Key questions this article answers:
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Venture debt is an alternative funding source for startups. How much has venture debt grown in the African startup ecosystem?
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What features are common across startups that have raised venture debt in Africa?
Amongst the many things startups deal with is the question of funding.
How much should I raise? How much equity should I give up? What kind of funding should I raise? Whether building in Lagos, Bangalore, Nairobi or San Francisco, these questions resonate with founders. Founders must determine the best terms for them and convince investors to commit funds. These questions become critical during a funding winter such as we are encountering.
The most common funding approach startups adopt is exchanging equity (ownership stake in a business) for investment. This funding type has consistently made up at least 80% of annual startup funding since 2019, per Africa: The Big Deal database. But
