How to raise capital globally: The pitch

Earlier this year BitPesa, the company I co-founded, closed a $2.5 million series A round led by Draper VC, totalling up to USD 6 million raised in the past 2 years. I know from experience that fundraising is very hard. In the next weeks, VC4A will publish a series of 3 articles where I will share my story and fundraising experiences – including my top tips in raising capital globally to scale companies regionally in Africa – that can help prepare your current or upcoming fundraising activities.

I’m from New York City and for those of you who don’t know, New York is a city of immigrants. My family arrived 100 years ago and I guess I’m first generation of reverse immigrants going back across the Atlantic to follow the growth in Europe and Africa. After college, I first moved to Europe working in the finance sector as an investment banker in London, Zurich and Frankfurt right before the financial crisis in 2008.

After the crisis happened, it was time for me to follow the new growth in emerging markets and therefore I moved to Nairobi in 2009 as a rating analyst for SME and micro-finance banks after finishing my graduate degree at Columbia University. Having lived in Nairobi for 7 years, I’ve witnessed the tremendous growth in Kenya from forest-covered suburbs to a modern city full of apartment buildings, 6-lane highways and Nairobi has become the hub for international and regional businesses to enter East Africa or Africa in general.

The idea of BitPesa

The idea of BitPesa was incubated when I was travelling across Africa. Many businesses are often trading beyond their country borders within Africa, and outside of Africa including Europe, China and Middle East. One of the issues they have is to move money across the border cheaply and easily. I was really frustrated when I realized I couldn’t use my online banking system to move Kenyan Shillings to Tanzanian Shillings (and they are actually neighboring countries!) to pay for my hotel bookings and I have to bring cash to pay for it.

Another problem is that most of the transactions require going through U.S Dollars as an intermediary settlement currency. Why can’t we just use our local currency in Africa? Why are we giving up that right to use our own local currency to do international and regional businesses? It’s expensive and slow to move money through U.S. Dollars and some markets don’t even have enough liquidity.

Fastest, cheapest and easiest

From that experience, I’ve been constantly thinking about what could be the fastest, cheapest and easiest way for businesses to make payments beyond their borders. What if we can just use African local currency to convert directly to Chinese Yuan or Dirham to import goods and services? What if we can have a truly digital platform for African businesses to pay their suppliers, consultants or employees abroad without standing in the queue of a banking hall? How could that look like? How much savings in fees could we have for all the small and medium businesses so they can be profitable faster and easier?

Our mission at BitPesa is to make business easier in frontier markets and we started early 2014 to build a truly digital payment solution powered by cutting-edge blockchain technology to provide direct and instant settlement for global and regional businesses, not only between African local currencies within the region but also with the other global currencies such as USD, EUR, CNY, JPY, AED and ZAR.

Business payments across borders

Our clients are not just using our solution to send money back home to support their families, they are some of the largest global and regional businesses making payments to their employees across 3 countries in Africa, to their suppliers across 3 continents, to their own subsidiaries for intercompany treasury settlement and also to inject operational capital for starting a new company in a new country.

Having raised $6 million in the last 2 years to build and scale BitPesa, I want to share with everyone that it’s not easy to raise money if you are trying to build a regional / global business in Africa. Even with all the privileges of working on fund raising in my previous investment banking jobs and all connections I had from living in US, Europe and Africa, I still found it very difficult. Therefore, I made sure that I was extra-prepared and extra-organized.

Fundraising experiences

I’d like to share more about my fundraising experiences and learnings along the way for those of you who are still struggling to do this as I’ve been helped by a lot of people and I’d very much want to give back to the community. I’ve summarized my learnings into 5 top secret tips to raise funds globally to scale your solution in Africa.

Today I want to discuss the first, most important part of your fundraising activities — “The Pitch”:

Build a concise and convincing “Pitch”

What does the “Pitch” actually mean? For me, it means two things: How you present your company and secondly, the physical actual document you show to potential investors. It could be 10 slides, 5 slides or sometimes investors will ask you for a 1-pager presentation. These pitch materials are very important to have and below is what I have done to build my pitching materials to convince my investors.

  1. Create a 10 slide presentation about your company and make it stylish, minimalist and without error – Investors do not have time to look through wordy documents. You need to have presentations about your company and ideas ready to give out anytime. What I would recommend is to think about how you can show investors what your company is without using any words. Keep it visual, clean and simple. Investors, especially in the tech sector, like to see beautiful designs. Show this pitch to your friends and ask them if they understand what you are trying to convey and sell without you speaking. If you have anyone who works in graphic design, let them help you.
  2. Discuss the problem, your solution, the opportunity and prove why your team can execute – What is the real problem you are trying to solve? How is your solution different from others? This part of the pitch really needs to show why your solution is unique and why your team can make it happen. Investors want to know how much money they can make by investing in you and the only way for them to know that is to know how big the market opportunity your solution could address. Be aware of who you are talking to and what kind of solution they are looking for. I found that most of American investors are specifically looking for globally and/or regionally scalable products.
  3. Update it monthly with traction and financing needs – This pitch needs to be updated ALL the time. I almost have 100 version of pitches I’ve done in the last two years. Every month, I update new data and traction about the business – our sales volume, new customers, key team members. I make sure the pitch is as up-to-date as possible.

Last but not the least, you shouldn’t go overboard and say something that you cannot back up later on. Sometimes you may drop a client or say you already have it, but once they get to the next stage they will double check everything. I will be sharing a few more tips in the next two articles and hope you will benefit from my experience.

Free advisory service

If you are interested in learning more about our B2B digital treasury / cross-border payment solution, please share your company details here and my team will reach out to you immediately.

We are also currently hiring multiple roles at BitPesa. For our Nairobi office we are looking for an East Africa Business Development Manager.

Elizabeth Rossiello is the CEO and Founder of BitPesa, the largest African digital currency FX and Payments company. BitPesa was founded in 2013 and has since launched operations in 7 countries.