Nearly every week, we hear reports of startups in Africa raise funds. But what do the different types of funding rounds mean? Well, a funding round is anytime money is raised from one or more investors for a business. They’re given a letter, such as A Round, B Round, C Round, etc. because each round follows another. The letter identifies which number of rounds they’re on. Here, we take a closer look at the types of rounds and what they mean.

Series A round funding
Investing at this stage is usually regarded as high risk because the company will probably still be at the startup stage with a lot to prove.

Angel investors may be interested, but venture capitalists may also invest. Angels usually invest their own money and are often considered high net worth individuals. VCs and other institutional investors tend to invest other peoples’ money, so, they usually only invest in companies with a proven track record to reduce their risk.

Series B funding
A series B round is the second round of funding by private equity investors and VCs. By this stage, the company will probably have a higher valuation than before. The risk will be lower than before as the business will have a track record – so the cost to invest will be higher. Investors will expect to see signs of growth at this stage in revenue, users and product/service success

Series C round
A series C round is needed when a company is ready for rapid growth. The company will usually: have become a proven success in its market, wants to make acquisitions of competitors, increase market share and scale up or develop new products or services.

Venture Capital
This type of situation is different than an angel in that it is an organization of investors. Usually, this type of investor isn’t as interested in the early stages of a startup and prefers to see some return before they get involved. They like to make deals where they know they will get a return so they can be turned off by too much risk. However, they are more likely to invest a larger sum of money, but typically require ownership and to be placed in a decision-making position.

Seed/angel fund
Seed round usually occurs when the company is at the initial idea stage, or once the founder has a prototype/proof of concept, as well as some kind of sign that there’s a demand for what could be offered. Meanwhile, an angel round often occurs when a company is only just launching, if not before. Chances are that it will need an investment to support the business because it probably won’t be generating a big enough cash flow to cover all the day-to-day running costs. Sometimes a seed round and an angel round aren’t two separate rounds, they can be a hybrid of the two. Despite the name, both seed and angel investment rounds usually include a large proportion of funding from friends and family. It can also include money from angel investors who are focused on early-stage companies.

IT'S A GOOD IDEA TO INVEST ON WEED RATHER THAN ANY OTHER TIN IN THIS COUNTRY BECAUSE NO BUSINESS DEY OK FOR 9JA AT THIS TIME OF APC

Having your own fund for your startup is the best

Angel investor needed for a digital magazine investor.... @vx

ok that is good

Alright

came to see fund

No link, how can one get in contact?

Only like 0.0001 percent of African startups make it to series A. Getting seed funding here is extremely difficult.

H

Fund 9ja startup at ur peril. Dem go waste ur money dey live lavish

please I need help on profitable business I can start with 1m. I'm thinking of having a shop for soft drink and supply for events. Any idea pls.

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where is the link to get the fund

In addition to OP's list ,see 12 PROVEN WAYS YOU CAN RAISE CAPITAL FOR BUSINESS IN NIGERIA.

This is Nigeria not silicon valley. No series x whatever here,

hmm

yeyerolling:
Fund 9ja startup at ur peril. Dem go waste ur money dey live lavish

I'm still learning that lesson

Space booked.. Following Keenly

People still eat, no matter what. Agribusiness is viable but most Nigerians think they are beyond agriculture, that agric is for the unsophisticated village people. You eat garri but you look down on those who produce it. The fact is there're no other businesses in Nigeria except Agribusiness. We are not developed, so looking for tech or office jobs or investment is self-delusion. The lack of market demand is why businesses are closing in Nigeria. Do the right business that is based on our development level and needs and see how profitable you'll be.

SheikhMuniru:
IT'S A GOOD IDEA TO INVEST ON WEED RATHER THAN ANY OTHER TIN IN THIS COUNTRY BECAUSE NO BUSINESS DEY OK FOR 9JA AT THIS TIME OF APC

BruncleZuma:
I'm still learning that lesson

once worked for a startup. I quit. It looked lik yahoo. As soon as one oyinbo invested, oga change car, collected driver, started flyin First class, and he began to alter my financial reports. Omo i pick race. D business don crash sha

yeyerolling:
once worked for a startup. I quit. It looked lik yahoo. As soon as one oyinbo invested, oga change car, collected driver, started flyin First class, and he began to alter my financial reports. Omo i pick race. D business don crash sha

Mehn my belle still dey turn from my last escape from Congo.

yeyerolling:
once worked for a startup. I quit. It looked lik yahoo. As soon as one oyinbo invested, oga change car, collected driver, started flyin First class, and he began to alter my financial reports. Omo i pick race. D business don crash sha

He was prolly doing it for money. Some of us are passion driven. Someone like me wants to have a name. If an entrepreneur wants to be identified by his product not lifestyle... He wouldn't make such mistakes. People identify with Mark cos of facebook, seun cos of nl, dangote cos of cement.


This should be the focus of every entrepreneur

boiz2men:


He was prolly doing it for money. Some of us are passion driven. Someone like me wants to have a name. If an entrepreneur wants to be identified by his product not lifestyle... He wouldn't make such mistakes. People identify with Mark cos of facebook, seun cos of nl, dangote cos of cement.


This should be the focus of every entrepreneur

This is a very important thread but I'm sure it won't get the attention it deserves. I totally agree with you on people who are passion driven. I don't want to think it's a Nigerian thing. For some startups, bootstrapping is a necessity and the team must be prepared to suffer in that initial stage.

I know so well what yeyerolling was alluding to, and it demotivates a team big time. You can't claim to be a head and you're giving all the bad signals with resource mismanagement. Red flag!!!

One of this will be inevitable.



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This is the type of thread that doesn't exceed page 0
If na gossip now we no go hear word

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