Seven of our SEED Malawi eco-inclusive enterprises – Chonona, Green Impact Technologies, Green Ventures, Honey Products Limited, Hortinet, InteWaste and Ziweto – were recently able to raise significant funds that will help them to scale-up and achieve their full impact potential. We asked them to share their fundraising journey and learnings with you.

Some important fundraising learnings from these successful enterprises include:
 
i) Developing an innovative and viable eco-inclusive business model;
ii) Putting forward a convincing pitch for possible donors and investors;
iii) Joining entrepreneurial trainings, incubator programmes and mentorships to develop investment readiness;
iv) Establishing partnerships, obtaining certification, and keeping good record and registration is essential to be considered trustworthy and professional to prospective donors and investors;
v) Finally, a motivated team continuously working on proposals and business pitches.

 Abudala Napuru receiving the SEED Award in 2016 for Chonona Aquaculture

Which barriers did you come across?

“Some of the barriers in our raising of funds included the lack of collateral, our country not being in the geographical location where the target investors operate and the scale of our business being too small for the investors.”

Byton Simwela, Ziweto (Providing rural livestock smallholders with affordable veterinary services and animal health products to improve the rural livestock value chain)

“Barriers include the poor economic environment as evidenced by the high costs of loans, financial illiteracy which has made a number of SMEs fail to repay the loans, and different targets of investors. Some investors are not willing invest in Malawian enterprises due to the poor enabling environment such as an underdeveloped road network and communication infrastructure. A lack of trust is another problem affecting access to finance.”

Tione Kaonga, Chonona (Producing diverse fish products in an in integrated aquaculture approach)

“The main barriers for us to raise funds for our start-up was that most partners viewed it as a high risk having no internal controls and also it was difficult for us to communicate the language required by the development partners.”

Joyce Sikwese and Admore Chiumia, Green Impact Technologies (Providing solar energy to rural communities using a pay-as-you-go financing model)

Admore Chiumia (first from the left) and Joyce Sikwese (first from the right) from Green Impact Technologies. 

What did you do to raise funds?

“Ziweto Enterprises Limited participated in trainings, incubation and mentorships to become investor ready. Some of the programs that helped Ziweto to succeed include the Tony Elumelu Foundation, SEED Awards, Fledge LLC and Africa Agribusiness Academy.”

Byton Simwela, Ziweto

“Training by SEED helped us to work on our business model and business plan and most importantly on how to pitch our business to stakeholders.  We showed a full understanding of our own business and figures. We proved that there is a market and that our business addresses both social and environmental issues in addition to economic ones. Having a unique and innovative business model, i.e. not many entrepreneurs are in fish farming here in Malawi, is an advantage. Significant investment by our own shareholders provided confidence to the donor to invest in our business. In addition, we had some systems in place e.g. being a registered business with a business registration certificate, a separate bank account and our company is registered with the Malawi Revenue Authority. Furthermore, our partnerships made the donor have trust that funds once given to us will be used properly. Overall, having a strong vision and passion supported by activities on the ground can impress possible donors.”

Tione Kaonga, Chonona

“Our journey to start raising funds dates back to our participation in entrepreneurship trainings and fellowships e.g. Tony Elumelu Foundation and Mandela Washington Fellowship. Our participation built our capacity to determine our evidence-based theory of change on how we can contribute in addressing energy challenges in the off-grid communities in Malawi and Sub-Saharan Africa as a whole.”

Joyce Sikwese and Admore Chiumia, Green Impact Technologies

“With SEED funding, we were able to kick start our business and the publicity from SEED raised our profile both online and in Malawi; we leveraged that to win the trust of other development partners and investors. We formed a business structure with directors, management and the team, which helped us to focus on our own specific roles within the team rather than everyone doing a bit of everything. Defining roles within our team helped us to identify gaps and address possible solutions. For example, we noted that we needed someone to head the Fundraising section of the company. Eventually, we chose a Business Development Manager. Our business development section worked tirelessly with the help of the whole team to promote our brand, write proposals, pitch our business idea, form partnerships and this helped us to raise our funds from $5,000 SEED Funding to $82,000 as of today.”

Mathews Dunga, Honey Products Malawi (Creating an agribusiness value chain out of high-quality honey)

Byton Simwela receiving the SEED Awards in 2016 for Ziweto Enterprise

What are your learnings, which can be helpful for other eco-inclusive enterprises?

“Some of the insights for our successful fundraising include 

• Building a strong and winning team which provides confidence and assurance to the investors that their investment is likely to bear fruits
• Proving that the business idea is eco-inclusive, viable and scalable with a well-articulated business plan that clearly shows how the business is going to contribute towards its set objectives. Also, the business needs to have a proven model or prototype that will convince investors that it is going to yield good results.
• Having proper certification, records and documentation for the company (i.e. business registration certificate, tax certificate, records and audited accounts)”

Byton Simwela, Ziweto

“Our learnings include

• Running a business is different to knowing how to pitch it. We saw entrepreneurs with very good business ideas that failed to convince investors/donors.
• Presentation of the business idea using a concise business plan and power point with statistics about the business environment and sector, financial figures and pictures is critical. In business, it all starts and ends with bottom line (profit) and it is good to understand when your business will start to earn profits. 
• Honesty is important in business. It is not good to paint a perfect picture of one’s enterprises when the business is not able to make profits. Most entrepreneurs are not honest about their businesses as they think external investors are only interested in a business that is profitable, not knowing that sometimes investors look for people who are honest and have businesses that have a potential for growth. 
• Many entrepreneurs wait for free money to start their businesses instead of starting with their own resources which will attract investors. 
• Different funding options are available to SMEs including equity and debt. It is important to properly select your partners or investors and to negotiate and understand the contractual terms to avoid divergent interests and conflicts. 
• It is important to have operational and financial systems e.g. quality control, reporting and recruitment set in a business, even if it is small. Most SMEs are not registered with relevant authorities, yet they expect external investors to pump money into their businesses.”

Tione Kaonga, Chonona

“We have learned that:

• Networking is key in fundraising so that you can meet like-minded partners who help you to make contacts with donors and investors to drive your vision forward
• Building partnerships and assembling the right skill sets is a prerequisite to attract and gain confidence from the funders
• Working or addressing a problem that has a direct impact on people’s lives will attract more development partners”

Joyce Sikwese and Admore Chiumia, Green Impact Technologies

“Our learnings include

• Build a great team dedicated to the enterprise’s growth
• Build partnerships
• Refine the business model and financial model (keep improving)
• Understand the business ecosystem
• Leverage the expertise of international partners to develop the enterprise
• Build a strong brand for the enterprise
• Produce competitive products and services”

Mathews Dunga, Honey Products Malawi

Honey Products Industries

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