THESCATHGROUP, a team of tech enthusiasts in Kaduna, is providing tech entrepreneurs from northern Nigeria with funding and advisory services to bring their ideas to life.
Oluwajimi Akitunde is no stranger to growing a business. Fresh out of Ahmadu Bello University, he started to work on building a logistics business before he stopped due to a knowledge gap that affected their ability to scale. Six years later, he co-founded THESCATHGROUP(TSC) in Kaduna where he lives, a hybrid VC that is providing early-stage funding & advisory for tech entrepreneurs from northern Nigeria.
While the tech community in northern Nigeria has seen some growth since 2016, there are a lot of unique challenges that entrepreneurs from the region face in trying to scale, including a lack of infrastructure and investor bias. Unlike the tech scene in states like Lagos, which is now the face of the country’s thriving ecosystem, startups in northern Nigerian states are still struggling to convince investors that they exist.
“Many investors are based in Lagos and are more likely to invest in startups based in the southern part of the country,” Surayyah Ahmad, an early-stage investor at TechTankLabs wrote. “This bias has made it difficult for startups in the North to secure funding, even if they have promising ideas and strong teams.”
According to Akitunde, they have had cases where they reached out to investors or partners and as soon as they realised that TSC operates from Kaduna, they became hesitant.
“Thriving tech hubs like Lagos that they’re enthusiastic about now, only exist because a group of people took the bet on them and we need to extend this to other places,” Akitunde shared.
When asked why investors are hesitant to invest in the North, Akitunde shared that he believes it’s primarily an interest issue and investors are rarely interested in much that’s happening outside Lagos. He is however confident that the region has immense potential which is being overlooked.
“Northern Nigeria holds two-thirds of the country’s population so there’s a lot of potential for talent and also as the target market. It does have its challenges but the only way to overcome them is to build through,” Akitude said to TechCabal over a call.
TSC so far has provided ten founders in Northern Nigeria with some capital to kickstart operations. However, it is looking to raise funding to support even more and write larger cheque sizes of at least $50K to $100K for the average 7.5% they expect in return. Their portfolio businesses span across mobility, agritech, and fintech, and most of them are kicking off nicely. Akitunde shared that although their firm receives a lot of applications, funds are limited so they are only able to write cheques for a few.
Beyond funding, the firm provides consultations and community for entrepreneurs, two things that are critical for early founders. Community is one of the reasons the northern ecosystem has grown to this level, but it does need a lot more. In 2016, Daser David and Hyginus Horson founded nHub in Jos, northern Nigeria’s first tech and innovation hub. Sanusi Ismail founded CoLab a year later. These two hubs provided thousands of young people in the north with the knowledge and community required to take their interests in technology seriously. More than 10,000 tech talents have gone through nHub and members of CoLab have gone ahead to develop into world-class talent working at global companies and building their own pan-African startups.
While there are a number of investors in Northern Nigeria, they prefer to invest in traditional businesses as investing in early-stage tech startups is not as popular and consequently does not inspire enough trust. This is part of the work that TSC does. They have a hub in partnership with Afrilabs where they host monthly community events for people in and outside the ecosystem to meet, learn and network.
“This has been useful in bringing people together to learn about the work that is being done and collaborate,” Akitunde shared.
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