Safaricom has announced the start of a new Million Dollar venture fund, which is aimed at growing and offering support to Mobile ICT start-ups in Kenya as well as contribute to the country’s development.
With the total fund standing at One Million Dollars (KSh 90 Million), selected startups will receive funding starting from 6 million ($66,000) to 22 Million ($240,000).
The Safaricom Spark Fund will provide funding in either equity or in convertible debt instruments, and will be managed by TBL Mirror who will be responsible for maintaining a relationship between the telecom and the app developers in the country.
Startups to benefit from the fund will be selected through a deal to be managed by TBL and after completion of due diligence process to be submitted to the investment committee for consideration.
Also through the fund, startups will be able to access various resources from Safaricom such as M-Pesa APIs, Bulk SMS, USSD access, Airtime Billing, cloud hosting as well as other services that are necessary in app development.
Nzioka Waika, director of Corporate Affairs at Safaricom said the M-Pesa APIs that have been rumoured to be made available over time, will be provided to app developers but not without limitations.
“One of the Safaricom goals is to grow mobile broadband usage in the country. We need Kenya-centric mobile apps to tap to the growing mobile market,” said Nzioka.
Influenced by the annual Appwiz Challenge, Safaricom decided to start the venture fund in order to help the growing number of ideas from the youth become a reality by providing support in monetary terms as well as business mentorship.
With 31 million mobile subscribers in Kenya, the telecom realised that the only way to achieve growth is through partnerships and by starting this fund, Safaricom hopes to work with more startups in the near future and long term to sustain development.
“Most young entrepreneurs are faced with the sustainability problem that comes with the existing funding gap. They have ideas, but due to lack of funding they are not able to grow these ideas into businesses,” said Victor Kyalo, CEO ICT Authority.
Kyalo lauded Safaricom for creating a platform that will help create jobs for the youth and also help meet the growing and ever-changing broadband shift.
The telecom is encouraging more women to apply for the Spark Fund as well as developers in various areas including Agriculture, Education, Health, Public Transport sectors and security.
Safaricom recently acquired one of the finalists at last year’s Appwiz Challenge dubbed M-Ledger, to help improve their mobile money service by offering customers on the M-Pesa platform a better and seamless way of tracking transactions.