Pangea Unblocks Diaspora Influx as Funding Source for African Startups

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Norwegian Pangea Trust through its equity crowdfunding platform Uniteseeks to unlock diaspora remittances as a source of funding for early stage and growth stage start-ups in Africa.

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Remittances from abroad reached $45 billion in 2021, with Nigeria, Ghana, Kenya, Senegal and Zimbabwe topping the list of recipient countries.

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And as the annual influx of funds grows, Anne Laui, regional director and CEO of Pangea in Kenya, told TechCrunch, diaspora remittances can be used to increase the amount of funding invested in startups. Startups in Africa raised almost $5 billion in funding last year, but the amount remains meager compared to the rest of the world.

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“While the amount of funding invested in start-ups in Africa has increased over the years, it is still small compared to the need. And that is why we are working to make remittances from the diaspora a source of funding,” Lavi said.

“And because we are also an accelerator, we have developed and validated an approach that helps us identify investment ventures…we have also created structures that help angel investors invest in these ventures along with venture capitalists,” she said.

However, this requires a change of perspective and so Pangea, working in partnership with the Swedish International Development Cooperation Agency and the Kenya Diaspora Alliance, has organized a series of events since last year aimed at educating the diaspora about why startups are good investment options.

Since the initial public announcement of its first cohort last year, Pangea has screened and accepted nine startups that met several criteria, including rapid growth potential and long-term goals aligned with the Sustainable Development Goals. Nine are in need of an equity investment of between $25,000 and $100,000.

By the end of the fundraiser, Pangea will connect startups to $320,000 in diaspora funding, with an additional goal of raising $1 million from the same sources by the end of the year.

Startups participating in the initial fundraiser include Grow Agric, which provides farmers with access to working capital; Ai Care, a SaaS insurance company; Baridi, an off-grid solar energy conservation business solving post-harvest losses; Damu sasa, Blood Services Management Information System; Ambulex, which offers emergency medical care to the underprivileged; Funke Science, an e-learning platform for science courses; Kiri EV, manufacturers of electric scooters; Rabbii Teecha, which offers personalized learning services; and Benacare, a link to home care services.

All of the above startups are based in Kenya, but other startups from Ethiopia and Somalia will be supported in a pilot phase, with plans to expand to five more countries over the next year, including Rwanda, Tanzania and Zimbabwe.


Credit: techcrunch.com /

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