As the Nigerian tech startup space continues to grow, there is a huge need for investment and in response attracting local and foreign investors in filling this gap with hopes of getting high rewards.
Kresten Buch, Founder Managing Director of 88mph, an international investment company with the keen interest in African startup is on of such investors and we caught up with him on his visit to Nigeria. He shared why 88mph chose Nigeria over Ghana in regards to opening an office as well as other things.
O: Tell us about yourself and why you are in Nigeria?
KB: My name is Kresten Buch, I am the MD of 88mph which is seed fund that invest in early stage starts that is targeted at the African Market and we are based in 2 cities at the moment which are Cape Town and Kenya, We are here in Lagos to explore the viability of setting up the 3rd in Africa.
O: Why did you think Lagos is the next move?
KB: Looking at Africa, you can’t say you’re an African and not been in/to Nigeria. It’s also because we want to be based in West Africa as well, and looking at the most popular mobile penetration market in Africa, South Africa, Kenya, Nigeria and Ghana top the chart. A lot of researches shows it’s easier to setup in Ghana but we discovered the market is in Nigeria, so we are here.
O: What industry do you invest in?
KB: We don’t invest in a specific industry, we invest in companies that use mobile services or connectivity to distribute their products or communicate with their customers, retails, mobile banking. We don’t invest in hardware companies but small startups won’t need much additional staffs or additional fixed cost to scale.
O: Have you invest in any Nigerian Startup before?
KB: Yes, we have invested in Nigerian startup called Gamesole, which currently has over 1.2 Million downloads on Microsoft platform. He is currently in Kenya because he is a game company that can seat anywhere and operate.
O: Coming to Nigeria, how many startups are you looking to invest in?
KB: Normally we invest in 7 to 10 startups and it won’t be different here.
O: What interest you in the startups you invests in?
KB: The most important thing is that they have good team, what market they are targeting, what knowledge they have about their targeted Market and how far they have gone with their product and the market need to be interesting.
O: What are the process to get 88mph’s investment?
KB: We don’t expect startups to write us a business plan, we just ask them to fill our application of 20 questions, so we schedule a meeting with them after and the program is once a year.
O: Now that you are having Nigerian office, is there going to be physical contact with applicant startups?
KB: We get more than 600 contacts so there won’t be physical contacts to safe the stress until we stream it down to 20 or 50.
O: What are you thinking about competitors like Rocket internet?
KB: Our business model is different from Rocket internet, we only fund we don’t have share in the company but Rocket is doing good with educating entrepreneurs.
O: When will your Nigerian office open for access?
KB: We don’t know yet, but it should be early next year. We are partnering with local investors to coming in with us.
That was our chat and we look forward to their local launch in Nigeria.