The Venture Capital Fund, 440.ng, a partnership between venture capital firms, 88mph and L5Lab, to bring early stage funding and the accelerator model to Nigeria, has opened applications for its 2014 Lagos accelerator programme.
Having successfully raised $1.5 million, the fund has begun screening start-ups for investment. The 440 model, innovated by Y-combinator in 2005, invests small amounts such as $20,000 to $110,000 in about 10 start-ups at a time. These start-ups are enrolled in a three-month intensive programme designed to quickly accelerate their product development, revenue generation, and customer acquisition.
In addition, start-ups are also connected to mentors, investors, partners such as Google for entrepreneurs, as well as other key clients that may increase their chances of success. “While we’ve been incredibly lucky to invest in great teams in the past, trying out this more scalable and intense model is the logical next step as we try to maximise our impact,” said Chika Nwobi, founder of L5Lab.
Nwobi continued that aside from capital, one of the most vital needs of start-ups is having access to experienced mentors, key decision makers, and the kind of peer-to-peer interaction that this kind of programme enables.
L5Lab and 88mph have invested in over 40 successful start-ups in Kenya, South Africa, and Nigeria such as Jobberman, Cheki, Apex Peak, Ghafla!, and Mdundo. The common denominator that these businesses share is the use of mobile/web technology to scale and disrupt traditional businesses, and target African consumers.
Kresten Buch, founder of 88mph stated that “Having seen the talent, hustler mentality, and sheer market size of Nigeria, I think we will see some amazing companies come out of this programme.
“Furthermore, the reception we’ve seen so far in Lagos, tells us that many experienced entrepreneurs and business leaders are looking to mentor, invest, and get involved in the mobile/web revolution that is happening in Nigeria right now.”
The company will be announcing some of those who have agreed to get involved as mentors over the course of the summer. Both Chika and Kresten are former mobile/web entrepreneurs who have successfully started and exited businesses, and understand the need to test ideas quickly in the market, and prioritise revenue generating activities from the start to ensure that the business is firstly solving a real problem, and secondly to build the groundwork for a sustainable business early on. Both are elements that will be a central part of the 440 accelerator programme.