South Africa records 600% increase of fraud cases in four years
South Africa recorded a 600% increase in fraud cases between 2018 and 2022. According to statistics from the Southern African Fraud Prevention Service (SAFPS), there was a 600% increase in incidents of fraud reported by their members in 2022 when compared to 2018. In order to tackle this growing problem of fraud, the SAFPS has launched a fraud prevention protocol called Yima, which seeks to educate the broader public who may be susceptible to fraudsters. According to Nazia Karrim, head of product development at the SAFPS, Yima will establish a proactive approach to combating fraud and scams. “In response to the growing need for a proactive approach to fraud prevention, the SAFPS is developing a product called Yima. Once launched, the product’s website will be a one-stop-shop for South Africans to report scams, secure their identity, and scan any website for vulnerabilities related to scams. They will also be able to educate themselves on identifying a scam,” says Karrim in a statement. “These tools will enable consumers to surf the net more confidently and go about their daily lives aware and informed. These are just some exciting elements South Africans can access through the site.” The main element of the website will be the ability to report a scam incident or any suspicious activity to the SAFPS. This suspicious activity includes a fake or suspect-looking online shopping website/portal and instances where the user has received phoney banking information. These reports will be collated and shared with law enforcement for investigation. Users will also be provided with a scams hotline to report a fraud incident directly to their banks, retailers or insurance companies via a single number. Users will only need to remember one number rather than search for each institution’s contact numbers online. Additionally, Yima users will have access to the consumer products and services offered by the SAFPS. On top of the meteoric rise in fraud cases, in a report last month, INTERPOL also gave South Africa the unwanted title of the cybercrime hub of Africa, with the country recording over 230 million incidents.
Read MoreAWIEF opens the 2023 Academy for Women Entrepreneurs
The United States and Africa Women Innovation and Entrepreneurship Forum (AWIEF) have announced the 2023 Academy for Women Entrepreneurs. The programme is open to young women between 21 and 35 in South Africa, Lesotho, and Eswatini. The Academy for Women Entrepreneurs, launched in 2019 as an initiative of the U.S. Department of State’s Bureau of Educational and Cultural Affairs, has helped over 25,000 women across the world grow their businesses and learn digital skills. It aims to promote economic growth and prosperity and empower women to build better futures for their families and communities. This year, the South African cohort will select 140 participants to join activities in Bloemfontein, Cape Town, Durban, Johannesburg, Maseru, Mbabane, and Pretoria. With this expanded 2023 cohort, the total number of women entrepreneurs trained through the U.S. Mission to South Africa and AWIEF partnership will surpass 550. This year, the opportunity is open to women from neighbouring countries, Lesotho and Eswatini. Selected participants will get access to AWIEF Community, which provides ongoing peer learning and support, expert-facilitated hybrid business management training and mentorship sessions, as well as free delegate passes to the 2023 AWIEF Conference in Kigali, Rwanda, among others. Interested women can apply here. Africa has more female entrepreneurs than anywhere else in the world, with women making up 58% of the continent’s self-employed population. However, women entrepreneurs across sub-Saharan Africa continue to earn lower profits than their male counterparts and have access to less funding, making it difficult for women-owned SMEs to grow. There is a $42 billion gender funding gap across Africa, costing the continent about $92 million per year. Irene Ochem, founder and CEO of AWEIF, shared that the Academy for Women Entrepreneurs program has been a huge success in South Africa so far. “It has empowered enterprising young women not only with the knowledge, networks, and access they need to launch and scale successful enterprises but also with personal development and growth. We are excited to be continuing in our role as implementing partner and extending the impact to women in Lesotho and Eswatini.” AWIEF is an award-winning women’s economic empowerment organisation that provides women entrepreneurs in Africa the support needed to grow their businesses. Their mission is to foster women’s economic inclusion, advancement and empowerment through entrepreneurship support and development.
Read MoreWasoko expands operations to Southern Africa with launch in Zambia
Wasoko, an African e-commerce company operating in the informal retail supply chain, has expanded into Zambia – the company’s first location in Southern Africa. Wasoko, a pan-African B2B e-commerce company with a presence in East and West Africa, has kicked off operations in South Africa with the launch of operations in Zambia. The company will launch its operations in Lusaka, the capital of Zambia, and says it will invest $1 million in its first year to “support local Zambian businesses and communities to get more essential goods for less through the power of e-commerce”. Wasoko, formerly Sokowatch, uses its platform to allow informal retailers to order products via SMS or its mobile app for free, same-day delivery, to their stores. The platform also provides retailers with credit offerings by leveraging purchasing history. It has been difficult to place a value on the informal retail market in Africa due to how fragmented and unorganised it is, but it is estimated to be worth between $600 billion and $1 trillion. Wasoko will also pivot to a hub and spoke logistics network (a model that uses a large distribution centre to dispense inventory to multiple fulfilment centres) and will use Lusaka as the central hub for Zambia. The company says it is pivoting to this model to drive stronger operational efficiency and significantly boost its capacity for faster regional expansions. According to the Zambia Information and Communications Technology Authority (ZICTA), there are 11.1 million active internet subscriptions in the country which translates to 56.8 per 100 inhabitants. Sharing why Wasoko will launch its South African presence in Zambia, Daniel Yu, the founder and CEO of Wasoko, said, “With high smartphone usage and a pro-business government administration keen on expanding the country’s digital economy, Zambia is an ideal environment to launch our model and strongly aligns with our current core markets, both in terms of similar regulatory practices and a supplier base which is intertwined with East Africa.” In addition to its latest expansion, Wasoko will double its service radius across all of its existing locations in Kenya, Tanzania, Rwanda, and Uganda, where it says it has amassed a network of over 200,000 informal retailers and delivered more than 5 million orders to date.
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Google is set to change how you create and listen to music with its AI music generator
Google’s AI music generator, MusicLM, is now available for public use. However, in order to access this innovative tool, users are required to join a waitlist. Also, the data generated by users while utilising the application will be used to further train the AI system. Yesterday Google launched MusicLM, an AI-powered tool that can transform text descriptions into music, for public use. It should be noted, however, that this release is intended for training the AI model, and your usage of the application and feedback will be utilized to further refine it. The tool can be accessed through a waitlist. As per Google’s press release, if you simply type in a phrase like “ambient, soft-sounding music I can study to,” MusicLM will generate two song versions for you to select from. Additionally, you can provide a more specific prompt, including the desired instrument and mood. The AI will produce two versions, for you to listen to them and choose your preferred one. Google plans to utilise user feedback to enhance the capabilities of this tool. Image source: Google The tech giant previewed MusicLM in January and said that there were “no immediate plans” to release it for several reasons including its tendency to incorporate copyrighted material from training data into the generated songs. Generative music has been raising concerns about copyright infringement for years as these AI music generators are trained on existing music to produce similar effects. This is the same for visual art generated by AI. Several artists whose work has been used to train AI systems without their knowledge or consent have filed lawsuits. Spotify reportedly removed thousands of AI-generated songs from startup Boomy over the past month following a complaint from multinational music corporation Universal Music Group. Meanwhile, Google said in its blog post that it has been working with musicians like Dan Deacon and hosting workshops to “see how this technology can empower the creative process.” You can watch a GoogleLM artist at work here.
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👨🏿🚀TechCabal Daily – Sama must pay
Lire en français Read this email in French. 12 MAY, 2023 IN PARTNERSHIP WITH TGIF Some of your favourite shows may never be renewed. Disney Plus lost four million subscribers this year, and coupled with the 2.4 million it lost in Q4 2022, the company has announced that it’s spending less on content. In today’s edition Updates from Google I/0 Kenya says Sama must pay moderators Safaricom receives mobile money licence in Ethiopia Funding tracker The World Wide Web3 Event: Inside Identity Job opportunities UPDATES FROM GOOGLE I/O Artificial intelligence (AI) is here to stay and Google this week announced how it’s bringing it to everyone. If you missed Google’s annual developer conference—Google I/O—which was held on Wednesday, here are the most important things that the big tech company announced: Bard is available to everyone: In February, Google unveiled a ChatGPT rival called Bard which does pretty much everything ChatGPT can do with a plus of being able to comment on events past 2021. Now, Google Bard is available to everyone! For free. Try it out here—we did. AI in Search: Google is also integrating generative AI into its search results, which will allow users to see AI-generated text summaries of information from across the web, above the usual links and ads. Search will also feature actual responses from human beings so if you ask questions like “How can I express sorrow but maintain beauty”, Search will bring you responses from similar questions on Reddit, StackOverFlow, or blogs. Two large language models: Showing off, Google announced two new large language models (LLM), the PaLM 2 and LaMBDA 2. The former is a 540-billion parameter LLM, while the latter is a 1.3 trillion parameter LLM. This means that LAMBDA 2 is about 2.4 times larger than PaLM 2. While both are still under development, PaLM 2 is said to be stronger in logic and reasoning than Open AI’s GPT models. It’s being used to power Bard and other Google AI products. Studio Bot: Google also announced Studio Bot, an AI-powered coding bot that can help Android developers build apps by generating code. Studio Bot is still in its early stages, but Google is confident that it will only get better. A lot more announcements were made, including new additions to the Google Pixel family, updates to Project Starline and Duet AI, and a magic eraser that lets you edit people out of photos, but what we’ve listed are the most critical ones. You can find the rest here. P.S. Parts of this news was written by Google’s Bard. It’s our editor’s attempt to work smart and “bring on the weekend”. MONIEPOINT RANKED 2ND FASTEST-GROWING AFRICAN COMPANY Moniepoint is Africa’s second-fastest growing company, as shown in FTs latest report. We also processed 1 billion transactions worth $43 billion in Q1 alone. Read all about it here. This is partner content. KENYA SAYS SAMA MUST PAY CONTENT MODERATORS Kenyan courts are not slacking on Meta and its outsourcing partner Sama. Yesterday, Kenya’s Employment and Labour Relations Court ordered the content moderation service Sama to pay its employees. ICYMI: Earlier this year, Meta cut ties with Sama after content moderators accused Sama of poor working conditions. Early in March, Sama then announced it would lay off over 200 content moderators as Meta moved to outsource its content moderation to an international company Majorel. The content moderators—about 180 of them—sued both Meta and Sama, seeking compensation of up to Ksh million ($73,000) per moderator for unfair labour practices, and a further Ksh20 million ($146,000) each, for violation of their rights. The courts then ordered Meta to continue working with Sama and its content moderators pending the hearing scheduled for May. Sama has to pay: Now, the content moderators have revealed that Sama is refusing to pay salaries despite the March order. Yesterday, the employment court heard the case and ordered Sama to pay the content moderators their due. Zoom out: So far, both Meta and Sama appear to be ignoring court orders with Meta reportedly going ahead to engage Majorel. The big tech company has previously argued that the Kenyan courts have no jurisdiction to convene over its affairs, a notion that the courts rejected. SAFARICOM SECURES MOBILE MONEY LICENCE IN ETHIOPIA Ethiopia’s mobile money market is heating up as Safaricom Ethiopia secured a mobile money licence from the National Bank of Ethiopia. Safaricom looks to replicate the success it has garnered in Kenya with its M-pesa mobile money service. The announcement followed President Ruto’s speech where he expressed confidence that Ethiopia would grant Safaricom’s mobile money licence request in a deal that was reportedly finalised by President Ruto and Ethiopia’s Prime Minister Abiy Ahmed in Addis Ababa. Ethiopia is open for business Prior to this licensing, talks about awarding mobile money licences were slow-walked by Ethiopia’s bureaucracy which sought to protect the government–majority-owned Ethio-Telecom and its then-recently launched mobile money service, Telebirr. Eventually, in April 2022, Ethiopia’s central bank announced a draft bill which, upon being made law, permitted foreign–owned telecom operators like Safaricom to launch mobile money services. In December 2020, the Ethiopian government invited telecom companies to bid for two licences to compete against Ethio Telecom. Only two consortia placed bids. One from South Africa’s MTN Group, and the second from the Global Partnership for Ethiopia Consortium, led by Kenya’s Safaricom and including Vodafone, Vodacom, CDC Group. The Safaricom-led consortium won after the government rejected the MTN Group’s bid. MTN refused to participate in a second tender. Zoom out: Until Safaricom’s entry, state-owned Ethio Telecom operated as a monopoly with 54 million subscribers in Ethiopia, Africa’s second most populous country with an estimated population of 118 million people. EXPERIENCE VIVA TECHNOLOGY Book your pass to Europe’s biggest Startup and Business event here. This is partner content. TC INSIGHTS: FUNDING TRACKER This week, South African Health-Tech company Quro raised $1.3 million in an undisclosed funding round from Mineworkers Investment Company (MIC). Here are the other deals this week: Egypt-based fintech company Balad closed an
Read MoreWith data becoming more affordable, Africans are spending one-third of their day on their phones
Reports from Data Sparkle, a data and analytics platform for emerging markets, have shown that Africa has over 270 million monthly active users who spend one-third of their time on mobile apps. As the world moves towards a more digital landscape, more people rely heavily on their mobile devices for a lot of activities. Per a new report [pdf] from Data Sparkle, Africans spend one-third of their daily life—over 4 hours each day—using their mobile phones, while using an average of 12GB of data monthly. The report, named “The Changing Landscape Of Africa’s Mobile App Market”, analyses Africa’s mobile market’s transformation in the past year by examining various aspects, including the behaviours and preferences of mobile users, the apps that have gained popularity, and the contributions made by developers. According to the report, Africa had over 270 million monthly active users of mobile apps as at the end of 2022, representing a 14% rise from the beginning of the year. Data is becoming more affordable in Africa According to the report, Africans use an average of 12GB of data monthly. Mobile internet has become more affordable lately, with the cost of 1GB of data dropping across the continent. Between 2019 and 2022, the average cost of 1GB of data dropped by 38% in Egypt, 69% in Kenya, and 91% in Nigeria. In 2022, the average cost of 1GB across 13 African countries was less than US$1. Most of the world’s most expensive mobile data plans are in Africa Africans spend a tiny fraction of their income on data subscriptions In today’s digital-centric society, more people rely on the internet to stay in touch with friends and family, work and do business, thereby spending more on data subscriptions. According to the Data Sparkles report, most users spent an average of $5-15 monthly on data subscriptions- a meagre fraction of their average monthly income. Kenyans spend 7.9% of their income on data subscriptions, while Nigerians spend 6.2%. Egyptians and South Africans spend 3.8% and 1.9% of their income on data subscriptions respectively. The reports show that users from Egypt and Kenya consume the most data monthly, with averages of 24.3GB and 14.1 GB respectively in monthly data subscriptions. African mobile phone users are night crawlers According to the report, most Africans used their phones mainly at night- after 6 pm, with phone usage peaking between 7 and 9 pm. Also, Africans spend one-third of their daily life—over 4 hours everyday—using their mobile phones. A large portion of this time is spent on communication and social apps. In contrast, a minute fraction is spent on news, books and music apps. On average, African users spend up to 23 hours monthly on social media, split among popular social media platforms, Facebook, Tik Tok, Youtube and Instagram. Africans love their leisure time Of the 575 apps surveyed in this report, 183 games were in the top 500 apps categories, representing 36.6%. Other popular app categories include: tools (41 apps, 8.2%), music & audio (32 apps, 6.4%), video players & editors (31 apps, 6.2%), communication (28 apps, 5.6%), social (26 apps, 5.2%), finance (22 apps, 4.4%) and productivity (22 apps, 4.4%). While gaming had the most significant representation in the top apps category—36.6 of the total apps surveyed—the number of monthly active users of mobile games in Africa also saw an increase, with over 200 million users spending an average of 12 hours monthly playing casual, puzzle, card and arcade games. Subway Surfers, Candy Crush, Ludo Master, and Talking Angela, amongst others, were the most played games in which African users found comfort and swiped away their stress. There is room for more Overall, the report showed that “Africa’s mobile market maintained its growth momentum in 2022”. Mobile internet consumption on the continent also swelled, with global players from different industries establishing businesses here. Categories such as communication, social and video players & editor had the largest user base but other sectors requiring higher operation costs and better Internet connectivity, without dominant players in place, have not yet been be fully tapped.
Read MoreCourt bars Nigerian Broadcasting Commission (NBC) from imposing fines on broadcast stations
The Nigerian Broadcasting Commission (NBC) has been barred from imposing fines on broadcast stations. This happened after a ruling in Abuja on May 10, 2023, which was presided over by Justice James Omotosho. According to the ruling, NBC had no power to sanction broadcast organisations and while the NBC code grants the commission the power to impose a sanction, it conflicted with the constitution, which conferred judicial power in the court of law. Other things the judge noted included the fact that the broadcasting commission had no power to conduct a criminal investigation that would lead to a criminal trial and imposition of sanctions. According to him, this goes against the doctrine of separation of powers, which is in place to prevent tyranny by concentrating too much power in the hands of one body. “The action of the respondent qualifies as excessiveness,” Justice Omotosho said. On March 1, 2019, NBC imposed a fine of ₦500,000 each on 45 broadcast stations in the country over an alleged violation of its code. This prompted the Incorporated Trustees of Media Rights Agenda to sue the regulatory body, calling the sanction a violation of the rules of natural justice. That was not the last time NBC doled out hefty fines to broadcast organisations. In April, NBC imposed a ₦5 million fine on Channels TV for interviewing the vice-presidential candidate of the Labour Party, Datti Baba-Ahmed. According to NBC, the station was complicit in the “outburst” of the Baba-Ahmed, who advised the Chief Justice of Nigeria (CJN) against swearing in President-elect Bola Tinubu. NBC’s unfine history of fines NBC also imposed ₦2 million fines on broadcast stations Arise News and TVC for alleged breach of national broadcasting codes in the countdown to the 2023 general election, saying that the stations allowed derogatory comments to be broadcast. The commission demanded that payment of the fines should be within two weeks of the receipt of the letters or the sanction would be graduated. In 2020, three broadcast stations, AIT, Arise TV, and Channels were also fined ₦3 million for their “unprofessional” coverage of the ENDSars protest. Popular Nigerian artistes have also met the fury of NBC as the commission has banned several songs and music videos for reasons like explicit videos or vulgar lyrics. Media stakeholders and the general public have expressed their dissatisfaction with the actions of NBC for a long time now. The commission’s code has repeatedly been accused of being unconstitutional, arbitrary and unlawful. In a statement issued by the Broadcasting Organisation of Nigeria (BON), the NBC was condemned for acting as both “accuser and judge” and imposing an illegal fine on a broadcast station without employing all avenues to investigate the complaints nor give room for defence from the station accused. Following this ruling, the NBC will henceforth have to engage the judicial system before sanctioning a TV or radio station, and both sides will be granted a fair hearing.
Read MoreAs Safaricom seeks to conquer Ethiopia, its profits are taking a hit
Safaricom’s Ethiopia expansion seems to be coming at the expense of the mobile network operator’s profitability. In early October 2022, TechCabal reported that Kenya’s leading telco Safaricom officially launched its Ethiopian service following a ten-city pilot and a phased launch across the country. Today, the mobile network operator released its FY23 results, covering the period between March 2022 and March2023, which showed that its market entry into Ethiopia has yielded mixed results. While its revenue saw an increase of 4.3%, its Ethiopian operations affected profitability thanks to the costs associated with the market expansion. According to the results, Safaricom’s profits after income tax were down by -13.6%, with the group’s capital expenditure for the year surging by over 93%. The company’s Ethiopian operating costs stood at almost 20 billion Kenyan shillings (~$146 million), which represents over 27% of the group’s overall operating costs. While Safaricom’s Kenyan operations reported over 110 billion Kenyan shillings (~$804 million) in profits, Safaricom Ethiopia incurred over 21 billion Kenyan shillings (~$154 million) in losses. The company’s share price dropped by as much as 8.5% following the release of its latest results. At its lowest today, Safaricom shares traded at 14 Kenyan shillings per share on the Nairobi Stock Exchange, prices last seen in 2015. Despite weakening earnings and a persistent slide in share price, Safaricom board chair, Adil Khawaja, defended CEO Peter Ndegwa in the earnings call and swatted at rumours about a planned exit for the chief executive. State of Ethiopia operations According to Safaricom, the company now has 2 million, 1.4 million, and 700,000 voice, data and messaging customers respectively in the country since commencement of operations in October 2022. Overall, the number of customers onboarded stood at 3 million in 22 cities, a 22% penetration. Revenue from Ethiopian operations stood at 1.8 billion Kenyan shillings with service, voice, data, and messaging accounting for 600 million, 100 million, 400 million, and 3.9 million shillings respectively. A bet worth making? In the current macroeconomic environment, the majority of financial experts seem to support bottomline growth over topline growth, with profitability supposed to take precedence over revenue growth. It seems like Safaricom is taking a different approach and making what some might consider a risky bet. It is important to note that South Africa’s MTN Group pulled out of a second tender offer to purchase a telco licence in Ethiopia in 2021, citing an unwillingness to operate in conflict-ridden markets, a reference to conflict in the Tigray region. But the opportunity in the Ethiopian market is clear if costly. Together with its annual results, Safaricom also announced that it has secured the licence to operate mobile money services in the country at a cost of $150 million. It plans to launch the service this quarter. Until Safaricom’s entry, state-owned Ethio Telecom operated as a monopoly with 54 million subscribers in Ethiopia, Africa’s second most populous country with an estimated population of 118 million people. Now Safaricom’s wildly successful M-Pesa gets to compete with the Telebirr service from the government–backed mobile network operator. In June last year, Ethio-Telecom announced that it had on-boarded over 21 million customers to its mobile money offering, figures which show the immense potential of the service in Ethiopia. On the results, Safaricom puts the scaling of its Ethiopian operations, specifically its mobile money offering, as one of core FY24 focus. Only time will tell if the bet will be worth it.
Read MoreAndy Umana is improving the real estate experience with the blockchain
Andy Umana met with CrossFund’s chief editor, Luke Sheehan, to share a journey that has taken him from being a young student at the Ilorin State University, with an interest in environmental sustainability, to being the founder of a blockchain and real estate startup during the pandemic. Umana’s father was a civil servant and his mother a trader; Umana was “that guy ready to help out and try to see how to put food on the table” for his family. In his own words, he “has always sold”. As an adult, he manifested that, first, by starting a supply chain business for agricultural products (Yahgro), with a model based on finding food supply in northern Nigeria and selling in the south. Bottlenecks and a heavy presence of middlemen got in the mix, and then inflation hit, making what was a profitable company hard to scale. That’s when he discovered the blockchain. A peer-to-peer platform followed, and then he joined the team that created the first NFT collection in Nigeria. At that point, he figured there must be an untapped opportunity somewhere. He’s now founder and head of growth at Relsify, a fractional real estate platform for Africa, which was launched in 2021. Tell me how Relsify got started. I moved to Lagos during the pandemic. Somebody had a distressed property to sell and I could not afford it at the time. Yet I had a community because of my involvement with the crypto space. I thought, “With this community and technology, we can go in on this property and share the profit that will come out of it.”Even during the pandemic, real estate was growing faster than any other part of the economy. To bring people into the market who, like me, are not part of the “1% of the 1%”, new solutions were needed. I mean, it is obvious that the quality of people’s earnings is reducing day-by-day in Nigeria, but the cost of housing is going higher. To get access to the market and get a return requires innovation. The opportunity to get in on real estate investment is becoming slimmer and slimmer. The space is highly cash-based, and in Nigeria—and Africa as a whole—there is little infrastructure to allow people to access mortgages and become owners. So we thought of a way to scale a platform to allow people to take profit out of the real estate market that they are actively involved in. We did a proper market analysis and we found out that the best way to go about it is to build something that uses a transparent system that allows people to crowdfund and own bits and pieces of properties in highbrow areas. That’s the basic story of how Relsify was born—hopefully the start of a revolution in housing. We have made a lot of progress so far, in terms of regulatory compliance and definitely the building of the product. You say on your LinkedIn that you’re hiring. Can you tell me about how you’re expanding your team? Is it hard to find and keep talent?We are definitely facing this struggle. “Japa Syndrome” [the brain drain of young Nigerians] is real. A lot of talents are relocating to other countries. Two or three of our team members, just before product launch, left the country. To solve this, we’re trying to build a culture around solving pain points for talents, not just hiring people to get the job done. We are building a community around the product, so they feel that sense of belonging and ownership of it. We’re shaping minds to ensure they are genuinely concerned and interested in revolutionising the way people invest in real estate. That’s basically how we’re going about finding and retaining the right talent now. If you were in charge of Nigeria, what would you change?We are building a highly-regulated product; we have to work with the government of the day. One of the challenges that we face—and why we’ve not broken into the market with full strength from day one—is that we have had to wait and talk to the SEC in Nigeria to secure a provisional licence for us to carry out what we’re trying to do. Despite numerous challenges, we were able to follow up until they recently crafted one that suits us. But now we await approvals to pull it through. They are telling us that they are waiting for the new government to come through before they [the SEC] start issuing this licence, because they want to understand [the new government’s tone and approach to policy first]. The representatives of the new government were explaining to us during their campaign that they would be pro-blockchain; that Nigeria would no longer be among the crypto-agnostic countries. There are a lot of different things that the government has to do, with regard to accepting and working with innovation. I think that regulation can catch up with innovation, eventually, and we will see paths to market for the solutions and products we are building. I think the new government should create a better playing field for startups like mine. There are positive signs from the president-elect around the real estate and startup sectors, going back to his time as governor of Lagos state. Are you optimistic about getting enough funding in the near future?Surely. I’m super excited about what funding is looking like in Africa. We’ve seen big funding rounds and acquisitions in recent times. I think exciting times lie ahead when people see the work coming out of Africa. Mostly, I have raised from friends and family to start and build this business, and I’m trying to build up traction towards a proper seed round. In all, I’m really optimistic about where we are going. We are moving into using our skills for building, and the government is joining the race. When people see this from the outside world, they will definitely see the changes in our market and more funding will be accessible. We
Read MoreAfrica’s funding winter means smaller budgets for marketing campaigns
Marketing is a crucial part of a startup’s growth, but for every company the process is different. How do tech companies and startups approach marketing, especially in an economic downturn? Growth and marketing have had a significant impact on the startup boom in Africa. While there are critical keys to a startup’s success like access to funding and product-market fit, marketing is also a strong area and can be seen in the way that startups and companies across the continent heavily invest in marketing and advertising. We’ve seen startups launch campaigns with celebrities and sponsor major reality shows like Big Brother in a bid to reach a wider audience. In 2021, startups like Kuda spent over $1 million on marketing efforts to deepen their market penetration. Opeyemi Odusola led marketing in Nigeria for accessories company, Oraimo. One of the things he enjoyed the most about marketing with Oraimo was the fact that he wasn’t constrained by budgets. At Oraimo, he had the liberty to experiment with various ideas and collaborations, with his favourite being the campaign they created for the Freepods 3. It involved collaborating with Grammy-award-winning producer Telz and other major artistes. “We wanted an ad that showed our users that we listened to them and we understood them. Being an artiste myself, I also wanted something that resonated with music-loving users and we felt like bringing a couple of artistes together to talk about their relationship with music would be great,” he shared. For Ebuka who works in marketing for Piggyvest, an interesting metric that he uses to judge the success of ad campaigns is how well he is able to do with a small budget. Although the team at Piggyvest has a larger budget to execute with— unlike his previous workplace —, he shares that paying attention to budgets is a critical part of a campaign’s success. “When I find myself going above the budget, it means that I have to go and tweak something. Either your content is not good enough, your creative direction is not the right one or your landing page experience is incomplete. There has to be a reason why your ad is not getting the desired results and it’s up to you to fix it,” Ebuka stated. Ads are beyond money to Ebuka, who believes that while bigger budgets can help you execute bigger ideas, they don’t always translate to better results. “It’s not just about having money, it’s very difficult to get people’s attention online these days and your ads have to resonate with your audience to work,” he shared. View this post on Instagram A post shared by Piggyvest (@piggybankng) Navigating marketing in a downturn Marketing Specialist Ebunoluwa Ade-Taiwo shares the same sentiments with Ebuka on marketing going beyond money. Ade-Taiwo, who works at Quidax— a startup that has had to lay off 20% of its workforce due to the downturn—, shares that there are a lot of ways to be creative when you don’t have access to a large budget. 2023 has seen a decline in startup funding across the continent, and a byproduct of this is that startups are being more prudent with resources which extend to marketing budgets. “Companies are utilising more creative, cost-effective ways to reach potential users and drive growth. Unlike previous years when we could easily sponsor big events and sign celebrities as ambassadors; we now try to explore other options like using your employees as ambassadors and tasking them to help promote the company. We also do a whole lot more digital and content marketing now, as these are cheaper alternatives.” For fintechs, Ade-Taiwo believes that marketing is a lot more complex due to the trust factor. “You need to build trust and credibility if you’re asking people to trust you with their money. In Nigeria today, before somebody can part with as little as ₦5,000, they have to trust you, and so you need to pay extra attention to the kind of ads you are putting out and what your reputation is,” he noted. Despite not having a large budget, the Quidax team is using their social media to tell stories and one of Ade-Taiwo’s favourite ad campaigns was one for International Women’s Day titled “How Qbabes are saving smarter.” For that campaign, they made a compilation of stories from women on how they were making smarter financial decisions. However, she wished they had a bigger budget for the campaign to do better than it did. View this post on Instagram A post shared by Quidax (@quidaxglobal) Nigeria’s tech ecosystem has witnessed rapid growth over the years and marketing has been a fundamental part of it. A huge part of marketing, however, is budgets and although bigger budgets are not always markers of success for campaigns, companies with bigger budgets typically have more reach as we’ve seen in the case of companies like OPay and Kuda, among others. As funding for the Nigerian tech ecosystem falls — and consequently the marketing budgets, will the growth in the coming years be slower, or will smaller companies find a way to make up for smaller budgets?
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