It’s only taken 7 years but Andela, the talent epicenter of Africa’s tech revolution, has earned the coveted unicorn badge.
The company has raised $200 million from SoftBank’s Vision Fund 2, with the participation of Whale Rock, an American investment firm. Generation Investment Management—the Al Gore firm that led a $100 million round in 2019—and the Chan Zuckerberg Initiative, which first invested in 2016, also backed this Series E round that values Andela at $1.5 billion.
After two years of quick-fire operational changes that sometimes bothered observers, Andela will deploy its new war chest to organize the remote-work world it envisioned in Nigeria nearly a decade ago.
Jet fuel for ‘operation get big quickly’
SoftBank’s involvement is a notable piece of this announcement. It’s the Japanese firm’s second Africa-related milestone in as many weeks, after making OPay a unicorn.
“We chose SoftBank for this round because they are very comfortable with the idea of getting big quickly,” Jeremy Johnson, Andela’s CEO, tells Quartz. “They believe you can build companies that shift how the world operates in a relatively short time, and that’s what we believe at Andela.”
Regular shifts in strategy have marked Andela’s ambitions since it was founded in 2014 as an academy that trained African software developers for jobs at US companies and elsewhere.
The first was around September 2019 when over 400 mostly junior developers were let go across Nigeria, Kenya, and Uganda. Andela scrapped entry-level training as a core value of its chain, to focus on placing experienced talent at companies. In May last year, it closed its physical offices in Africa for good after another round of layoffs, becoming fully remote and able to accept developers (as contractors) from anywhere on the continent.
Andela’s broad focus over the years has been to be the go-to platform for companies building distributed teams, an investment that has started paying off as companies everywhere scaled up remote work last year. After expanding beyond Africa to welcome applicants from Latin America, and eastern Europe this year, Andela now accepts developers from 80 countries.
Yet, Africa continues to account for over 80% of Andela contractors at companies like GitHub, Cloudflare, Coursera, and ViacomCBS, according to Johnson. He is proud to have that honor as the company strives to perfect a global marketplace for technical talent. Based in San Francisco, Andela retains some full-time operations staff around Africa including a managing director for Rwanda.
Expect Andela to buy some startups
Beyond geographic expansion, quick growth for Andela also means adjusting to evolving customer demands in a remote-work world.
The company will start offering designers, and data engineers in addition to software engineers. It started helping companies recruit salesforce developers in April.
But it may not be able to do all of this in-house with its current capacity. “You are going to see more M&A from Andela in the future, and an emphasis on building products for engineers and companies,” Johnson says. Buy options include talent networks, and companies whose technology can improve Andela’s four talent-related activities – sourcing, assessing, matching, and support.
Startups like Decagon (Nigeria), Gebeya (Ethiopia), and Moringa School (Kenya) took up developer training after Andela exited that line of business in Africa. Are they on Johnson’s radar? “There’s a pretty reasonable chance that some [acquisitions] will be in Africa” is all he says.
Johnson says not to expect an IPO announcement soon though it is the probable long-term outcome for Andela investors. Idris Ayodeji Bello, founder of LoftyInc Capital Management which backed Andela really early in 2014, believes the company has surpassed expectations of its founding years, and backs its new journey to give talent everywhere a fair shot at opportunity.
An earlier version of this article stated Andela’s valuation as $1.2 billion. It is $1.5 billion.
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