African Startups Selected for Techstars Toronto Program
Techstars Toronto Accelerator Welcomes Increased African Startup Representation
In March, two Nigerian companies, Treepz (previously known as Plentywaka) and TalentQL, were accepted into the Techstars Toronto accelerator program, joining eight other ventures.
This virtual program offered participating startups financial support – a $100,000 convertible note alongside a $20,000 stipend – as well as mentorship and access to a valuable network.
For both Treepz and TalentQL, inclusion in the program presented an opportunity to establish operations in Canada, with the long-term goal of expanding into the global market.
Growth in African Startup Participation
While the fourth cohort featured two African startups, the recently announced fifth class boasts a fourfold increase in representation.
Furthermore, the total number of startups per class has expanded from ten to twelve.
Of these twelve, eight startups are focused on the African continent and have been chosen to participate in the three-month program, which will conclude with a Demo Day in January 2022. The program is scheduled to begin today.
Introducing the October 2021 Cohort
The African startups selected for Techstars Toronto’s October 2021 class are Lenco, OurPass, Healthtracka, Rentsmallsmall, Kyshi, Duhga, Fleri, and PayDay. Details about each are provided below.
Startup Profiles
Lenco provides businesses with comprehensive current accounts, expense management tools, and a range of banking services.
OurPass streamlines digital commerce by offering a one-click checkout solution.
Healthtracka is a digital health platform facilitating at-home lab testing, sample collection, and results delivery within three days.
Rentsmallsmall offers an on-demand home rental service with flexible monthly payment options.
Kyshi, while based in the U.K., concentrates on fintech solutions for sending and receiving money to and from Africa.
Duhqa functions as a complete, end-to-end supply chain and distribution platform for last-mile delivery.
Fleri assists immigrants in providing healthcare and insurance coverage for family members in their home countries from the United States.
PayDay simplifies transactions between Africa and the rest of the world, enabling foreign employers and clients to easily pay individuals on the continent.
Techstars Toronto’s Increased Focus on African Startups
Y Combinator currently holds the position of the leading global accelerator for startups originating from Africa, having made investments in approximately 60 such companies over the past six years.
The number of African startups participating in Y Combinator’s programs has demonstrated consistent growth, initially ranging between five and eight, before rising to ten and fifteen startups in the most recent winter and summer cohorts.
Considering Y Combinator’s established operational patterns – though not a definitive predictor – the significant increase in startups accepted by Techstars, from two to eight within a single year, is noteworthy.
This expansion is directly attributable to the strong performance exhibited by African companies previously supported by Techstars, as stated by Sunil Sharma, the managing director of the Toronto-based accelerator.
Techstars initially began its engagement with the African market in 2019, providing backing to Korapay, a payments infrastructure company, and subsequently investing in Quidax, a cryptocurrency exchange platform, the following year. Fliqpay, a cross-border payment infrastructure company, also received support from the accelerator in 2020.
“The success of Techstars, in part, stems from the achievements of prior African companies – Treepz, Korapay, Quidax, TalentQL, and Fliqpay,” Sharma explained in a recent interview with TechCrunch. “Therefore, our increased commitment to Africa represents more than a quadrupling of our investment, driven by our confidence in the region’s potential.”
Sharma further indicated that Techstars anticipates multiplying its annual investments in African startups to 24. To date, the accelerator has invested in 10 startups this year, bringing the total to 13 since 2018.
When asked about the possibility of similar increases in investment occurring at other Techstars locations globally, Sharma responded, “We anticipate that other Techstars accelerators will also increase their involvement with African startups. The rapid growth in valuations and the emergence of more unicorn companies are compelling factors, and we are eager to contribute to this trend and support these entrepreneurs.”
Regarding the selection criteria employed by Techstars for startups operating within the region, Sunil Sharma emphasized that the accelerator prioritizes the founders and the strength of the team. Subsequently, they assess the team’s capacity to deliver substantial value and disrupt their respective industry.
However, the accelerator demonstrates a preference for startups operating in the fintech, crypto, insurance, payment, and future of work sectors, leveraging Toronto’s established reputation as a prominent global financial and talent hub. While Canada’s tech market is smaller than that of the U.S., it offers advantages such as more favorable immigration policies, greater talent accessibility, and a lower cost of living.
Sharma and his team are confident that these advantages will attract more African startups to establish operations in Toronto, and they are actively raising awareness to capitalize on the accelerator’s approval to increase participation from African startups.