Congratulations to SPARK, Nigeria’s tech scene’s “company that builds companies”! They’ve closed a $2Mn investment from 17 individual international investors, three months after their launch, in nine days! “We expect to raise more money in the coming months to cement Spark as one of the preeminent Internet groups in Nigeria and Africa.”
Internet entrepreneurs Jason Njoku, Bastian Gotter and Mary Remmy-Njoku of the successful Nollywood movie platform iROKOtv and media company iROKO Partners launched SPARK last May as a new $1Mn fund to revolutionize Nigeria’s angel investment eco-system, focusing solely on the country’s Internet startup scene. Following this launch, a number of high net worth individuals from Lagos, Singapore and London approached Njoku and Gotter to discuss the potential of investing their private capital into Africa.
Jason Njoku, Spark Managing partner expands: “We have been able to raise the sum of $2Mn in nine days from high network individuals, a mere three months after the official SPARK launch. We expect to raise more money in the coming months to cement SPARK as one of the preeminent Internet groups in Nigeria and Africa.”
The investors’ direct approach and the fact that SPARK opened and closed the round in nine days demonstrates how international investors’ interest in Nigeria’s Internet industry is growing, revealing the huge potential the continent holds in terms of building an exciting and profitable Internet marketplace. The investment round in SPARK is based on a $10Mn valuation for the three month old company. Currently, the Internet sector in Nigeria is valued at $250Mn. Industry experts have calculated that this will increase to $1Bn by 2016.
Njoku and Gotter will use the $2Mn to expand the company’s offices, initially in Lagos, before opening SPARK hubs across Nigeria. The investment will also provide further follow-on rounds of seed-investments for SPARK companies.
Bastian Gotter, SPARK Managing partner explains: “Capital here in Nigeria is prohibitively expensive for most, so start-ups tend not to be able to grow at the rate that is required to become a mature and profitable business. SPARK companies now have the capital behind them to invest in technology, good staff, building out their inventory – whatever is required to make them into a stronger long-term business. Jason and I have previously been vocal on the shortcomings of Nigeria’s business eco-system and how investment does not reach the right people. With this additional investment of $2Mn, we are now able to channel even more funds to the companies who will one day lead the continent’s Internet space.”
To-date, SPARK has invested in some of Nigeria’s most exciting Internet startups including Hotels.ng, leader in hotel room booking services in Nigeria (check out their VC4Africa venture profile); Bus.com.ng, Nigeria’s number one bus ticketing website, and ToLet.com.ng, who are revolutionizing the customer facing lettings space in Nigeria.
Jason Njoku adds: “We set out to grow the SPARK companies to be market leaders. This requires capital. Our companies are laser focused, totally exceeding our initial expectations and showing increasingly strong metrics. Every SPARK company focuses and generates revenue which we feel is essential to the survival of any Internet startup in Nigeria. Bastian and I were impressed with their output, as were our investors.”
SPARK companies currently employ 130 people across the nine launched companies, three of which have already secured second-round seed investments totaling an additional $700k from Njoku and Gotter, primarily to build upon their current market leading positions, compete more effectively and enable them to expand fast enough to meet consumer demand. Spark companies collectively generate $50,000 turnover a month and this figure is expected to increase significantly as the companies begin to really build traction.