Africa’s 88mph Start-Up Accelerator Eyes Nigerian Expansion
Written by Adam Oxford | From ZDNet
88mph, a high tech startup accelerator with offices in Nairobi and Cape Town, is branching out to a third African country later this year when it begins a new operation in Nigeria’s most important tech centre, Lagos. The company is forming a new venture, 440, in partnership with L5Lab, a local seed funding specialist and business mentor.
Since it launched in Kenya in 2011, 88mph has raised over $4.5m from African and European investors and funded 34 companies through its three month “start-up garage” programs. Applications for the first cohort of 10 to 12 Nigerian companies will begin in May, and the program itself is expected to kick off in August.
Last week, Nigeria overtook South Africa as the continent’s largest economy in GDP terms, with growth at around seven percent. 88mph founder Kresten Buch says that with rapid growth there’s an opportunity for private finance to get involved in the burgeoning startup scene.
“There’s a lack privately funded initiatives run by experienced entrepreneurs [in Lagos],” says Buch. “You can’t substitute that with government incubators and startup consultants that haven’t built a business and don’t have the pressure to deliver a return.”
Buch, a successful Danish entrepreneur in his own right, founded 88mph after meeting Kenyan businessman David Owino at Stanford University in 2009. At the time, Buch says he was looking to create an angel investment fund in Europe, but Owino convinced him to look at emerging economies in Africa as ripe for Y Combinator-style incubators, with plenty of talent, lower costs, and little competition compared to Silicon Valley.
Buch says that the most successful venture has been ApexPeak, an online marketplace for small businesses seeking short term trade finance. ApexPeak has so far raised $2.4m from investors looking for quick returns, and Buch says that there’s no shortage of demand for the service from firms looking for liquidity in markets where banks are reluctant to lend and slow at making decisions.
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