Investor Talk: Predictions for 2016

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As we welcome in the new year, here at Disrupt Africa we thought we’d ask our investor friends for their predictions for 2016.  This is what they said…

Mbwana Alliy, managing partner, Savannah Fund:

“African corporate VCs will increase their activity from telcos to banks as they get more pressure to innovate in the global fintech boom, but startups need to select carefully how they can add value whilst not limiting their future options.

Pan-Africa scaling will remain a big challenge for startups that have raised Series A especially operating in relatively small countries as an initial market.

Tech exits are just around the corner! Really! Some have already happened and not necessarily reported in places like Nigeria (notable ones in 2015 were Woothemes in South Africa, and Weza Tele in Kenya).”

Andrew Carruthers, managing director, Novastar Ventures:

“We are excited by the opportunities in Ethiopia, but wonder if there is now quite a lot of money chasing the available deals there at the moment.  Nevertheless, we are hoping that as the big infrastructure projects (hydro in particular) come to a close, the availability of hard currency improves the environment for investors considering how they are going to get their returns out of the country.

We see quite a lot of activity in the micro lending sector as the availability of capital for the ‘financial inclusion’ agenda increases.  

The arrival of larger funds may begin to drive investment activity outside the capital cities into the regions.  This has already started with off-grid power.

There is an increasing amount of money being made available by DFI’s and other government providers for strengthening the entrepreneurial ecosystem, but not many new ideas on how to use it beyond the funding of incubators, mentorship programmes and seed funds.”

Paul Cook, founder and managing director of Silvertree Capital:

“Macroeconomically it will be a difficult year for major markets, with South Africa and Nigeria both facing headwinds from end of resource boom along with political uncertainty. The continent will grow overall but weaker leading markets may reduce investments into the biggest players.

That said, a tough macroeconomic climate is often when the foundations of tomorrow’s winners are laid, which we’ll see in in years to come.

Fintech is probably for me the sector where breakthrough African startups are most likely to come from in 2016. Other sectors are either too early stage, or vulnerable to/driven by global players.”

Bunmi Akinyemiju, chief executive officer of Venture Garden Group:

“Future projections for the industry remain bright. In 2016 and beyond, we can expect more technology innovation around banking – we see a lot of new companies growing to serve this gap.  In addition, we believe that there will be some strong home-grown cyber-security companies to counter the high growth of fraud incidences within the financial sector.”

 

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Inspired and excited by the African tech entrepreneurial scene, Gabriella spends her time travelling around the continent to report on the most innovative tech startups, the most active investors, and the latest trends emerging in the ecosystem.

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