Accelerator Summary and launching 2nd Cohort starting August 2013
We learnt a lot during the first accelerator class that began in November 2012 and concluded in March 2013 just before the Kenya elections and then capped of with a Demo Day in Kampala, Uganda before the 3rd Pivot East at the end of June. For one, we started with 4 startups and only 3 received funding and graduated- a lot of that is to do with setting expectations and getting the paperwork done efficiently (often in parallel with starting the programme). Ahonya incorporated in Ghana and Safaridesk in the US Delaware- these 2 of the startups were not incorporated at the start of the programme and legal paperwork for startups in Africa can be challenging- we now have standardized terms sheets for Kenya and Uganda jurisdictions and will work to add more countries in future as we do more deals in those countries and extend our network of legal contacts.
A lot of people think taking 15% common equity for $25,000 is a lot (and it is probably not competitive for US or European based startups), but they often forget how much work we put into each of the startups and the fact that we are still much better than many angel deals that are done in the region- its not uncommon to hear startups get offered as little as $20,000 for 40-80% of the company. We created an accelerator FAQ to better inform startups about what to expect and the conditions for acceptance- we maintain our take it or leave it approach- but the most important aspect is that startups want to work with us for the long term.
Rolling up sleeves and forming the programme
We received close to 200 applications across Africa and globally with a majority in Kenya and East Africa. Naturally due to prohibitively expensive travel costs, East Africa originated startups are better suited for our accelerator- that being said, we still accepted strong startups outside the region including Ahonya, an ecommerce startup from Cape Coast in Ghana that has now relocated to Accra following spend few months in Nairobi for the accelerator. Ahonya were recently interviewed by “How we Made It in Africa” about their experience. One of the biggest benefits of the accelerator beyond just the money is the access to mentorship and follow on investors. As Techcrunch reported, mentoring was one of the things that went very well in our first class, by leveraging the interest the global tech community has in the East African ecosystem with the epicenter around the iHub. Some of the sessions inc. Max Ventilla who sold his startup Aardvark to Google, Carey Eaton of Africa One Media, Eran Feinstein of 3G Direct Pay a leading credit card and payment processor in East Africa and investors including Khosla Impact. We also focused heavily on digital marketing by bringing technical experts such as Agnes Sokol who continues to advise some of the startups. In the next accelerator we will add additional resources including collaborating with iHub Research and UX Design Lab. We are always interested in corporates helping out, but only if they provide tangible value to the startups and true partnerships for growth around building companies, not just purely self interest.
Assembling Teams to Startups
Accelerators often take the most risk on early stage startups with a high bias on having a great team in place as well as some form of traction. Irvine originally from Kenya but having studied in Australia and Paul from New Zealand teamed up to found Safaridesk . We took a bigger risk on Safaridesk not having a product in place, but Irvine’s connections with the travel industry, my experience starting yellowmasai and Tanzania as well quite an accomplished advisory team set a good foundation to start building a product- they launched in May (much later that I would have hoped) with a gorgeous product- we will see them continually tweak their product whilst talking to users and travel partners to help build a unique marketplace in what is a huge travel industry that is very inefficient in Africa.
Talent to Winners
Kola Studios from Uganda had their 4 millionth game played recently and now focus mostly on Android and iPhone Games. Following pitching at Demo day, went on to win the entertainment category at Pivot East. Kola Studios is now exploring unique ways to monetize their games that have a primary African audience.
We put together this video below that helps provide more of an insight as to what we are trying to do with the Savannah Fund Accelerator. The deadline for applications for the next Accelerator is less than 1 week away this Friday.