MTN Nigeria posts ₦133.7 billion Q1 profit in second straight positive quarter
MTN Nigeria reported a profit after tax of ₦133.7 billion( $102.85 million) in Q1 2025. This marks the telecom giant’s second consecutive profitable quarter, a significant rebound from the ₦392.7 billion ($302.08 million) loss recorded in Q1 2024, largely driven by foreign exchange losses and inflation. The unaudited Q1 2025 results, released on Tuesday, reflect a strengthening financial outlook. Service revenue rose 32.5% year-on-year to ₦752.98 billion ($579.22 million), fueled by recent price hikes, broader adoption of 4G and 5G networks, and solid growth in MTN’s digital and fintech verticals. It’s also the company’s first Q1 profit since the 2023 naira devaluation triggered a cascade of FX-related losses. MTN’s return to financial stability has tangible benefits for its over 84 million subscribers. A profitable MTN can invest more aggressively in network upgrades, improve service quality, expand rural connectivity, and enhance the overall digital experience. Faster internet speeds, fewer call dropouts, and better access to services in underserved areas are among the expected gains. “We are encouraged by the improvements in Nigeria’s macroeconomic conditions, marked by increased forex liquidity, a relatively stable naira, and easing inflation,” said Karl Toriola, MTN Nigeria CEO. “However, the recent escalation in global geopolitical and trade tensions presents risks to the broader outlook.” Profitability has also strengthened MTN’s operational efficiency. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) margin rose to 38.5%. Key contributors include MTN’s expense efficiency program and successful renegotiation of tower leases, which have already saved the company ₦3.8 billion ($2.92 million) annually. MTN’s stock has responded positively. Trading volumes soared to 11 million units on April 15—its highest single-day activity this year—while the share price surged 55% from a 2024 low of ₦170 to ₦264.20 ($0.20) by the end of April. Analysts have taken notice, with Chapel Hill Denham calling the stock “extremely cheap” despite its recent rally, citing stronger earnings expectations and improved investor sentiment. This momentum also sets the stage for a new public offering. MTN Nigeria plans to reduce MTN Group’s stake from 76% to 65% via a share sale expected to raise between ₦500 billion and ₦700 billion ($436.6 million). Proceeds will fund network expansion and reduce debt. The company’s last offering in 2021 drew over 126,000 local investors, and this new issuance aligns with government efforts to boost indigenous ownership in the telecom sector. A central pillar of MTN’s recovery strategy is diversification. In Q1, the company rebranded its fibre-to-the-home business to FibreX, supporting Nigeria’s ambition for 90% broadband penetration by 2025. This complements fintech growth, where MoMo wallet transactions rose 21% year-on-year, processing $16.8 billion in merchant payments. Digital services now contribute over 25% of fintech revenue. The company also made progress operationally. Active data users increased by 12% year-on-year, and the negative effects of the NIN-SIM linkage enforcement, which caused subscriber losses in 2024, have largely tapered off. Despite these wins, challenges remain. Retained earnings still stand at a negative ₦607 billion ($466.9 million), which may delay dividend resumption. Inflation remains stubbornly high at 28.3%, squeezing margins, and a pending class-action lawsuit on data mismanagement could pose reputational risks. Analysts forecast a sharp recovery for MTN Nigeria, powered by strategic tariff increases, network expansion, and operational discipline. The company aims for mid-40% growth in service revenue and EBITDA margins through the remainder of 2025. Key to this ambition will be the continued rollout of 5G infrastructure, improved forex liquidity, and the execution of the public offering. MTN Nigeria’s Annual General Meeting, set for April 30, will address potential dividend policy revisions and corporate governance updates—two topics sure to be closely watched by investors.
Read MoreNigeria’s open banking to launch in August after four-year wait
Nigeria’s central bank (CBN) has approved the launch of open banking, mandating that banks begin sharing customer data with other financial institutions starting in August 2025, according to one person with direct knowledge of the meeting. Nigeria becomes the first African country to implement open banking, four years after the Central Bank of Nigeria first released its regulatory framework for the initiative. With the CBN’s approval, customers can now consent to allow regulated financial institutions to access their data, such as account balances, transaction histories, and spending patterns, and, in some cases, even initiate transactions on their behalf. The data will be shared through a standardised API that all banks and participating institutions can connect to, enabling secure and consistent access. A central registry will identify and authenticate all participants, while a consent management framework tied to customers’ Bank Verification Numbers (BVNs) will ensure that customers remain in full control of who can access their data and for what purpose. Open banking is ready for Nigeria, but CBN’s approval stands in the way The CBN revised its approach after pushback from the banking industry against centralising control under the Nigerian Interbank Settlement System (NIBSS). It has now established independent committees to oversee open banking, led by bankers and employees of financial institutions without direct CBN control over any of the committees. The importance of open banking cannot be overstated. By accessing years of data on Nigeria’s 120 million bank customers, financial institutions can use this data to offer new services to Nigerians. The most likely service to improve with access to data is lending. So far, bank-led lending has resulted in low credit penetration, with as much as 70% of bank account holders locked out from accessible credit. FIntechs have entered the credit market to fix this despite having limited data, leading to a mixed bag of subprime loans and predatory collection methods. With open banking, lending fintechs would receive data (transaction history, consumption patterns) from banks to assess creditworthiness and also help create a much-needed credit score for Nigerians. Financial institutions can also create new types of personalised financial products backed by data. *This is a developing story. Open banking can change Nigeria’s financial industry. Why is the CBN stalling on it?
Read More9mobile claims SIM porting is active, but users say otherwise
9mobile subscribers are encountering a new and frustrating challenge: they cannot port their numbers to other networks due to persistent network outages in several parts of the country. Despite these disruptions, 9mobile maintains that porting services remain active. “Our customers can still port out of our network if they choose to, and we comply fully with regulatory guidelines to ensure a smooth process,” said Chineze Amanfo, 9mobile’s Public Relations Lead. “We encourage any customer experiencing issues to contact our support team for assistance.” The discrepancy between the company’s assurances and user experiences has raised concerns about transparency and access, especially as network reliability continues to decline. For users dealing with frequent call disruptions, slow internet, or total network outages, porting offers a vital solution. In April 2013, the Nigerian Communications Commission (NCC) introduced Mobile Number Portability (MNP) to give consumers more control and encourage competition. The policy allows telecom users in Nigeria to switch to a different network without losing their existing phone number. Porting requires both the donor (current) and recipient (new) networks to be online and responsive in real time. Any outage, glitch, or downtime on either end halts the porting process entirely. And that’s exactly what many 9mobile users are now facing. Until January, 9mobile users could port out without issue. In January 2025, the operator recorded 4,528 outgoing ports, making up nearly 79% of all 5,710 ported numbers across the industry. MTN Nigeria followed with 952 port-outs, Airtel had 130, and Globacom recorded just 100. Porting involves the subscriber sending “PORT” via SMS to a short code to initiate the transfer, after which the request is processed by a central Number Portability Clearing House. But if 9mobile’s systems are down or unresponsive, the request can’t go through, and subscribers can’t generate the code. For some subscribers, the frustration has reached a breaking point. Oloruntoba Yusuf, a broadcaster and former 9mobile user, told TechCabal that after enduring two months of poor service, he tried and failed to port. “I gave up,” he said. “ I changed my BVN number and threw the SIM card away. My sister-in-law still uses 9mobile and says the network hasn’t been restored.” A TechCabal reporter attempted to port from the network after 9mobile’s response to comments and received the following message: “Your message has been received. If you have not done so already, please proceed to the nearest shop of the network you want to port to.” Rotimi Babs, an energy consultant and current 9mobile subscriber, said the problems go beyond unreliable service. Although network coverage has been inconsistent, purchasing airtime and data bundles has been even more frustrating: banks debit his account, but 9mobile fails to credit the data. Even trying to buy data using existing airtime doesn’t work. “I’ve migrated most of my communication away from the line,” Babs said. “At the first opportunity to port, I won’t hesitate.” Some industry insiders claim the timing of the disruption in porting is not coincidental. 9mobile is in the final stages of negotiating a national roaming agreement with MTN Nigeria. The deal would allow 9mobile to use MTN’s infrastructure to improve its reach and service quality, especially in underserved areas. According to two sources familiar with the matter, the partnership could be announced within a few months. “To secure more favourable terms in the deal, 9mobile likely wants to retain as many subscribers as possible,” said one telecom executive who wanted to remain anonymous to speak freely. “Blocking porting—even indirectly—helps keep those numbers stable.” But Amanfo told TechCabal that the possibility of switching off its network is zero. “We work under strict regulatory guidelines,” she said. “We cannot just switch off our network without the express permission of the NCC. You can confirm this from the regulator as well.” In December, 9mobile blamed ongoing technical glitches caused by fibre cuts in multiple locations for the difficulty in supplying quality service. It denied intentionally blocking users from leaving the network. However, the operator’s sharp decline tells its own story. Formerly known as Etisalat Nigeria, 9mobile held 15.7% market share in 2015. As of January 2025, it had dropped to 1.9%, with just 3.2 million active subscribers, and that number hasn’t changed for three months straight. In several regions, including many parts of Lagos, even remaining subscribers report complete service blackouts. Whether the MTN roaming deal can revive 9mobile remains to be seen. But for now, many of its customers feel trapped, with no signal and no way out.
Read MoreCoronation Wealth wants the average Nigerian to invest in the capital markets
Coronation Wealth, the investment and wealth management subsidiary of Coronation Group, is making a long-term play to turn millions of Nigerians into first-time investors, most of whom have never bought a single stock. Launched in April 2024, the company is tackling one of the country’s most persistent financial challenges: a deep lack of participation in formal capital markets. Despite a population of more than 200 million, fewer than 1% of Nigerians invest in collective investment schemes like mutual funds, according to the company. CEO Olufemi Yoloye sees this as both a risk and a major opportunity. “The market is so thin that it’s not a game of snatching customers from another house,” Yoloye told TechCabal in an interview. “We literally have to create a market for the investing public.” Coronation Wealth is solving for two key pain points: low financial literacy and poor access to investment tools. Its solution comprises three core products: a digital investment education platform, a gamified fantasy trading league using live market data, and a consumer investment app aimed at simplifying the onboarding process for first-time users. Its Coronation Investment Academy, which has attracted nearly 400,000 learners, offers free, digestible educational content to help bridge the knowledge gap that often drives Nigerians to riskier, informal investment schemes. “That’s why every year there’s a new Ponzi scheme, and every year it has victims,” he said. The company has also rolled out the “Play Coronation Fantasy League,” a virtual platform that allows users to trade virtual portfolios using real-time market data. This gamified approach, which simulates managing a ₦100 million ($75,000) portfolio, is designed to engage users and make investing more approachable. “If MTN is ₦20, it is ₦20 on the fantasy league,” Yoloye explained. “If it rises, your portfolio reflects that.” Targeting retail investors The Coronation Wealth app is the actual investment platform, designed with simplicity in mind. Yoloye explains that the app prioritises ease of use: “The retail guy cannot be overwhelmed by the information.” With just a few graphs and straightforward analysis, the app avoids the complexity that can deter new investors. Coronation Wealth also offers proprietary research, including stock recommendations and model equity portfolios, such as one that returned 50% last year, outpacing inflation. The company’s strategy focuses on breaking down barriers for retail investors by providing access to investments that have traditionally been the domain of high-net-worth individuals and institutional investors. For example, commercial paper – a popular fixed-income instrument – is typically out of reach for most Nigerians due to its ₦5 million ($3,121) minimum investment. However, Coronation Wealth has found a way to allow retail investors to participate by pooling their money into funds that invest in such instruments. “We’re democratizing access to investment,” Yoloye says. Yoloye’s investment philosophy is centered on “first principles.” He advises users to assess their “risk appetite,” “investment horizon,” and “budget” before diving into the world of investment. “When in doubt, just go for a money market fund,” he suggests. “If you don’t have time to track yield curves or monitor MPC [monetary policy committee] communications, it’s someone’s job to do that for you when you invest in a fund.” Beyond investing Coronation Wealth is also positioning itself as a “multi-sided platform” that serves as an intermediary between various financial services and retail investors. The platform integrates several services from across the Coronation Group, including Coronation Asset Management, which offers mutual funds, money market funds, and fixed-income instruments, and Coronation Securities, which provides access to stock trading. The platform will also eventually offer insurance products, with regulatory approvals pending. For Yoloye, the aim is to provide a one-stop shop for all things related to capital markets. “We’re not there yet, but we’re live with mutual funds and shares,” he says. “By the end of the year, we should roll out insurance and other services. Over time, we’ll layer services from our partners as well.” Despite the competition, Yoloye doesn’t see other players in the market as direct rivals. “Anywhere people can put money today, I see them as a competitor, more realistically, more practically, I see them as peers,” Yoloye says. He tracks other capital market operators, such as Optimus by Afrinvest, I-invest by Sterling, and PiggyVest, observing their strategies and using them as benchmarks. “Whenever they do anything [features and product offerings], I’m eager to see how we can support building the capital market,” he adds. Coronation Wealth says its digital-first approach sets it apart from traditional players in the market. “We are closer to tech bros than institutional,” Yoloye says, noting that the platform’s agility allows it to rapidly adapt to market needs. The company recently rolled out an updated version of its app in January 2025 to improve performance and align more closely with user preferences. “We had to rewrite the entire app,” he explains. “Not because it was more from a perspective of we need to improve performance, but because there was a lot of groupthink. We wanted to make the app work for everyone, not just capital market players.” Coronation Wealth sees a massive opportunity to reshape Nigeria’s investment landscape. The country’s average age is skewing younger, with 62% of the population under the age of 24, according to the National Bureau of Statistics (NBS). This shift presents a unique chance to meet a new generation of investors where they are and build a more inclusive market. “If all we’re able to do is support national discourse with raw data, we can make the case for regulation adjustments that allow younger investors to participate,” Yoloye says. Coronation Wealth’s long play is that financial inclusion won’t be driven solely by bank accounts or payments, but by equity ownership. It’s betting that Nigeria’s next million investors aren’t coming from the banks. They’re being created from scratch.
Read MoreA southeast Nigerian startup wants to become the “Netflix of documentaries”
When the COVID-19 pandemic forced the world indoors in 2020, streaming audiences went hunting for more than sitcoms and Marvel reruns. Documentaries—long a second-class citizen in the streaming world— moved quietly to the front row. Now, a startup out of Aba, southeastern Nigeria—once an epicenter of Nollywood’s DVD distribution boom—thinks it has the answer for the next phase of that demand. OptimalVid, founded in 2024 by Praise Igwe and a small team of engineers and content junkies, is betting that a dedicated documentary streaming platform—with cheaper, smarter, and more flexible access—can carve out a place in the crowded streaming universe. It’s a risky idea. But sometimes, the best ideas are. With a planned app rollout later this month, OptimalVid will allow users to stream documentary content for $2 per month. Unlike many platforms, users will be able to pause their subscription—a feature built for fluctuating economic realities. “Let’s say you’ve used your subscription for 15 days, but you know you won’t be streaming for the next few days. With OptimalVid, you can pause your subscription for 3, 5, or 7 days so you don’t lose value during downtime. It’s a way to make sure your payment stretches further, especially when life gets in the way,” Igwe, CEO and Co-founder of the startup said in an interview.” However, users cannot pause for more than 10 days in a 30-day billing cycle. At launch, the platform will source royalty-free and free-to-air documentaries. Over time, it plans to license premium titles from content marketplaces like All Rights and Filmhub, where deals can be made for as little as $500 for 100 titles per month. A niche that’s growing faster than you think Documentaries are still very niche, but a growing one. According to recent projections by Market Research Future, a data and intelligence firm, the global market for documentary films and shows will almost double by 2034, from $4.83 billion in 2025 to $8.95 billion. More importantly, audience behaviour is shifting: more viewers, particularly post-pandemic, are seeking nonfiction content that informs as much as it entertains. “People want to learn now, not just escape,” Igwe said. “They want content that’s not just made-up stories.” OptimalVid’s gamble is that it can serve this evolving appetite better than the current behemoths who operate in this niche streaming space. But it’s a long road, and the competition is brutal. Players like CuriosityStream (with over 25 million subscribers), Kanopy, and DocuBay already dominate the niche with deeper pockets and broader libraries. On the African continent, AfriDocs offers free streaming of African and international documentaries. And looming over everyone are platforms like YouTube and Netflix, where documentary content is either free or produced at a blockbuster scale. The business model and the real test OptimalVid is betting that lower prices (a $2 launch subscription, and a subsequent $5 fee per month) and subscription pausing—a rarely offered feature—will make it sticky among cost-conscious users. Its early strategy is simple: start with low-cost licensing, build an audience, raise capital, and eventually invest in exclusive rights and original productions. The startup is currently raising a $1.5 million seed round to bankroll this vision, with funds earmarked for content licensing, cloud infrastructure, and modest team scaling. However, building a global streaming platform from Aba faces major challenges. Nigeria’s streaming market is still small. Netflix estimated in 2023 that South Africa had almost seven times more streaming customers than Nigeria—1.1 million versus 169,600. This fact is not lost on Igwe; he is building OptimalVid for global reach, echoing moves by Nigerian streaming pioneers like IrokoTV. In 2020, IrokoTV CEO Jason Njoku announced a pivot away from Africa-focused growth to international markets with higher consumer spending. But reaching a global audience means competing with better-funded platforms that can spend heavily on original content, a proven growth driver for streaming platforms. Netflix, for example, allocated a large chunk of its $17 billion content budget for 2024 to originals and added a record 19 million new subscribers after releasing hits like the second season of Squid Game. Betting on a smarter screen OptimalVid’s early moves—lean licensing, flexible subscriptions, and global-first design—are smart bets for a scrappy startup. But surviving in the brutal economics of streaming will take more than good ideas. Without exclusive content, the platform risks becoming just another option in an ocean of free and premium services. Still, the timing feels right. The demand for nonfiction storytelling is swelling, and audiences everywhere are seeking new voices and smarter screen time. If streaming’s next big shift comes from an unexpected corner of the world, it wouldn’t be the first time. “We’ll focus on our own documentaries for now, and we hope to do so for a long time. In the future when we become category kings in this industry, we might extend to other industries,” Igwe said.
Read MoreLendsqr develops AI to assess Nigerian borrowers by face and voice
Nigerian lending software startup, Lendsqr, is building an artificial intelligence model that analyses borrowers’ voices and faces to determine if they qualify for a loan. The model, which the company says is 76% accurate, will help Nigerians without financial documentation apply for small ticket-sized loans between ₦30,000 ($18) and ₦50,000 ($31) from lenders. Before lenders issue loans, they have to tick off a list of requirements to determine a borrower’s creditworthiness, and most lenders rely on the five Cs: character, capacity, capital, collateral, and conditions. Lendsqr’s model will help lenders judge borrowers’ capacity to repay the loan and their intention to repay. “Can we help vulnerable people prove their capacity and character, not through paperwork but through their words? That’s the thinking behind this AI project,” Adedeji Olowe, Lendsqr’s CEO, told TechCabal. How the model works When borrowers apply for a loan through Lendsqr, they can talk to the AI model instead of filling out forms. The model prompts them to answer questions about their jobs and how they intend to repay, and the borrower responds either by video or by voice. Based on the video or audio data, Lendsqr’s model predicts whether the borrower will repay or default. Lendsqr is currently piloting this model using its capital. It will also make its research findings from the model public before the end of the third quarter of 2025 and will allow its competitors to use the data to power their loan engines. While the company’s immediate goal is to expand credit access for Nigeria’s mass market, it also plans to test the model in Canada to support immigrants and new students who often struggle to access credit due to a lack of local credit history. “Africa is the primary target because this is where the problem is largest,” Olowe said. “Across Africa: Kenya, Ghana, Ivory Coast, Malawi, and South Africa, you see the same pattern. The underbanked and vulnerable struggle to get loans because they lack documentation.” Game changer If Lendsqr’s model can accurately predict creditworthy Nigerians, the impact could be transformative for the economy. Today, only 6% of Nigerian adults have accessed formal credit, and fewer than 12% of the country’s 41 million small businesses have access to it, despite Nigerian banks consistently reporting record deposits. Fintechs have stepped in to fill this credit gap by taking a less risk-averse approach to lending. However, they often rely on costly internal verification methods, which drive up the overall cost of borrowing for Nigerians. For Lendsqr’s current customers—including Kredi, Snapcash, and Blockacash—the new model has the potential to lower lending costs and expand their customer base, making credit more accessible to Nigerians who need it most. “Imagine you’re a lender giving loans to 10,000 people: If 9,000 repay because of better screening, it dramatically improves your profitability and sustainability,” Olowe said. Partly funded by the Nigerian government through the Ministry of Communications, Innovation & Digital Economy, and Google, the model will be released when it’s 90% accurate. “If it works, it won’t replace traditional lending for mortgages or car loans, but it could help people access foundational credit. Small, life-changing amounts,” Olowe said. Fintech startup Lendsqr is launching ₦1 billion working capital for lenders
Read MoreLandmark ruling on unequal pay puts Kenyan startups, SMEs on notice
Kenya’s Employment and Labour Court has declared that paying workers different salaries for the same role is unlawful, in a ruling that could have far-reaching implications for tech startups and SMEs. The case stemmed from a complaint by Tom Oduor, a former manager at Dawa Life Sciences, who alleged he was paid less than colleagues performing the same role. In a ruling delivered on April 9, Justice Stella Rutto ordered the company to pay him $30,000 (KES 3.88 million) in compensation for discriminatory pay, unfair dismissal, and accrued leave. The ruling lands close to home for Kenya’s tech sector, where wide, unexplained pay gaps often mark roles like software engineering, design, and product management. Many startups and SMEs rely on lean HR structures and negotiation-based offers, but such practices may not shield them from liability under this ruling. “In as much as the claimant may have accepted contractual terms that were less favourable compared to his counterparts, there was a statutory duty on the part of the employer to ensure fairness across the board and strive to eliminate and discriminatory policy or practice in the workplace,” Justice Rutto said in her ruling. Justice Rutto’s judgment could expose startups and small firms with opaque pay structures to legal risk, especially where salary disparities cannot be justified. The Judge said Kenya’s employment laws obligate employers to uphold fair labour practices, including ensuring equal pay for equal work. She cited a breach of constitutional protections under Article 27 of the constitution and Section 5 of the Employment Act, placing the burden of proof on employers to demonstrate that pay differences are not discriminatory. “By dint of Section 5(7) of Employment Act, the employer bears the burden of proving that the discrimination did not take place as alleged and that the discriminatory act is not based on any of the grounds specified within that sector,” the Judge said. The ruling comes against a backdrop of rising employment disputes in Kenya, supported by an assertive workers’ court. On March 28, a Nairobi court ordered neobank Umba to pay $21,600 (KES 2.88 million) in damages and legal costs for unfairly terminating one of its executives. The ruling came two weeks after another court ordered Marketforce Technologies, once a rising star in Africa’s B2B e-commerce sector, to pay $16,000 (KES 2.1 million) to a former employee for wrongful termination, highlighting legal challenges for startups navigating employment laws in the East African country.
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Why Kenyans are using mobile money more but sending less
The value of mobile money transactions in Kenya dropped sharply over the 12 months to February 2025, falling by 19.6% from KES 790.8 billion ($6.13 billion) to KES 636.2 billion ($4.93 billion) — the lowest monthly figure recorded in over a year, according to new data from the Central Bank of Kenya (CBK). The decline comes even as the sector’s reach continues to expand. CBK data shows active mobile money agents rose from 320,182 to 394,853. Subscriptions increased from 77.3 million to 84.6 million over the same period. The widening gap between usage and transaction value indicates a structural shift in how mobile money functions within the Kenyan economy. Mobile money, celebrated for expanding Kenya’s financial inclusion since the launch of M-PESA in 2007, is now grappling with slowing household spending, intensifying competition from banks and fintechs, and changing consumer habits. While the growing number of agents and subscriptions shows increased access to financial services, the sustained fall in transaction value reveals deeper pressures. Core inflation, which strips out volatile food and energy prices, rose to 2.2% in March 2025 from 2.0%the previous month. Rising living costs have squeezed household budgets, leading many to reduce non-essential mobile money use. Although more Kenyans are signing up for mobile money accounts, many now transact smaller amounts or use their wallets less frequently. Growth in account numbers no longer directly translates to higher transaction volumes, reflecting the strain on household budgets and shifting money movement patterns. The agent network has expanded, especially in smaller towns. This has reduced earnings per outlet, as transaction volumes are now split across more agents. But the wider spread hasn’t offset the broader trend, and total transaction values are falling, not rising. For higher-value transactions, such as rent payments, tuition fees, and business transfers, many Kenyans now prefer using bank apps or mobile banking platforms, reducing reliance on traditional mobile money. However, Safaricom’s M-PESA remains dominant with a 91% share of the mobile money market as of December 2024, according to the Communications Authority of Kenya (CA). Airtel Money trails with an 8.9% share.
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TechCabal Daily – Still buffering… profits
In partnership with Lire en Français اقرأ هذا باللغة العربية Good morning! What are the odds of 100 men against one prime silverback gorilla? Whichever side you lean toward, here’s the real lesson: if you put your mind to that daunting task/KPI, maybe—just maybe—you can achieve beat it. That’s enough aspire to Maguire to get you through today. In other news, every Monday, my colleague, Muktar Oladunmade sits with Africa’s finest investors to document their investment journey, theses and lessons in his Ask an Investor column. For this week’s edition, Muktar sat with Biola Alabi, a venture partner at Delta 40 and one of our earliest investors, to discuss her investment journey across media, e-commerce, and fintech. Enjoy the full conversation here. Let’s get into today’s dispatch. Everything we heard on the first day of AVCA OmniRetail raises $20 million series A funding MTN stock activity surges in recent weeks Ethio Telecom wants to be the Safaricom for Ethiopians World Wide Web 3 Opportunities Venture Capital Everything we heard on the first day of AVCA Image Source: AVCA 2024 Conference season has kicked off in Lagos! The big investors (there’s over $1.5 billion in assets in the room) are in town for the 21st annual African Private Equity and Venture Capital Association. Yesterday, a press conference was held so reporters could ask investors like Kola Aina of Venture Platform, Sola Lawson of AIIM, and Genevieve Sangudi of Alterra Capital questions. Some of the most important questions were about investing in African artificial intelligence (AI) startups and the growing role of secondaries, when investors buy and sell shares in startups from other investors. Kola Aina told reporters that his firm is actively investing in AI startups and using AI to pick startups. Because AI in Africa is like the internet in 1995 to Aina, his firm has been helping startups ensure they are AI-enabled to stay competitive. Sola Lawson, on the other hand, is exploring the opportunities that exist in providing solutions to AI’s infrastructure needs, especially computing power and data. He thinks that African countries with abundant land, cheaper power, and improving connectivity can provide data centres. Investors selling shares to each other can be a good thing, but when it becomes the only thing that provides exits, it becomes a bad thing for an ecosystem. According to Aina, investors are adapting to Africa’s reliance on secondaries by selling small stakes early to show liquidity and holding onto their positions to capture a bigger upside later. Alterra Capital has had eight exits over the last two years, returning hundreds of millions of dollars to limited partners, so it probably makes sense to listen to Sangudi’s advice. She wants investors to build companies that generate cash flow during the holding period and not just rely on a big sale at the end. There’s a lot more that’s happening today as the conference officially starts. Muktar Oladunmade, our reporter on the scene, will be on the ground listening and reporting on the conference for those of you not present here in Lagos. For the Lagosians, see you guys at our mixer tonight! Seamless Global Payments With Fincra. Issue accounts in NGN, KES, EUR, USD & more with one integration. Send & receive funds seamlessly across borders; no more banking hassles or complex conversions. Create an account for free & go global today. Funding OmniRetail just locked down $20 million to take over West Africa Image Source: OmniRetail OmniRetail—Africa’s fastest-growing company by the Financial Times in 2024—just raised $20 million in Series A funding to fuel its expansion across Nigeria, Ghana, and Ivory Coast. The round came with a few firsts. It was co-led by Norfund, Norway’s development finance institution (making its first-ever direct equity investment in an African startup), and Lagos-based Timon Capital. Other familiar faces like Ventures Platform, Aruwa Capital, and Goodwell Investments (via Alitheia Capital) also got in. But the biggest surprise? Nigeria’s 64-year-old food giant, Flour Mills, joined the party too. If you’re wondering what a legacy fast-moving consumer goods (FMCG) brand is doing in a tech funding round, be on the lookout for the full story on our site. (Spoiler: It actually makes a lot of sense.) Even at first glance, the move is telling. Flour Mills isn’t just betting on returns, it’s getting closer to the future of distribution. In emerging markets, distribution is king. Manufacturing consumer goods is only half the battle; getting products into small stores, kiosks, and rural shops at scale is the real moat. OmniRetail already digitises and organises the chaotic, fragmented distribution network that companies like Flour Mills have struggled to manage for decades. By investing, Flour Mills ensures it has early influence, maybe even preferential access to a tech-enabled retail channel that could soon become the dominant path to market. With the new cash, OmniRetail plans to grow its retailer base, push into new product categories like personal care, home care, and cold storage, and beef up Omnipay, its embedded finance arm. It’s also investing in better infrastructure, sharpening its credit underwriting tools, and strengthening its partnership game with debt providers—all while snapping up strategic acquisitions, like the 2024 deal for Traction Apps. If you’re just catching up: OmniRetail’s B2B e-commerce play revolves around three products—Omnibiz for retailers, Mplify for distributors, and Omnipay to keep the money moving. In 2023, the company processed $810 million in transactions and currently disburses $12 million monthly in inventory credit through Omnipay. Profitable? Check. Shaking up Africa’s B2B e-commerce market? Check. $20 million in the bank? Big check. If OmniRetail had a motto right now, it’d probably be: “get ready to be sick of me.” Never miss an update from Paystack Subscribe to Paystack for a curated dose of product updates, insights, event invites and more. Subscribe here → Telecoms Retail investors are buying MTN shares, believing the telco is nearing a return to profitability Image Credit: MTN MTN Nigeria might not be your favourite telecom operator with its spotty service, but retail investors
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Biola Alabi wants angel investors to be patient for returns
Biola Alabi has seen early-stage investing in African startups from all sides. She began as an angel investor, with her first cheque going to Big Cabal Media, TechCabal’s parent company. She later led angel syndicate deals with other angels before moving into venture capital, investing with firms like Acasia Ventures, and now at Delta 40. Before she began backing African startups, Alabi worked as a regional marketing manager at Bigwords, an American startup that raised $80 million to build an online textbook marketplace before shutting down during the dotcom crash of the early 2000s. That experience left a lasting impression—she and her colleagues only learnt the company had lost its funding through news reports—and later inspired her investment in Big Cabal Media, driven by a belief in the importance of transparency and resilience in startup building. In 2003, fuelled by a desire to work on the continent, she took up the position of Africa Regional Director for Sesame Workshop, creators of the popular children’s show “Sesame Street”. But it was her next job as a managing director for Multichoice, the largest pay-TV operator on the continent, that brought her popularity as an operator. It was during this time that she began investing in startups. Throughout her investment journey, Alabi’s thesis has consistently rested on a few key pillars. She places strong emphasis on the founders and assesses their experience, commitment to the problem they are solving, and resilience in the face of challenges. As she once put it to a founder: “Why should I not expect you to leave in a year if a $2 million a year offer from Google comes along?” She also looks for early signs of traction, valuing real-world use cases, actual users, or references who can testify that the product is solving a real problem. “There’s no business without a customer,” she told TechCabal over a call. Given her background in subscription businesses and media, Alabi prefers to fund companies with multiple income streams and expects any startup she backs to demonstrate that it operates in a large, scalable market. TechCabal spoke to Biola Alabi to understand her investment approach, thesis, and her advice for angel investors. This interview has been edited for length and clarity. You had a successful media career. At what point did you realise you wanted to start doing angel investing? I’m not sure you actually realise you want to do angel investing. I think, a lot of times, angel investing comes to you. I was looking at different types of investments, and around that time, I started meeting founders through mentorships and other engagements. Then people just started pitching me. I’m not even sure exactly how it happened. It started with setting up a meeting with me and telling me what they’re working on, and asking for my support. That’s how I wrote my first cheque and how I started angel investing. Big Cabal’s founders came to me for an angel investor who can also mentor and invest. I loved what they were working on. I felt it was really important—especially for the ecosystem—so I invested. And then from there, someone else said, “One of our angels…” and more people started pitching me. I eventually started joining angel groups, and that’s how I became a member of the Lagos Angel Network. How were you able to put yourself out there to even be in a position to mentor people, and in a position where people could pitch to you? Because I’d been in the media, people already knew me as a leader. I had been doing a lot of speaking engagements. I was also very interested in how I could support entrepreneurs, especially in the creative sector. For me, that was really one of the main things I was working on at the time. There were a lot of people creating content, but the question was really, how do we monetise this content? I was helping people understand monetisation from a broadcasting perspective, the opportunities available, and why they should license their content to us as a broadcaster. Because I was leading conversations on the continent about creating opportunities in the creative economy, I was already visible. There were quite a number of people I was either mentoring through work or through my office, and then the word just got out. People who were starting new companies began reaching out to me. I think it was just a natural evolution in my leadership journey. Can you walk me through your experience as an operator, as someone who has worked in the media space and across different sectors? How did that shape the way you evaluate startups? For me, when I’m looking at a company, the first thing I focus on is the customer because without a customer, there’s no business. Someone has to be willing to buy what you’re offering. I’m always trying to understand how the customer thinks, why the customer is buying this product instead of another, and whether there’s early traction. A lot of times, you’ll find companies that have been trying to build something, but there’s just no traction. That usually means the market isn’t responding, and they need to figure out how to pivot or what to change. I’ve worked in subscription businesses, so I also like to understand the revenue model. In my broadcasting experience, revenue came from subscriptions, sponsorships, and airtime sales. I’m always looking to see what the multiple ways are in which the startup generates revenue. Then I think about the people leading the company: Can they actually make this happen, and can the people building this go all the way? That’s what I’ve seen consistently, whether it’s in the companies I’ve worked at or with founders I’ve met: to get anything done within a big organisation, you have to understand who you’re selling to, how much you’re selling, and whether you have the people who can execute and see it through. It’s the same mentality I bring to evaluating
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