My view on the Good and Ugly of Impact Investing in Africa


What is Innofrugal? It's a global conference that focuses on Delivering Impact.

It was held online because of the COVID-19 situation.

Thanks to my friend, I got an excellent opportunity to be one of the event speakers. In this post, I'm going to share the moderator(Gilbert)'s questions and my answers In the session with you.

Q: Can you tell us a little bit about yourself and your interest in investing in startups based in Africa?

I co-founded Connehito, Inc. We run an online Q&A platform, "mamari" which is the most significant(No.1) communication platform for moms in Japan.

Connehito, Inc. was acquired by the Japanese telecom giant, KDDI, in 2016.

After my first exit and PMI, I went on a worldwide tour to see the culture, understand startup globally.

I visited over 40 countries, 60 cities and met terrific startup people.

Fortunately, I could invest in 8 African startups.

I'm honored to be on their journey with respectful entrepreneurs.

Q: How did you select the Startups that you selected for investment? What did you look for? What criteria did they have to meet?

I looked for an ambitious startup that can be an infrastructure of Africa.

For example, Flare (one of my portfolio companies) can be 911 of the African continent.

(I mentioned it before in this blog post. Please check the details of Flare)

As for criteria, the most important thing is an entrepreneur.

A business model can be changed, but entrepreneurs cannot be changed.

I believe that if entrepreneurs never give up, their startup won't lose. Finally, they would be able to reach achievement.

Q: With reference to your investments, how did you overcome challenges or risks commonly associated to business in emerging markets? how did you go about doing due diligence?

I think there are 2 challenges.

1. The startup ecosystem in Africa isn’t still mature

  • The number of exits is still lower than in a developed country
  • Lack of knowledge: investment flow, product development, contract, and so on
  • 2. Governments and Economy are unstable

  • For instance: in Nigeria, the foreign exchange market is dependent on the oil sector, which accounts for 95% of exports and 80% of the country's revenue
  • Unfortunately, there are still some corruption
  • On the other hand, this can be a chance for a startup.

    As I already mentioned, the 911 system is given by a local government in developed countries. But now startup provides a similar service in Africa. It has significant potential to be an infrastructure of Africa.

    As for due diligence, reference is the most important thing. I believe a reliable person may introduce a trustworthy entrepreneur.

    Q: How should someone who has never invested before begin their journey? How much money is needed? What do they need take into account?

    The amount is the same as a typical startup investment, 10k ~ 50k.

    When it comes to the stance for investment, you need a long-term perspective.

    For example, Stripe acquired Nigeria's Paystack for $200M+. CEO of Stripe said

    We are thinking of what the world will look like in 2040-2050.

    (source: )

    The population is growing, There are large fundamental issues, rapid development of IT infrastructure, and great startups.

    According to the UN World Population Projection 2019, sub-Saharan Africa's population is expected to double (99%) by 2050.

    We will see more and more of this as startups solve fundamental challenges, and startups themselves become the infrastructure of life.

    It would be best if you believed in the future of Africa.

    Questions from Audiences

    Q: Did you change your strategy of investment after Covid-19?

    A: No, I didn't. Covid-19 push digitalization forward. It's also a chance for startups.

    Q: How high are the ROIs for startup investments in Africa?

    A: One of my friends is an angel investor. His portfolio performance is 10x. But it's a good example.

    It's not still mature, as I mentioned before. That's why there are not many examples. The answer is too early to measure ROIs. It depends on the case.

    Of course, there is a possibility of losing money. But it's an investment. When it comes to the startup investment, anywhere it happens.


    Enjoyed joining the event as a speaker remotely.

    I want to express my gratitude once again. Thank you so much.

    I am honored to be part of Innofrugal and ThinkAfrica.

    Recent Updates

    BTW, I gave a speech at 100 Open Startups, one of the largest online platforms for open innovation in Latin America.

    It was also a wonderful time.

    So, be sure to follow me on Twitter and don't miss any of my updates. I'll keep sharing my activity with you.

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