Tanzania has been experiencing incredible GDP growth rate averaging at 6% over the past 10 years, this has led to the transformation of many sectors including telecommunication, banking, road infrastructure, real estate, and many more.
Unfortunately, this growth has remained at macro and corporate level, with many start-ups still struggling to make a cut. Starting and growing a start-up is a tough journey across many African countries, if not all. With some exceptions in South Africa, Nigeria, and Kenya, which have done a wonderful job in growing the start-up ecosystem, especially in the tech space, and attracting more than 60% of all funding coming to the continent.
Tanzania, the second largest economy in East Africa, is still in its early stage of growing a robust start-up ecosystem that will create formidable start-ups, sustainable innovation spaces, and readily available venture capital and angel investors funding.
We have seen great efforts in starting innovation hubs in the country, some not existing anymore, and some showing great hope and maturity in terms of building the future “Africa-made unicorns”, these include DTBI and Sahara Accelerator, there is also an initiative to promote the emergence of Silicon Dar, the concept which is still in the cooking.
What happens when hubs and accelerators do their job right? Is there funding ready to take start-ups to the next level?
We know we can’t talk of banks, neither can we speak of VCs, as this is too early for them. With this missing link, the angel investors network is an inevitable selection for hatching these incubators. Fintrek report by EAVCA and partners published early this year indicate that Between 2010 and 2017, Tanzania raised USD 0.8m only, while Kenyan-based FinTechs, for example, raised $204 million for the same period. This requires aggressive change.
Tanzania Angel Investors Network (TAIN) is one of the initiatives expected to improve the situation by mobilizing local and foreign capital for early-stage investing. To be launched on 23rd May in Dar es Salaam, the network seeks to mobilize financial resources from local successful entrepreneurs and executives, Tanzanians living in the diaspora, formal and informal savings schemes, and international angel investors interested in the market.
The network will also work closely with start-ups in preparing them to be investor-ready, purifying their books (if any) and refining their business models. The network will also work closely with start-up building hubs and other players in the ecosystem. The Network plans to learn more and collaborate with key players in the industry including VC4A, ABAN, East African Trade and Investment Hub, and Sahara Ventures.
The network also seeks to partner and share experiences with similar networks in the region that include Viktoria Business Angels Network in Kenya and Kampala Angel Investors Network in Uganda. If you are interested in getting involved please reach out to me or my team.
Image was taken by Prof.Chen Hualin