“$200k isn’t enough”: Madica’s Emmanuel Adegboye on the brutal reality of early-stage funding

Emmanuel Adegboye, head of Madica, has spent three years making a bet that is unusual even by African standards.

Madica, an Africa-focused investment programme launched by global venture firm Flourish Ventures, writes $200,000 cheques and has backed over a dozen startups on a thesis most African investors do not follow: some of the best early-stage companies on the continent are in markets nobody is watching.

As head of Madica, Adegboye has deployed capital into 10 African markets. He argues that this is neither charity nor exoticism, but where the opportunity actually sits. Most African venture investments are concentrated in the same four markets (Nigeria, Kenya, South Africa, and Egypt), which Adegboye says reflects proximity to investors rather than merit.

For a Silicon Valley investor with no physical footprint on the continent, Africa is rarely top of mind, leaving high-potential startups unfunded for reasons entirely unrelated to their business fundamentals. Madica was built to address that market failure and is backed by Flourish Ventures.

“The biggest thing, which in a sense ties to Madica’s model, is our original thesis, which still holds: that we would back founders across sectors, markets, and founder profiles that are typically underfunded on the continent,” he told me from Dakar.

“That need still exists,” he added.

Every Madica investment has to tick at least one of four boxes—founder profile, gender, market, or sector—chosen because they show who typically gets overlooked. At least half of Madica’s companies have a female co-founder, in an ecosystem where female-founded startups routinely take a low single-digit share of funding.

Three years in, Adegboye has adjusted his playbook. He has learnt that early-stage startups require more capital for longer periods as the gap between funding rounds continues to widen—a shift not fully accounted for in his original thinking. Madica was initially designed around the premise that a standalone $200,000 cheque could comfortably propel a company forward, but today, Madica actively co-invests in most deals.

This change stems from the belief that startups with a broader syndicate of investors are far more likely to survive prolonged fundraising droughts.

In this interview, Adegboye details how he sources deals in markets without formal venture ecosystems, what separates a ‘yes’ from a ‘no’, why he views voice technology as Africa’s primary AI opportunity, and the key policy reform required to unlock local institutional capital.

***This interview has been edited lightly for length and clarity. ***

After three years of investing at Madica, what misconceptions did you hold going in that have since been cleared up?

We thought we would invest in companies where $200,000 alone would be sufficient. That has not panned out as we planned, because in reality, a lot of these companies need far more funding and for much longer, because it takes so much longer for firms to raise on the continent. If you look at many of our investments, we have actually co-invested with other investors.

There is early-stage capital on the continent, but there is still a gap at that earliest stage that we at Madica are still trying to figure out how best to address. Given how we invest, it makes sense to invest alongside other investors, because that has a higher likelihood of success, given how much longer it takes founders to raise here. I would not call that a misconception exactly. It is a learning: for companies to succeed, they need to raise a lot more funding.

One misconception is that there are not enough female founders to back on the continent. That is not true, and our portfolio proves you can find female founders here building genuinely interesting, scalable solutions. At least 50% of our portfolio has one female co-founder.

We have also now invested in 10 different markets, including places like Algeria and Cameroon, where you do not hear many venture announcements. For us, it shows these opportunities do exist, especially at the early stage. Our hope is to invest in more companies like these that can go on to become significant success stories.

Early-stage funding has dropped sharply over the last 18 months, with more money going to growth-stage companies. What is causing that, and why does it matter that early-stage startups get funded?

There are many reasons, but one glaring one is the global shortage of venture capital. Two things are happening. Capital is concentrating in a handful of funds and also in a handful of startups globally. That is not a Nigerian phenomenon.

Most funding globally is going to AI infrastructure companies, and just a handful of those. Similarly, most venture funding is going to a handful of funds. There is concentration happening globally, and there is also a shortage of funding going into venture generally. It is starting to normalise a little, but there was a significant drop between roughly 2021 and 2024, and what we are seeing in Africa is a knock-on effect of that.

The concentration in later-stage companies reflects risk aversion. The earlier you go, the more risk you take, and a lot of venture capitalists are taking more calculated risks, which means going to a later stage.

On top of that, much of the funding coming into Africa comes from outside Africa, which exposes the continent to that risk. There is still a shortage of local capital, of people investing in local currency, of investors closer to market realities.

The way to address that is to figure out how to get more local capital into early-stage funding. That is something I think about a lot. I do not have all the answers, but if we are going to run venture sustainably here, and early-stage venture especially, we need to prove to high-net-worth individuals that they should do more angel investing on the continent. We need to show this asset class makes sense to invest in at the early stage. That builds the pipeline and, in a sense, de-risks the companies that later-stage investors can then come back.

How important is it that early-stage startups get funded? Without Paystack, there would be no** Paystack Mafia**; without Interswitch, no Moniepoint.

I am with you on the logic. We need a lot more early-stage startups, and we need a lot more of them funded. But we also need to be comfortable with the reality that many early-stage startups will not succeed on their first attempt. That is how ecosystems are built.

If you have worked inside a Paystack or an Interswitch, the likelihood of you succeeding when you start your own company is much higher than someone fresh out of university. But does that mean the person fresh out of university should not get funded? I do not think so. They should get funded. They will probably make mistakes, but the learnings are what they carry forward. There is a kind of learning you only get from launching a startup, and a different kind of learning and network you build working inside a later-stage company. Both matter. More funding should be going to early-stage startups.

Outside fintech, which sectors do you see as strongest on the continent?

I will be biased and say look at Madica’s portfolio. We have invested in everything from healthcare to mobility to AI to e-commerce.

I am very biased towards mobility. We are also doing a lot in renewable energy and in the circular economy. The startups we have just invested in sit in that circular economy space.

I am biased towards opportunities solving very tangible problems, with a mix of technology and offline work. In some ways that is also the opportunity in mobility, because it is not all software.

What is your thinking on how AI should be applied on the continent?

I am very much in the voice AI camp.

As I said about concentration in global investing, there is a lot of funding globally going into foundational models and large language models. The opportunity in the African space is taking the unique datasets we have and building on top of those models for very specific use cases, whether in healthcare or elsewhere.

Longer term, the real opportunity is in voice. I think daily about people in rural areas. Let me articulate it this way: what is the easiest way to participate in the global economy if you only speak Wolof? I am in Dakar right now. If you only speak Wolof, and everyone is talking about AI and the opportunities out there, how do you participate?

The fastest and easiest way is to create platforms that speak Wolof, or deliver information in Wolof, so you can do all of that without needing to learn English. That is why I think voice is a genuinely important long-term opportunity in AI, and it is why some of our investments have been in voice AI.

I also think there is an opportunity in hardware and AI.

What is the difference between a yes from Madica and a no?

There are three sides to this.

The first is the thesis, and you cannot do anything about it. We were set up to catalyse funding into markets, sectors, and founder profiles that are underfunded on the continent. We look at four levels: profile, in terms of education and exposure; gender; market; and sector. All of our investments tick at least one of those boxes, and it is unlikely for us to make an investment where none of them are ticked.

As I mentioned, 50% of our portfolio has at least one female co-founder. That is a bar we have always tried to maintain. If an investment does not meet any of those criteria, it will probably be a no, and there is not much that can be done about that.

The second is the business itself. Once we have answered the thesis question, we invest like any other venture fund. Is this an opportunity we believe has the potential for scale? Is this an early-stage opportunity where you have proven you understand customer pain points and have built something that addresses them in a way that lets us assess the scale of the problem, the scale of the opportunity, and your own potential as a founding team? Ultimately, we are trying to understand whether there is an opportunity here.

The third, which is tied to the second, is our conviction in the team. A lot of the time, the bet is not just on the size of the opportunity but on the team. What about the founding team, the management team, the advisory board, the people you have surrounded yourself with, gives us conviction that you know the space, that you are obsessed with the problem and the customers, and that you can execute?

If you tick the thesis box, if it is a compelling early-stage opportunity, and if we feel strongly about the team’s capacity, it will most likely be a yes.

What should we expect from Madica over the next three years?

Two sides to that. The mission remains the same: to catalyse funding into these markets, sectors, and founder profiles. You should expect more investments from Madica and an acceleration of the work we have already laid the groundwork for.

But beyond investment announcements, we should also expect to hear about our portfolio succeeding, and about exits within the portfolio, because that is what we all hope for. That proves the thesis and gets more people thinking about these markets.

The second side is that as we do this work, we are learning what works and what does not, especially at the early stage. We are constantly figuring out whether there are tweaks the model needs, or things we did not anticipate that we need to account for. We are very much a startup ourselves, like any new fund. The nature of early-stage work like this is to learn, iterate, and course correct. If the model needs to change as we learn, we will be transparent with the ecosystem and correct course.

What is one policy change that would improve African venture investing?

We need to unlock more local capital. There are a lot of conversations about pension funds, but I also think there is lower-hanging fruit in angel investor incentives and angel investing protections—in a way that makes it easier for early-stage, middle-class individuals to consider angel investing as a viable asset class on the continent.

There is the conversation about pension funds being able to invest in funds. But there is also the conversation about retail investors willing to invest in tech startups on the continent, and there are policy changes that could make it easier for them to make that leap.True scale demands moving beyond surface-level integrations to robust execution. We’ve filtered the noise out of Moonshot 2026, optimising the conference strictly for high-calibre connections between startup founders, global financial operators, enterprise leaders and individuals rewiring Africa’s technical frameworks. Get 20% off Early Bird tickets for a limited time.

True scale demands moving beyond surface-level integrations to robust execution. We’ve filtered the noise out of Moonshot 2026, optimising the conference strictly for high-calibre connections between startup founders, global financial operators, enterprise leaders and individuals rewiring Africa’s technical frameworks. Get 20% off Early Bird tickets for a limited time.