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Home Blog Page 5301

5 things investors look for in a founder/startup before investing

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After all, said about doing proper valuation, and what else to put in place before fundraising, there are a few other things investors hope to see before putting their funds into a business. Startup investors are charity foundations looking to give out money without expecting it back. They are always looking out for one or two things to convince them that investing in your business will not be the same as pouring water into a basket.

Significant market size

Investors consider the market size available for the audience you want to target as well. If you watch the Dragons Den show, you may have heard the ‘Dragons’ tell a founder something like “I just don’t think there are enough people who want your product” or “this product is not something I see going all big. The market is too small”.

Nobody wants to back an excellent product that only 200 people need in the world. It is even worse if it is a one-off product, where consumers buy once and do not need to buy again for years. If you refer back to a previous post on reverse product development, you will see that this is one of the things you ought to have covered during your market research. Do you have a market large enough to sustain the business? The number of customers/potential customers and the frequency of purchase are going to be key factors that can work for or against you.

Passion

Remember what we said in the post about preparing your pitch. When you stand before investors to pitch your business idea, they look beyond what you are saying. Investors look at your passion and ambition and try to gauge how far it can go with the business. The potential investor wants to see signs that you as the founder are ready to make the commitments and sacrifices that the business will require through its growth stage.

You can have an excellent product, with a valid business model and impressive financial projections; but the investor perceives that you do not possess enough passion or will to push it through, they could refrain from investing. No business model, however perfect it seems, can run itself. It all comes down to the entrepreneur. In addition to your passion, your integrity, charisma, and character is consistent factor to be considered in deals like fundraising. You would hardly find an investor who is willing to put his money behind an entrepreneur who has demonstrated an erratic temperament.

Competitive advantage or product differentiator

It is highly unlikely that you are starting or running a business that no one has done in the past. And even if you are, the investor will want solid information on what your competitive advantage will be when you start having other businesses competing in the same market. There just has to be something that stands you out, and it should be valid enough to keep your customers loyal to you. Hard work is not going to be much of a USP when the competition storms the market. There should be some cultural, strategic, or product advantages you can play.

Team members with expertise

I explained this in an earlier post. An investor wants to be sure that you are not the only strong person on your team. Even if you have not established traction yet, the integrity and antecedents of the people that make up your team, say a lot about how far the business will go. It is not about having a team of 50 people. It is about their expertise and experience, and their relevance to the business. If you can, get a power team before looking for funds. But if you don’t have them yet, you can state in your pitch that these are the persons you are looking to bring on board once the funds are available.

Exit strategy

As a bonus point, the investor will also be considering the exit strategy you have mapped out for them. Don’t try to impress them with unrealistic timelines and empty assertions. Investors want to know – How much do I need to invest? How much will I get back, and when will I get it? Your potential investors can tell when your financial projections sound pragmatic and realistic, and when they are nothing but empty promises.

The Next Edition of Tekedia Capital Investment Cycle Begins Next Month; Join Today

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Yesterday, we sent emails to some startups which we have pre-qualified for the next edition of Tekedia Capital Syndicate investment cycle. They cover AI, media, HR, retail, financial services, etc – all unified by technology. Once we receive the data we asked, our team will close on the ones which will be presented to our members.

Tekedia Capital Syndicate members come from more than 30 countries and through them, we seed the empires of the future, in Africa and beyond.

A case in point: we raised 3x what a startup originally wanted this month in less than 4 days. It was so popular that we had to reject new funds.

If you are not investing via Tekedia Capital Syndicate, I invite you to join us and co-own a piece of the finest companies in Africa. Click and join here 

Skill Acquisition Programs – Tools For Economic Growth

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Boniface, a shoemaker, poses for a photograph with a set of finished women's shoes at a shoe factory in Araria market in Aba, Nigeria August 19, 2016. REUTERS/Afolabi Sotunde

With the high demand for skills lately, it is safe to say that skill is very important in the life of every human. It might interest you to know that many technicians who never saw the four walls of a university earn more than university graduates. Lately, both graduates and undergraduates now understand that not only is acquiring a certificate important, but also acquiring a skill. With the high rate of unemployment and other social vices that has ravaged the country, the government needs to organize skill acquisition programs.

Not only will it lead to the economic growth of the country, it will curb the rate of social vices in the country because a lot of youths will be actively engaged. One of the major Millennium Development Goals(MDGs) which Nigeria aimed to achieve in 2015 was the eradication of extreme poverty and hunger with the target of encouraging the proportion of people who earn less than a dollar a day to engage in skills acquisition. A lot of youths desire to learn one skill or the other but lack the resources to enroll in such programs. This is where the government comes in.

They should ensure to always organize skill acquisition programs where a lot of youths don’t have to worry about the fee for enrollment. The youths engage in such programs and learn any skill of their choice. These programs will help them to become self-dependent and earn a proper living which will make them shun any negative act in society.

The skill acquisition program is a very effective tool for eradicating extremes of poverty and hunger because it will pave the way for employment among unemployed youths and also create an avenue for wealth creation that would bring about self-sufficiency and reliance in contributing to the growth of the economy.

Industries are often constructed in different parts of the country and many of these industries require skilled and well-trained workers. With the empowerment of a lot of youths through skill acquisition programs, they will always be actively engaged. Any country that is hell-bent on development should ensure that the youths are well empowered. The youths are where the strength of a country lies because they are vibrant and energetic to take on any task. Asides from the creation of skill acquisition programs the government should ensure that there is an adequate establishment of skill acquisition centers in all states in Nigeria.

There is also the need to set up vocational centers where useful skills will be taught and practiced. Curriculum in schools should also include vocational courses where students get to learn not only how to read and write, but also how to engage themselves with the necessary skills in case jobs are not forthcoming. In nation-building, although the government actively has a role to play, but then, both non-governmental agencies and wealthy individuals can join hands on deck to ensure that the poverty level is drastically reduced by organizing skill acquisition programs.

Skill acquisition is very essential because it contributes to the development of the nation’s human capital. The productive capacity of any nation depends solely on the ability of that nation to recognize the ability of its manpower. Skills one acquires will aid in the development of the individual and the nation in particular. One of the goals of skills empowerment programs is the acquisition of appropriate skills and the development of mental, physical, and social abilities and competencies as tools for the individual to live and contribute to the development of his society. In Nigeria today, there is a need for skilled personnel who will be enterprising and self-reliant.

There is also the need for skilled people who can understand and adapt to changes in the increasing complexity of technology. People who can apply scientific knowledge to the improvement and as a solution to environmental challenges for the use and conveniences of man are also needed. Skill acquisition and empowerment programs act as catalysts to developing creativity and innovation in youth, hence, adding positive values to the economic condition of a country.

Promoting The Significance Of Mother Tongue As We Mark Int’l Mother Language Day

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February 21 annually, the global community commemorates the International Mother Language Day. Hence, the 2022 edition is being marked today.

The day was proclaimed by the General Conference of the United Nations Educational, Scientific and Cultural Organization (UNESCO) in November 1999. The theme of this year’s commemoration is “Using technology for multilingual learning”.

The date – February 21 – represents the day in 1952 when the Pakistani students who demonstrated for recognition of their native language, Bangla, as one of the two national languages of then Pakistan, were shot and killed by the police in Dhaka, the capital of what is now Bangladesh.

On 16th May 2007, the United Nations General Assembly (UNGA) in its resolution called upon Member States to promote the preservation and protection of all languages used by peoples of the world.

By the same resolution, 2008 was proclaimed as the ‘International Year of Languages’, to promote unity in diversity and international understanding through multilingualism and multiculturalism.

A language can be defined as a system of sounds, written symbols, and/or signs used by the people of a particular country, geographical area, tribe, or status as the case may be, to communicate with each other. It can also be described as the human ability to acquire and use complex systems of communication.

There are several forms of languages in existence across the world, such as spoken language, sign language, computer language, and animal language.

Estimates of the number of languages in the world vary between five thousand (5,000) and seven thousand (7,000). However, any precise estimate depends on a partly arbitrary distinction between official languages and local/mother languages.

Mother language or Mother tongue, which is also widely known as dialect or native language, is the indigenous language of one’s parents which is usually the first language learnt by him/her.

In the same vein, it is also referred to as the language of one’s ethnic group. Suffice to say that, one’s Mother tongue is an apparent indication of where he or she hails from.

Mother language is often regarded as one’s ‘first language’. Therefore by contrast, a second language is any language that one speaks other than his or her first/native language.

The Mother language is noted as ‘first’, because it is regarded as the most important language spoken by anyone due to its hereditary value as well as its cultural impact on the individual in question.

No doubt, Mother language or first language contributes immensely in a child’s personal, social, cultural, intellectual, educational and economic life.

Personal, in the sense that, a child’s first (native) language is critical to his or her identity; Social, in the sense that, when the native language of a child is not maintained, important links to family and other community members may be lost. Culturally, in the sense that, sustaining a child’s Mother Tongue would help the child to value his or her culture and heritage, which contributes to a positive self-concept.

Furthermore, the intellectual aspect of it is that, when students who are not yet fluent in their second/official language such as English or French, but have switched to using only the said official language, would have the tendency of functioning at an intellectual level below their age, thereby resulting in academic failure.

Educational wise, students who learn a second language and continue to develop their native language would have chances of higher academic achievement in later years than those who learn their second language at the expense of their first language.

More so, economically, there are available better employment or job opportunities in Nigeria and in the diaspora for individuals who are conversant with their official language as well as another language, probably a native language.

As Nigeria joins the global community to celebrate the International Mother Language Day, I call on every Nigerian, both home and abroad, to join in the ongoing crusade of promoting the significance of Mother tongue by acknowledging that Mother languages are the most powerful instruments required to preserve and develop their respective tangible heritages.

To this end, I also call on the National Assembly (NASS) to enact a law that would ensure every citadel of learning in Nigeria, ranging from primary to tertiary level, offers at least one native language relevant to the area or community where the institution is situated.

In addition, the proposed law ought to also mandate the various existing examination boards in the country including the West African Examination Council (WAEC), the National Examination Council (NECO), and the Joint Admission and Matriculation Board (JAMB), among others, to ensure the students compulsorily enroll as well as sit for the said native language or subject as it concerns their respective schools or the institution where they are seeking admission.

Indeed, considering the singular fact that Mother Language helps to create full and thorough awareness on cultural traditions coupled with its role in promotion of solidarity among members of any given community thereby uplifting the level of moral, social and intellectual values of our young ones, it’s of no gain reiterating that the ongoing crusade regarding uplift of various Mother languages is a task that awaits all and sundry.

If an institution like Oxford University could include Igbo Language in their Special Curriculum, you would agree with me that Mother Tongues are gradually gaining momentum in our everyday lives. 

Like Cryptocurrency, the IMF Said eNaira Poses Terrorism Financing Risks

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In October, the Central Bank of Nigeria (CBN) launched Nigeria’s digital currency eNaira, in an aim to counter the burgeoning influence of cryptocurrency that’s rapidly overshadowing the financial industry.

The CBN urged Nigerians to download and sign up to the eNaira as it’s designed to facilitate easy financial transactions, including cross-border transactions. The Central Bank Digital Currency (CBDC) has racked up more than 694,000 downloads since it was launched. But in a country of over 200 million people, the number of downloads is meager. But that’s not all.

The International Monetary Transfer (IMF), in its ‘Nigeria Staff Report for the 2021 Article IV Consultation’, said the expansion of the use of the eNaira to cross-border fund transfers and agency bank networks could lead to new money-laundering and terrorism financing risks.

“Prospective expansion of eNaira use to cross-border fund transfers and agency bank networks may cause new money-laundering/financing of terrorism risks,” the IMF said.

The Washington-based financial body also pointed at other possible risks facing the digital app, including cyberfraud.

“There are cyber security risks associated with the eNaira. Unforeseen legal issues, including for private law aspects of its operations (e.g., the exact nature of legal relationship between the wallet providers and CBDC holders), may subject eNaira to litigation and operational risks,” it added.

The CBN launched digital currency in the aftermath of its ban on cryptocurrency, providing a government-backed alternative to a large section of Nigerians, who by their adoption of cryptocurrency, showed willingness to embrace digital transactions.

It was swift, compared to how long other countries like China worked on their CBDCs. Many are still trialing even though they started much earlier than Nigeria. The CBN started work on eNaira about mid-last year, and the CBDC was launched in October, taking only a few months – and it was never trialed. Nigeria thus became the first country in the world to launch digital currency.

While there are aspects of the eNaira applauded by the IMF, such as bank funding, the risks it pointed out put the digital currency’s chances of adoption under question. The CBN said part of the reasons it banned regulated financial institutions from dealing with cryptocurrency is because it is used to finance terrorism and facilitate money laundering.

It is a concern the eNaira has failed to address since according to the IMF, the CBDC poses the same risks and some others not yet observed. The international lender said there is need for vigilance to various risks, including monetary policy implementation, bank funding, cyber security, operational resilience, and financial integrity and stability, through regular risk assessment and contingency planning.

The CBN has repeatedly assured users of the credibility of the eNaira, and has also denied that it poses any risk. However, the IMF suggested a line of actions the apex bank should follow to address the risks.

“While preventive measures and the planned AML/CFT regulations for eNaira intermediaries are welcome, a money laundering/terrorist financing risk assessment of domestic and cross-border uses of eNaira and the adoption and implementation of the regulation along with putting in place risk-sensitive mitigation measures should be a priority,” the IMF said.