Thoughts on the Andela unicorn round

29 Oct 2021

By Maurizio Caio, Managing Partner TLcom Capital (Andela investor), and co-chair of the AVCA VC Committee

Andela has recently announced a US$200mn Series E financing round led by SoftBank at a pre-money valuation of US$1.5bn.  

The relevance of this event for the African venture capital ecosystem is significant from several perspectives.  

First and foremost, it points to the maturing of African VC as an investment space where global investors are demonstrating a strong interest in scouting, identifying and recognising world-class entrepreneurial teams that can deliver world-class returns. Africa is becoming part of the global VC space and to the extent that companies have compelling value generation stories, they can attract global capital at attractive valuations. Other recent unicorn status financing rounds or exits – just this year - include Flutterwave, Wave, OPay and Swvl 

Second, Andela is a global leader in the talent sourcing and placement market, with a particular emphasis on software development teams. This means that “there is life beyond fintech”. While significant investments – and growing valuations – are taking place in the African fintech space, and in the most compelling and sizeable market of Nigeria, Andela shows that technology can enable successful business models in other verticals and across geographies.  

Third, Andela is not an isolated high valuation event, but the beginning of a structural cycle where a long string of African companies is scaling and maturing, and hitting the milestones typically associated with high valuation financing rounds and exits. Strong business fundamentals in the form of growth and path to profitability, experienced management teams and world-class governance, predictability and visibility on future growth: a growing number of African startups are progressively qualifying along these dimensions. Over the next few months and quarters, we will certainly see more African unicorns attracting global capital and delivering world-class returns.

About the author

Maurizio Caio is the Founder and Managing Partner of Nairobi, Lagos and London based TLcom Capital, investing in technology-enabled fast-growth businesses across Europe, Israel and Sub-Saharan Africa for over 20 years. The TIDE Africa Fund has completed eight investments. Before TLcom, he was a Director of Bain & Company, leading the firm's EMEA Technology practice, and a Manager at McKinsey. Maurizio seats on the boards of Twiga, Ajua, Terragon, Shara and Cuebiq. He has a Summa-cum-Laude degree in Business Administration from Bocconi University in Milan and NYU, and an MBA from Stanford University. He is based in Nairobi.

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