and thirsty for fresh ideas. Fear of contact with business angels from outside the industry is therefore a bad guide.
A tip for advanced users: If you already have a business angel at hand, you should involve them as much as possible. Specifically: you should go with them to look for investors. A well-known name creates trust and credibility – and increases the chance for future financing rounds.
How to be taken seriously as a young founder
Work experience is certainly a helpful factor in starting your own business and finding investors. Nevertheless, more and more young founders are daring to take the step into self-employment, not least because there are much lower market entry barriers today, both technically and via the Internet. But young founders in particular have to prove themselves even more in order to be taken seriously .
The following tips will show you how:
Don’t let that get you down
Every founder has to reckon with headwinds at the beginning. This can be even more severe for young founders. Investors will advise you against your plan, tell you that you can’t do it or even outright declare your idea to be absurd and bad. If you want to be taken seriously, don’t let that get you down. Demonstrate that you firmly believe in your idea and have strong and reliable arguments for it – preferably numbers. If there are even first results, first customers and market interest, the ice is broken and investors will pay less attention to your age.
An appropriate business outfit, the right body language and also a professional presentation, for example when you present your business plan – all these things have an enormous influence on the first impression you make. Here you can already set the course, whether you will be perceived as a serious founder with solid planning or as a young student with a dream. Of course, you should not pretend, otherwise you will lose authenticity.
Make the right contacts
You still lack the experience? Then find a mentor or two before approaching investors. Benefit from the experiences that older founders have already had and use their knowledge for your own company and your personal career. Not only can you learn a lot, but you will also be taken more seriously if you surround yourself with successful and experienced entrepreneurs.
Use your age as a strength
Even if age is often interpreted as a weak point, it can be your greatest strength: Perhaps you understand your (young) target group much better and can use this knowledge to set yourself apart from the competition. Or you have a critical look at the old structures and recognize which errors exist and how these can be avoided today. Make it clear that you bring a breath of fresh air.
We hope now you have an idea regarding Kenya start-up funding as it relates to angel investors.