Iyin Aboyeji, the founder of the VC firm Future Africa, and Mia von Koschitzky-Kimani, a general partner at the firm, are launching Accelerate Africa, an accelerator backed by a $750,000 USAID grant. Aboyeji and Koschitzky-Kimani, who have two unicorns and several exits between them, hope to produce the next generation of global businesses.
“The big idea is to become the YC of Africa,” Aboyeji told TechCabal.
Accelerate Africa’s first cohort will run for eight weeks and admit ten pre-seed and seed-stage startups across all sectors and from any of Africa’s 54 countries. During the programme, Accelerate will work with founders to improve their storytelling, build their team, and figure out business development and product development.
The launch of Accelerate Africa comes as accelerators are quietly shutting down across the continent. Y Combinator, arguably the world’s most famous accelerator, is also beating a retreat from Africa. The accelerator’s summer 2023 cohort had only three African startups.
“We are looking for founders with great ideas and massive market opportunities. The impressive ones who would have gotten into YC but can’t because YC is closing their doors to Africa, so to speak,” Aboyeji told TechCabal.
Aboyeji doesn’t find the American accelerator’s refocus on its homeland surprising. “When capital is scarce and expensive, you will focus on the demography you know. Especially if you have had egg on your face several times.”
Last year, YC-backed companies like 54Gene and Dash shut down in clouds of controversy after raising significant amounts of money.
Accelerate Africa will fill the shoes of now-retreating American accelerator Y Combinator, a funding magnet and a mark of credibility for African startups. Iyin Aboyeji is confident of success.
“We have an African perspective, which YC lacked. We also have access to regulators and leaders at [traditional financial institutions like] banks and can provide guidance grounded in the context of Africa’s market and business realities.”
How will Accelerate Africa measure success?
Unlike the recent trend of accelerators running remotely, Accelerate Africa will work with the startups in person throughout, and the ten selected startups will be divided into two groups of five.
For the first six weeks, the programme will run concurrently in two cities—Nairobi and Lagos—headed by Koschitzky-Kimani and Aboyeji. In the final two weeks, five startups in Nairobi will join the teams in Lagos. The first cohort will run from April to May.
The accelerator will measure its success by the amount of follow-on funding the ten startups get during and after the programme. However, unlike YC, participating in the accelerator does not come with guaranteed funding from the accelerator itself.
This distinction is important to Aboyeji because of an earlier experience in the pilot phase of the accelerator, where all 25 startups were offered investment for participating. “Finalising those equity investments was a messy process, as realised during the programme that the thesis of the Future Africa fund did not align with some of these businesses. We didn’t invest in all 25 of them.”
At the end of the accelerator programme, participating startups will get a chance to pitch to investors on demo day. This will include angel investors who typically write $25,000-$50,000 cheques, Series A and Series B investors, and Future Africa, whose cheque size ranges from $250,000-$500,000. But Aboyeji is clear that the accelerator is not a pipeline into Future Africa’s portfolio. “We may invest or might not.”
The accelerator is separate from the VC firm, but the programme will be facilitated by some staff of Future Africa and may raise some concerns about a potential conflict of interest between Future Africa and its new accelerator program, considering that some startups may hold ideas and technology similar to existing portfolio companies.
“We’re not signing NDAs,” admitted Iyin Aboyeji, “but we have no interest in building startups ourselves.” He also said Future Africa has a reputation for ‘Chinese walls’ within its portfolio, so startups can rest assured their information won’t be shared with potential competitors.
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