In order to successfully facilitate active participation in investments, a lot of factors come into play. One of the most important factors is the need for investors to have access to credible information and knowledge on how to make investment decisions and build stellar investment portfolios. This is where private investment clubs like the TGI Club come in. 

Since Tomie Balogun founded the TGI club in 2018, her vision has always been to bridge the gap in understanding how investing works. Her passion and tenacity led to TGI Club being one of the most active investment clubs in Nigeria offering first-hand access to financial advice, opportunities, and support. The club has also grown from 35 members at inception to 2000+ active members.

TGI Club is focused on helping everyday investors build investment portfolios in a way that empowers them to live independently and contribute to economic development. Since its inception, the TGI Club has collaborated to invest $25M+ (As at December 2021) in multiple asset classes and SMEs which has aided members in diversifying their investment portfolios. 

In 2021, TGI club partnered with 2 notable Venture Capital (VC) funds. to get access to competitive investment opportunities in the VC space. After a number of educative webinars and thorough research, club members co-invested a total of $1.3m in two top-rated VC funds in Africa in 2021.

“Working with TGI Club was a fantastic experience. They were very professional and very fast. They mobilized quickly to invest the largest investment at the first close of our LoftyInc Afropreneurs Fund 3. No investor of that size moved as quickly as TGI Club did. Their sizable investment at first close provided a positive signal to subsequent investors. Tomie Balogun led the KYC process with efficiency on behalf of the syndicate which is a large reason for this favorable outcome. We are pleased and honored to have TGI Club as investors and partners,” said Idris Ayodeji Bello, Founding Partner at LoftyInc Capital Management.

This year, startups in Africa received about $4 billion startup funding with Nigeria earning the largest chunk of $1.37 billion. It is also predicted that by educating more people about income-generating assets, opportunities abound for Africa’s teeming population. 

In an exclusive interview, the founder of TGI Club, Tomie Balogun discusses major funds raised by TGIC, the importance of combining opportunities through education, the VC and startup scene in Africa, as well as key insights to help investors in 2022.

Creating a private VC club for everyday investors like yourself to participate in the emerging VC space in Africa is a pretty impressive achievement. Why did you decide to do this and what impact has it made? 

Tomie Balogun: I’ll start with providing context on the TGI club. The TGI club exists as an investment club that combines financial education, co-investment opportunities, and networking under one umbrella. We provide online, on-demand access to financial education and curated co-investment opportunities across multiple asset classes. The TGI club is focused on helping everyday investors basically get access to information, which is very key when you’re building an investment portfolio, and access to competitive investment opportunities as they are available in the marketplace. 

When we started the club, a lot of our members were just beginning to build investment portfolios at the time, so they invested mostly in the money market, stock market, some alternative options like Agro-finance, debit notes, etc. In recent times, we’ve seen our members grow remarkably and we realized a number of them were ready to invest in VC funds. VC investing is long-term in nature and an investor needs to understand the risk associated with it. We started with hosting experts on educational webinars on VC investing, which helped our members take an interest and make informed investment decisions.

We decided to set up a sub-club within the TGI Club called the TGI Private VC Club. We knew that not all members were ready, but we wanted those who were ready to join the sub-club. The first VC fund co-investment we did was for the LoftyInc Fund. LoftyInc Capital Management (LCM), is an early-stage African-focused technology fund that has invested in African unicorn trailblazers such as Flutterwave and Andela. In mid-June 2021, we invested $750,000 in the LAF3 fund as a private club. The funds were pooled together by members of the private club because anyone who wants to invest in a VC fund typically has to have a minimum of $200,000 to be admitted as an investor but we collaborated in a way that allowed for co-investment and pooling of funds. We were one of the lead LPs for the $10m Lofty Inc Afroprenuers Fund III (LAF3). The second lead LP for this fund was FBN Quest Ltd. Subsequently, we plan to invest in more partner VC funds within the TGI VC club. In 2021, we closed another co-investment In a second VC fund.

What’s the profile of the typical TGI Club member?

Tomie: The typical member of the TGI Club is a working professional who has worked for an average of 5-6 years or a business entrepreneur in business for 3-4 years who wants to make better decisions with their personal finances. They are focused on building their careers/businesses and earning more income and as a result, do not have time to search for or analyze credible investment information. We provide a lot of resources on investment education, host monthly webinars with industry experts and events that drive open investment conversations. All of these activities provide our members with the information they need to make investment decisions correctly.

With the TGI Club, we’re building investment portfolios that are diversified, well allocated across asset classes, and across currencies. Investment portfolios that will stand the test of time, and help members live the life they want.  

Your approach to helping Africans invest and create wealth is innovative and interesting. Why this approach, especially in today’s world of decentralized finance trends?

Tomie: Our approach is similar to the age-old ‘Ajo ’/collective saving schemes. We believe there is power in many and we work on taking advantage of the benefits that come with being a 2,000 strong investment club. This approach works because it democratizes opportunity for people like you and me. Our active co-investing activities in TGI Club help us attract the best opportunities and negotiate the best terms for the members of our club. Honestly, we didn’t realize how ground-breaking our approach was till we released a report titled The Money Moves of Today’s Young Nigerian and started to receive messages from all over the world saying they had never seen this club model before where you enable everyday people to co-invest in multiple asset classes beyond the stock market or real estate.  What we’ve done with co-investing in top VC funds, we’ve also done with Real Estate, Eurobonds, etc.

What have you observed about the VC landscape and startup scene in Africa?

Tomie: The VC landscape in Africa is growing significantly. The Paystack story, the Flutterwave story, and so many other stories have opened up the VC space and attracted a lot more capital into Africa. I’ve read reports on Africa being the next frontier for years. Now, we’re finally beginning to see capital get attracted to innovation in the continent. If we want growth, we need to be able to continue to attract or mobilize capital. I believe what’s even more interesting is that we’re seeing local investors also get interested in VC investing in Africa. The ongoing pandemic opened up opportunities for more technology use cases in different sectors of the economy. I’m looking forward to seeing more capital get invested in these companies in a way that improves employment rates and contributes to economic growth.

In terms of what I see going forward, I believe that we’re going to see the difference between real businesses and the ones that will fall on the wayside. We’ll see the companies that stand the test of time continue to expand and attract more capital. We’re going to see a lot of that in the fintech industry which is a big wave right now and I expect we’ll also see this happen in other industries as well. 

If we look at the 5 unicorns that have come out of Africa to date, 4 of them are fintech. Why do you think fintech companies are so far ahead of other startups on the continent when it comes to revenue and valuations?

Tomie: Yes, I think fintech has received the most interest but with due reason. It is a fact that financial inclusion enables a lot of growth in any society.  Asia and Latin America are great examples of how financial inclusion can enable economic growth. When we say Nigeria has an estimated population of 200 million people, it’s not really a ‘200 million user market’ until everyone is included in the financial system. There’s no way we can really grow as a society if we don’t get more people included in the financial system. When the fintech companies fill this gap and have the potential to drive even more inclusion if they collaborate with the regulators. This is why I believe the fintech companies are way ahead in terms of valuation. They are a major enabler for financial inclusion and strong economic growth

Based on the global and local economic events in 2021, how should an investor plan for 2022? 

Tomie: 2022 is an interesting year and I say this because it’s a pre-election year. TGIC research team carried out research on previous pre-election years just to see if there has been any trend. Based on research and the trends observed, we expect some economic volatility in the local economy, especially because of the expected change in leadership, election planning, a lot of campaigning, and more. 

We are not totally out of the pandemic yet as well. Will there be more variants? Most likely as the entire world population is not vaccinated yet. Thankfully, the effects of the Omicron variant seem to be less critical than the previous variants. We expect this to lead to fewer economic lockdowns and drive more innovation in how we work, relate, and do business in general.  Right now, a lot of countries are experiencing high inflation. For example, the U.S and the U.K are experiencing high inflation, unlike anything they’ve experienced in the last two decades. Due to all of this economic uncertainty and analyst expectations of a market correction which may or may not happen anytime soon, the average investor should ensure they stick with basic financial principles,  have a stash of emergency/safety funds, set financial goals, seek out opportunities to make informed investment decisions and build an investment portfolio that helps them build the life you want. I’ll place an emphasis on being informed as information is so important to become aware of what opportunities exists and take advantage of these opportunities on time

Generally, food prices went up significantly in 2021 and I don’t see these prices coming down significantly. This means whatever financial plan you have should include a plan to earn additional income. You can’t depend on one income stream alone, especially if you don’t see your income increasing anytime soon. 

Finally, I’ll say pace yourself. Don’t invest in what you don’t understand or get into fraudulent investment schemes all because you want to make the quick buck. There are no get-rich-quick schemes that stand the test of time.

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