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Revolutionizing Fundraising for African Startups: Vula’s Innovative Approach


Vula, a fundraising assistant, revolutionizes the fundraising journey for entrepreneurs. By simply inputting their website URL, users leverage the power of AI to generate tailored funding applications. Founded in 2022 by Nicholas Rawhani and Alex Goff, Vula aims to ease the fundraising challenges faced by African startups and SMEs.

In this installment of Ask An Investor, TechCabal engages in a conversation with Nicholas Rawhani, the co-founder and CEO of Vula. Discover how Vula’s platform streamlines the fundraising process, enhances convenience, and contributes to the growth of fundraising efforts across the continent.

Nicholas Rawhani, the founder of Vula, aims to address the challenge of providing African-owned businesses with the capital they need to grow.

Through conversations with over 500 founders, it became evident that the financing application process, whether seeking grants, pitching to venture capitalists, or applying for loans, was complex and consumed significant time. This process often diverted founders’ attention away from managing their businesses effectively.

My co-founder Alex and I, drawing from our experience in assisting startups with funding challenges and utilizing big data for automation, initiated Vula. Our vision is to create a unified and accurate information source for companies, enabling the training of AI companions for each business. These AI companions act as relationship bankers and investment advisors, guiding companies on the continent toward the most suitable funding opportunities and aiding in the application process once they deeply understand the company.

However, we realized that even the financiers faced challenges. We initially assumed that development financial institutions, pan-African banks, and others would have advanced systems for identifying and financing businesses. To our surprise, we found this wasn’t the case. Consequently, Vula aims to bridge the funding gap by catering to startups and financiers. An exciting aspect of our model is that we can offer our startup and SME support tools to founders for free while generating revenue by assisting large financial institutions in digitizing their onboarding processes.

How does Vula plan to drive investment into the continent?

NR: In the United States, there’s a concept known as the Common Application. It simplifies the university application process by allowing students to fill out a single application that matches them with suitable universities. Vula aims to bring that same convenience to founders. The traditional method of searching for investment opportunities one by one, completing numerous applications with redundant questions and documents, can be quite burdensome. With our powerful platform, we streamline this process and facilitate more effective engagement with financiers. We are confident that optimizing the investment facilitation process can significantly increase investment levels on the continent.

Q: What challenges has the Vula platform encountered, and how have they been overcome?

NR: Regarding founders, we haven’t faced significant challenges since we offer a free and innovative service that they appreciate. However, the main hurdle lies on the side of financial institutions. It’s essential to envision the incredible experience of founders instantly accessing all available financing opportunities upon logging in. Historically, African financial institutions have primarily financed large corporations in sectors like mining and telecoms, neglecting SMEs and startups.

These institutions have traditionally thrived on transactional banking, but they are gradually recognizing the immense profitability of SME financing. In Europe and the US, SME financing is the most lucrative sector within the banking industry. In the short term, some banks are hesitant to fully engage in SME financing, which affects our adoption rate. On the other hand, forward-thinking banks and financial institutions understand the long-term value that Vula brings and are willing to invest in it.

A three-step plan clearly outlines Vula’s approach to tapping into the funding facilitation market. Initially, they aim to empower financial institutions with cutting-edge digital tools. As this ecosystem of digital tools reaches a critical mass, it will transform into a thriving marketplace, attracting a substantial influx of investments. Drawing inspiration from the 1950s when mortgages gained popularity in the US, Vula plans to replicate a similar model in Africa. Instead of individual banks handling mortgages, Vula envisions aggregating companies seeking investments into packages, making them attractive assets for large institutional investors like JP Morgan. This approach holds promise due to African businesses’ diverse and uncorrelated nature. However, the current challenge lies in the continent’s lack of adequate tools and data. Vula sees itself as the solution, aiming to parameterize African companies and provide a unified understanding of their operations. This, in turn, will enable significant institutional players in the US and Europe to view African businesses as a distinct asset class, fostering greater liquidity flow into the continent.

What role will platforms like Vula play in the future of fundraising in Africa?

NR: Platforms alone don’t hold any special significance. We’ve witnessed various platforms come and go in the past. The notion that merely placing companies on a platform and attracting financiers will solve everything is somewhat of a myth in the African financing landscape. It’s not about the platform itself. I believe it’s about gaining a deep understanding of the real obstacles that hinder financing. The most substantial barriers are trust and the ability to secure funding. Many entrepreneurs aren’t truly prepared to attract investors. They’ve been led to believe by the VC model that the only way to start a business is by convincing someone else to provide capital. I think this has somewhat hindered the continent because we have a tradition of establishing cash flow-positive businesses through our determination, hard work, and resourcefulness.

The future doesn’t revolve around specific technologies or platforms; instead, it’s about instilling confidence and empowerment in both investors and innovators within the market. Our goal is to ensure that they have the belief that they can support ideas they are passionate about, develop solutions for real-world issues, and access the necessary support to sustain these endeavors.



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