US-based VCs (venture capitalists) should get off their arses and realize that there is a greater world out there than what they hear about on the US East or West coast. I’m not talking about Europe or Israel either. I’m echoing what Ben Parr said in a recent Tech Caucus email that:
we in the Silicon Valley / LA / NYC bubble have no clue what’s happening in Africa.
Life as a VC has been OK for a while, but now the dream of unicorns is coming to an end. The tragedy is that US VCs have only considered that a unicorn should come from the USA. But there is another area of potential unicorns, finding needs that can assist the billions of people not in the US. I’m not referring to the ‘bottom of the pyramid’, but the increasing number of lower- and middle-income populations that are emerging in Africa.
African startups are defying the global tech slowdown with most of the activity coming from sub-Saharan Africa’s major economies – South Africa, Nigeria, Kenya. US VCs can help African startups address one of their biggest challenges, not finding ideas or identifying solutions, but in providing access to finance.
As a US VC you might argue that you can only manage startup investments where you’ve invested several million dollars, that you don’t know the region and its issues, and that African startups are really angel investor territory. But my response would be come to Africa and meet some of the very savvy private equity investors we have on the continent. You don’t know what you don’t know, but by taking 7-10 days away from the US you will be able to meet people who will open your eyes to investment opportunities you haven’t even thought of.
To help you generate some ideas, here’s the Gartner 2015 Hype Cycle for ICT in Africa.
It’s never been easier and cheaper to visit Africa, and it’s going to get harder for US citizens to get EU visas. However, as a US citizen you can enter South Africa without a visa. So why not come and experience the warmth of Africa’s winter (in your summer) and start making contacts.
Update: I’ve become aware of a book published in 2015 – The Next Africa – which describes how:
A wave of transformation driven by business, modernization, and a new cadre of remarkably talented Africans is thrusting the continent from the world’s margins to the global mainstream.