BCW #8: Funding Tactics for African Startups
Actionable Strategies to Unlock Capital in Africa's Impact-Driven Tech Ecosystem including a $10,000 Equity-free Opportunity
Summary: In this week’s newsletter, we dive into smart funding tactics for African founders, inspired by a subscriber’s request on navigating Nigeria’s competitive funding landscape. From grants to pitch competitions and angel syndicates, we explore some practical steps to secure capital, overcome common challenges, and scale impactfully. With real-world examples of African startups who have successfully secured funds from investors, this issue is packed insights for founders and investors alike. So grab a seat!
From The Desk: Funding Tactics for African Startups
Hey fellow builders,
Last week, a subscriber on BuildersCabal dropped a comment that hit home: “Raising capital in Nigeria feels like a maze — too many rejections, not enough clarity on what investors want. How do I stand out?”
His words took me back to 2021, when a friend was advising a Nairobi-based startup pitching at a local competition. They had a killer idea but kept striking out with investors. The problem? They were pitching tech, not impact.
Once they reframed their story to highlight how their solution empowered smallholder farmers, they landed a $30,000 grant and a handshake from an angel investor. That pivot changed everything.
His struggle is real — and it’s not unique to Nigeria. Across Africa, founders face a funding landscape that’s both vibrant and daunting. In 2024, African startups raised $2.2 billion — a 31% drop from 2023 — with Nigeria, Kenya, South Africa, and Egypt accounting for 67% of the total. Yet amidst this “funding winter,” opportunities abound for those who know how to navigate the maze.
This week, we’re unpacking actionable funding tactics — from grants to pitch competitions to angel syndicates — tailored to Africa’s impact-focused tech ecosystem. Let’s dive in!
Tactic 1: Master the Art of Grants for Early-Stage Traction
Grants are a lifeline for pre-seed and seed-stage startups, offering non-dilutive capital to build prototypes or prove market fit. But grants aren’t handouts — they demand a compelling narrative tied to impact.
Actionable Steps:
Research targeted grants like the Africa Business Heroes or the Anzisha Prize for young entrepreneurs.
Align with impact by framing your startup’s mission around solving local challenges - health, financial inclusion, food security etc.
Polish your proposal — be specific about milestones. For example, “$50,000 will fund 10 pilot clinics in Lagos” beats vague promises.
Leverage networks by engaging in communities like BuildersCabal and the African Founders Foundry for grant application support and mentorship.
Tactic 2: Win Pitch Competitions to Gain Visibility & Capital
Pitch competitions are Africa’s stage for founders to shine. They offer cash, exposure, and investor connections.
Actionable Steps:
Find the Right Stage: You can target competitions like Innovation City’s Startup of the Year in Cape Town or Africa Business Heroes’ pitch finale.
Craft s Story, Not a Slide deck: Highlight your “why” to resonate more than the tech jargon.
Show Traction: Investors want metrics - revenue, users, or retention. Even small wins build credibility.
Follow up Fast: Connect with judges or attendees within 24 hours post-pitch to build relationships.
This is one you can apply for now:
Pitch2Win
On July 30, 15 early-stage startups will pitch live in Lagos to a room full of investors. One startup will walk away with $10,000 (equity-free), but every founder gains visibility and valuable connections. Deadline to apply is June 15. You can apply now at: Apply here.
Tactic 3: Tap Angel Syndicates for Flexible, Relationship-Driven Capital
Angel syndicates are a growing force in Africa. Unlike VCs, angels often invest based on trust and shared vision, making them ideal for early-stage startups.
Actionable Steps:
Build relationships first: Attend ecosystem events like Lagos Startup Expo, Moonshot by TechCabal or join communities like BuildersCabal.
Target local angels like those backing female-led startups.
Offer clear terms: Be transparent about valuation and exit.
Show personal commitment: Angels bet on founders, not just ideas. Share your hustle-late nights, customer wins, or community impact.
What’s Your Move? How are you navigating Africa’s funding maze? Share in the comment or hit reply with your biggest funding challenge or a tactic that’s worked for you.
Hot On The Radar: Nigeria & Africa Tech Ecosystem
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A new U.S Nigeria trade deal is set to unlock more investments for Nigerian startups: A new U.S.-Nigeria trade agreement may offer a lifeline to the country’s startup ecosystem amid a global funding slowdown. Signed in July 2024, the U.S.-Nigeria Commercial and Investment Partnership (CIP) aims to…. Read More
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Money Moves
PalmPay in talks to raise up to $100M: PalmPay is in talks to raise between $50 million and $100 million in a Series B funding round, according to TechCrunch… Read More
Carrot Credit has raised $4.2 million in seed funding to expand its asset-backed lending platform: Carrot Credit, a Nigerian fintech startup, has secured $4.2 million in seed funding to scale its alternative credit service that allows users to… Read More
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Opportunities This Week
Applications open for 2025 Llama Impact Accelerator to boost AI startups in Africa. Apply here
Moniepoint is hiring for several roles. Apply here
Nomba is hiring a Backend Engineer. Apply here
Betternship is recruiting Social Media Intern. Apply here
Fokescareers is hiring for Business Developer Manager. Apply here
No-code Tool of the Week
Flutterflow is a powerful low-code platform that allows you to build and launch mobile apps quickly without extensive coding knowledge. It's ideal for African founders looking to prototype and deploy solutions efficiently.
Fast Insight
“Building in Africa requires patience and a deep understanding of local realities.”
Context: Success here is tied to cultural fluency and long-term commitment.
— Tayo Oviosu (Founder & CEO, Paga)
Links We Loved
Must-Watch Movie: Makemation is a 2025 Nigerian AI-tech themed family film that tells the story of a brilliant young girl in rural Lagos who uses her tech knowledge to navigate challenges.
Podcast: TechCabal Weekly offers insights into Africa's tech ecosystem, featuring interviews with founders, investors, and industry experts.
In case you missed the BuildersCabal Community Rules of Engagement. Check it out here
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Till next week, Stay Building!
Chioma Judith
Writer/Curator of BuildersCabal Vibes