A strategic alliance between industry giants Safaricom, M-PESA Africa, and Sumitomo Corporation seeks to tackle the biggest challenges that hinder early startups from growing to scale.
The three entities are joining forces under the Spark Accelerator program, and are currently searching for early-stage tech startups interested in joining the initiative to grow and scale their businesses.
Interested startups have until 16 February 2024 to lodge their applications for consideration via: https://www.safaricom.co.ke/sparkaccelerator
Focus on Fintech and Content startups
The three-month accelerator program, which initially focuses on Fintech and Content startups, will provide these enterprises with a combination of business training, mentorship, financing, and go-to-market support to power their growth.
“We are offering more than just capital injection which is what we did previously with Spark Fund. We have restructured the program to address the challenges that hinder early startups from growing to scale,” explained Peter Ndegwa, CEO, Safaricom.
The startups will further benefit from access to technical support to develop mini-apps embedded into Safaricom’s M-PESA Super App, enabling them to reach over 4 million customers who use the app.
Additionally, M-PESA Africa will provide expertise, market research and insights, and other capacity support for startups looking to expand their reach to other countries.
“M-PESA connects more than 60 million customers and 5 million businesses across eight countries, providing a unique opportunity for startups in Africa looking to grow and scale rapidly,” said Sitoyo Lopokoiyit, Managing Director, M-PESA Africa.
“We have therefore partnered with Safaricom and Sumitomo to launch the Spark Accelerator to provide funding, technical expertise, resources and mentorship to the next generation of the continent’s leading tech startups. In turn, the startups will create innovations that connect customers and businesses on M-PESA to more opportunities while providing them with even more value,” added Sitoyo.
The Spark Accelerator will take an ecosystem-based approach to identify and accelerate the startups by leveraging a team of experts who understand market dynamics, emerging tech and who are keen to enable continuous innovation.
“We will contribute to the development of the African economy, human resource development, and the realization of a more prosperous life for the people,” said Katsuya Kashiki, Sumitomo Corporation’s General Manager, Smart Communications Platform Business Division.
The accelerator program will conclude with a dedicated investor demo day, where participating startups will pitch for potential investment from Safaricom and partner venture capital firms.
iHUB, a key player in Kenya’s startup ecosystem and a subsidiary of Co-Creation Hub, Africa’s foremost innovation hub, will serve as the implementing partner for the Spark Accelerator. Other supporting partners for the program include Vodacom and AWS.
Research indicates that roughly 90 percent of startups worldwide face closure at some point. Even in Silicon Valley, the global epicenter of innovation, where startups appear to enjoy the best environment to thrive, the failure rate is 83 percent.
In addition to insufficient funding for some, startups contend with challenges in recruiting and retaining top talent, rely on flawed business models, struggle to leverage the potential of data, face difficulties pivoting at the right moment, and may misallocate resources, ultimately failing.