For African startup founders, dealing with currency inflation when converting Simple Agreements for Future Equity (SAFEs) is important. Inflation means prices go up over time, making money worth less and in Africa, inflation rates can be frequently high. When converting SAFEs into ownership, the agreed value might change because of inflation and make the investment worth less. In cases like this, here's what founders can do to deal with the inflation; 1️⃣ Update investors on the company's progress and value regularly. 2️⃣ Negotiate terms that consider inflation, like adjusting the conversion price based on the current value of money. 3️⃣ Spread out the company's assets or income to lessen the impact of inflation. 4️⃣ Talk to financial experts who know about dealing with inflation in African markets. 📌 Structure your SAFEs properly with Raise custom tools and collaborate with shareholders and legal partners on agreements and signatures in one place: https://bit.ly/SAFEstacks #SAFEStacks #SAFEs #AfricanStartups #Equity #AngelInvestors #VentureCapital #Inflation
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Between January 2023 and January 2024, the Kenyan shilling lost 22% of its value against the dollar, and the Nigerian naira lost more than half. Such stark currency depreciation devastates African businesses. It makes revenues less valuable and leads to severe consequences like inventory shortages, debt issues, and job losses. In our latest blog post, Wanji Ng'ang'a, Associate Director of Portfolio at Acumen East Africa, and Daniel Waldron, Acumen’s Head of Insights, discuss the urgent need for new FX solutions. Read more and share your insights with us.
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Insightful post addressing what has been the elephant in the room for a while: Local currency solutions. Great initiative by Acumen and looking forward to making the necessary steps to making this more available to the local entrepreneurial ecosystem. Reminds me of my Group Consulting Project while at Cambridge Judge Business School on developing offshore local currency bonds. Probably time to explore if that could be one of the workable solutions, or what adjustments could be made! #localcurrency #currencymismatch #fx #sustainablefinance #sustainabledevelopment #fxrisk #lcb #localcurrencybonds
Between January 2023 and January 2024, the Kenyan shilling lost 22% of its value against the dollar, and the Nigerian naira lost more than half. Such stark currency depreciation devastates African businesses. It makes revenues less valuable and leads to severe consequences like inventory shortages, debt issues, and job losses. In our latest blog post, Wanji Ng'ang'a, Associate Director of Portfolio at Acumen East Africa, and Daniel Waldron, Acumen’s Head of Insights, discuss the urgent need for new FX solutions. Read more and share your insights with us.
We need new FX solutions in Africa, now
https://acumen.org
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Associate Director of Investing @Acumen | East Africa Chapter Steering Committee at Aspen Network of Development Entrepreneurs- ANDE | Board Member @SokoFresh and @SimuSolar
Currency risk remains the constant challenge for entrepreneurs on the African continent…many years in, we still lack affordable solutions! Daniel Waldron and I wrote this article about this challenge. We’re looking to curate solutions and are holding a workshop to develop solutions for the continent! If this is a problem for you as an organization and your interested to co-curate solutions with us, please fill out the form linked at the bottom of the article!
Between January 2023 and January 2024, the Kenyan shilling lost 22% of its value against the dollar, and the Nigerian naira lost more than half. Such stark currency depreciation devastates African businesses. It makes revenues less valuable and leads to severe consequences like inventory shortages, debt issues, and job losses. In our latest blog post, Wanji Ng'ang'a, Associate Director of Portfolio at Acumen East Africa, and Daniel Waldron, Acumen’s Head of Insights, discuss the urgent need for new FX solutions. Read more and share your insights with us.
We need new FX solutions in Africa, now
https://acumen.org
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Insightful post addressing what has been the elephant in the room for a while: Local currency solutions. Great initiative by Acumen and looking forward to making the necessary steps to making this more available to the local entrepreneurial ecosystem. Reminds me of my Group Consulting Project while at Cambridge Judge Business School on developing offshore local currency bonds. Probably time to explore if that could be one of the workable solutions, or what adjustments could be made! #localcurrency #currencymismatch #fx #sustainablefinance #sustainabledevelopment #originalsin #fxrisk #lcb #localcurrencybonds
Between January 2023 and January 2024, the Kenyan shilling lost 22% of its value against the dollar, and the Nigerian naira lost more than half. Such stark currency depreciation devastates African businesses. It makes revenues less valuable and leads to severe consequences like inventory shortages, debt issues, and job losses. In our latest blog post, Wanji Ng'ang'a, Associate Director of Portfolio at Acumen East Africa, and Daniel Waldron, Acumen’s Head of Insights, discuss the urgent need for new FX solutions. Read more and share your insights with us.
We need new FX solutions in Africa, now
https://acumen.org
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Global MBA Candidate EDHEC Business School |Wealth & Investment Mgmt | Impact Investing | Venture Capital | Capital Raising| International Finance | Sustainability | Strategic partnerships
🎉 **Nigeria’s Successful Eurobond Issuance: A Milestone in Market Confidence** On December 2, 2024, Nigeria successfully raised $2.2 billion through the issuance of 6.5-year and 10-year Eurobonds, priced at 9.625% and 10.375%, respectively. This landmark achievement garnered a peak orderbook of over $9.0 billion—an impressive 4.18x oversubscription—highlighting strong investor confidence in the Nigerian economy. This issuance attracted diverse participation from global institutions: fund managers, insurance firms, pension funds, and banks from regions such as Europe, North America, Asia, and the Middle East. 💡 **For Investors** These bonds offer local and international investors a chance to tap into Nigeria’s evolving credit narrative, supported by improving liquidity and a government committed to economic stabilization. They also serve as a valuable portfolio diversification option and a potential tool for currency hedging. ✅ **For Nigeria** The proceeds are earmarked to finance the 2024 fiscal deficit and meet budgetary needs, signaling a commitment to fiscal discipline. Moreover, this issuance deepens Nigeria’s engagement with international capital markets, setting a benchmark for future sovereign and corporate issuances. 🔴 **Challenges Ahead** However, the relatively high yields reflect lingering concerns about Nigeria’s credit risk, inflation, and currency volatility. These factors could increase the cost of servicing debt and place additional pressure on the country’s fiscal framework if not managed prudently. 🔎 **My Take** This successful issuance is a step forward but not a silver bullet. To sustain investor confidence and optimize future debt issuances, Nigeria must prioritize structural reforms, diversification of revenue streams, and robust governance in fiscal and monetary policies. 🌍 **Outlook** The robust demand from international investors showcases Nigeria’s potential to remain a key player in the global capital markets. If managed strategically, this can be a gateway for more investments and partnerships to fuel sustainable growth. 💬 I’d love to hear your thoughts on the implications of this issuance. How do you see this shaping Nigeria’s macroeconomic landscape and its position in global markets? #Nigeria #Eurobond #Finance #CapitalMarkets #SovereignDebt #InvestmentOutlook
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Sharing the work of Wanji Ng'ang'a and Daniel Waldron from Acumen, as they dig into why innovative FX solutions for African companies are of existential importance right now. Foreign exchange fluctuations constantly threaten the survival of many companies in Africa, especially over the last 12 months in Nigeria and Kenya. Driving to the bottom of the problem, and collecting broad expertise, is precisely what is needed right now. https://lnkd.in/dZKTadhs #Africa #ForeignExchange #FinancialInnovation It's a must-read for anyone looking to understand the financial landscape in Africa and the steps we can take to mitigating FX risks in an affordable way. GoodFX excited to be part of the conversation. https://lnkd.in/dZKTadhs #Africa #ForeignExchange #Investment #BusinessViability #EconomicStability #FinancialInnovation
We need new FX solutions in Africa, now
https://acumen.org
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“The unfortunate truth is that the high cost of capital that companies face does not just reflect risk, it creates it. If we want to reduce the risk of investing in Africa over the long term, the only way to do that is by facing it today.” Helpful reflection from Acumen on key risks and barriers to sustainable investing in social enterprises in Africa. Until such structural barriers are addressed, delivery of key services will continue failing, at the cost of those in need.
Between January 2023 and January 2024, the Kenyan shilling lost 22% of its value against the dollar, and the Nigerian naira lost more than half. Such stark currency depreciation devastates African businesses. It makes revenues less valuable and leads to severe consequences like inventory shortages, debt issues, and job losses. In our latest blog post, Wanji Ng'ang'a, Associate Director of Portfolio at Acumen East Africa, and Daniel Waldron, Acumen’s Head of Insights, discuss the urgent need for new FX solutions. Read more and share your insights with us.
We need new FX solutions in Africa, now
https://acumen.org
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True composure lies in the ability to be financially secured. Invest in the Emerging Africa Money Market Fund and improve your financial composure. #emergingafrica #moneymarketfund #stability #financialgrowth #investment
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In #Africa, well-developed local #CapitalMarkets are crucial for providing reliable local currency financing to governments, small businesses and financial institutions. These markets can allocate investments more efficiently and enhance risk-sharing while offering an alternative funding source to complement traditional bank financing. However, many African capital markets remain underdeveloped with small equity markets and illiquid bond markets hampered by rigid regulations and weak infrastructure. This underdevelopment stems from both supply and demand challenges: institutions struggle to raise capital due to high costs and stringent regulations, while a narrow investor base primarily local banks limits participation. We are committed to transforming African capital markets into a credible funding source for vital sectors like housing, infrastructure, agribusiness and small businesses. Through targeted support, we aim to strengthen local capacity, improve regulatory frameworks and enhance market efficiency. 🔗Read more: https://lnkd.in/e3_5kPYf -- #MakingFinanceWork #Financialinclusion #EconomicGrowth #SustainableDevelopment -- Evans Osano, DBA, Mary M. Njuguna, Jemima Gathumi, Cecilia Bjerborn Murai, Victor Nkiiri, Vimal Parmar, CFA, MBA, Adebayo Araoye, Sandy O. Okoth, Brian O. Yalla, CFA, CAIA, CIPM, MCSI, CIFA, Amos Mugi, FRM, Grace Pascal Mdemu, Joy V. Kendi, Lilian Bwire
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From Investment IQ. Emerging market sovereigns that have restructured their debt present a new set of opportunities for fixed income investors. Countries like Zambia, Ghana, and Sri Lanka have posted strong returns following recent restructurings, with innovative bond features tied to economic performance. Vanguard 🔗 Read the full article on Investment IQ: https://incm.pub/4fMgPsY #investing #assetmanagement #wealthmanagement #finance
Distressed EM bonds: New opportunities for active investors
investmentiq.co.uk
