The pandemic has taken a toll on African start-ups. One estimate predicts that investment in African startups could drop by as much as 40 percent by the end of the year. In an effort to keep these companies afloat, Ventures Platform, an Abuja, Nigeria-based early-stage fund, is creating a relief program to provide emergency grants to keep innovation alive.
The equity-free grants can be up to $20,000 and will be available to early, high-growth stage startups in need of cash lifelines. The funds are being procured in partnership with Acumen, a New York-based impact investor, and LoftyInc, a Lagos-based investment firm.
During the pandemic, investors have become more risk-averse and young companies tend to be hit hardest by financial recessions. To qualify for a grant, startups must have raised seed capital and have accrued annual revenues of $60,000 before the pandemic struck.
The demand for these grants is high. According to the Ventures Platform, the program is already reviewing 2,700 applications. Perhaps this program will offer a lifeline to one of the world’s most innovative companies of the future.