Internet and search engine titan Google has announced that it has made its first investment from its Africa Investment Fund in Ugandan startup Safeboda. The figures surrounding the investment remains a mystery as it was undisclosed by both Google and super app Safeboda.
The investment in Uganda’s Safeboda follows about two months after CEO Sundar Pichai announced that the tech giant would be committing $1 billion over the next five years in “tech-led initiatives”, which covers a $50 million Africa Investment Fund focused on African startups in their early or growth stages. This announcement came in October this year.
Google, like a number of other tech companies, is contributing its quota by helping smaller companies unravel their potentials and mitigate the problem of lack of funding. Before the fund was launched, Google has been assisting startups through its Google for Startups Accelerator Africa Program. Currently, this startup has supported over 80 startups in seed and Series A funding round with equity-free mentorship and resources. Google also newly launched Black Founders Fund, a non-dilutive $3 million fund allocated to 50 startups every year.
Africa is filled with potentials especially for startups but one problem that these growing startups experience is the lack of or access to funding but this is slowly starting to change thanks to efforts from companies like Google and other investors. Last year, fintech startups in Africa (majorly from Nigeria, Kenya, Egypt and South Africa – called the big four) made up 25 percent of the VC funding that came into Africa.
Investors like Google aim to bridge the gap in funding by investing in these overlooked or “abandoned” regions. Nitin Gajria, the Managing Director of sub-Saharan Africa Google expressed these sentiments in October when the company announced the Africa Investment Fund in October.
“We are not restricting ourselves to certain verticals. We are focusing on investments where we believe that Google could add value. If there are founders building interesting products solving real challenges in Africa that would fall squarely within our investment thesis”, he said.
According to SafeBoda, the investment it received from Google’s Africa Investment Fund will help “its growth in Uganda and Nigeria, scaling its transportation-led app to offer new payment and financial services solutions for its expanding set of customers: passengers, drivers and merchants”.
In a statement, co-founder of SafeBoda Ricky Rapa Thomson said that “SafeBoda welcomes Google to their community and are excited to continue to drive innovation in informal transportation and payments in the boda boda (East Africa) or okada (West Africa) industry. This vital industry is the lifeblood of Africa’s cities and powers economic development. SafeBoda is thrilled that leading global companies such as Google see the importance of backing startups working towards these goals”.