The killing of George Floyd and the nationwide protests that have followed have brought an increased focus on black-owned startups and how VCs can play a role is supporting the black community. Now, a black-led social impact fund is looking to do that on the other side of the world.
Recently launched Frisco-based Aptive Capital was created by founding partner Ben Peter in an effort to plug the funding gap created by the pandemic. It has put out a call for African early-stage startups in Nigeria, Ghana, Kenya, South Africa, Egypt and Ethiopia in an effort to invest $10,000 in equity in five companies.
“We believe that the best ideas for solving some of the world’s most critical problems can come from anyone, anywhere,” Aptive’s website reads. “Through our grants and risk capital, we help breakthrough solutions to global development challenges… to maximize their impact and affect meaningful change.”
With offices in Texas and representation in Africa, Aptive states its mission is to “support emerging global talents and entrepreneurs” and to support businesses that have a “high social impact on the communities they operate within their region.” Peter told news site Techpoint.africa the firm also believes in seeking out the founders and entrepreneurs that align with its mission.
Aptive focuses on Seed rounds, but says it will invest in Series As, with investments ranging from $5,000 to $1 million -- although, its averages about $10,000 on investments. With a focus on e-commerce, agriculture, health, logistics and consumer goods companies, among other things, Aptive already counts Slab Deck, One Kiosk Africa, StatesMan.NG, and Regalo Kitchen in its portfolio. And with this newest call, Aptive is hoping to add five more from the African continent.
Peter told Techpoint the focus on Africa is due to the opportunity there created by an emerging market. In 2019, African companies raised more than $1.25 billion in VC funding, with Nigeria making up $650 million of that.
With the newest investment challenge, Aptive is looking to make an impact in previously under-represented communities. It's hoping to attract tech and non-tech early-stage startups from a broad array of industries. And applications end Wednesday night. After making one-on-one Zoom pitches, 10 finalists will make their pitches between June 15 and 19 for a chance at the $10,000 equity funding prize.
The challenge is part of a broader plan in Africa for Aptive. The firm plans to invest in and provide mentor and accelerator support to at least 100 African startups over the next five years.
“We invest in people, not just the business model. Business viability and profitability are essential factors, we are also driven by the passion and experience of the founders who have cultivated the business opportunity,” Peter told Techpoint.africa. “We believe that once the business’ foundation, especially the team and drive, is established, leadership will develop strategies to meet market challenge… All we do is support them in their quest by providing capital to scale operations.”
Recently VC firms have seen increased scrutiny on the role they play in creating racial equity. In 2019, black founders made up only 1 percent of VC-backed founders and only 3 percent of VC investors are black. During ongoing protests about racial violence and equality, giant firms like SoftBank and Andreessen Horowitz have launched funds specifically focused on funding companies led by people of color.
“…acknowledge the humanity of black founders, fully and completely. See us, don’t turn away from us, and fund us,” wrote Kanarys co-founder and CEO Mandy Price in a post for NTX Inno.
