A new, privately funded venture fund and start-up accelerator, 88mph has been launched in Cape Town to invest in early-stage start-ups and help them grow rapidly.
88mph wants to fund start-ups focused on online or mobile that have the ability to grow quickly across other English-speaking African countries. It will invest as much as US$100 000 in each start-up and the share of equity it takes will depend on the valuation of the company it’s investing in.
“The start-ups we look at are often small teams who lack experience and the networks necessary to quickly grow their businesses,” says 88mph founder Kresten Buch. “They often struggle to focus on their product and customers due to the multitude of other things that need time and attention, like administrative tasks, office-related issues and finding follow-on investment.”
88mph has formed a partnership with Google to provide start-ups with office space and digital resources. There’s a mentor network and seven “entrepreneurs-in-residence” will be on hand during a three-month accelerator phase to offer advice on everything from sales to programming and Web design.
At the end of the accelerator period, start-ups will get to present their ideas to a group of investors.
Earlier this year, 88mph invested in eight start-ups in Kenya’s capital, Nairobi. That three-month accelerator is coming to an end and the start-ups will be presenting their products and services to investors in mid-December.
Increasing use of mobile data in Africa has created huge demand for local applications and services that cater to the young and growing middle classes, says Buch. He says 88mph is designed to fund start-ups wanting to grab a portion of this growing market.
To date, 88mph has invested more than $500 000 in 15 early-stage start-ups. With a new fund nearly closed, the programme hopes to invest in more than 10 South African start-ups.
“I think the biggest opportunities for return on investment will be in Africa and other emerging markets,” Buch says. “Our accelerator programme is a great opportunity for international technology entrepreneurs and ‘returning diaspora’ to come, take advantage of the insane growth here, and work on solving some really interesting problems.”
Those looking to apply to 88mph must do so by 15 December 2012 and the programme starts at the beginning of February in Cape Town. — (c) 2012 NewsCentral Media