When non-disclosed transactions were excluded, African startups active on the continent and led by a woman raised 203.2 million US dollars. This is 58% less than what enterprises of this sort mobilised in 2021.
The Big Deal gathered and disclosed this information, which includes funding transactions worth more than $100,000 USD.
According to the same report, this decline in performance for African start-ups led by women contrasts with the overall trend in the sector. At least 129 of them were able to mobilize resources compared to 141 in 2021.
“Despite the little rise, the total amount of financing deals for African start-ups over $100,000 reached a new record with at least USD 4.8 billion, or about USD 200 million more than in 2021. Despite the relative success of venture capital on the continent, less than 3% of start-ups with female founders and just 4% of female entrepreneurs have benefited from it,” indicates the source.
According to Africa the Big Deal’s research, “the gender gaps seen in sub-Saharan Africa continue to be consistent with the limited interest of foreign venture capital for female entrepreneurship in Africa.”
And to add: “According to World Bank data, just 34% of enterprises are started or managed by women, compared to 66% for men, in Nigeria, which dominates the financing of start-ups by venture capital on the continent.
The International Monetary Fund (IMF) produced a study in 2020 that examined the difference between males and women’s access to funding in Africa. One of the arguments made was that the latter were given less funding since they felt they were excluding themselves and their actions would not have a chance of succeeding.
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard
The Tech African Women (TAW) programme has officially launched in the hopes of providing support and acceleration to women-owned African tech startups, taking their businesses from the idea stage into real-world operations. TAW is spearheaded by the United Nations Economic Commission for Africa (ECA), in partnership with Betacube and invites female-led idea stage startups from Ethiopia, Senegal, Tanzania, and Tunisia to submit their applications to join.
The programme’s objective is to “empower” female founders to leverage their skills in order to build strong tech startups from scratch, accelerate the transformation of project ideas into validated business models and to develop alliances between different African ecosystems. Throughout the duration of the incubation program, the entrants will have access to a pool of tech developers and designers who will work to support and mentor their respective teams free of charge.
Entrants will also have the opportunity to work closely with top experts in Marketing and Finance in addition to the participation in tailored webinars provided by international trainers. The program will run from August to December 2022 and is composed of 3 main phases: First, a series of intensive 3-day training bootcamps & pitching competitions to be held in Tunisia, Senegal, Ethiopia & Tanzania in partnership with local ecosystem players. The winning team of each bootcamp will win a cash prize of $2000. Then, a 2-months online incubation program for the best 2 startups from each country supporting them to reach market & investment readiness.
A final ceremony is to be held in Addis Ababa, Ethiopia at the ECA Conference Center where 8 finalist startups will be invited to pitch to win the final prize of the program (a cash grant of $7000 for the best startup). “TAW targets female-led & idea-stage tech startups and offers these startup teams an exclusive opportunity to acquire new entrepreneurial skills, establish partnerships with their African peers, increase regional business visibility, and access funds,” reads the announcement of the initiative’s launch. “It supports ideas addressing Sustainable Development Goals (SDGs) by developing the capacity of female entrepreneurs who desire to understand how to play a role in the continent’s development and want to deep dive into building impact-driven startups.”
This programme however, is open to only nationals of four African countries namely; Tunisia, Tanzania, Senegal, or Ethiopia and the applicants must have an idea of a tech startup that is addressing at least one of the SDGs. Entrants must be female and aged between 18 and 35 years old and be able to communicate fluently in French or English. Applications are now open for candidates from the four countries on the official website of the program until the 10th of August 2022 for Tunisia, and until the 17th of August 2022 in Ethiopia, Senegal and Tanzania.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry
Leading women in technology across Africa have called for more opportunities for women not only to be in tech, but also to acquire the much needed tech skills as developers.
There was an agreement that having more “women in tech” doesn’t necessarily mean more female engineers and developers, but rather getting more young women tech-ready, to see that technology can and must underpin and complement their business ideas.
That is according to Omobola Johnson and Andreata Muforo, who together make up two-fifths of the management team at Africa-focused VC firm TLcom Capital, which is the first focus of a series of case studies and podcasts produced by Disrupt Africa, commissioned by Boost Africa Technical Assistance Facility and financed by the European Union under EDF Thematic Blending and Cotonou Investment Facility.
Female fund managers are very much in the minority worldwide. In the US, only nine per cent of decision makers in the VC space are women. In Africa, no definitive numbers are yet available, but female fund managers are hard to come by – a big mistake for the VC world, as data clearly demonstrates a direct link between gender diversity in teams, and increased profitability. The Diversity dividend: Female fund managers in Africa series (view here, free download here) looks at firms that recognise this truth, and put diversity front and centre.
Johnson and Muforo come from different backgrounds and have followed different career paths, but now they are united in a set of common goals – building VC success stories in the African tech space, and bringing more women into Africa’s tech ecosystem.
A woman in tech doesn’t necessarily mean more female engineers and developers, Johnson said. Rather, it’s more about getting young women tech-ready – to see that technology can and must underpin and complement their business ideas.
Few of the male founders that TLcom encounters on a daily basis are “tech founders” in the sense that most don’t come from a hard technical background. But men are more willing to found a tech business based on their ideas, she says.
Muforo adds that in Africa, cultural values around perceived success and failure may contribute to the lack of female entrepreneurs.
“The concept of failure is something that is really looked down upon, so I think many people are deterred from entrepreneurship. But in practice, there’s always something that you learn. It never amounts to nothing. You’ve learned something, and you get up and you try something else as well,” she said.
Both of them have advice for young women considering the tech startup or investment space for their career path – jump in and work hard.
Johnson, during four years in government, saw some “really outstanding” technology entrepreneurs in Africa. So when she was considering her options post-politics, she was drawn to a career path that allowed her to apply her skills gained during 25 years in consulting and her stint in government, in helping these entrepreneurs to thrive.
Muforo’s desire, meanwhile, was motivated by the ability to be closer to the entrepreneur and the business they are pursuing.
“In my previous capacity it was only advisory, but as an investor can be a conduit for capital direct to entrepreneurs, and support their business building,” she said.
“At the time when I joined TLcom, it was still fairly early in the African tech VC ecosystem, so I was more excited about the opportunity to be a manager in a tech VC fund […] because I could see the role that tech is playing in providing the services that African residents and citizens really need, at a more affordable price, with more efficiency, and increasing access,” she said.
Here are Johnson’s thoughts on what it takes to get more women involved in the African VC space.
“When I came into TLcom we started talking about how there’s not enough female entrepreneurs in our deal pipeline, and we need to do something about it. The thing is, unless you are intentional and deliberate about getting more females into any sphere, it’s never going to happen,” she said.
“In general, the world is a better place when both men and women are participating, versus if only half the population is contributing – there’s something that is missed there,” said Muforo.
“It’s more about trying to get to the point where we have representation that allows us to build more holistic, more robust, more sustainable ecosystems, and more sustainable and successful companies,” Johnson said.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry
Women remain a largely untapped resource in the technology talent pool in South Africa. The statistics don’t lie: there are only 56000 women filling 236 000 Information and Communications Technology (ICT) roles in the country. That is 23%. Women fare even worse in emerging technology roles, such as cloud computing, and data and AI, with only 14% female participation in professional cloud computing and 28% in data and AI.
Isme Oosthuizen, associate director at BCG Platinion
Perhaps even more concerning is the lack of female talent filtering into the pipeline. For every two women who graduate with a STEM-related (science, technology, engineering and mathematics) degree in South Africa, there are five males making their way into the industry.
These numbers are a wake-up call. They indicate a smaller pool of female talent – and a clear need to encourage girls to pursue careers in technology, as well as improve the representation of women in the workplace to unlock the potential of South Africa’s technology sector, and the broader economy in general.
Research has shown that greater gender diversity drives performance, and leads to higher productivity and profit.
Diversity = Profits
BCG’s own research of female leaders in the technology sector revealed that even adding just one woman to a company’s board or management team shows an increase in return on assets of between eight and 13 basis points, while organisations, where 30% of leaders are female, enjoy a 15% increase in profitability.
Another study found that businesses that use female talent effectively are 45% more likely to report improved market share.
However, the issue of women representation in what is a typically male environment is part of a bigger conversation around the importance of diversity.
Diversity and inclusion (D&I) are increasingly becoming a business imperative because of the value it adds to the bottom line: cognitively diverse teams solve problems 60% faster, and drive financial performance.
Companies with above-average total diversity have been found to have both 19% points higher innovation revenues and 9% points higher EBIT (earnings before interest and taxes) margins.
Shifting from Awareness to Action
What this illustrates is that businesses today must shift from awareness to action in creating more diverse and inclusive workplaces. Being diverse and inclusive means bringing together different types of thinking and talent to drive innovation and creative problem-solving through diverse points of view.
But more than that, it means creating an enabling environment where people are able to do their best work because they feel their point of view and voices are heard and valued. And this is proving to be particularly important in South Africa.
South Africans researched as part of BCG’s study on Decoding Global Ways of Working, in partnership with The Network and local affiliate CareerJunction, were found to care more about diversity than the global average. 82% of South Africans said that diversity and inclusion had become more important to them in the past year, compared to 68.7% globally.
Diversity and inclusion were also particularly meaningful to the country’s young people, with 87% saying D&I had become more important to them in the past year. Half of the South African respondents overall would even refuse to work for an employer that does not match their beliefs in this area.
The growing value of diversity and inclusion is further backed up by a BCG report on the most innovative companies of 2021, which showed that companies in the top 50 tended to exhibit higher gender and ethnic diversity in their leadership. This included leaders in the technology sector too, like Microsoft, Alibaba and Cisco.
All of these are examples of the overwhelming importance of prioritising diversity, particularly in the technology sector.
This is why at BCG Platinion, the digital transformation, IT implementation and risk management services arm of BCG, have put in place a diversity strategy that aims to ensure a wide and diverse range of industry, functional, and technology expertise. This breadth of talent provides a sustainable competitive advantage.
Diversity is only going to get more critical for companies’ going forward – and it is going to become a non-negotiable for businesses to actively show that we are working to create workplaces that are both diverse and inclusive, and which bridge the gaps that currently exist.
Isme Oosthuizen, associate director at BCG Platinion
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry
To encourage more women into the tech workforce and help reverse the wide yawning gap between men and women in tech, a female focused fund aimed at providing initial seed funding for women has been launched by Nigeria’s Odunayo Eweniyi. The Managing Director of Endeavor Nigeria who is also the co-founder of PiggyVest has launched FirstCheck with hope to create a level playing for women in tech.
Odunayo Eweniyi, Managing Director of Endeavor Nigeria and founder, FirstCheck
The need to bridge the gap is informed by the huge disadvantage women face in the tech workforce denying them opportunities and emerging skills in that sector. Though not an African malaise only, women are disproportionately represented in tech. Globally, women in tech make up about 28.8% of the tech workforce as of 2020. While this number is an increase from 25.9% in 2018 and 26.2% in 2019, reports still show it could take 12 years for women to have equal representation in tech. In Africa, it will take even longer than the estimated 12 years.
Representation matters and like many other industries, the technology ecosystem is still struggling with gender diversity. Women in African tech businesses are underrepresented because the sector is predominantly male.
These and other linked challenges are what FirstCheck hopes to address. FirstCheck is a female-led, female-focused, angel fund and investor community to help women who have ideas for technology startups. As the name suggests, the investor platform’s main objective is to give African women in tech their first check by investing up to $25,000 in each woman at the ideation stage and working to help her raise a significant pre-seed round within 12 months after being confirmed.
In Africa, when investors are approached by women entrepreneurs, there is an unconscious bias that they will not be as reliable an investment as their male counterparts. Female-led teams still find it difficult to raise funds and be taken seriously. This was the case of Damilola Olokesusi, CEO of Shuttlers whose story of gender bias in the workplace was during a board meeting she attended with her co-founders – an all-female team. A misogynistic statement made by a male attendee made it difficult for her and her team to be taken seriously throughout the meeting. Every woman who runs a business has her own story to tell.
FirstCheck’s fundamental goal is to “create enablers and active pathways between Africa’s growing community of early-stage funders and female founders.” They plan to do this by being active connectors and collaborators to accelerate female-owned tech startups on the continent. With a service catering to African women with scalable ideas, FirstCheck will be writing first checks for “audacious female founders” with bold ideas in their earliest stages.
“Our mission is to advance equity, capital and leadership for a generation of women in Africa through technology & entrepreneurship.”FirstCheck is building infrastructure around women in technology, believing it will generate a solid return on investment. In exchange for modest equity, FirstCheck will invest in female founders aiming to validate their ideas and build viable products.
The investment startup will be working with a community of African women with ideas for technology startups, even those with vague ideas that could eventually become startups in the future. Businesses that are no longer in their ideation stage but already in their early stages of execution, pre-revenue especially, will be considered as well.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry
The benefits of empowering women to participate in the digital economy are obvious. The key to success will be initiatives to teach digital literacy and expand access to Internet-enabled devices, as well as efforts to boost the confidence of women and girls, who have long been discouraged from competing against their male peers.
From Women in Tech conferences to Girls Who Code programs, initiatives aimed at enabling girls and women to enter the so-called STEM fields (science, technology, engineering, and mathematics) have proliferated in recent years. But change has been slow to arrive: while the percentage of women in the labor force has gradually increased, it remains significantly lower in the tech sector. Given that sector’s central role in driving the Fourth Industrial Revolution, this amounts to a major drain on economies’ potential.
The problem is particularly pronounced in Africa. In Sub-Saharan Africa, for example, the overall female labor-force participation rate has reached 61%, yet women constitute only 30% of professionals in the tech industry. More fundamentally, although Internet usage in Africa is growing at the world’s fastest rate, the digital gender gap has widened since 2013. A quarter fewer women than men use the Internet.
In today’s digital economy, women’s relative lack of connectivity undermines their capacity to reach their economic potential. Even women with their own “analog” businesses, such as dressmakers or hairdressers, suffer when they cannot advertise online, let alone use technological tools to monitor, measure, and optimize their operations.
These women can often afford to buy mobile phones and data. It would be easy for mobile providers to offer basic digital-literacy workshops, showing users how to perform basic online tasks such as creating email accounts. (Think of the myriad functionalities of, say, a Google account, from tracking business activity to creating advertisements.) As women-owned businesses became more productive, the entire economy – including those mobile operators – would benefit. But learning how to use existing digital tools is just the start. Women need and deserve opportunities to innovate. Men may work hard, but women – including those with full-time paid employment – still perform the bulk of unpaid labor. This leaves them with little time or space to engage in creative work – and that is exactly what innovation is.
Moreover, pervasive gender bias means that men often take woman innovators less seriously. Women-only clubs or social-media groups could help to push back against these forces, by giving women the chance to share their ideas, get feedback, and form their own professional networks.
Boosting women’s digital literacy today would have far-reaching inter-generational implications. In Africa, as in much of the world, women are more likely to be their children’s primary caregivers, which means that they are uniquely suited to prepare younger generations to participate in the digital economy.
But women can fulfill this role only if they have the right knowledge and tools. To that end, African governments should create computer literacy programs, targeting women from rural areas, in particular. Improving access to information and communications technologies (ICT), especially Internet-enabled mobile phones, would go a long way toward supporting these efforts.
Initiatives aimed directly at African primary- and secondary-school students – such as computer coding and robotics courses – are also needed. But, given enduring gender gaps in education – as well as the gender-based social pressures that perpetuate them – extra attention must be devoted to ensuring that girls are not left behind.
In fact, the Lesotho chapter of Africa Code Week – where I am a trainer and ambassador – has found that girls perform much better in coding when they are separated from boys. That is why girl-focused initiatives – including weekend coding workshops and coding marathons (hackathons) – are so important in enabling girls to innovate freely.
At tertiary institutions, it is up to research centers and innovation hubs to take up the baton of empowering young people – and especially young women – to innovate. In general, programs that allow students to pitch their ideas directly to investors could prove very valuable. Beyond giving great ideas a chance to shine, this would foster linkages between education and employment that could ensure that all students were acquiring the right skills to fill jobs in the tech sector.
Here, again, special attention must be given to girls. Science and technology faculties tend to be populated overwhelmingly by male students. For example, only 20% of those admitted to the University of Pretoria – one of Africa’s top research institutions – between 2015 and 2020 were girls.
In such male-dominated environments, even those girls who are admitted may struggle to reach their full potential. One way to help them would be for women who do advance in STEM fields to act as mentors, offering practical advice and confidence-boosting support.
The dynamics are complex and the barriers are high. But the benefits of empowering women to participate in the digital economy are obvious. The key to success will be concrete initiatives to teach digital literacy and expand access to ICT, as well as efforts to boost the confidence of women and girls, who have long been discouraged from competing against their male peers. Only if all Africans have the tools and support to achieve their potential can the continent thrive in the new economy that the Fourth Industrial Revolution is ushering in.
Palesa Libe, a co-founder of the NGO Green Tech, is an Africa Code Week trainer and ambassador in Lesotho.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry
