When you listen to entrepreneurs’ stories, many times they’ll say something like, “At the beginning, we didn’t know what we were doing.”

Even Sir Richard Branson’s company Virgin was named to reflect how new at doing business they were when they began.

However, imagine a scenario where every young inexperienced entrepreneur is backed by a veteran who already carries the battle scars of business. Imagine how that would drive faster economic growth catapulting Africa to new heights.

This could be done by multiplying the number of venture builders in the market. Venture Builders are investors who not only write cheques, but also take an active role in building the startups they invest in. In other words, they get their hands dirty, leveraging their knowledge, connections and resources to build their portfolio startups.

One Berlin-based venture builder — Rocket Internet — been on the news this past month as the backer behind the e-commerce behemoth, Jumia, which just got listed on the New York Stock Exchange.

This raises the question, why don’t we have more venture builders on the African continent?

Who are Venture Builders?

Venture builders are also called startup factories. They efficiently churn out startups to the market by executing several of the startup’s functions such as:

• Market research and idea conception
• Building high-performance teams
• Deploying shared resources and services such as legal and finance

Taking care of these services gives the entrepreneurs time and space to focus on their areas of competency.

Some venture builders are full-stack, aiding startups in every stage of their life while others have specialized capabilities.

What’s the Difference Between Venture Builders and Accelerators?

While some might confuse venture builders with accelerators, there’s a distinct difference between the two. First of all, venture builders don’t run competitive programs that culminate in Demo Day. They have skin in the game and are there to run operations alongside the entrepreneur.

Another difference is in the time investment made. Accelerators tend to run for 6 to 9 months and then entrepreneurs are sent out to fend for themselves. The problem with this model is they often find themselves asking, “What next?”

Venture builders, on the other hand, are invested — both with their finances and their time.

Which is exactly what our tech startup scene needs.

Emerging markets are volatile and vulnerable. Entrepreneurs need to overcome bureaucracies, as well as economic and infrastructural challenges. There’s also a shortage of skilled labor in the market, especially in STEM fields. That’s why bringing in a builder to share their resources across multiple startups would catalyze the ecosystem.

Also, venture builders are more likely to attract VC capital than individual entrepreneurs. Their established systems for manufacturing products, strategizing marketing and building high-performance teams tend to be more stable, thus lowering the perceived risk for investors.

Having a venture builder around would be too good an idea for every entrepreneur, but what’s in it for them?

More equity, of course. Because of all the value they bring to the table, they tend to take more equity than their counterparts in the venture capital world.

Just like local angel investors formalize investing, startup factories formalize the value added by investors to startups.

I’ll end with this quote from the website of Unicornify, a Venture Builder, “Money is stupid. It doesn’t think. It doesn’t network. It doesn’t solve problems. It doesn’t interface. Yes, it can buy you stuff but how do you know to buy the right stuff. We try to make money smart by attaching network and experience.”

Co-written with Amina Islam