Largest Ever Debut Fund for a Black-led VC Firm, AfDB Debuts with Synthetic Securitisation


In this week’s brief, with a $137 million in funding, Base10 Partners, is the largest ever black-led debut fund. The African Development Bank turns to Wall Street to offset risk, and Lagos to host the African Fintech Summit.

 

Nigerian-led Company, Base10 Partners, Gains Ground-Breaking $137 Million Fund

Base10 is now the first black-led venture capital (VC) firm to receive the highest ever fund.

Founded by Adeyemi Ajao and TJ Nahigian, the firm achieved $137 million worth of funding, which ordinarily should not be surprising amount, however, when readers and industry experts analyse the context of this fund as well as the deep-rooted issues surrounding funding for black-owned businesses, it is easy to see why this is a remarkable moment. A recent study by digtialundivided revealed that the average amount of funding raised black women founders is $0.

Base10 has changed the tide and intends to invest in unnoticed entrepreneurs. The company aspires to work with companies from all over the globe to solve issues that impact 99% of the world, stepping beyond Silicon Valley.  In relation to searching for entrepreneurs, Ajao said, “We are much more likely to fund someone that actually worked for eight years on a construction site and was like, ‘you know what, I think this could be done better and maybe I can make my life easier with automation,’ rather than a Ph.D in AI out of the Stanford lab that says ‘I think construction is inefficient and it can be done without people.”

During the course of its existence, Base10 has supported a number of companies. The Pill Club, Wonolo and TokendSoft have all received backing from the VC company. Furthermore, Base10 invested a $63 million Series A fund in startup companies Grin and Yellow.

Base10’s success is a sign that it is possible for companies emerging from West Africa and the diaspora to receive adequate financial support.


The African Development Bank Secures Financial Deal On Wall Street

The African Development Bank (AfDB) made a deal with a New York hedge fund to form a shared accountability on the risk of losses on loans. This new, co-responsibility relationship demonstrates rising partnerships between multinational institutions.

Recently, AfDB purchased insurance on a $1 billion collection of loans from a number of investors such as the Mariner Investment Group. Achieved through a synthetic securitisation, the hedge fund will not gain the asset. Instead, it will acquire $152 million of default risk while giving a financial return.

Worldwide organisations with high credit ratings are supported by various nations and receive pressure from governments that supply financial backing to find new ways of boosting their ability to lend. The AfDB’s decision is a critical one because it lowers this necessity to hold high capital against loans, giving the Bank a greater capacity to lend. Speaking on the matter, the President of AfDB, Akinwumi Adesina, said that the deal will, “super-charge our ability to invest in urgently needed projects across Africa”. He went on to say that “It leverages our financial resources so we can have more impact, and it creates new pathways that enable long-term investors to support Africa’s development while getting excellent financial returns.”

Covering an estimate of 40 loans, the deal will be used to invest in power, transport, finance and manufacturing ventures within more than 15 African Nations.


Founder of Nigeria’s Zenith Bank Jim Ovia Inspires with New Memoir

The founder of Zenith Bank, Jim Ovia, has published a long-awaited memoir called “Africa Arise and Shine”. Offering a personal glance at his career from the early days, the memoir is packed with humble wisdom and inspiration from the self-made businessman.

As an entrepreneur, Mr Ovia is no stranger to the trials that one may face on the road to starting and sustaining a business.

Within the memoir, he wrote, “Never allow the perceptions of others to play a substantial part in your own vision of yourself and your future,” he writes. “It is imperative to rely on one’s own instincts in taking stock of one’s own capabilities, and in evaluating a new business opportunity.”

Released first in the United States by ForbesBook in South Carolina, the memoir is expected to be available in numerous languages such as French and Spanish.


Lagos to Host the African Fintech Summit

For the first time, Lagos (Nigeria) will host the African Fintech Summit.

Taking place on 8th-9th November 2018, the Summit is an important part of Africa’s expanding fintech landscape. It provides an opportunity for innovators, investors, policymakers, and significant stakeholders to discuss technologies changing finance within the continent, create new projects, and compare top practices.

The list of African capitals making an impact in the finance industry continues to grow. In the western region, capital cities such as Lagos are creating hubs which foster many industries, with fintech being one example. The Chairman of the Summit, Leland Rice, stated, “Lagos is an ideal host city; it’s an epicentre of Africa’s fintech revolution and the driving force behind the continent’s entrepreneurial spirit”.