As an early-stage venture capital firm in Africa dedicated to equality of opportunity, we committed very early to including amongst our deal flow sources an open application for funding to founders. Unfortunately, we are finding open applications are a poor source of dealflow replete with more noise than signal and today we have made a decision to shut them down.
When we conducted an audit of our highest performing sources of dealflow, we found that we were more likely to fund a company recommended by our team members, Future Africa Collective investors or people who we knew to be active participants in the African tech ecosystem. Concurrently, more than two-thirds of the deals we passed on have come through the open call on our website.
This is because most of the applications we get through open applications are typically incomplete, out of scope or irrelevant to fundraising. Open applications have also created opportunities for unscrupulous individuals to make baseless claims of intellectual property theft should we choose to fund other companies in the same industry.
Discontinuing the open application channel will help us double down on sourcing through our proprietary channels that have historically produced higher quality deal flow. This means that we will be able to cut down the time it takes to review applications, enhance the quality of research we conduct per opportunity whilst providing funding and/or feedback to founders in good time.
The application form will be taken off the website by the 4th of March, 2022, and we will be focused on applications that come through warm introductions, recommendations from team members, and our ecosystem network. Founders are still encouraged to send well thought out proposals for funding to firstname.lastname@example.org, preferably with a recommendation from someone on our team or in our network.
P.S: Please note that this development does not apply to application-only programs that we put out such as FAVE-YC. We are still very much excited about doing our part for the growth of the ecosystem.
As always, we are thankful for your support.
Yours in Service,