Not every startup will not struggle to raise funds in Africa. In fact, it is harder to do so if the founder is little known, previously untested, and expectedly naive to established venture capital firms, family houses, banks, High Net Worth Individuals (HNWI), etc. And although accelerators are not primarily houses of funds for startups left out of this implicit bias in access to funding, they have come to serve as one, and most importantly, the final hope of these founders ever accessing funds. 

In a lugubriously-fashioned language, accelerators, also known as seed accelerators, are fixed-term (usually lasts from three to twelve months), cohort-based programs, that include mentorship and educational components and networking, often with investment. In simple terms, accelerators are to startups what schools are to students.

But does it really matter if a startup based in Africa does not make it through an accelerator? The answer is neither here nor there. African startups, from data, mostly go through accelerators to improve their access to funding, and if the accelerator is more glorified (like Y Combinator, 500 Startups, Techstars), to latch some flesh onto their valuations and consequently brighten their bargaining power when accepting investments. 

Funding

While funding accruing to the African startup ecosystem from venture capital firms is increasing year-on-year, the number of startups involved in the funding are relatively small compared to available data about the number of startups in Africa. In 2019, for example, while a platform like VC4A listed a total of 13,500 startups in Africa, only about 427 startups raised over $2 billion in funding. This means that if you are a startup in Africa, you are only about 3% more likely to raise funds from venture capital firms. 

Hence, being accepted into an accelerator may be a major escape from this reality. Data show that most startups from Africa who went through the path of notable accelerators had it easy with funding. For example, Paystack’s participation in Y Combinator’s 2015 accelerator program was a deal breaker. It gave room for immediate funding to the startup from global giants like Tencent, Stripe, Visa, among others. By industry stereotypes, Paystack’s founders Shola Akinlade and Ezra Olubi could easily have been dismissed as high-risk investments. Both founders studied in Nigeria, with some of the lowest ranked educational institutions, and have equally lived much of their lives in the West African country. And so there is every reason to doubt their capacity to deliver good returns on investments. Which is why both founders sought to first plug the startup into the global ecosystem, through Y Combinator’s accelerator, before deeply treading the startup path. Paystack was recently acquired by Stripe in a deal reportedly worth more than $200m. 

Another example is Chipper Cash which raised $6 million in seed funding, after 5 months of being selected into the Catalyst Fund. In fact, Catalyst Fund was part of that round. African genomic startup 54gene is also an example. After being part of the 2019 Y Combinator batch, the startup raised $15 million led by Adjuvant Capital, with a follow-on investment from the US-based seed stage accelerator. 

Valuation

Another way of looking at accelerator programmes is that a good number of them help to boost the valuation of most startups. That is to say, being part of a reputable accelerator will most certainly increase the market value of a startup. This will correspondingly draw in investors in their numbers. If this happens, startup founders will have much more bargaining power around certain issues such as the percentage of equity participation in the business available to investors, among other things.

“Accelerator programs like Y Combinator are world-renowned for launching companies like Airbnb, Dropbox and Stripe,” writes Alex Gold, Co-Founder of Myia Health and former Venture Partner at BCG Digital Ventures. “There are thousands of other programs similar to Y Combinator around the world. Usually, each one takes between 3 and 7 percent of equity in a business in exchange for an investment sometimes no greater than $200,000. Founders will trade off what is usually an extremely low or discounted initial valuation for a premium from investors when they graduate.”

Gold says for companies that progress through Y Combinator’s program, for instance, they can command a significant valuation increase over similar companies in the market or even those that went through other accelerator programs. 

“Often, investors engage in pattern-matching; and the “rubber stamp” of having gone through a prestigious accelerator is viewed as a marker of potential success, even though the data doesn’t necessarily support this,” he says. 

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Read also: Why Many African Early-Stage Startups Fail To Secure VC Funding

A Distraction?

Although accelerators could be instrumental in securing a successful startup, it is also arguable that they may, themselves, be distracting to entrepreneurs, especially noting that most successful entrepreneurs were not molded in a traditional brick-and-mortar (and now, probably virtual) settings. 

“A few years ago, I was speaking to another founder who had just entered an accelerator in Colorado,” writes Gold. “Despite its status as a nationally recognized program, the founder became exasperated at having to spend days in classes learning about subjects as elementary as incorporation, human resources and business development. They really go over the basics,” he recalled to me on the phone. “If I didn’t know many of these things, I wouldn’t be anywhere near where I am in my current business. They totally think we don’t get it, and it’s a massive distraction.” 

The Bottom Line

In Africa, accelerators are not compulsory in building successful startups. Founders who have large network of investors or those passionate about executing quickly may consider accelerators a complete waste of time. In any case, the startup journey is not a straight-line destination; the vagaries of the society, the founder’s resilience, previous and continuing experience, and a host of other factors, largely shape the journey. Even startups funded by VCs, most times, equally have access to useful resources from the investors, who usually sit on the startups’ boards by virtue of their investments. Nevertheless, while they exist, accelerators are still a strong force in attempting to bridge the funding gap for startups on the continent.

Find a few of the active startup accelerators on the continent, below. 

S/N	NAME OF ACCELERATOR	LOCATION	FOCUS	DIRECT FUNDING YES/NO	NOTABLE AFRICAN STARTUP GRADUATES
1	Founder Institute	Palo Alto, USA.	Pre-seed Stage.		No	DigiFi (Egypt)
2	Betraton	Hong Kong	Startups seeking to expand to Asia.	YES		OkHi; ThankUCash
3	Changelabs	Cyprus	Accelerates mostly  North African startups.	YES		Hospitalia; El-Dokan
4	Openner	USA	Egypt; Pre-seed; Seed.	YES		Recently launched.
5	Google Business Startup Accelerator	USA	Early Stage.		NO	Crop2Cash (Nigeria); Curacel (Nigeria).
6	Start Path Accelerator, Mastercard.	USA	Reg-tech; Fintech.		NO	uKheshe (South Africa)
7	F-Lane Accelerator	Berlin, Germany	Female founders.		NO	Bidhaa Sasa
8	Flat6Labs Accelerator	Egypt	Seed.	YES		Logistics startup ILLA; Instabug (Egypt); Dabchy (Fashion, Egypt)
9	Catalyst Fund accelerators (Inclusive Digital Accelerator, etc)	USA	Early stage; African startups.	YES		Sokowatch; ChipperCash; Cowryrise
10	“I’M IN” Accelerator	South Africa	South Africa; Female founders.	YES		MomSays; Droppa; Lightbulb Education.
11	Akro Accelerate	South Africa	South African startups.	YES		DentX (Insurtech, South Africa)
12	FoodTech Africa Accelerator	Norway	Kenya-based Agritech enterprises.	YES		iFarm360 (Kenya); Ecodudu (Kenya); Digicow (Kenya)
13	FRAGG Impact Growth Accelerator	Nigeria	West Africa-based startups.	YES
14	DIFC Fintech Hive	UAE	African startups in fintech; Insurtech; Islamic fintech.	YES		Amplified Payment System (Nigeria)  PaySky (Egypt)
15	Facebook Accelerator (Community, Commerce)	USA	Invests in community-focused, commerce and other early stage startups.	YES		BoxCommerce; ShoppingFeeder.
14	Hseven	Morocco	African startups	YES
15	I & P Accelerate, Investisseurs & Partenaires	EU	Startups in Benin; Burkina Faso; Cameroon; Côte d’Ivoire; Gambia;  Guinea;  Ghana; Mali; Mauritania; Niger; Chad; Togo and Senegal.	YES
16	First Digital Startup Accelerator, Forbes	USA	Nigerian startups.	YES
17	Land Accelerator Africa	Kenya	Agritechs aimed at land preservation.	YES
18	Innovate Ventures Accelerator	Somalia	Early stage.	YES
19	Falak Startups Accelerator	Egypt	e-health; Fintech; Logistics; 3D Printing; Remote work and ed-tech fields.	YES
20	Google’s Accelerator program on Sustainable Development Goal	USA	Startups working on SDGs.		NO
21	Africa Transformative Mobility Accelerator	Kenya	Kenyan and Ugandan mobility startups.	YES		SafariShare; Easy Matutu; Zembo Motorcycle.
22	Grindstone Accelerator	South Africa	South African startups.	YES		WhereIsMyTransport; OneCart; Sentian (IoT, South Africa)
23	Village Capital Agriculture Africa Accelerator.	USA	African startups.	YES		Complete Farmer; Reelfruit
24	Vodacom Digital Accelerator, Vodacom; Smart Lab	Tanzania	Mobile;  fintech;  media, health; education; and e-commerce startups in Tanzania.	YES		Smart Class; Hastag Pool; MYHI
25	Seedstars Tanzania Accelerator	Switzerland	Startups in Tanzania.	YES		Sheria Kiganjani (legaltech, Tanzania)
26	The Baobab Network Accelerator	UK	Startups in Congo; Democratic Republic of the, Ethiopia; Ghana; Kenya; Rwanda; South Africa;  Nigeria; Zambia, Zimbabwe, engaged in Agribusiness; Clean technology; Education; Financial services; Healthcare.	YES		Kakbima; Gladepay
27	Y Combinator	USA	Seed stage; global accelerator.	YES		Paystack; 54gene; Helium Health
28	AUC Venture Lab Accelerator	Cairo, Egypt	Seed Stage.	YES		SWVL; Agora
29	JFN-IT E4 IMPACT Accelerator	Doula, Cameroon	Early Stage.		NO	–
30	Catalyst Fund‘s Fintech Accelerator	USA	Early Stage; Fintech.	YES		Turaco (Kenya)
31	ARM Accelerator	China	AI & IoT Startups.	YES		Kwaba (Kenya);
32	Plug and Play Startup Accelerator Tech Center	USA	Morocco; Early stage; Smart city startups.		NO	–
33	Tachyon Accelerator, run by Consensys Ventures	USA	Blockchain.	YES		Elkrem (Egypt)
34	Starfleet Incubator	Sofia, Bulgaria	Blockchain.	YES		UTU Tech (Kenya)
35	Binance Labs	Hong Kong	Blockchain.	YES		XEND Finance
36	AlphaCode Incubate	South Africa	Early stage; fintech.	YES		Akiba Digital; ISpani Group; Nisa Finance.
37	Start and Grow Your StartUp Accelerator, GIZ	Tunisia	Early Stage.		NO
38	Seedstars	USA	Seed; Early Stage Startups.	YES		Pezecha (Kenya); Chaka (Nigeria)
39	MEST Africa (Pan African Fintech Accelerator, etc)	Ghana	Early Stage startups;  Fintech.	YES		Shopa (Kenya); Tendo (Ghana); Amplify.
40	DFS Lab Accelerator	Seattle, USA.	Early stage startups with at least two co-founders; Ecommerce; Fintech.	YES		Cherehani Africa (Kenya),Nobuntu (South Africa),
41	Orange Fab Tunisia	Tunisia	Early Stage.	YES		Galactech (Tunisia)
42	Passion Incubator	Nigeria	Early Stage.		NO
43	Enterprise Development for Women-Owned Ventures in Green Energy, AWIEF	South Africa	Women-led cleantech startups in Malawi and Nigeria		NO
44	Village Global Accelerator	San Francisco, USA	Early Stage.	YES		Eden Life
45	Google Launchpad  Accelerator Africa	USA	Seed; Early Stage.	YES		Piggyvest; ThankUCash; Thrive Agric; Eversend (Uganda); Aerobotics
46	VC4A Venture Showcase	The Netherlands	All Stages.	YES
47	Afrikhaliss-Suguba	Cote d’ivioire	Early stage startups in French-speaking West Africa.	YES
48	Justice Accelerator, the Hague Institute for Innovation of Law	The Netherlands	Legaltechs  in Africa led by committed CEOs.	YES		Lenoma Legal; Luma Law
49	500 Startups’ Global Seed Accelerator	USA	Early stage startups.	YES		Shezlong (Healthtech, Egypt); Source Beauty (Egypt).
50	Startup Wise Guys Accelerator	EU	Fintech startups in Egypt, Morocco and Tunisia.	YES		Paylock (Ghana)
51	Greenhouse Lab Accelerator	Nigeria	Female-led startups in Africa.	YES		Doctoora (Nigeria); Vesicash (Nigeria)
52	She Leads Africa Accelerator	South Africa	Female-led startups Africa.	YES		DeliveryBros, Art Splash Studio, BathKandy Co.
53	Egbank MINT	Egypt	Fintech Startups Egypt.	YES		Shahry (Lending, Egypt)
54	Startupbootcamp AfriTech Accelerator	South Africa	Blockchain; fintech startups.	YES		MPOST (Kenya); CredPal (Nigeria); GotBot (South Africa)
55	Impulse Accelerator	Morocco	Agritech; Biotech; Mining tech; Nanoengineering  startups.	YES		Farmcrowdy (Nigeria); Coldhubs(Nigeria);Safi Organics (Kenya)
56	Make IT Accelerator	Kenya	Banking; Computer software; Creative, media and entertainment; E-commerce;  Internet, Mobile;  Telecom.	YES		Doctoora E-Health Ltd  DoLessons ; Embinix Automation ; Insight Africa
57	Itanna	Nigeria	Sector-agnostic.	YES		Indicina Technologies
58	GSMA Ecosystem Accelerator	UK	Telecom.	YES		Coliba (Ivory Coast)
59	EFG-EV Fintech	Egypt	Fintech startups.	YES		Raseedi (Telecom, Egypt)
60	SOSV Accelerator	Ireland	All Stages.	YES		CanGo (shutdown; delivery  Rwanda)
61	Wadi Accelerator, Oman Technology Fund (Partner 500 Startups)	Oman	Early Stage; Seed.	YES		Bekia (Waste Management, Egypt)
62	Antler Startup Accelerator	Kenya	Early Stage.	YES		ChapChapGo; AnyiHealth; Digiduka
63	Founders Factory Africa (Venture Scale, etc)	UK	Early Stage.	YES		Wella Health (Nigeria); Redbirth (Ghana); Truzo (South Africa)
64	Pangea Accelerator	Kenya	Early Stage.		NO	–
65	Bongo Hive	Lusaka, Zambia	All Stages.		NO	–
66	Savannah Fund Accelerator	Kenya	Seed.	YES		–
67	NEST	Kenya	Seed.	YES		–
68	MMH Accelerator	Kenya	Ghanaian, Kenyan and Nigerian late-stage healthtech firms.	YES		–
69	Technipole Sup – Valor	Yaounde, Cameroon	Cameroon Startups.		NO	–
70	SW7	Johannesburg, South Africa	Early Stage		NO	–
71	Startup Reactor | Innoventures	Egypt	Early Stage.		NO	–
72	TIEC Entrepreneurship Accelerator	Giza, Egypt	Early Stage		No

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer