On the last episode of the weekly Fidelity SME Forum, Ms. Lexi Novitske (Partner, Acuity Venture Partners) shared insights on the topic: “Building a Successful Business in a Challenging Environment”. The session with Ms. Lexi Novitske was the first episode in the series dedicated to showcasing women who chose to challenge in their respective fields.
It is no myth that a major challenge that African Entrepreneurs face is the lack of capital. While some entrepreneurs have been able to tap into international investors through incubation and venture funding programs (e.g. Paystack and Flutterwave), most SMEs in Nigeria lack the capacity to attract venture funding. According to Ms. Novitske, the major challenges faced by tech start-ups when seeking funding are multifaceted and range from issues around currency exchange fluctuation, difficulty in finding developers and engineering talents, and issues around regulatory instability.
Acquity Ventures provides equity for businesses operating in Africa. Their focus is on start-ups that are building products for financial inclusion, enabling software platforms and stock infrastructure. Consistency, Product, and a Cohesive Team are key factors that they consider before going into a partnership agreement with these start-ups.
Lexi also shares some deep and thought provoking insights by adding that the Covid19 pandemic acts as a sort of “catalyst” when it comes to technology, teleworking and virtual teams. She emphasized the need for SMEs to leverage these opportunities and in the long run growing and stabilizing their business.
She goes further to demystify the myth that women in tech around the world are less aggressive and that the tech-space is male dominated and has little or no space for women. According to her, women are doing many exploits in the world of tech as well as other industries such as oil and gas, banking etc. As a way of supporting women, Acuity Ventures gives women founders’ more opportunities by prioritizing investment in women-owned business.
Lexi went on to advise MSMEs that are seeking funding to actually understand that early-stage investors focus on the “Team” and “early traction” of any start-up before they make investment decisions. These small businesses should be able to demonstrate the capacity of their team and volume of knowledge capital to inspire investors’ confidence.
It is also imperative to note that the concept of “early traction” gives insights into potential revenue and market acceptance of the product. Hence, it is important for startups to build up some traction to show a ‘proof of concept’ before seeking investments from venture capitalists.
In conclusion, Ms. Novitske recommends that MSMEs should challenge the status quo. Acuity Venture Capital favours aggressive growth companies with the potential for a global reach.