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Safaricom links app makers with private equity investors

Safaricom has partnered with a US venture capitalist to offer cash to local software developers and transform their ideas into commercial products.

The mobile provider announced the partnership with Invested Development on Thursday during the unveiling of the Safaricom Development Challenge.

Through the competition, Safaricom intends to capture local developers of mobile applications to drive up data usage and increase sales. Applications developed during the incubation stage will be uploaded onto the Safaricom App-store for commercialisation.

Previously, Safaricom solely handled applications for a similar competition. But Safaricom chief executive Bob Collymore said the firm brought in the venture capitalist to avoid mistrust expressed by some developers.

“Unlike the previous competition, this time we have partnered with a US firm that will be in charge of incubation process as we have had cases where some people claim that Safaricom has taken their ideas and turned them into products, as you can remember the M-Pesa case,” said Collymore.

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Safaricom will award a total cash prize of Sh3.7 million for the competition. The winning app will be awarded Sh1.5 million and Sh1 million will go to the first runners up.

Each of the six category winners will get Sh200, 000. The competition is targeting developers who lack the skills to successfully deploy their applications into the market.

Sean Smith, investment manager at Invested Development said the firm is eying applications with high growth rate and that can be used to solve  challenges in agriculture, health, financial inclusion, education and entertainment.

The venture firm said it will be investing between $30,000 (Sh2.5 million) and $50,000 (Sh4 million) for apps that meet their requirements.

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