Startup companies in Nigeria and Africa require more venture capital funding to accelerate growth, Dave Uduanu, managing director/CEO Sigma Pensions.
He said, while startups focus on the importance of getting funding, they also need to ensure they embed good corporate structures, citing it as pivotal to their growth and sustainability.
Uduanu said this at the maiden edition of ‘Founders and Funders’ event organised by Melon Capital in Lagos where startups and investors converged to network and rub minds.
He said, “The more venture capital funding is available, the better for the economy because when you find very talented founders and you give them substantial money, they can fast track and grow their business.
“So, I guess for me, the more venture funding we have in Nigeria and in Africa, the better and the easier it is to build these big companies and unicorns as they are so-called.”
He also urged that startups to have good corporate governance and management structure from the unset.
He added, “Investors in startups should ensure where they are investing in have good corporate governance, good management structures in these companies.”
On his part, Andrew Alli, partner at SouthBridge Group, and former chief executive officer, Africa Finance Corporation (AFC), also speaking on the importance of corporate governance, said corporate governance is super important.
“When I was at AFC and we are talking about startups, we did many studies about what were the best predictors of success of our investments, and corporate governance was more often than not a better predictor of success, he said.
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“Also, I think the corporate governance needs to evolve with a company.”
Further alluding to the importance of good corporate governance, and speaking from a founder’s point of view, the co-founder, Trade Depot, Kachi Izukanne noted that it is important for startups to scale.
He said, “Corporate governance is vital because it is a constant reminder to you as a founder why it is important to have corporate structures in place and why it is important to do things the right way.”
“As a business, you would get farther because of the structures you put in place, and also, there is value in private investors of all sorts adopting similar mechanisms to help ensure the right corporate governance structures are in place in the companies they invest in, Izukannee said.
