Entrepreneurs today are more easily able to acquire venture capital funding than a decade ago, according to Carl Wazen, co-founder and chief business officer of payments company, Yoco.
Wazen launched Yoco in South Africa almost 10 years ago. Speaking at Africa Tech Festival 2023 last week, he said that, back then, “’Fintech’ wasn’t a word”.
“We were trying to raise money when there was no ecosystem. I remember our first pitch, we still hadn’t used the word ‘Fintech’.
According to Wazen there are “tons more mentors now and these VCs actually understand what you’re trying to do”.
Kenfield Griffith, CEO and co-founder of Tappi — a business helping to grow SMEs — said that there are now more VCs investing in African businesses specifically, which gives entrepreneurs a higher chance to take ideas into fruition.
“Before you only had a handful of VCs to select from, now, you have multiple VC authorities to select from. You have a choice,” he said.
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According to Griffith, mistakes are part and parcel of start-ups, today, in the past, and those to come, “you just have to learn the fact that is part of the journey”.
He said that entrepreneurs need to look at what “critical” mistakes they’re making, whether it’s from hiring, government partnership, acquisitions, and learn how to limit them.
It’s also important that start-ups continually develop talent from within the company, Wazen claimed:
“We’re still all responsible for our talent and for creating a really great environment. There are no shortcuts,” he urged.
And while it may be easier to access funding, Wazen said that start-ups need to ensure there is demand for their business idea by listening to customers at all times:
“There’s no Excel spreadsheet that can define direction more definitive than your customer. The customer is going to tell you when your product is or isn’t working for them. Index hard on the customer and really use that as your North Star.”
Griffith concluded that entrepreneurs must be able to stick within a budget, and financial management is key to success.
He credited angel investor, Bob McNeal, when he was building his first startup:
“He was, I think, the best investor that taught me the rule of financial management. He invested a quarter of a million dollars into the business, but he never actually released that money all in one go. It was a little bit every month and I had to find customers to replace the money that I didn’t get.
“The discipline I learned was it’s like asking your parents for money — you don’t want to do it every month. What it taught me was necessary for the survival that we had to go through.”
