For many start-ups, raising sufficient funds to go beyond an interesting idea to create a viable business or social enterprise can be a real headache. Limited information, high risk and lack of funding structures can all prevent potential investors from risking their capital, even where they are well disposed to supporting the next generation of leaders. This is something that our grantee, BongoHive, in Zambia have recognised and we’re delighted to be supporting them with a grant of £8,975 to help address a couple of these issues. Using this funding, BongoHive plan to create an Equity Investment Plan which will allow them to make equity investments in the most promising start-ups coming through their programmes. Not only does this provide start-ups with continued access to mentoring, office space and professional services, but also allows BongoHive to generate income from the start-ups they are supporting which can in turn be used to bring more start-ups through the doors.
For local start-ups, BongoHive has been something of a revelation and the structured support they offer can be vital to budding entrepreneurs looking for advice:
The beautiful thing about this programme is that it makes you concentrate on the crucial aspects of your business that you wouldn’t necessarily care about at an early stage of your business. – Elijah Zgambo, Former Launch Participant (Founder, Street Culture Zambia)
But it’s not just BongoHive that wants to invest. Local Zambian investors are also keen to get in on the action and so the remainder of our grant will be used to establish an angel investment fund, which will allow a select group of local investors to safely and legally invest in start-ups at BongoHive. By creating the formal, legal structures necessary for investing in companies, BongoHive hope to give confidence to local investors interested in supporting home-grown talent. Together, we hope that the angel investment and equity investments will provide BongoHive with new sources of revenue, start-ups with access to capital and investors a way to support the local start-up ecosystem.