The experts spoke at a web conference themed ‘Access to international capital and funding solutions for Nigerian businesses’ organised by the Lagos Chamber of Commerce and Industry.
In his keynote address, the Founder and Chairman, Invest Africa, Mr Robert Hersov, said partnerships between local entrepreneurs and foreign investors were more likely to create strong and sustainable businesses.
He urged business owners to be less concerned with giving away equity but rather focus more on growing their enterprises.
“African businesses are reluctant to give away equity. So they focus on taking on debt which then puts strain on their businesses and reduces their ability to grow. The right equity partners can be hugely beneficial and help take businesses to the next level,” he said.
According to him, entrepreneurs that are able to develop a strong business relationship with the right funding partners attract more investors that will provide opportunities to acquire more companies or expand to other regions.
He highlighted the requirements for securing external funding as transparent financial reporting and governance, good track record of performance and growth; and management teams that are aligned to the goals of the company.
Other speakers at the event include Managing Partner, Acuity Ventures, Lexi Novitske; Director, Middle East and Africa, Jersey Finance, Faizal Bhana; and Senior Counsel, Dentons UK and Middle East, Raj Kulasingam.
They noted that the biggest challenge for many businesses was accessing local capital in Nigeria to execute business expansion goals.
The President, LCCI, Mrs Toki Mabogunje, represented by the Vice President, LCCI, Mrs Mojisola Bakare, commended the CBN for improving access to finance for businesses through policies like increase in Loan-to-Deposit ratio; and several intervention funds for different categories of business, including the MSMEs.
The LCCI president called on business owners to explore alternative funding solutions available on global as well as local space.
“In order to unlock access to international capital and finance for Nigerian businesses, we need to holistically and very quickly address issues that have constituted impediments over the years in order to align the expectations of investors with the priorities of business owners,” Mabogunje said.
She enjoined business owners to adopt the right model that prioritises growth and provides clear strategies under different scenarios.
According to her, sound corporate governance is crucial to business survival.