Today’s featured member of the VC4Africa community is entrepreneur Toni Maraviglia of MPrep, incubated at the m:Lab in Nairobi, Kenya. Mprep sells mobile educational tools to schools across Kenya. Over 8,000 users at over 400 Kenyan schools are using their tools, and impact studies show that MPrep helps students increase their exam scores in English, Math, Kiswahili, and Science more than the average student.
We understood from a Bloomberg article you have secured investments from angel investors. What have you secured and what are you still looking for?
“Last year we were able to survive off $80K we made in competition money. We just accepted our seed round of investment, which was $200K. Our goal was to raise $150K for one year of runway and time to prove out a great business model. We’ll be fundraising a larger, equity round and closing it about a year from now. We have just started conversations around this.”
Can you share with us some insights on how you found the investors?
“Our current investors were found through professional connections, and we grew with them over time. We just closed in January 2013, and some of the conversations around investment started back in May, even March 2012. Angel investors want to see growth, traction, and want to help you get there. They want to know you’re progressing. Many of them, in a sense, become a part of your team.”
Do the investors have an active advisory role with Mprep or is the involvement purely financial? Was it complicated to negotiate the terms?
“It depends on the investor. Our investors are all huge champions for us. We’re an educational company, so I can’t say for any of them it’s ONLY about the money. People want to see growth, impact, and potential to change the status quo. A few of our investors have become our greatest advisors. We have very entrepreneur-friendly investors that help us and negotiated terms for us that were very reasonable. It’s our investors’ goal to see us get to a Series A equity round and to do everything they can to help us get there.
As some advice to other entrepreneurs, know what terms are fair for our market! If you don’t know, ask! Email me, or email someone else who knows. I read the book ‘Venture Deals’ before starting this whole process, and it gives a fantastic perspective.”
How did you make use of lawyers, advisers and other resources? Was this money well spent?
“We made use of everything we had. The most helpful resources I had were other entrepreneurs, advisors, and the investors that committed early to MPrep. They helped lead the fundraising process. One thing I would also note is how important it is to get early traction and partnerships — strategic ones that will really drive traction.”
We understood from the Bloomberg article you have initiated a next round of funding?
“We have not officially started a next round of fundraising. I was supposed to be on a fundraising break for January and February, to tell you the truth. We’re still thinking through what this round will look like, when it will close, who the lead investors would or could be, etc. I would say we’ll start actively fundraising for it in June, when we’re at the Unreasonable Institute.”
How do you think you will gain from the Unreasonables program?
“I think we’ll be able to work with fantastic mentors and advisors that will help us strategize long-term growth plans, especially when it comes to moving internationally.”
How do you see the VC4Africa community and how do you use VC4Africa?
“I read all the weekly updates. Mostly to check for competition in possible markets! I learn a lot more about companies I never knew existed across the continent. I also look for companies for potential partnership. We love partners that make sense.
What advice would you give to other ventures in the VC4Africa community, who are also looking for funding or are in other phases of building their businesses?
“One: You don’t know what your market wants. Dig deep and find out. This will make you 100% confident when you talk to potential investors.
Two: Your team is more important than the idea.
Three: Investors have a lot of good advice, even if they know they won’t invest in you or you aren’t a fit for their repertoire. Ask them what they think. Ask them who else you should talk to.”
How can other VC4Africa members support you?
“Contribute to our crowdfunding campaign!! Every bit counts. See the Unreasonable Institute’s website.”
Anything else you’d like to add?
“Get obsessed with your company. The MPrep Team works really hard but has a lot of fun doing it. And a quick shoutout to the Team: Kago, Chris, Peter, Isaac, Moses, Mercy, Christine, Kush, Joe, and Jackie. You’re my heroes!”
For more information, see Mprep’s VC4Africa venture profile.