👨🏿🚀TechCabal Daily – Sony’s new $10 million fund
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning Here’s your weekly reminder to move TC Daily to your main folder so you don’t miss any editions. If this newsletter landed in “Promotions”, simply drag and drop it to the “Primary” folder. In today’s edition Andela launches new AI platform SA tightens hold on Airbnbs Sony launches $10 fund for entertainment startups Baobab has a new fund for African startups The World Wide Web3 Opportunities AI Andela launches AI-driven platform to improve tech hiring Image source: Andela Nigeria-born unicorn, Andela, is enlisting AI’s help in its mission to connect companies with the best tech talents. The company has announced the launch of Andela Talent Cloud, an integrated, AI-driven platform that streamlines the process of matching global technologists with companies in need of specific skill sets and increased capacity, enabling informed and secure hiring decisions. Simplified hiring: Andela says the platform will simplify the entire hiring process, covering sourcing, qualification, hiring, management, and payment of global technologists all in one place. Additionally, the Andela Talent Cloud relies on the AI-driven Talent Decision Engine (TDE) to precisely match talent with client-specific roles and skill requirements. Per Andela, the entire procedure can take as little as 48 hours, and prove to be 30% to 50% more cost-efficient. It outshines traditional hiring methods like in-house recruitment, consulting firms, and outsourcing. Zoom out: Andela’s global client footprint includes companies such as Mindshare, Google, and Microsoft. These companies have reportedly relied on Andela to scale their teams and deliver projects faster. Access payments with Moniepoint Moniepoint has made it simple for your business to access payments while providing access to credit and other business tools. Open an account today here. Policy Airbnb regulations in South Africa threaten small-time hosts Image source: ZikokoMemes South Africa is tightening its grip on Airbnb and other home-sharing platforms. The South African Department of Tourism has published a new whitepaper that proposes new regulations for Airbnb and other home-sharing apps. What new regulations? In April 2019, the Department of Tourism unveiled its plans to regulate Airbnb and similar home-sharing apps through the Tourism Amendment Bill. This bill aims to grant the tourism minister the authority to set specific “thresholds” for South African Airbnbs. These thresholds could include limits on the number of nights a customer can book. The South African government has argued that platforms like Airbnb could lead to a surplus of unregistered properties on the accommodation market, resulting in the value of formal accommodation providers, such as hotels and guesthouses declining. Furthermore, Michele de Souza, chair of the Pietermaritzburg Bed and Breakfast Network, is advocating for specific regulations that Airbnb hosts should follow. This includes obtaining municipal permission, ensuring safety checks, acquiring hospitality insurance, and registering with local tourism authorities. De Souza also called for Airbnb to pay taxes and adhere to business regulations like traditional businesses. A pushback from Airbnb: Airbnb has expressed concerns about the proposed regulations. They have taken issue with the proposed limits on the number of nights a property can be rented and a registration system requiring property inspections before being listed on the platform. Airbnb emphasises the need to differentiate between small-scale homeowners renting out a single room and those operating more significant, small-to-medium-sized guesthouses. Funding Sony launches $10 million fund for African startups GIF Source: Tenor Sony has launched the Sony Innovation Fund to support the growth of entertainment startups on the continent. What startups? Sony will invest about $10 million in seed to early-stage startups across gaming, music, movie and content distribution sectors. The company has yet to specify the total number of startups that will benefit from the fund. However, ticket sizes are expected to range between $250,000 to $1 million. Gen Tsuchikawa, CEO of Sony Ventures, told TechCrunch that in addition to the fund’s seed and early-stage investment strategy, it will offer follow-on investments to its portfolio companies. Sony is also collaborating with the International Finance Corporation (IFC), the largest global development institution focused on the private sector. The partnership will support the growth of the entertainment industry in Africa by leveraging the strengths of both parties. Zoom out: According to data from Partech, gaming, music, movie and content distribution startups receive less than 1% of VC dollars on the continent. Sony’s Innovation Fund provides a pathway for actualising the enormous potential of these areas. Accept payments fast with the Paystack Virtual Terminal Paystack Virtual Terminal helps businesses accept blazing fast in-person payments at scale, with ZERO hardware costs. Enjoy instant transfer confirmations via WhatsApp, multiple in-person payment channels, and more. Learn more. Funding Baobab launches new fund for African startups GIF source: Zikoko Memes African early-stage startups are getting new funds. Baobab Network has announced plans to invest in 1,000 African startups for the next 10 years. A $100,000 fund: To kick start its goal, the accelerator has launched a $100,000 investment fund for early-stage startups on the continent. In addition to the funding, Baobab Network will offer a 12-week accelerator to the startups selected to set them up for scale. Startups selected for Baobab’s latest cohort include Brandrive, a growth-as-a-service startup in Nigeria; PocketFood, a kitchen-as-a-service startup in Nigeria; Bunce, a payment automation startup in Nigeria; Kawu, a fintech startup in Uganda; and Alal, a startup in Senegal. Per Techmoran, each company has received $50,000 directly from Baobab, with another $50,000 investment from their newly launched co-investment Vehicle. Baobab continues to be one of the most active pre-seed investors in Africa. The Nairobi-based accelerator invested in five startups earlier in February this year. Zoom out: Investment funds like Baobab Network’s raise fresh hopes for early-stage startup founders who are looking to raise amidst dwindling funding options on the continent. Attend the Ugandan National Science Week The National Science Week (NSW) is a hallmark event in Uganda’s calendar, celebrated every year to honor Science, Technology, and Innovation (STI). The event will feature a dedicated Investor Summit, bringing together some of the world’s
Read MoreFood prices push Nigeria’s inflation rate to 26.72% in September
Nigeria’s inflation rate reaches 26.72% in September 2023, amid soaring food prices and harsh economic realities. Data from the National Bureau of Statistics (NBS) Consumer Price Index puts Nigeria’s headline inflation at 26.72% for the month of September 2023. The latest numbers from the NBS represent a continuing uptrend in Africa’s largest economy’s inflation rate. Nigeria’s headline inflation for September increased by 0.92% points when compared to the August 2023 headline inflation rate of 25.80%. Nigeria’s inflation rate also increased on a year-on-year basis. Inflation figures recorded for September this year were 5.94% higher when compared to September in the previous year. Also, the headline inflation for September was 1.08% lower than the one recorded for August 2023. Meaning that the changes in the prices of goods and services in September were less than in August 2023. Food continues to be Nigeria’s biggest driver of inflation. Per the report, the food inflation rate for September 2023 was 30.64% on a year-on-year basis, which was 7.30% points higher compared to the rate recorded in September 2022 (23.34%). The report attributes the rise in food prices to increase in the prices of oil and fat, bread and cereals, potatoes, yam and other tubers, fish, fruit, meat, vegetables, milk, cheese, and eggs. However, food prices fell on a month-to-month basis. Food inflation rate recorded in September was 1.4% lower than the rate recorded in the previous month. Nigeria’s inflation remains on a continuous uptrend despite several monetary measures by the country’s central bank to tame the rising inflation rates. Food also continues to be the biggest mover of Nigeria’s inflation in recent times. Food inflation has been driven up by the removal of fuel subsidies, which has led to increased prices of foods across the country. Today’s inflation data suggests an increased need to arrest food inflation. The government had earlier proposed a commodity board to solve the problem of food inflation but has so far proven ineffective.
Read MoreHow RexPay is revolutionising payments on the African continent
The African business ecosystem is witnessing a surge in fintech innovations. These innovations are making business processes easier and expanding the ecosystem’s global reach. One of these innovative fintech solutions is RexPay, a product from leading fintech player, Accelerex. RexPay has been revolutionising the payment landscape in Africa with its seamless and secure payment processing capabilities. It is built to be an effortless and secure way for businesses to receive online payments from their customers, through a diverse number of methods. This cutting-edge payment solution can be seamlessly integrated into any web or mobile application to support a wide range of payment methods including cards, accounts, transfers, USSD, and QR codes. It also seamlessly processes payments across major payment schemes and card brands, such as Verve, Mastercard, VISA, and Amex. RexPay can be easily and smoothly integrated with various platforms, from e-commerce platforms to accounting software, and inventory management systems. The platform also allows merchants without websites or apps to create and share payment links with customers via email, SMS, social media, and more. With a lot of vendors setting up shops on Instagram and Facebook and receiving orders via DMs, these vendors can now also DM secure payment links to customers to facilitate easier and faster sales. With RexPay, merchants can now service customers through any means of payment, safely and reliably and this helps them build brand trust while also increasing profit. What makes RexPay stand out from other payment gateways is that it offers multiple payment options with premium security features, on an easy-to-use platform. The e-commerce industry on the African continent has been growing rapidly since the COVID-19 pandemic. Merchants on the continent are moving online to expand their business reach and seeking technology that makes this process easier for them and their customers. RexPay offers merchants from anywhere the ability to easily integrate into its system and offers bespoke services to customers reliably. The process of signing up is pretty seamless. The platform offers a user-friendly self-onboarding feature, allowing merchants to sign up swiftly and begin accepting payments within minutes. Merchants with websites can also have RexPay integrated into their systems as RexPay offers seamless integration with APIs and WooCommerce—a popular e-commerce platform. Rexpay offers a White Labelling feature that enables businesses to customise the payment experience with their branding and logo and make it their own. All this comes on an intuitive portal that enables merchants monitor and manage transactions, refunds, settlements, disputes, and more in real time. The platform also provides rich and detailed data and analytics on customer behaviour, preferences, trends, and more, and with this data, businesses can optimise their marketing and sales strategies effectively. On security, RexPay has a robust security system that incorporates a Two-Factor Authentication (3-D secure) feature which elevates transaction security and minimises the risk of fraud. The platform combines this with advanced technologies and algorithms to detect and prevent fraud and ensure compliance with regulatory standards. All these attributes help brands build consistency, customer trust, and enhance the overall payment experience for their customers. Led by Chuks Anakudo, the managing director of Accelerex, the parent company behind RexPay, the online payment product was built to change the payment landscape and assist businesses to succeed in the digital era. Over the years, Accelerex has grown to be one of the leading providers of electronic payment and business management solutions in Africa. The company services all the merchant acquiring banks in Nigeria with over 120,000 connected payment channels across the 36 states in the country. Since 2018, it has been consistently ranked as one of the top three providers of payment channel services (by value of transactions processed) by the Nigeria Inter-Bank Settlement System (NIBSS). Certified by the Central Bank of Nigeria (CBN) and the Bank of Ghana (BoG) as a Payment Terminal Service Provider (PTSP) and Payment Solution Service Provider (PSSP), Accelerex has leveraged its bespoke application development capability to provide fintech solutions that simplify the payment experiences of retailers through innovative technology. Accelerex has a product specifically developed to smoothen the operation of all stakeholders in the agency banking system – Accelerex Agent Network Platform (ANP). Its product bouquet also includes RexRetail—for SMEs to automate their business operations and manage inventory easier, and more recently RexPay—an online payment gateway for businesses to receive payments easier. The company is committed to providing businesses with the support and payment tools they need to succeed in the modern world and RexPay is a continuation of the company’s dedication to this goal. Speaking on the uniqueness of RexPay, Chuks Anakudo emphasised the vision of making a significant impact on the payment industry in Nigeria and beyond. According to him, “RexPay is a payment product tailored to the needs of Nigerian businesses. Whether big or small, RexPay’s simplicity, convenience, and security feature addresses the online payment requirements of merchants and empowers them to grow. It also equips them with valuable tools and insights to enhance their payment operations and performance. This aligns with Accelerex’s ambition to support Nigerian business owners with easy and affordable payment tools.” He says. With the addition of RexPay to its suite of groundbreaking solutions, Accelerex continues to push the envelope for fintech in Africa. RexPay is available for merchants to sign up on and begin accepting payments. For more information, please visit www.myrexpay.ng.
Read MoreNext Wave: Do VCs still believe in VCing?
Cet article est aussi disponible en français <!– In partnership with –> <!–TopBanner Join us for TechCabal Battlefield, Moonshot’s startup competition where you can showcase your startup idea to a global audience and an esteemed panel of judges and stand a chance to win up to 2.5 million naira in funding for your business! Click to register for TC Battlefield First published 15 October 2023 This week’s Next Wave is a double-decker. First, TechCabal’s Moonshot is well on its way to defining the value that technology industry events in Africa can create, I am proud to report. And I have a question for investors getting cold feet and second thoughts about VCing. I had initially written about tech events needing a bit of inventiveness to become relevant. But what TechCabal’s Moonshot conference taught me was that sometimes new things are overrated and that the basic pillars of truly valuable events do not really change. If you make people feel good about being in a room with others, provide opportunities for them to meet people they respect, deliver solid content and minimise boring paternal keynotes in favour of insight and fun, your event will win! Especially if the event execution is as close to perfect as you can humanly manage. It also helps to build up to the event. It is probably no coincidence that TechCabal’s biggest and best annual event so far was organised 10 years after the first TechCabal article was published. One hundred and twenty-one months ago, Odunayo Eweniyi was writing (as a TechCabal reporter) about interesting tech events to attend in July 2014. Last week she was speaking at the biggest tech event of the week in Lagos, and Piggyvest was a key sponsor. The world goes round and is not flat. Someone said Moonshot has the potential to become that one pan-African tech industry event that everyone looks forward to every year. That means we sowed a good seed, and we’re looking forward to the next Moonshot in October 2024! Next up on the event trail, I’m in the Dubai World Trade Center for GITEX Global throughout this week and looking forward to “Capital Meets Innovation” at Norrsken Africa Week Kigali in early November. If you’ll be at the Dubai Harbour or DWTC, hit reply and we can find some time to talk tech events, what I’m researching about Africa’s digital market, and the more important stuff like… whether VCs still believe in venture capital (see below). <!–Chart section 1 A sample of African startups that have gone from raise to bust. | Infographic by Victoria Olaonipekun, TC Insights How many VCs still believe in VCing? It’s easy to talk about how African entrepreneurs will face more challenges with raising funding because VCs dashed (a Nigerianism for a gift, typically in cash) millions of dollars to poorly thought-out venture experiments or outright fake businesses. A lot of people like to talk about this and go on and on about it. I don’t. I intensely dislike the discussion because not only is it distracting, it is fodder for bad assumptions and priors. Priors in this sense is the statistical probability of an outcome regardless of unknowns. For me, the meaning of new reports detailing bad founder behaviour is simple. Everyone needs to grow up and stop being sheep. Speaking about being sheep, from late 2022 it began to be obvious that a bubble burst was underway. The battle cry from the global VC community switched from speed-writing cheques to calling for profitability almost overnight. Sheep can turn on command, but whaling ships cannot do snap turns no matter how loud the captain shouts at the steering wheel. More notably, the entire point of being a venture investor, if we go back to the original legends that spawned this asset class, is that VCs are specialised middlemen who connect extraordinarily promising risk with capital sourced from sombre pockets. The moment we miss this and begin to build an asset class that behaves more or less like the human version of a hedge fund trading algorithm, the more we set up venture capital to become a perpetual cyclical machine that is 100% in sync with public market sentiment. This is the opposite of a mostly outlier-defined investment class. In September I tweeted: “How many VCs still believe in Vcing?” And here’s a tweet by Stephen that captures a big part of my worry. I’m very worried African VC is going to entrench itself in multiple-based tunnel vision at the earliest stages. Conservatism was needed after ’20-22 but exchanging the comfort of momentum-based investing with rigid metrics-only investing is a disservice to founders with vision. — Stephen Deng 邓广藻 (@mrstephendeng) October 5, 2023 To put this another way. If blindly following trends brought us here, what makes metric-focused investors think that driving a hard bargain based solely on relatively arbitrary measures in Africa’s still largely untested markets will not yield the same averaged-out result of mediocrity if not failures? Article continues after this ad Your gateway to Africa’s tech leaders Every Sunday Africa’s technology industry leaders, investors, operators, and regulators turn to Next Wave for insightful commentary on where the continent’s digital economy is headed. In an era of news and noise, Next Wave is the opportunity to reach decision makers in Africa’s fast growing world of technology with your unique message. Get in touch today In the last few months or so, I’ve seen a lot of takes about venture capital. Everyone from purebred venture capitalists to social impact VCs, hedge fund and traditional fund managers, to public market analysts have an opinion, hand-wringing or unabashed schadenfreude they derive from the collapse of the short-lived roaring 2020s in VC land. Some parts of this are worrying, but other parts are funny to watch or read, especially the full-throated gloating comments on Financial Times articles by traditional asset managers. What is clear, though, to me is that the world of venture capital is undergoing an identity crisis like never
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👨🏿🚀TechCabal Daily – Nigeria still wants to regulate social media
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning We interrupt your regularly scheduled newsletter to inform you that human beings did indeed write this edition of TC Daily, and this lede is in fact not AI-generated. Now, let’s find out why the Nigerian government is holding onto its will to control social media tighter than it held onto COVID palliatives. Yes, we can say that. We’re witty-ish, but don’t tell Muyiwa. In today’s edition Nigeria reintroduces bill to regulate social media Tanzanians now need permits to use VPNs Airtel Uganda extends IPO closing date Openview admits user inflation The World Wide Web3 Opportunities Legislation Nigeria reintroduces bill to regulate social media Image source: DMForCredit, Seriously Nigeria is not letting go. The Nigerian government has reintroduced a bill aimed at regulating digital platforms, including social media. The bill, which seeks to repeal and reenact the National Broadcasting Commission (NBC) Act, was reintroduced in the National Assembly by the National Broadcasting Commission (NBC) last week, to regulate the use of social media in Nigeria. It proposes a number of measures, including requiring social media users to register with the government and giving the government the power to censor social media content. For and against: Although the bill has been met with mixed reactions from stakeholders, NBC has defended the bill, arguing that it is necessary to give the commission the authority to oversee and regulate digital platforms. The commission’s director-general, Balarabe Ilelah, referred to social media as a “monster” and emphasised the need for regulation. In a counter move, the Socio-Economic Rights and Accountability Project (SERAP) has called on the National Assembly to reject the social media bill, stating that the bill would “unduly restrict the rights to freedom of expression and privacy.” In addition, NBC says it is engaging Google and TikTok regarding the upcoming social media regulation bill, aiming to examine the legal and regulatory structures that apply to social media platforms in Nigeria. Zoom out: The social media bill was initially presented to the National Assembly in 2019 under the name “Protection from Internet Falsehood and Manipulations Bill 2019,” but failed to pass into law after public outcry. Get a working card from Moniepoint With the Moniepoint personal banking app, you get reliable payments every time and a card that always works. Enjoy seamless payments powered by the infrastructure that 1.5 million businesses trust. Download the app. Internet Tanzania imposes ban on VPN usage Image source: ZikokoMemes Tanzanians are at risk of serving jail time for using VPNs without a permit. In a statement released on Friday Last week, the Tanzania Communications Regulatory Authority (TCRA) banned the use of VPNs without a permit in the country. A permit? Yes. The TCRA clarified that using VPNs is not prohibited, but users must report the VPNs they use and provide necessary information. To comply, residents and citizens must fill out a form available on the TCRA website by October 30, 2023, providing their individual user IP addresses and specifying whether the VPN is for individual or company use. This action is based on Regulation 16(2) of the Electronic and Postal Communications (Online Content) Regulations of 2020, which restricts Tanzanians from accessing content deemed illegal. Legal consequences: Those caught without the necessary permit could face a fine of Tsh 5 million( $2,000) or a minimum of 12 months in prison. This situation raises concerns as it restricts the freedom that VPNs offer in the digital world while potentially infringing on real-world freedoms. Zoom out: Tanzania has become the second East African country to implement regulations on VPN usage. Following the introduction of the social media tax, Uganda took measures to block VPN usage in 2018, as it was believed that Ugandans were using VPNs to evade taxes. Telecoms Airtel Uganda extends IPO closing date Airtel Uganda branding material at Kabira Country Club © Airtel Uganda Airtel Uganda has shifted the closing date for its initial public offering (IPO) from October 13 to October 27. The company will begin trading its shares from November 7 instead of the initial November 3. Why? The telecommunications company did not give any reason for this postponement. However, people close to the situation told local media that the postponement was due to poor investor response. ICYMI: Airtel is offering 20% of its total stock—8 billion shares—on the main investment market segment of the Uganda Securities Exchange at Shs100 ($0.0269) per share. Airtel opened its IPO for subscription on August 30, 2023, and was expected to close by October 13. The company expects to raise Shs800 billion ($215.2 million ), which would value the telecom at Shs4 trillion (nearly $1.1 billion). Zoom out: Airtel’s delay in closing its IPO is not unprecedented in Uganda. MTN Uganda’s IPO also failed to attract enough investors. MTN was seeking to raise Shs900bn ($243.6 million), but was only able to raise 60%—($144.7 million)—of the total amount. Accept payments fast with the Paystack Virtual Terminal Paystack Virtual Terminal helps businesses accept blazing fast in-person payments at scale, with ZERO hardware costs. Enjoy instant transfer confirmations via WhatsApp, multiple in-person payment channels, and more. Learn more. Streaming Openview admits to inflated subscriber count GIF source: Zikoko Memes eMedia has admitted that it does not have 3.2 million viewers potentially missing out on the Rugby World Cup as it stated in newspaper ads. This comes after a South African high court, last week, ruled out eMedia’s case against Multichoice over a dispute about broadcasting rights for the Rugby World Cup. According to data from South Africa’s Broadcast Research Council monthly television audience metric, the total number of viewers on Openview was around 2.6 million as of September 2023. The figure is about 600,000 less than the 3.2 million viewers which the broadcaster repeatedly claimed in court documents and newspaper ads. eMedia has said that numbers from the BRC do not adequately reflect its viewership, citing that the BRC’s numbers are not updated real-time but are updated annually.
Read MoreLogistics company, truQ bags ₦2.5 million as TC Startup Battlefield winner
truQ, a logistics startup, has emerged winner of the debut TC Startup Battlefield, pitching against eight other startups at the just concluded Moonshot Conference by TechCabal. TruQ, a logistics startup streamlining mid-mile logistics across Africa, has won the TC Startup Battlefield competition. The startup clinched the ₦2.5 million cash prize ahead of nine other competitors. Jamit, a social audio network, emerged as runner-up, walking home with ₦1.5 million. The competition was held at the just concluded flagship Moonshot Conference by TechCabal. TC Battlefield competition is dedicated to showcasing local startups’ innovations to a global audience. The maiden edition featured only Nigerian startups which include: Flickwheel, an auto tech startup; Stackjunior, an edtech platform; Powerful Technology Limited; Royalty.io, a music cataloguing startup; Jamit, a social audio network; Payslice, a fintech startup; Fless, a money management platform for small business owners; Belarush, a food delivery startup; TruQ a logistics startup; and Deepbux, a growth-as-a-startup service. The competition was judged by Hope Dilthakanyane, investment principal at Founders Factory Africa—who also chaired the panel; Nela Ekpenyong, head of portfolio, Ingressive Capital; Uwem Uwemakpan, head of investments, Launch Africa VC Fund II; and Gloria Okorie, venture partner at Republic. Speaking on the win, Williams Fatayo, CEO of TruQ, said the win is a validation of the work that the startup is doing. This is not TruQ’s first rodeo; the startup was a recipient of the 2023 Google Black Founders Fund. The startup was also part of the Techstars 2022 accelerator cohort, and the V8 Growth Labs. According to Fatayo, TruQ’s win coincided with the startups seed raise which will be announced in the coming days. Jamit’s co-founder and CEO, Ike Orizu, is proud of the company’s win, which he sees as a confirmation of the team’s hard work and commitment to excellence. In an interview with TechCabal, Orizu noted that the money will be reinvested into the company. Beyond the cash prize, Orizu asserts that Jamit has gained increased global recognition and publicity with both local and international audiences. Launched in 2018 by Stan Agbadugo and Ike Orizu, Jamit is styled as “the African podcaster’s platform, built with love from Africa, for African podcast listeners and creators”. The startup released its first podcast in 2019, proceeding into podcast production and distribution, and became a podcast platform in 2020. According to Orizu, the startup has over 170 creators on its platform at the moment and has partnered with global giants, Dolby and Sony.
Read MoreHow MTN aims to revolutionise SA fintech with MoMo 2.0
MTN South Africa’s chief financial services officer Bradwin Roper speaks on the recently launched MTN MoMo 2.0 platform. Two weeks ago, MTN South Africa announced a slew of products on its mobile money (MoMo) super app. Some of the services unveiled include MoMo Business Wallet, which will enable businesses to receive payments in real-time with no transaction fees. MoMo Eazi, a more consumer-facing product, enables users to make payments. Another product launched was International Remittances which will allow foreign nationals in South Africa and local residents to send money across 12 African countries without any data charges. MoMo also launched a point-of-sale device to take card payments from customers as well as a life insurance package. With these products, MoMo continues to double down on the South African market which it returned to in 2020 following a three-year hiatus. Currently, the service claims to have 9 million subscribers and has an outlined goal of “becoming one of South Africa’s premier financial services platforms”. To get a deeper understanding of the rationale for the launch of such an extensive suite of products, TechCabal spoke to Bradwin Roper, chief financial services officer at MTN South Africa. In the interview, Roper touches on why MoMo returned to South Africa after a three-year hiatus, the super app route was chosen for the new iteration of MoMo, as well as the future of the product in the southern African nation. Why were the new products launched in super-app format as opposed to launching them individually? Bradwin Roper: We want to offer convenience and access to products and services like no one else. Technically, I think every major company with a major fintech product has essentially the same strategy. We looked at the industry verticals and the industry opportunities and tried to solve them at a client level. So we look at the client and we say from when you kick start your day, commute to work, etcetera, how can we help you throughout the day and offer convenience? So we wanted to offer convenience on the mobile platform like never before. We wanted clients to have access to their wallets, payments, insurtech services, all in one place. Also, it makes sense to keep the features and benefits in sort of one app for customers to understand them. Additionally, from a digital and financial literacy perspective, it also makes sense that we aren’t siloed and we’re doing everything in one place. So if we can, for example, entice you and get you interested in prepaid funeral cover, you will get comfortable and recognise another product from the app to add to your list. A super app packs a very simplistic user journey and convenience for consumers. We will continue to innovate and add more features and benefits to it but in all honesty, we are not really chasing super app status but just convenience for our customers. Do you think that being within MTN, which is the second mobile network operator in SA, will help with the adoption of the product? BR: Yes, because we have the benefit of being a FinTech inside an incredible organisation. So, if you look at the accolades that MTN Group has achieved at the continental level, it is very impressive. It is a known brand which comes with a level of trust and sophistication. The group has always stood for digitisation as evidenced by what it has done in fintech across the continent where it has products which have tens of millions of customers. So for us as the SA team, it is great to solve problems within such an organisation and have a user base that is already familiar with the company’s vision. How do you plan to attract and retain customers within the product? BR: The level of sophistication that we have brought to the market with this launch signals to the market and customers that we will continue to look for opportunities where we believe customers are being exploited. So, for example, with the Business Wallet product, zero fees means that as a customer, when you transact R100, it remains R100. So, we will continue to look for opportunities where we can add value for customers. As MTN, we strive for shared value. Wherever we can leverage technology and digitisation to unlock shared value and create shared prosperity for our customers, that’s what we will be doing. We don’t really look much at the competition, but rather, we look at the industry and realise, for example, that less than 4% of people have insurance in the country. Then we ask ourselves, what’s the thing holding people back from actually getting insurance? Well, it’s a debit order. And, also, it’s the fact that I need to pay R55 until the day I die to be able to qualify for insurance. So then we go, how do we out-engineer that? And how do we say to citizens, “Hey, you can get insured, but you pay once from a mobile wallet, and by doing so, you’re going to save more than half what you would if it was running off a debit order?” So, in short, we will continue to scour the market for opportunities where we truly believe that customers can save. And in so doing, that’s how we’re going to continuously drive adoption. Where we believe we’re going to win is by creating shared value, but also really being revolutionary in terms of client experience and addressing the questions of clients’ needs and how we can use technology to innovate and solve those needs like never before. As the platform grows, will you build more in-house or consider some M&A deals and collaborations with startups along the way? BR: Because we want to solve for customers, we’re always going to be seeking for the best way to go about this. Do we build or buy or partner? I’ll give you an example. The remittance product that we launched was done with a South African called ClickSendNow. So
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What Kippa’s Kennedy Ekezie has learnt about building a fast-growing startup at 25
After moving back to Nigeria from Beijing in 2020, 23-year-old Kennedy Ekezie-Joseph and his brother, Duke, knew that they wanted to start a company. For seven months, they worked on building a software recruiting startup, which was profitable but did not grow as fast as the brothers wanted. This pushed them to think of another idea that was more tailored to the local market in Nigeria, and after two months of interacting with small business owners across the country, Kippa was born. Kippa is a fintech startup that’s revolutionising bookkeeping and digital payments for small businesses in Nigeria. In under two years, the startup has secured over $10 million from global fintech investors and has a workforce of 50. In an interview with TechCabal, Kippa’s co-founder and CEO, Kennedy Ekezie-Joseph shares what he’s learned building a startup in his early twenties as well as how he ensures the company grows fast to accommodate their over 500,000 small business owners. What are some things you’ve learned about building a bookkeeping and finance app? Kennedy Ekezie-Joseph: One thing I learned was that all solutions have to be tailored towards the pain points of the target audience. In our case, the small business owners. Psychographically, small businesses want to make more money, and they want to keep as much of that money in their pockets for as long as possible. This means that whatever solutions you’re building for them have to very directly address one of the pain points that affect their ability to do that. We also learned that imported solutions do not work. You cannot convince businesses that they need a solution that they are not convinced that they need, which has been an incredible pain point for us because there’s always a risk when building software and replicating a playbook. There’s the tendency to over-index on your playbook to the point where you lose touch with your customers and what their needs are. That is something important that we’ve learned so far. Are there other things that you’ve learned about building a startup and working with teams? KE: A big lesson we learned while building Kippa was definitely to not scale your team too early. You need to have very few people who are very hard-working and can take on multiple roles and multiple hats. Another lesson we learned was avoiding the temptation to throw money at problems. If you’re in a position where you can afford to throw money at problems, you have a quality problem, because most people don’t have the money to solve their problems, but it’s still not always the best solution. Kippa has seen rapid growth since its launch in 2021. What are certain things you think have contributed to this growth? KE: I think it’s mainly because we are building in one of the very few segments on the continent where rapid growth is possible. For the longest time, small businesses have not had anyone deeply building for these particular problems that they have, and so there’s ample opportunity to scale. Another reason is that as a startup, we move fast. It’s one of our ethos internally, and it’s always when I speak to people outside of my company that I realise how fast we move. It doesn’t always feel that way, but when I zoom out enough, I’m really able to understand how quickly we move from building products to shipping products which I think comes from how impatient leadership is. Why should we take 10 days to do what we can do in two days? We are very clear with deadlines and timelines internally, and there’s no task that is allocated without the person allocating the task issuing a hard deadline. That’s a muscle we spent time building, and we’ll continue to build. I think all of those micro things help us on the macro scale to move very quickly and experience the sort of growth that we’re seeing. Kennedy Ekezie What’s the team at Kippa like? KE: We’re a team that’s not afraid to have hard conversations. When we realise we’ve made bad decisions, which we’ve made in spades, we correct them very transparently. There is no one who is above correction, not me, not my co-founder, and definitely not any senior member of the team. I think that building and embedding that sort of culture in the team is also responsible for the growth that we’ve seen so far. Culture-wise, we’re not the sort of team where you come and find folks making TikToks at the office, or hugging each other and laughing with each other; not that anything is wrong with that. We run our business like it’s serious. We know that the work we’ve signed up for is a very hard task, and if we’re going to succeed, then we have to burn all cylinders. We can’t let anything slip through the cracks. Are you bothered by the funding winter that’s affecting some startups currently? KE: Yes, we are. We cannot afford to not be bothered about it, because that would be irresponsible. Our sector is also one that’s very capital-intensive, and so you actually do need capital to grow. Fortunately, we have a great team of investors behind us, and we are in a position where we can afford to put our heads down and focus on product building. However, we’re always paying attention and consistently monitoring how the market evolves. Beyond Kippa, what makes this path of helping SMEs scale important to you? KE: Even before Kippa, everything I’ve done has been very Africa-centric. I’d describe my personal mission as one that involves creating economic prosperity for Africa, and when we look at the stats, small businesses contribute to 60% of Africa’s GDP. SMEs employ about 84% of the total labour force and 96% of all businesses in Africa are small businesses. So economic prosperity for Africa is impossible if small businesses cannot grow sustainably and profitably. For me, Kippa was just a logical next
Read MoreNorthflix is taking the Hausa film industry global
Viewers from about 100 countries can easily access Hausa films and shows on Northflix, a platform exclusively for streaming Hausa films. As the world slowly moves from TV to streaming platforms, Kannywood has been left behind as the industry does not have the necessary funding and talent to create films and shows that match the quality requirements of global platforms like Netflix or Prime Video. This has led to a big gap as Kannywood films have been left out of the streaming revolution, depriving producers of a wider, more global audience. At an event in Kano, where he was invited to give a lecture to graduates, businessman Jamilu Abdussalam had a conversation with veteran actor Ali Nuhu, where the actor mentioned the distribution problems wrecking the Hausa film industry. The desire to solve it pushed Abdussalam to create a streaming platform, Northflix, that offered a wide variety of Hausa films to people across the globe. What has the reception to Northflix been like? JA: We’re growing really fast. In the past five years, we’ve achieved over 100,000 subscribers from all around the world. When we started, we thought only people in Nigeria would watch content on our platform, but to our surprise, we have subscribers from close to 100 countries. People from Greece and Finland watch content on Northflix, and that’s a great thing. We’ve been featured on CNN and BBC as well, which I believe speaks volumes about how far we’ve come. What’s the relationship between Northflix and Kannywood like? JA: The relationship has evolved over time. When we started, we used to rent films on our platforms and split the revenue with producers. After about a year, we started to acquire the content licence from producers. So, we’re buying the licence that gives us the rights to be the exclusive streaming platform, but they can take the [same] films to TV stations. This relationship is the basis for our business. We came in for three purposes. One is to control the piracy problem in the industry. Secondly, we want to provide access to a distribution channel where people across the globe can have real-time access to the content. Lastly, we wanted to improve the quality of the films Kannywood produces. How do you navigate finding quality content for your platform? JA: One of the most challenging things we experienced was selecting the films to be streamed on our platform. There was a need for better-produced content and better stories if we wanted to appeal to a more global audience. People watch movies of a certain quality on platforms like Showmax, and you can’t expect them to go from that to low-quality content. We had to step up and be more deliberate about the kind of stories we tell and the quality of content available on the platform, which meant being more choosy with films and insisting that producers put in more effort. What we do to improve the quality of the content being produced in the industry is to join the production team or produce original content for our platform. Right now, we have over ten projects that have been scripted and they range from feature-length films to documentaries and even TV series. So far, we’ve produced only one TV series called Zaure (The Corridor) to test the market, and it’s doing well. Another challenge we struggled with was piracy but I’m glad to say that we’ve solved that. We’ve enabled technology that makes it impossible to record movies directly from our website which has greatly reduced the rate of piracy. What are some challenges that you’ve encountered so far? JA: As with every business, a challenge I’ve experienced is funding. With investors from the Northern part of the country where I’m from, it’s hard to sell them the idea of a streaming platform as a viable business opportunity. They’re used to traditional business ventures so telling them about subscribers and how they can yield revenue is not what they understand or want to hear. On the other hand, investors from other parts of the country or world do not understand why we’re exclusively a Kannywood streaming platform. We always get questions like “Why not include other Nollywood or Bollywood films?” or “What’s so special about the northern entertainment industry?” What’s so special about the northern entertainment industry? JA: I did not build Northflix just because I’m a Northerner. The reason I started Northflix is because Kannywood is a niche market with a lot of opportunities. There are over 200 million Hausa speakers around the world, which is a lot, and creating quality content in Hausa for these people is a great business opportunity. What are the next steps for Northflix? JA: We look forward to being listed as an IPO company and selling shares to the wider public, that’s our dream. We want to make Northflix bigger and create content of higher quality content that can compete with content from global streaming platforms. People watch Indian and Korean movies even when they don’t understand the language, and this is what we want for Hausa films and shows.
Read MoreCharting the way forward for logistics in Africa
Logistics is fragmented in Africa, but an all-around approach can solve the problems. Solving the problem of logistics for the African market is critical. Africa is still heavily reliant on roads which accounts for 80% of the movement of goods and passengers, according to the African Development Bank. Of that 80%, only 15% is paved in Nigeria, per this Stears report. On another hand, investment in logistics startups on the continent is not as easy as it seems. Ciku Mugambi, CEO of Kobo360, a Nigerian logistics startup, admitted that operating a logistic business in Africa is not “sexy” compared to other tech sectors like fintech, for instance. Mugambi said this during a panel session at TechCabal’s flagship conference, Moonshot, on Thursday, October 12. “We are literally just moving goods and people from one place to another and most people don’t find that to be very exciting. There is no doubt about how important logistics is. Nothing goes anywhere except we provide the means for that to happen,” Mugambi said. The inevitability of finance Very closely associated with the logistics business is the consistent need for finance. Mugambi said this is inevitable because the business deals with micro-fleet owners who need to get paid before they run their next trip. “For us to mobilise as many transporters to guarantee reliable supply to our enterprise clients, we need that velocity to be happening faster. Because our bank won’t extend purchase orders financing, we have to bridge that gap,” she explained. Another panellist, Miishe Addy, co-founder and CEO, Jetstream Africa, shares a similar view. Addy insisted that truck drivers should not be given loans to fulfil orders without any assets. She explained that unsecured loans can lead to loss of one’s investment in the business. “If lenders don’t have a security interest in a cargo, you are at a loss,” she said. Her argument is simple: no logistics company should give free money away. If credit is provided, it would have to be on top of the asset to mitigate against any form of default from the fleet owners. Solving the problem a step at a time Lack of finance is just one portion of the many issues that logistics companies face. Many logistic startups have to decide whether to own their own fleet or have another firm fulfil those orders. For investors, how these companies manage this aspect is top of mind at all times and the determinant factor for any investment. On the other hand, it is a challenge coordinating drivers of these trucks or e-hailing drivers in the mobility sector who battle fuel hikes, asset maintenance and poor road systems. Mugambi is positive about the outlook for logistics despite the fact that the sector is “highly fragmented, opaque and informal”. She admits that the business requires investors who are familiar with devaluation amidst the other economic situations plaguing the continent. “If I show my numbers when the naira was at ₦450 and now it’s ₦750, you are not asking what happened. Also, it requires investors who are in it for the long haul and a specific kind of capital attached to it,” she said. Another panellist, Onyeka Nduka, head of growth and marketing at Haul247, said it is time to activate the African Continental Free Trade Area (AfCFTA) agreement and get government buy-in on road maintenance. “We need more financing and structure for the businesses to have access. I believe that private-public sector partnership will drive that, and it makes projects more efficient,” she added.
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