Huawei takes on big cloud providers with $10m credits to Nigerian startups
Huawei, the Chinese technology company expected to report $98 billion in 2023 revenue, will grant cloud credits worth $10 million to 100 Nigerian startups as it attempts to grow its cloud business and win significant market share. The Chinese vendor’s free cloud credit offerings mirror those of cloud giants and competitors, such as AWS, Google Cloud and Microsoft Azure. These free credits help cloud providers onboard clients and the complexity of migration also ensures stickiness and retention after those free credits are spent. However, it will need more than free cloud credits to win a substantial share of the market, especially at a time when many Nigerian startups are looking to reduce costly USD-denominated cloud services bills. While Huawei also charges cloud fees in USD, it claims it plans to switch to payments in local currencies. Despite being relatively new to the cloud computing market, Huawei has secured some major clients; the Chinese fintech startup, OPay, is one of its biggest clients, TechCabal first reported in March. It also counts Eden Life and Feather Africa as part of its clientele. The cloud market in Nigeria and Africa is booming with demand from businesses and operators like AWS, Google Cloud, and Microsoft Azure are increasing their investments in the market. A report by Xalam Analytics showed that demand for cloud computing services in Africa is growing at between 25% and 30% annually. Huawei claims it has its sights on affordability, and has set a target of onboarding 10,000 startups globally by 2025. It currently has onboarded over 3000 startups, some of which are in Africa.
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👨🏿🚀TechCabal Daily – Nigeria puts more passion into energy sector
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Happy pre-Friday Yesterday, WhatsApp was unavailable for two hours in a downtime that should have come to Slack…or Google Meet…or Microsoft Teams, if your company is into that kind of freaky stuff. The downtime affected all Meta products were affected by the glitch, but the company is yet to reveal what is up. This is the first major WhatsApp outage since 2022, but is Meta’s second largest outage in five weeks after another glitch, on March 5, took down Facebook, Threads, and Instagram but left WhatsApp untouched. In today’s edition Nigeria doubles electricity tariffs for Band A users Binance wants Nigeria to release its execs LemFi gets regulatory approval in Kenya Adenia Partners closes $470 million fund The World Wide Web3 Opportunities Economy Nigeria increases electricity tariff prices Nigeria is bringing putting more passion in its energy sector. The country has a long history of poor electricity supply. This lack of power supply has affected the nation’s economy and small businesses alike, with most SMEs resorting to alternatives like gasoline-generating sets and solar generators to power their daily activities. Yet, the Nigerian government spends a huge amount of money—about ₦2.8 trillion ($2.1 billion) from 2015–2022—on subsidising electricity prices for its people, eating into allocations for building roads, and healthcare among others. A recharged thinking: The government is now having a rethink and has removed subsidies for 15% of the population who consume 40% of the nation’s electricity. Only users on Band A—those who receive up to 20 hours of electricity per day—will be affected. At this stage, it is unknown if there are any planned upticks for the other bands. This change also comes as the country battles its ailing national grid which has already collapsed twice this year, and plunged the nation into darkness. In 2023, the grid collapsed over 13 times, and the only solution is to invest more in the sector. What that means is that it will now cost almost three times as much to get electricity as the new electricity tariff has been raised from about ₦66 ($0.050) To ₦225 ($0.17) kilowatt per hour. This also represents a significant shift for small businesses on this band as they may have to raise prices to cope with the new change. A win for DisCos: While Nigerians may face the brunt of the new tariff hike, electricity distribution companies are in for a win. Since the Nigerian government broke its power firm into eleven distribution companies and six generations firms, these power companies have been hurting from losses incurred during their operations. The new move by the government to raise power tariffs has been long expected by the electricity distribution companies as they have clamoured in recent times for a need to increase their fees to help bolster their balance sheet. Read Moniepoint’s case study on family-owned businesses Family-owned businesses are everywhere, shaping our world in ways you might not expect. We’ve found some insights into how they work, and we’d love to share them with you. Dive in right away here. Crypto Binance wants Nigeria to release the detained executive The tussle between the Nigerian government and Binance is still on. Five weeks after Nigeria detained Tigran Gambaryan, a former US Agent and executive of Binance, the crypto behemoth has asked the Nigerian government for his release. ICYMI: Gambaryan was detained alongside Nadeem Anjarwalla, Binance’s Kenya-based regional manager for Africa. Both executives had flown into the country to resolve the company’s restricted website access. Anjarwalla fled the country with a smuggled passport, according to the office of Nigeria’s national security adviser (NSA). In a new statement released yesterday, Binance said Gambaryan, a former US Agent, “has no decision-making power in the company and should not be held responsible while discussions are ongoing between Binance and the Nigerian government”. Human rights violations? Last week, both executives filed a human rights violation suit in Nigeria’s Federal High Court, asking the office of the NSA and Nigeria’s anti-graft agency, the Economic and Financial Crimes Commission (EFCC) to release them, return their passports, and issue a public apology. Binance claims that Gambaryan—who leads Binance’s Financial Crime Compliance (FCC) team and was hired in 2021 to help fix the crypto giant’s complaint issue—has worked with Nigerian law enforcement in the past, providing information that helped tackle fraud and money laundering activities up to the tune of $400,000. The company said Gambaryan’s team facilitated multiple training sessions for Nigerian law enforcement on the role of exchanges in the digital asset ecosystem. As Gambaryan approaches his sixth week in detention, it remains to be seen how the scuffle between Binance and the Nigerian government unfolds. No hidden fees or charges with Fincra Collect payments via Bank Transfer, Cards, Virtual Account & Mobile Money with Fincra’s secure payment gateway. What’s more? You get to save money for your business when you use Fincra. Start now. Startups LemFi gets approval to operate in Kenya In the past two years, startups in Kenya have faced the heat as the country’s apex bank shut them down left, right, and centre for lack of regulatory approval. Flutterwave and Chipper Cash, for example, went through a rough patch after the Central Bank of Kenya (CBK) directed all banks to stop dealing with the company for being unlicensed. Other digital lenders also faced the same problem. In defence, the startups argued that the apex bank’s licensing procedures were sluggish, with some processes extending beyond three years. It seems LemFi might have broken the spell, as the startup, yesterday, announced that it had received regulatory approval from the Central Bank of Kenya less than a year after entering the Kenyan market. In June 2023, the fintech entered the Kenyan market via a partnership with PesaSwap that allowed users send Kenyan shillings to other currencies. The fintech, at the time, also noted that Kenyans using its services would not have to pay any transfer fees. Now, with the
Read MoreCentral Bank of Kenya maintains interest rates at 13% as inflation eases
The Central Bank of Kenya (CBK) has held its interest rate at 13%, signalling it is moving closer to cutting borrowing costs as inflation eases and the Kenyan shilling strengthens against major global currencies. On Wednesday, the apex bank noted that the headline inflation eased to 5.7%, the lowest in two years, as the costs of most food items including maize flour, wheat flour, kales, spinach, and cabbages dropped. The CBK’s Monetary Policy Committee (MPC) exercised cautious optimism despite the shilling rallying against the dollar and inflation easing within the regulator’s 2.5% to 7.5% range. “The MPC noted that its previous measures have lowered inflation, addressed the exchange rate pressures, and anchored inflationary expectations. Therefore, the MPC concluded that the current monetary stance will ensure that overall inflation continues to decline towards the 5.0 per cent midpoint of the target, and thus decided to retain the Central Bank Rate (CBR) at 13 per cent,” CBK said in a statement on Wednesday. The Kenyan shilling has rallied 18%, addressing inflation caused by imports. The central bank on Wednesday quoted the shilling against the dollar at KES 131.48 from a record high of KES 160.18 in February–representing a 17.9% appreciation in the past month. The CBK said that leading economic indicators point to “continued strong performance of the Kenyan economy in the first quarter of 2024,” buoyed by agriculture, the service sector, and ICT. The March 2024 Agriculture Sector Survey conducted ahead of the MPC meeting indicates that food prices will fall in the next three months supported by favourable weather conditions, stronger shilling, and dropping fuel prices.
Read MoreNigeria’s electricity regulator hikes tariff by 240% for urban customers
The Nigerian Electricity Regulatory Commission (NERC) has increased electricity tariffs for urban customers by 240%, confirming earlier reports of a possible hike in energy prices amid the country’s rising inflation. The new rate, effective immediately, will be ₦225 per kilowatt-hour (kWh), a significant jump from the previous ₦66 per kWh, NERC’s vice chairman, Musliu Oseni told journalists on Wednesday. These customers—under the Band A classification—use 20 hours of power supply daily and represent 15% of the country’s 12 million electricity customers. The upward price review will not affect customers on the other bands, he said. On Tuesday, Bloomberg reported that Nigerian authorities plan to hike electricity prices as President Bola Tinubu seeks to reduce government spending and subsidise tariffs for only Nigerians in rural areas. The move follows pressure from the country’s electricity distribution companies, the report said. The electricity tariff hike comes amid Nigeria’s worsening power supply which has been blamed on its low level of power generation and distribution. The West African nation has an installed capacity of 13,000 megawatts for its 200 million population. In March, Nigeria’s power minister Bayo Adelabu said plans were underway to “settle outstanding debts owed to power generation and gas supply companies, which will alleviate the financial strain and contribute to improved generation levels nationwide.”
Read MoreSouth Africa passes digital nomad visa law amid public concerns
South Africa has officially passed its digital nomad visa regulations into law. This makes way for the country to start implementing the issuance of digital nomad visas, a topic which has attracted polarised opinions among locals. When the draft regulations were published in February, the government invited the public to share feedback and comments that would shape the eventual outcome of the visa. However, the draft regulations and the official ones are the same, meaning that none of the public opinion was taken into consideration. South Africa eyes Nomad goldrush, targets wealthy remote workers in new draft regulations Although some South Africans favour the digital nomad visa on the premise that it would make the country’s tech ecosystem attractive to foreign talent, others believe an influx would lead to a rise in the cost of living, an increase in inequality, and tax leakage concerns. Others also pointed to several regulations which could impede the effectiveness of the visa. According to Andreas Krensel, founder of immigration firm IBN Immigration Solutions, the lack of consideration for public opinion on the bill is problematic. “Although the confirmation of [the] digital nomad visa is great news, the same questions asked almost two months ago [when regulations were announced in February] remain unanswered,” said Krensel. Among these questions is whether the minimum salary requirement of R1,000,000 (~$53,000) is gross or net and whether freelancers would be eligible for the visa. Additionally, South Africa’s current legislature has numerous laws that have to be amended if the digital nomad bill is to become law. For instance, the digital nomad bill proposes an income tax exemption for foreign employees working in South Africa for less than six months, and the income tax act would have to be amended to provide for the exemption to be legal. The proposed tax administration bill introduced by South Africa’s Revenue Service in 2023 is another potential obstacle. Under the proposed amendments, employers of South Africa-based remote workers must deduct pay-as-you-earn (PAYE) tax. Foreign companies would need to apply for and receive a SARS income tax number and register a branch company within South Africa. Another legislation that might put off digital nomads is a proposed amendment to the country’s Copyright Bill. For example, universities and other institutions will have the right to reproduce software products without having to pay producers of said products. “What the bill proposes [is] to water down copyright owners’ protection, and that [is] deeply concerning,” stated Sadullar Kajiker, professor of intellectual property at the University of Stellenbosch. This could prove to be a disincentive for nomads building proprietary software while in the country. With the visa law now official, it will be interesting to see how the government traverses through the unaddressed challenges as applications start flooding in.
Read MoreBinance says detained executive in Nigeria has no decision-making power, calls for release
Binance, the global crypto exchange at the centre of a crypto crackdown in Nigeria, has asked authorities to release its detained executive Tigran Gambaryan, a week after the company was charged with tax evasion. Binance said Gambaryan, a former US Agent, “has no decision-making power in the company and should not be held responsible while discussions are ongoing between Binance and the Nigerian government”. Gambaryan was detained alongside Nadeem Anjarwalla, Binance’s Kenya-based regional manager for Africa. Both executives had flown into the country to resolve the company’s restricted website access. Anjarwalla fled the country with a smuggled passport, the office of Nigeria’s national security adviser (NSA) said. Last week, both executives filed a human rights violation suit at the Federal High Court of Nigeria, asking the office of the NSA and Nigeria’s anti-graft agency, the Economic and Financial Crimes Commission (EFCC) to release them, return their passports, and issue a public apology. Binance claims that Gambaryan—who leads Binance’s Financial Crime Compliance (FCC) team and was hired in 2021 to help fix the crypto giant’s complaint issue—has worked with Nigerian law enforcement in the past, providing information that helped tackle fraud and money laundering activities up to the tune of $400,000. The company said Gambaryan’s team facilitated multiple training sessions for Nigerian law enforcement on the role of exchanges in the digital asset ecosystem. This is Gambaryan’s fifth week in detention. Last week, the Nigerian government filed tax evasion charges against Binance and sought an international arrest warrant for Anjarwalla, Binance’s regional manager for Africa who fled custody.
Read MoreUS blames corruption for slowing investments in Nigeria and Kenya in trade report
The United States has blamed rampant corruption and blatant extortion by state officials in Nigeria and Kenya for slowing the flow of foreign capital into the two countries. Katherine Tai, the US trade representative, has revealed in the 2024 National Trade Estimate Report on Foreign Trade Barriers [pdf] that US firms have expressed concerns over the opaque nature of the procurement processes in the two countries, which has slowed foreign investments. “Corruption remains a substantial barrier to trade and investment in Nigeria. Corruption and lack of transparency in tender processes have been great concerns to U.S. companies. U.S. firms experience difficulties in day-to-day operations as a result of inappropriate demands from officials for ‘facilitative’ payments,” Tai said in the report about Nigeria. In Kenya, the report noted that foreign companies willing to bend the law and have local connections were faring better than US companies scouting for opportunities in East Africa’s biggest economy. “U.S. firms continue to report challenges competing against foreign firms that are willing to ignore legal standards or engage in bribery and other forms of corruption. Corruption is widely reported to affect government procurements at the national and county levels,” the report said. The assessment of Nigeria, which is the biggest economy in Africa, noted that the country’s effort to root out corruption was being hampered by internal wrangles in the government and partisan politics. Nigeria and Kenya are considered among the world’s most corrupt nations, ranked 145 and 126 respectively, out of 180 countries by Transparency International. While the report raised questions about Nigeria’s judicial system’s ability to convict and sentence corruption-related crimes, the US trade representative noted that political interference in the judiciary is encouraging the vices in Kenya’s case. “While judicial reforms are moving forward, bribes, extortion, and political considerations continue to influence court cases. As such, foreign and local investors risk lengthy and costly legal procedures,” Tai noted. The report, however, observed that Nigeria has made modest progress in opening government tenders to foreign firms and levelling the playing field. Enforcement of intellectual property (IP) rights and data protection laws in the two countries have also been cited as a barrier to US investments. However, Nigeria has made some remarkable progress on this front, passing legislation to combat idea theft. “In 2019, Nigeria enacted the Federal Competition and Consumer Protection Act, which includes provisions designed to combat trademark counterfeiting, and in 2021, Nigeria enacted the Plant Variety Protection Act, creating a legal framework and administrative structure for the protection of plant varieties. In March 2023, the Nigerian President signed the Copyright Act 2022 into law,” the report remarked.
Read MoreRoam secures financing deal with Mogo to grow electric motorcycle adoption
Roam, a Kenyan-based electric mobility company, has secured a partnership with Mogo, an asset financier in East Africa, to boost the adoption of electric motorcycles in the East African country. The financing package will first be accessible to riders in Nairobi. According to Roam, the partnership also increases the transition to electric motorcycles from traditional motorcycles. Motorcycle riders, popularly known as boda boda riders, are expected to increase their daily earnings by 30%. Roam told TechCabal that it is the largest provider of electric motorcycles putting out the largest volumes in Nairobi targeting boda boda riders and B2B providers. For riders participating in the deal, Mogo will offer financing at a rate of KES 25,000 deposit, and a daily repayment of KES 682 for 24 months. The package includes a motorcycle, battery, charger, and two helmets and vests. “At Roam, our mission is clear, we want to provide the best and most affordable electric motorcycle to the market and Mogo is a great partner in accelerating that mission,” said Mikael Gånge, Co-Founder and Chief Commercial Officer of Roam. Kenya boasts of about 3 million boda-boda riders according to James Macharia, the minister of transport. The United Nations also estimates that about 5 million Kenyans get their income from riding motorcycles. However, the Kenyan government is keen on converting most of the fuel-based motorcycles to electric. President William Ruto had on September 1, 2023, launched a national e-mobility programme which has three-wheeled tuk-tuks, or auto rickshaws the focal point of a transition to green transportation. Kenya’s National Transport and Safety Authority (NTSA) plans to convert 2-3 million boda bodas to being electric by 2030. Raul Leitis, business development project manager at Mogo said the deal with Roam will go beyond Kenya to the rest of the continent and electric motorcycles will surpass fuel motorcycles in no distant time. “We see that the electric motorcycle market is ever expanding and with Roam’s innovative products that enable customers to not only charge at home but also at the Roam Hubs, we believe the electric motorcycle market will eventually become larger than the petrol one,” Leitis said.
Read MoreSomalia plugs 5G into its economic rebound
Somalia has received its first 5G installation, cranking up a series of reforms to revamp its economy after joining the East Africa Community (EAC). Hormuud Telecom Somalia Inc., its largest telco, rolled out faster internet speeds last month, signalling budding growth in the country’s digital services industry. “As Somalia strides towards stability, the launch of 5G services by Hormuud Telecom emerges as a critical milestone. This initiative is more than just a technological advancement, it’s a symbol of our nation’s commitment to growth and constant improvement,” said Somalia’s Telecommunications Minister Jama Hassan Khalif. The immediate benefit of this rollout, according to Hormuud, is the seamless upgrade for its 4G customers to 5G at no additional cost, ensuring that a broad base of users instantly enjoy improved internet speed and reliability. A 5G service promises to enhance connectivity and efficiency, aiding the country’s integration into the regional economy and stimulating trade and investment. The network will initially be accessible in major cities, offering 81% coverage, indicating the extensive reach of the new technology nationwide, the service provider said. “The network will initially be accessible in Mogadishu, Kismayo, Galkayo and Baidoa, as well as Dhusamareeb, Beledwayne, Afgoye, Merca and Dhobley,” Hormuud said in a statement. After years of investor reticence and minimal foreign direct investment flows, Somalis themselves have taken significant steps to alter their economic destiny. Hormuud Telecom, a domestically established firm since 2002, promotes itself as a company “built by Somalis for Somalis.” Operating from Mogadishu, the company is Somalia’s leading telecom provider, the largest private-sector employer, and the first Somali private enterprise to attain international ISO certification. With over 12,000 shareholders, all of whom are Somali nationals, Hormuud has grown from the 283 founders who initially started the company. Given the widespread reliance on mobile money services among the Somali population, particularly among those without access to traditional banking facilities, the introduction of 5G is also expected to significantly boost the efficiency and security of financial transactions. Somalia’s formal integration into the EAC came after its Minister of Commerce and Industry, Jibril Abdirashid Haji Abdi, presented the instrument of ratification of the treaty of accession to EAC Secretary-General Peter Mathuki on March 4, 2023, in Arusha, Tanzania. Its accession to the regional block comes after decades of hesitance due to factional political conflicts that had engulfed it in civil war. As active participation in EAC activities increases, robust digital infrastructure will be essential for further cross-border trade, investment, and collaboration.
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Who calls the shots at Sycamore?
Sycamore, a Nigerian fintech startup, offers loans for individuals and businesses, including salary and business loans. It also enables users to lend money directly to friends and family (peer-to-peer lending) and conveniently pay bills. Babatunde Akin Moses, Mayowa Adeosun, and Onyinye Okonji co-founded the startup in 2019. Governed by a board, three co-founders lead the Sycamore team who refer to one another as Sytizens—a play on Sycamore and citizen. [ad] Who calls the shots at the Tiger Global-backed Bamboo? The CEO is informed by three key executives: Daniel Anyaegbu (CTO), Kingsley Makinde (head of product), and Adebayo Adenaike (head of investment). Adeosun, the COO, manages a team including Mercy Dada (head of risk), Segun Afuwape (head of collections), Elizabeth Oyelae (head of finance), and Chukwuemeka Ikpa (head of internal control). Meanwhile, the CCO, Okonji, leads Mojisola Fagbohunlu (head of marketing), Francis Agim (head of sales), Adewunmi Awofadeju (head of customer experience), and Atiti Timi (Head of HR). This TechCabal org chart details Sycamore’s leadership structure. Sycamore’s Organogram If you would like to showcase the leadership structure of your startup in this way, contact the author of this article: ngozi@bigcabal.com.
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