Ethiopia’s Startups to Receive $750,000 in Grants at Landmark GRV Summit

Promising early- and growth-stage startups in the agriculture, healthcare, and education sectors are set to receive $750,000 in equity-free grants from the Ethiopian Diaspora Trust Fund (EDTF) at an upcoming summit.

The Great Rift Valley Innovation Summit (GRV), scheduled for late January, will mark one of the largest fundraising and pitch competition events in the history of Ethiopia’s nascent startup ecosystem.

According to Afomia Hailemeskel, co-executive producer of GRV Summit, the initiative looks to respond to the pressing need for innovative solutions that can address the challenges faced by Ethiopia’s youth.

“The decision to organize this specific startup funding event stems from the growing need to empower Ethiopia’s youth to become innovative leaders in sectors that are pillars of the nation: agriculture, education, and healthcare,” Afomia told Shega.

The fund, raised through contributions from Ethiopian diaspora communities worldwide, totals nearly $1 million and will be awarded in two categories. Currently accepting applications, EDTF plans to support over a dozen startups.

In the first category, which is dubbed the Legacy Builder Award, a total of $650,000 will be awarded to support four entrepreneurs with strong, scalable business models that align with EDTF's impact areas. The grand prize for this category is $150,000, with an additional $50,000 People's Choice Award.

The second category is the Young Innovator Award, where a total of $100,000 will be distributed to ten young innovators or first-time founders aged 25 and under. Each recipient will receive $10,000 to develop their innovative ideas and create impactful solutions.

EDTF has also partnered with the Innovative Finance Lab to assist in pitch vetting and judging. This collaboration, according to Afomia, underscores the importance of expertise in selecting startups that not only show potential for growth but also align with EDTF’s mission of driving impactful change.

All participants in the Pitch Competition will be guaranteed a slot in Cohort 4 of UNDP/IFL’s leadership accelerator and capital readiness program. The 5-month-long incubation program will provide ongoing mentorship, upskilling, and development in an accelerator environment.

A 2023 startup ecosystem report by Shega, JICA, and the Ministry of Innovation & Technology highlights the persistent funding challenges faced by Ethiopian startups. Early-stage ventures struggle to secure funding due to a lack of market validation, while traditional lenders are hesitant to provide loans. The report also notes the limited availability of alternative financing options like venture capital and crowdfunding.

Following Prime Minister Abiy Ahmed’s plea to the diaspora community to contribute a dollar a day toward vital socio-economic projects in 2018, the Ethiopian Diaspora Trust Fund was established to mobilize global support for sustainable development in Ethiopia. The fund has previously supported critical initiatives such as COVID-19 relief efforts, childhood education, and projects addressing hygiene, sanitation, and water supply.