The United States Agency for International Development (USAID) and Western Union have launched a second African Diaspora Marketplace (ADM II). ADM II encourages sustainable economic growth and employment by supporting U.S.-based African Diaspora and other entrepreneurs with demonstrated relevant connections to, or experience in, Africa with innovative and high-impact ideas for start-up and established businesses in Africa.
The new Marketplace will incorporate key learning from the first African Diaspora Marketplace, by focusing grants toward priority, high-impact sectors in Africa, including agribusiness, renewable energy, and information and communication technology (ICT). To expand upon their previous success, Western Union and USAID will invite small business investment funds and technical assistance mentors to participate.
SELECTION PROCESS Africa Diaspora Marketplace (ADM II) implementation team will review the pool of applicants and anticipates narrowing the group to approximately one hundred applicants by April 2012. These applicants will be invited to submit full business plans. ADM II will select approximately the top fifty from this pool as finalists. The finalists will be invited to Washington, D.C., where an “ADM II Marketplace” will be held in June 2012. The marketplace will allow them to showcase their business ideas/concept directly to the judges who will select the winners.
The finalists will be reviewed by an international panel of twelve judges. The judges will be tasked with selecting the top twenty ventures that will be ranked numerically by the agreed criteria. Grants will be provided in the form of cash funding and/or technical assistance. The target for the cash portion of the matching grants is up to but not exceeding USD 50,000. Any businesses not receiving funding will form a reserve pool for potential funding if a selected venture is not able to meet disbursement terms during the upfront due diligence stage. Additionally, each winner will be given a separate grant for Technical Assistance that may be from USD 10,000 to USD 20,000.
Within forty-five (45) days of awards being announced and after final compliance, ADM II will negotiate a grant agreement with the awardees. The grant agreement will outline the uses of funds, disbursement schedule, and agreed milestones. Proposed post-grant award activities must be completed within eighteen (18) months of receiving the initial disbursement.
A major distinguishing factor of ADM II will be a follow on financing round for eligible winners. This Year’s ADM will feature a follow on social investor forum hosted by the Tony Elumelu Foundation (TEF) in Lagos, Nigeria. The Forum will be reserved for eligible winners who have successfully met their grant milestones. The Forum will serve as a transition point for them to move from soft funding to hard funding. It will be a true test of the commercial viability of their venture. It will be in many instances be the first live pitch to investors. The funding from the Forum would be an actual investment that may range from USD 150,000 to USD 300,000.
“Through lessons learned from over two decades of building successful businesses in Africa, I firmly believe that Africa’s economic transformation can be driven from within by the continent’s own entrepreneurs,” says Tony O. Elumelu, MFR, Founder of The Tony Elumelu Foundation. “As an African foundation, we are pleased to participate in this innovative effort with Western Union and USAID as a way to bring African talent and innovation back home.”