88mph, an African seed accelerator, has received backing from venture capital firm, 4Di Capital.
88mph, which opened in Nairobi in 2011 and expanded to Cape Town in February 2013, is an incubator providing investment and mentorship to mobile or Web start-ups, allowing businesses to learn from each other and make use of an extensive network of business and technology professionals and entrepreneurs.
To date, the company has spent over $1 million supporting African start-ups, such as Near A Builder, a Western Cape Web site connecting South African homeowners to tradesmen. Near A Builder initially struggled to attract investment before approaching 88mph, and has received R2.5 million in client work since its launch in February 2012.
"The technology space in Africa is picking up and we're seeing a lot of activity and opportunity," says Kresten Buch, 88mph founder. "Investors are watching this and are beginning to look outside of developed markets like the US for growth, because those markets aren't expected to grow as fast as they have in the past."
The investment by 4Di will not only provide funding for 88mph and the start-ups it supports, but will also extend the existing network of local investors, allowing start-ups a better chance of securing funding.
Despite rapid economic growth in sub-Saharan Africa, funding continues to be a major hurdle for start-ups. "88mph is unique in that they provide start-ups with actual funds, which is very rare for an accelerator in emerging markets, and in Africa especially," says Justin Stanford, 4Di CEO and co-founder. "We have chosen to back this accelerator as part of our desire to help foster and develop the nascent early-stage start-up ecosystem in South Africa."
88mph is partnered with Google for Entrepreneurs, and is also funded by private investors, including Hannes van Renburg, Fundamo CEO, and Ranjith Cherickel, head of sales and business development, Africa at Nokia Siemens Networks.
"We're very excited to have taken a concept from Kenya to SA with Google's support and are now able to bring 4Di onboard as well," says Buch. "The more experienced companies and individuals involved, who inspire trust by attaching their names to this endeavour, the easier it is for these start-ups to get customers, investors, and ultimately, succeed."
88mph plans to expand to Nigeria.
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