Startups

Nigerian Fintech Carbon Launches First-Of-Its-Kind USD 100 K Fund For “Non-Fintech” Solutions


February 18, 2020

One of Nigeria’s fastest-growing fintech startups, Carbon, has pulled off yet another first by setting up a USD 100 K Pan-African fund to address the lack of funding and support holding back budding tech entrepreneurs on the African continent.

Carbon’s USD 100 K Pan-African fund, christened “Disrupt Fund”, is the first of its kind by an African fintech startup. The fund will invest up to USD 10 K per startup for 5 percent equity and as part of the incentives, Carbon will provide access to its API.

This is in an effort to enable investees to leverage its growing customer base and innovative technology platform, thus helping the beneficiaries get to market faster.

With those targets in mind, Carbon is now accepting applications from companies with operations in Nigeria, Kenya, Ghana, Uganda, Cote d’Ivoire, and Egypt.

Startups looking to apply for the fund must have a functioning product, post revenue and be open to the idea of operating in multiple countries. Although the fund has a wide investment mandate, target sectors at this time include insurance, health, and education which have not seen as much investment as the fintech space where Carbon operates.

Commenting on the rationale behind the decision to invest in sectors different from the one Carbon has made its turf, Chijioke Dozie, CEO and co-founder of Carbon, said there’s a lot more merit in collaborations and deliberate partnerships.

“Common investor wisdom is to stay in your market and dominate. This assumes that you are expanding on your own but we believe that by collaborating and partnering deliberately, Carbon and other tech companies can scale faster and build more enduring platforms,” said Chijioke. 

“There are many excellent companies across the continent looking for the kind of scale Nigeria offers and we are excited to partner with them to provide the support and financial investment they need.”

He added, “We are equally excited to expand beyond Nigeria and Kenya by working with a new generation of innovators across the continent and sharing our experience to tackle common obstacles to growth”

For the fourth time in as many years, funding for African fintech firms comfortably outstripped all whatever investments went into other sectors, not that these non-fintech firms don’t hold as much, or perhaps, even more promise.

Carbon’s Disrupt fund has been developed to tackle this disparity head-on, making it easier for entrepreneurs across all sectors to access the funds and support they need to establish their solutions and achieve their business objectives.

The fund will also provide mentorship, access to Carbon’s customers and payment platform, as well as office space in the Lagos offices of Carbon, easily one of Nigeria’s most promising fintech startups with footprints in payments, loans, savings/investments, and a host of other digital financial services.

Since launching in 2016, Carbon lays claim to having amassed 2.1 million users. The company also claims to have disbursed more than USD 63.7 million in loans in 2019 and processed more than USD 140 Mn in transactions.

Ngozi Dozie, co-founder of Carbon, also commented thus, “The investing environment for early-stage startups has improved in recent years. However, a key issue for most startups that has not been addressed is the cost of customer acquisition.

“A lot of money is spent on acquiring customers, mainly via social media, when a more collaborative approach among tech companies could be more efficient,” he added.

“Our fund will enable this collaboration, allowing others to market to our customer base and vice versa – a win-win for everyone. As the saying goes, ‘if you want to go fast, go alone.  If you want to go far, go together’”.

Interested entrepreneurs can apply to access the fund by clicking here.

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