There is a correlation between quality of startups and the number of tech hubs in their country of origin, according to insights released by the GSMA Ecosystem Accelerator’s on the basis of applications to its recently launched Innovation Fund.
Disrupt Africa reported in July the GSMA’s Ecosystem Accelerator announced the launch of the Fund, set to provide funding of up to GB£250,000 (US$310,000) to African and Asian startups using mobile technology. For its first round, the focus was on startups active in the areas of sharing economy, or mobile services for small and medium enterprises (SMEs).
More than 400 startups applied to the Fund; which has been narrowed down to a shortlist of the top 100 applicants. 75 per cent of these are African companies, led by Kenya, South Africa and Nigeria.
The remaining shortlisted applicants are from Asia – mostly from Pakistan and Vietnam.
The GSMA says there appears to be a correlation with between the origins of top applicants, and the number of tech hubs present in the country.
The five countries home to the top applicants are also in the top 10 countries with the most tech hubs in operation, according to the GSMA.
Furthermore, 44 per cent of applicants to the Innovation Fund work with a local tech hub.
Information has also been released on how the shortlisted startups have been funded to date. 31 per cent of the startups operate on the founders’ own savings. 26 per cent cited grants as their main source of funding. Angel investors were mentioned by 19 per cent of the shortlist; while only 12 per cent said they had secured venture capital (VC) funding.
Of the 100 shortlisted startups, 27 are currently being supported in building a full proposal, while due diligence is also being carried out by the Fund.
An independent panel will select 12 of these startups to receive grants of between GB£100,000 (US$124,000) and GB£250,000 (US$310,000) – funded by the UK Department for International Development (DFID); to be announced by March 2017.