Corporate

Bridging the global capital, markets gap for Kenyan start-ups    

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Investera Plus Africa executive director Tito Mutai at the firm's offices in Nairobi on August 5, 2021. PHOTO | DIANA NGILA

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Summary

  • The Business Daily spoke to Tito Mutai, the executive director of Investera Plus Africa, on how the firm plan to bridge the capital gap and the opportunities to arise for Kenyan start-ups.

UAE-based business intelligence and investment firm Investera has launched operations in Kenya that will see it guide foreign investors seeking to invest locally and link local firms to foreign opportunities.

The entry is through a partnership deal with their local counterparts, Investera Plus Africa.

Investera Plus Africa says it picked Kenya, East Africa’s biggest economy, as the prime location to set up its operations because of the country’s strategic importance as a key regional business gateway.

The Business Daily spoke to Tito Mutai, the executive director of Investera Plus Africa, on how the firm plan to bridge the capital gap and the opportunities to arise for Kenyan start-ups.

How difficult is it for investors to find the right idea to fund in Africa?

They do not have access to companies and start-ups that are offering themselves for investment. Even if they do, it is very difficult for them to also tell that this company is indeed a credible company, the information this company is providing is genuine and that they conform to the Kenyan laws.

How easy will the portal make it for investors to do so?

This platform will provide information on companies that are offering themselves up for investment.

We do a very rigorous due diligence to establish that these companies conform to the legal requirements and that the products or services they say they are offering are indeed true.

We go the extra mile to ascertain that. If an investor says they are interested in a particular company or start-up, they can ask us to do secondary due diligence and provide them with a report. This may include financials and customer ratings. We go the extra mile to do that.

How long does it take to return a review?

The primary due diligence will already be done before the company or start-up is accessible by the investor. The secondary due diligence will be upon the request of the investor. We can also propose to them what the parameters we need to provide in terms of a report are.

How will you seek to ensure start-ups and naive first-time entrepreneurs are not exploited by foreign investors?

The concern has been that innovative ideas are taken away. We do not have control of the investment opportunity. But the investors will have to conform to the relevant regulation in the country.

We can try to offer consultancy services for these investment opportunities so they do not end up losing. The government can come in to offer regulation but it should at the same time not stifle potential investments.

Which sectors are you targeting?

We provide the technology. This technology provides information across all the sectors, so it is the investor who will be targeting the sectors that are available in Kenya. We have categorised the companies and start-ups using the Global Industry Classification Standard.

It has eleven sectors and it has broken down these eleven sectors into so many sub-industry groups. So it is the investor to decide. If the investor looks at the sub-industry group which has a niche, it is upon them. We will provide them with the necessary information.

How many deals are you targeting?

The number of deals that we intend to make will depend on the pitches that we are going to get and investors who are signed up. It is not something that we can be able to predict. It depends on the start-ups and how much the investor wants to invest.

Investors usually commit for five years yet some have said the country’s tax regime has not been predictable.

In my opinion, the tax regime has been predictable. When you look at Kenya’s taxation system over the last five years, the difference is not that much.

Of course, investors want to get their money back within the shortest period of time. If it is long-term investment, it is something that they know they are capable of adapting.