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    Innovation Village | Technology, Product Reviews, Business
    You are at:Home»Agriculture»How to find funding for agritech startups in Nigeria
    funding agritech-startups

    How to find funding for agritech startups in Nigeria

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    By Tajudeen Adegbenro on June 21, 2021 Agriculture, Agritech, Funding, Nigeria

    Where to look for funding, and how to look for the funding depends on the type of company you operate and the kind of finance you need. There are a variety of funders in the Nigerian agritech sector which includes early-stage financiers such as accelerators, incubators, donors, and angel investors, and mid-stage investors like venture capital and impact investor firms. Late-stage investors such as corporate investors and private equity firms are currently not active in the agritech sector as they tend to invest larger amounts in established startups in all sectors with a proven business model and history of generating funds.

    If you are an agritech startup looking to raise funding for your business, here are some investor categories offering funds to startup.

    Accelerator

    Accelerators provide financial assistance to early-stage, growth-driven startups via mentorship, financing, and education. Startups basically enter accelerators for a specific time frame and as part of a cohort of companies. Example in Nigeria include Ventures Platform and Itanna Accelerator

    Angel Investor

    Angel investors are available for startups and earlier growth stages. Angel investors can be either a group of individuals or an individual who use their money to fund companies. They can mostly be friends of founders and family. Examples of angel investors in the Nigerian agritech sector include Rasheed Olaoluwa and Tomi Davies

    Corporate Investor

    Corporate investors make strategic investments like buying a company to have access to its proprietary technology. They are similar to venture capital firms and are mostly called corporate venture capital.

    DFI

    Development Finance Institutions (DFIs) are specialized government-owned organizations that invest in private sector projects or business startups in countries in low and middle income to promote economic growth and job creation. An example is FMO

    Donor

    Refers to a government agency, company, or individual agency that provides funds to a company or startup without basically taking an equity stake in the company. Examples include GIZ, Australian Aid, Tony Elumelu Foundation, and UK Aid.

    Impact investor 

    Impact investors aim to generate specific beneficial environmental or social effects in addition to financial gains. GreenTec Capital Partners 

    Incubator

    An incubator is a company that assists startups at the early stage to develop from ideation to service or product development. Incubators basically provide desk space, mentorship, and other business advice. Examples are Wennovation Hub and Passion Incubator.

    Private Equity

    Private equity firms source investment funds from high net worth firms and individuals and typically invests in companies during the later stages of growth to take control of them. Cox Enterprises and Ajayi Solutions are examples of private equity companies.

    Venture Capital

    Many people misunderstand the venture capital business. Many startup companies complain about venture capital companies fails to invest in risky or new ventures. People refer to them as sharks because they predatory business practices, because they think like a flock and want to venture into all kinds of deals. Venture capitalists are business individuals responsible for investing other people’s money. They invest in companies basically those with long-term potential, using funds raised from an endowment and wealthy individuals, and pension funds. Examples are Consonance Investment managers and Timo Capital.

    If you are a startup or have a business idea, you can leverage these investors to allow your business to live to its full potential. With a few minutes of research, you can find out individuals or companies that belong to each investment category.

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    Tajudeen Adegbenro

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