I have always been passionate about crowdfunding. Crowdfunding is a subject I have spoken quite a bit about. Ever since 2019, I have discussed the subject highlighting several things. One of those things was regarding the absence of robust crowdfunding platforms in Zimbabwe. Many of you will recall the Cyclone Idai era. Crowdfunding was mainly via mobilizing people via social media. The go-to platform was mostly GoFundMe which did come with some limitations. Then of course the other platform was EcoCash. That time particularly made it apparent that we need home-grown Zimbabwean crowdfunding platforms. Recently Lloyd Crowdfunding, a budding Zimbabwean crowdfunding platform, was launched and will operate in the RBZ regulatory sandbox. I recently had a chat with them:
CM: Who is Lloyd Crowdfunding?
LC: Lloyd Crowdfunding is a platform that brings together Small and Medium-Sized Businesses (SMEs) and investors to enable SMEs to raise capital. Lloyd Crowdfunding is a subsidiary of Lloyd Corporate Capital that has been providing human, equity, and debt capital and training and advisory services to businesses in Southern Africa for over 15 years. With crowdfunding, we leverage the easy accessibility of networks of people through social media and crowdfunding websites to bring investors and entrepreneurs together, making it easier for SMEs to raise funding for their capital and operational requirements.
CM: When and how did Lloyd Crowdfunding start?
LC: Lloyd Crowdfunding started operations in April 2022 when it was admitted into the Fintech Regulatory Sandbox by the Reserve Bank of Zimbabwe (RBZ).
CM: Kindly detail the services that Lloyd Crowdfunding offers.
LC: Lloyd Crowdfunding facilitates the funding and growth of small-medium-sized enterprises by providing a platform for business promoters and investors to interact. The business owners get access to capital, technical skills, and markets giving them a chance to grow their businesses at a reasonable cost. The financiers get exposed to a wider pool of investment opportunities vetted and ranked through a rigorous process. In return, the investors are appropriately rewarded for their investment.
The promoters can raise financing on the platform in several ways, including equity, debt, quasi-equity, and a combination of equity and debt. Under equity, SMEs can get funding in exchange for giving up a portion of shareholding in the business.
Under the debt option, businesses can borrow a loan that will carry a market-related risk-driven interest rate. The loan tenure will be for a minimum of 6 months and a maximum of 3 years.
Quasi-equity is a type of financing that ranks between equity and debt, having a lower risk than senior debt and higher risk than common equity. This includes preference shares and debentures and all the features that come with such an instrument (convertible, redeemable, cumulative, participating, etc.). Under equity-debt combination, a business can raise capital through the combinations of the above in different proportions depending on the project being financed.
CM: What is and how big is your reach and target market?
LC: Our target customers are SMEs operating as registered companies, are ZIMRA registered and have been operational for at least 2 years. The businesses need to have bankable projects, but they do not necessarily need to have collateral.
CM: Give an overview of the team behind the Lloyd Crowdfunding brand
LC: The Lloyd Crowdfunding team consists of experts in venture financing, technology, business development, legal and compliance affairs, and business analysts. It is led by seasoned business leader Messrs Bekithemba Nkomo (Managing Director) and technology expert Gift Gana (CTO). Mr Nkomo has vast business experience and has sat on the boards of directors for several companies listed on the Zimbabwe Stock Exchange. Mr Gana is an innovator with vast experience developing software technology solutions and consulting for deep-tech start-ups.
CM: What is your unique value proposition?
LC: The approval we have received from RBZ allows us to assist the many SMEs, including women and the youth, that are failing to get the much-needed funding, e.g. because they do not have collateral to obtain financing from traditional channels.
CM: How best can people help to push the Lloyd Crowdfunding brand forward?
LC: Crowdfunding presents a new regime for SME financing in Africa, enabling broad groups of investors to fund small businesses which are the engine of our economy. So, we encourage everyone to let friends, family, and colleagues who might need funding know of this great opportunity.
CM: Are you open to business or investment partnerships?
LC: We are open to new business partnerships with investors, both retail and institutional, and ecosystem enablers like entrepreneurship hubs.
You can access the platform and get more details by visiting the website. They also have social media accounts on Facebook, Twitter, and LinkedIn. You can contact them by email as well: email@example.com. For a full breakdown of their rules and regulations, you can read this article on their launch.Their contact numbers are +263 777 554 655 (cell) then other contacts are +263 29 2276562, +263 24 2255440/1, and +263 29 2273584/5. This is a great opportunity for small to medium enterprises in Zimbabwe to access the much-needed capital.