Exclusive: Africa’s Blockchain pioneer Zone will launch remittance product in 2025
Zone, Africa’s first licenced blockchain payment infrastructure company, will launch a remittance product in 2025, Obi Emetarom, the company’s CEO, told TechCabal this week. “Work is actively going on” to develop the product, Emetarom added. Zone plans to address the three critical pain points remittance providers, and International Money Transfer Operators (IMTOs) face: distribution, liquidity, and licensing. Remittance startups need robust distribution networks to deliver funds to recipients, even without direct connections to the local banks. They also struggle with managing liquidity in different local currencies, which can be expensive. The third hurdle is navigating the complex licensing requirements across different jurisdictions. “We want to deliver these services. The integration is possible because we are a switch and already connected to banks. Secondly, liquidity is possible because our settlement is instant,” Emeratom said. “And in terms of licensing, we already have a switching license, and our roadmap is to ensure that we have all the licenses that we need to operate in different markets.” In December 2023, Nigeria’s Central Bank reversed a two-year ban on crypto-related bank accounts and later released stringent rules for banks opening crypto accounts. At least two crypto startups have applied for licences from the country’s capital markets regulator, the Security Exchange Commission (SEC). Emeratom describes this as a “fantastic development” that will open up opportunities in cross-border payments. Canal+ tests the waters with a bid to buy MultiChoice Beyond its current role as a payments processor and switch, Zone has ambitious plans to reshape the financial landscape. The company envisions a future defined by regulated decentralized finance (DeFi), combining the strengths of blockchain technology and the legitimacy of traditional finance. “We’re working on a white paper to design what that future will look like. We are also building Zone to become the foundation for that future,” he said. Founded in 2008 by Emeka Emetarom, Obi Emetarom, and Wale Onawunmi, Zone (formerly Appzone) rebranded from a fintech software provider to a blockchain payment infrastructure company in 2022. The transition saw the company split into two entities: Appzone’s cloud-based Software-as-a-Service (SaaS) platform rebranded into Qore, while Zone remained the blockchain-based payment gateway. Zone, licenced by the Central Bank of Nigeria as a payments switch, runs a blockchain network that enables direct transaction flow between financial service providers without an intermediary. Thirteen Nigerian banks use Zone’s blockchain network to process ATM transactions. Zone earns a fee for every transaction processed through its channels, and in 2023, the startup claimed it processed $1 million daily, but Emeratom says “the number has gone up,” though he declined to share specific figures. The startup plans to roll out more use cases for its blockchain payments technology, including online payments and direct debit. “The ATM was just to showcase the technology. The big deal for us is that we have been able to get in as a new payments infrastructure, and now we can move to higher value channels.” Zone will also launch Zone 2.0, a new blockchain infrastructure built on the Ethereum standard, allowing instant settlements for financial institutions. The startup has plans to launch in the Global South markets, particularly Latin America, Southeast Asia, and the Middle East.
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Only Four African Countries Secured>$100m Funding In 2023 + Stark Decline Realities
The curtains may have closed on 2023, but the African tech landscape is still adjusting to the aftershocks of a watershed year that tested the resilience and adaptability of startups across the continent. To make sense of it all, TechCabal Insights has released its retrospective State of Tech in Africa Report for Q4. Its analysis is comprehensive and delves into the critical aspects that shaped the ecosystem while offering actionable insights for the journey ahead.Our report is divided into five key sections. The funding winter unmasks the realities of doing business in Africa. Simply put, 2023 was a difficult year for African startups, with only four countries raising above $100 million in funding. By comparison, eight African countries raised above that figure in 2022. Venture Capital (VC) experienced a funding decline of 40.2% compared to 2022, forcing innovative entrepreneurs to explore alternative avenues. However, fintech stood strong, maintaining its status as the most funded sector despite a 79% dip in funding. Weathering the storm explores the strategies for growth and adaptation. One silver lining was the utility of mergers and acquisitions as a startup lifeline, which will remain a mainstay in 2024. For all the challenges faced, 2023 still recorded the single largest acquisition deal in the history of African tech, with fintech, once again, being the pacesetter. The report also examined multimarket models and pivots, highlighting notable examples that can serve as a compass for investors needing a strategic shift. Regulation and policy look at the regulatory framework shaping African tech as policymakers and innovators thread carefully between navigating the digital frontier and staying compliant, in line with best practices. It covers regulation around digital identity, financial inclusion, cryptocurrency, open banking, anti-competition and data protection. For our two-part survey, we collated primary data to provide a nuanced understanding of the impact of tech layoffs on the workforce and a founders’ outlook for 2024, offering a real-time pulse on the sentiments within the tech community. Lastly, we provide an outlook for the future. What does the uncharted terrain look like? Can bootstrapping take the place of VC funding? What imperatives lie ahead for founders, investors, and policymakers alike? Which trends from the past can serve as a prognosis for 2024? What multipolar forces will define Africa’s digital economy in the future? The answers to these and more can be found in our State of Tech Report Q4. Click this link to download it. We also value your feedback. Help us fill this brief survey to let us know how our reports can serve you better.
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Canal+ tests the waters with a bid to buy MultiChoice
Canal+, the French pay-TV giant owned by Vivendi SE, has made a non-binding offer to buy MultiChoice, per reports from Bloomberg and Tech Central, four years after it first bought a 6.5% stake in Africa’s biggest pay-TV company. Per Bloomberg, the offer from Canal+ is 105 Rands per share, a significant markup on MultiChoice’s current share price of 79 Rands. Canal+ increased its focus on Africa in the past decade and has grown from just 1 million African subscribers in 2016 to 7.6 million in 2023. In July 2019, it bought ROK Studios, a prolific Nigerian film production company, from IrokoTV to increase its slate of original content offerings. A timeline of Vivendi’s MultiChoice stake Canal+ has gradually increased its stake in MultiChoice since 2020 Buying MultiChoice will represent a grand step in Vivendi’s African ambitions if it can get the deal over the line. With Vivendi’s history of hostile takeovers, industry watchers had predicted it would attempt the same play with MultiChoice. In October 2015, Vivendi spent €180 million to acquire minority stakes in two publicly traded gaming companies, Gameloft (6.2%) and Ubisoft (6.6%), eventually buying a 10% stake in each company, a TechCabal report from 2020 said. A MultiChoice acquisition is perfect for Canal+ but regulatory hurdles loom It also made a hostile takeover of Gameloft by buying over 30% of the company before convincing other shareholders to sell their stakes. In June 2016, Gameloft became a Vivendi subsidiary. Since 2020, Canal+ has increased its stake in MultiChoice from 20.1% to around 32.6%. In 2022, Vivendi received $40m in dividends from Multichoice Group (up from $23.3m in 2021). Under South African law, Canal+ must make a mandatory takeover offer when its shareholding reaches 35%. But a complete takeover of MultiChoice may be impossible in the near future. Regulation pumps the brakes By law, Canal+, a foreign company, cannot have more than 20% of the voting rights on the board of directors of a South African broadcaster. MultiChoice enforces this rule through a voting rights cap. “A full takeover of MultiChoice looks unlikely to us,” said a Bloomberg intelligence analyst in February 2023.
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👨🏿🚀TechCabal Daily – Google launches first African cloud centre
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Happy new month You can start your month with learnings from Africa’s tech ecosystem. Last week, we launched the State of Tech in Africa Q4 2023 report, and it contains critical details on how the ecosystem performed in 2023, and forecasts by industry experts. Download it for free here. In today’s edition Google launches its first African cloud centre Kippa pivots to edtech Bolt expands to Zimbabwe Bboxx moves its HQ to Rwanda Ghana’s mobile money agents have a new deadline The World Wide Web3 Opportunities Big Tech Google Cloud has set up shop in South Africa The clouds are gathering over South Africa, and it’s not just a weather forecast. The high cost of cloud computing is stifling African startups. Just last week, social media erupted with frustrated founders and operators complaining that cloud services eat up a huge chunk of their budget, making it difficult to stay afloat. This sparked debates about whether Africa needs to develop its own cloud solutions to break free from this financial burden and empower its growing tech scene. While homegrown cloud solutions hang on the horizon, more international cloud service providers are setting up shop in the continent. The news: Yesterday, Google announced the launch of its cloud service in South Africa, its first on the continent. Google became the latest cloud service provider in the country after the launch of Microsoft Azure in 2018, Amazon Web Services (AWS) in 2020, and Alibaba Cloud in 2019. Why does it matter? Google’s entry into South Africa means that local businesses get direct access to Google’s powerful cloud services, giving them improved speed and storage space to help optimise their service delivery. While the launch in South Africa serves as a huge boost for its tech ecosystem, the move also signals fierce competition to existing cloud service providers. The diverse cloud landscape might force cloud service providers to offer competitive prices to businesses in the country. For the everyday Joe, the move means faster downloads; and no more buffering videos or lagging apps. Zoom out: While Google’s entry into South Africa offers exciting opportunities for businesses and individuals, it also raises concerns about data privacy and security, particularly with local data now stored on the cloud. Recent high-profile data breaches and government surveillance programmes, both globally and within Africa, highlight the need for robust data protection laws. South Africa should consider policies similar to the EU’s General Data Protection Regulation (GDPR) to ensure user control over personal data, increase transparency from cloud providers, and hold them accountable for data breaches. 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. Startups Kippa makes an edtech play It’s not every day you get to see a fintech become an edtech. What? In an interesting turn of events, Kippa, a Nigerian startup which started as a fintech is pivoting to provide edtech services. Kippa’s new edtech play will allow users create new online courses or deliver existing ones in bite-sized formats using AI. Kippa’s new website Why? While Kippa’s pivot might have you howling, its pivot remains unsurprising given the startup’s recent turn of events. Kippa laid off 40 of its employees in 2023 after it shut down its agency banking subsidiary, KippaPay. The startup later transferred KippaPay to Nigerian fintech, Bloc, with some of its employees moving to the startup as a result. Kippa also struggled to make severance payments for its laid-off employees after it suffered a ₦30 million ($33,516) internal fraud. Before the eventual shutdown of KippaPay, the startup made efforts to resuscitate the ailing business. Kippa tried to unify KippaPay with the bookkeeping app. It also tried to monetize its Invoice service, all of which yielded no results. Zoom out: While its effort to salvage the troubled startup continues, Kippa has embraced an edtech play, putting out a new website that would allow users to produce online courses and deliver those courses using messaging tools like WhatsApp and Telegram. It remains uncertain what Kippa will do to its existing fintech customers. Secure payment gateway for your business Fincra’s payment gateway enables you to easily collect Naira payments as a business; you can collect payments in minutes through bank transfers, cards, virtual accounts and mobile money. Create a free account and start collecting NGN payments with Fincra. Mobility Bolt expands to Zimbabwe Bolt has crossed the 12-country mark in Africa, with a launch in Harare, Zimbabwe. In Zim, Bolt is taking the same route it used in its 2022 Zambia launch: it’s starting with a zero-commission policy for its first six months and 300 drivers. Bolt’s Zimbabwe expansion aligns with its plan to invest $530 million in Africa over the next two years, which will also see the creation of 300,000 driver jobs across the continent. The company operates in over 45 countries globally, serving over 150 million customers and working with over 3 million drivers. A familiar strategy: New market entrants are sacrificing short-term commissions to drive down prices and attract customers. This strategy, witnessed in the relaunch of rival companies like inDrive and Rida in Zimbabwe, relies on retaining price-sensitive consumers as prices undergo eventual adjustments. Bolt enters the fray: Local players like Hwindi have been the dominant ride-hailing platform in Zimbabwe since 2015. However, with the recent launch of inDrive and Rida in 2023, the landscape has shifted. They’ve lured customers with low fares fueled by massive ad campaigns and no initial commissions. According to drivers, inDrive reportedly charges a 10% commission while Hwindi charges 16%. With Bolt joining in, the competition is set to intensify even further. Accept fast in-person payments, at scale Spin up a sales force with dozens – even hundreds – of Virtual Terminal accounts in seconds, without the headache of managing physical hardware. Learn more → Cleantech Bboxx shifts headquarters from London
Read MoreAs Nigerian stock market booms, SEC board’s absence casts shadow over rally
While Nigeria’s stock market continues to soar globally, its regulator, the SEC, continues without oversight. In January, NGX, Nigeria’s stock market, was the world’s best-performing stock market, but amidst this rally, a crucial watchdog is missing: the board of the Securities and Exchange Commission (SEC). Nigeria’s SEC oversees the exchange and protects investors but has operated without a board for nearly a year. [ad] “President Tinubu has not made any appointments yet,” an investment analyst at the SEC who declined to be named told TechCabal. Typically, the president appoints board members, and the Senate confirms the appointees to insulate the board from political interference in its job to keep the SEC accountable. The NGX and the SEC did not respond to TechCabal’s request for comments at the time of this report. The term of the previous board expired in May 2023. Per the SEC website, the board comprises a chairman and four other members, including the Ministry of Finance and Central Bank representatives. The SEC’s Director-General, Lamido Yuguda, is the highest-ranking official on the board, per the SEC’s organogram. [ad] Despite the optimism around the NGX in the last year, there have been concerns that need regulatory attention. The market’s frothiness has masked allegations of insider trading and a vital criticism: the NGX’s inability to attract new and exciting listings. EDC Nigeria, a securities research firm, says the rise in stock prices is due to investors taking positions “in fundamentally driven stocks as we approach the earnings season.” [ad]
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Latest news on SRD SASSA payment for February 2024
As we approach the month of February 2024, beneficiaries of the South African Social Security Agency (SASSA) grants eagerly anticipate the upcoming SASSA Payment 2024 schedule. SASSA plays a pivotal role in supporting vulnerable individuals through various grant programs, and here’s a detailed breakdown of the payment dates for February: 1. SASSA Payment 2024 for Older Person’s Grants What you should know includes: Payment Date: Friday, February 2, 2024. Beneficiaries of Older Person’s Note: Grants can expect their SASSA Payment 2024 to be credited to their accounts on this day. This includes any arrears owed to the recipients. 2. SASSA Pay 2024 for Disability Grants For the Disability Grants: Payment Date: Monday, February 5, 2024. Note: Recipients of Disability Grants will receive their SASSA Payment 2024 starting from this date. This encompasses any grants linked to the specified accounts. 3. SASSA Pay for Children’s Grants Children’s wards should note the following: Payment Date: Tuesday, February 06, 2024 Final thoughts SASSA emphasizes responsible financial planning, encouraging beneficiaries to avoid rushing to withdraw funds immediately upon receipt. This patient approach ensures access to funds when necessary and contributes to financial security. For any inquiries or assistance related to SASSA Pay for 2024, SASSACARES is available through their toll-free helpline at 300000, operating from 10 am to 11 am. Beneficiaries are encouraged to reach out for support or clarification regarding their grants. As the payment dates approach, beneficiaries should remember to check their account balances regularly and verify the credited amounts. This proactive measure ensures transparency and addresses any discrepancies promptly. Additionally, SASSA urges recipients to update their contact information promptly to receive important notifications and announcements regarding their grants. It’s essential for beneficiaries to understand the significance of the provided payment dates and adhere to the recommended financial practices. Ultimately, responsible handling of grant funds contributes to the overall success of the SASSA program and enhances the well-being of the individuals it serves.
Read MoreHere is why SA startups saw an uptick in average valuations in 2023
South Africa was the only ecosystem in sub-Saharan Africa to see an increase in average valuations in 2023, according to data by MAGNiTT. Experts explain how the country managed to go against the grain. While valuations of tech startups in Sub-Saharan African countries broadly declined in 2023, South African tech startups were the exception, with an average increase of 21% in their valuation, according to data from MAGNiTT, a data research firm. The tenacity of South African startups is further reiterated by Partech, who stated: “Despite a -34% YoY decline in total equity funding in 2023, South Africa has been the most resilient ecosystem in the top 4, emerging as the new leader of the African tech funding landscape.” According to three VC firm managing partners who spoke to TechCabal, tougher competition for deal flow at early-stage startup investment drove up valuations in the South African tech ecosystem. “The global fundraising slowdown affected fund managers looking to raise funds, leading to delays in closing new funds,” said Naeem Sayes, senior research associate at MAGNiTT. ”This correlated with an adjustment in their strategies, favouring early-stage investments with a longer horizon to exit.” The shift in priorities to early-stage startups led to tougher competition among local funds in earlier stages, driving up round sizes and valuations from Seed to Series A. South Africa also saw a best-of-the-worst decline in seed investments, decreasing by 44%, while the rest of the continent averaged a 77% decline. On a per-deal basis, seed-stage deals increased by as much as 40%, according to data from Partech. The tenacity of some South African entrepreneurs and business models might also explain the trend, said Keet van Zyl, managing partner at Knife Capital.” When the heat of cash burn got too much in some other markets, SA startups suddenly became more attractive,” van Zyl told TechCabal However, despite this increase in valuations, van Zyl cautioned startups to focus on building resilient business models instead of being blinded by paper valuations. Instead of the hype, build a capital-efficient [business] with a recurring revenue model that consistently outperforms the ‘Rule of 40’ (revenue growth rate plus profit margin exceeding 40%),” van Zyl concluded. “Strive for a local cost base and hard currency revenue.”
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Exclusive: Target Global backed fintech, Kippa, is pivoting to edtech
Kippa, the financial management startup backed by Target Global, is pivoting from fintech and is piloting a new edtech service that enables anyone to create new online courses or deliver exciting ones in bite-sized formats using AI, an ex-employee with knowledge of the business told TechCabal. Kippa has created a new website for its new product, with which users can produce online courses and deliver those courses using messaging tools like WhatsApp and Telegram. Kippa declined to comment on any part of this article. Image source: Kippa Kippa’s pivot from financial management and bookkeeping is unsurprising given the company’s struggles in the past year. In 2023, the company laid off 40 employees after a difficult decision to shut down Kippa Pay, its agency banking business. At least two ex-employees said the layoffs were surprising. “One month before the layoff, in a general meeting, one of my colleagues asked the CEO—Kennedy Ekezie—if there would be job cuts, and he said no,” said an ex-employee. KippaPay was later transferred to the Nigerian fintech company Bloc, and some of Kippa’s employees moved to Bloc as part of that process. Exclusive: ₦30 million internal fraud sours exit as Kippa scraps severance for laid-off workers “I know that the entire engineering team was laid off,” another ex-employee said, claiming that less than ten people are working on the new edtech product. “Monty Dimpka, who was laid off, rejoined as engineering lead for the new product. There is also a web engineer, a finance manager, a customer-facing staff, and a product manager in India working on the product.” With this transition, Kippa leaves behind discontinued and unreleased projects. Two employees told TechCabal that before the company shut down its agency banking product, there had been plans to unify it with the bookkeeping app. There were also plans to monetize its Invoice service, but none worked out. “I am rooting for them, though. Kennedy is a great guy.”
Read MorePade processed ₦11bn in salaries in 2023 after landing Flutterwave as client
Pade, a startup that helps businesses manage their HR functions, caused a stir on X (formerly Twitter) when it shared that it paid ₦11 billion ($12 million) in salaries for its clients in 2023. With over 100 businesses on its people operations platform and over 6,500 employees, the math of it works out to an average salary of ₦240,000 across all the companies it handles payroll for. That figure is eight times Nigeria’s minimum wage. Some other numbers caught the eye, like how 60% of employees earn less than ₦150,000 and 25% earn more than ₦250,000 per month. Launched in 2022, Pade’s growth has been rapid. The ₦11.473 billion in salaries it paid to employees in 2023 was a 41.1% increase from its 2022 figure of ₦7.245 billion. The third and fourth quarters drove much of that growth, coinciding with when Pade signed Flutterwave, the Nigerian payment behemoth, as a key client. Landing Flutterwave’s business opened the door to other major players. Its other clients include Famasi, Risevest, Max, and Dantata. For the company’s leaders, growth has been a function of opportunity meeting preparation. “We have spent the last two years tweaking our product to build the right tools companies need to manage their staff,” said Seye Bandele, founder and CEO. “We invested substantially in bolstering brand awareness, refining our sales processes, cultivating authentic relationships with our audience,” Ore Badmus, Pade’s marketing lead, added. Pade’s onboarding and payroll platform helps HR professionals automate repetitive administrative tasks. Seye Bandele and Lekan Omotosho, Pade’s CTO, who previously worked in the HR departments of large FMCGs, decided to build the tech for other businesses to carry out HR functions. Pade’s payroll software solution, which uses a subscription model, is the company’s biggest revenue driver. The startup also makes money from paying taxes and pensions for its clients, and in 2023, it processed ₦76 million in taxes and ₦28 million pensions. In 2023, it launched Earned Wage Access (EWA), a feature that allows employees to draw an advance from their salaries before payday. It paid out ₦3 million in EWA last year, for which it charged withdrawal fees of 1-3%. Offering the EWA feature to employees on its clients’ payroll came with its bag of challenges. “Early on, establishing clear communication channels with employees was crucial,” admitted Ore Badmus, Pade’s marketing lead. Pade’s future moves in employee empowerment The startup has some interesting products in the works, including a feature that lets employees save and invest a portion of their salaries. It is also building a no-code tool HR consultants and small business owners who need access to payroll services. Pade raised a $500,000 pre-seed round in 2023 and is in talks for a new funding round. It has received support from the Microsoft-backed FAST startup accelerator program, which selected the startup for its first cohort in collaboration with Flapmax. Last year, the startup also got into Expert Dojo, an international early-stage startup accelerator that has invested in African startups such as Eden Life, Trade Lenda, VipLink, Aladdin, and others. Bandele says the startup is inching toward profitability and is targeting $1 million in revenue for 2024. The startup also has plans to expand into an East African market in the near future.
Read MoreLatest JAMB CBT mock updates 2024
In recent developments, it has been gathered from Joint Admissions and Matriculation Board (JAMB) candidates that all available slots for the JAMB CBT mock exams in Lagos for the year 2024 have been filled. We spoke to a couple of candidates currently trying to register for the Unified Tertiary Matriculation Examination (UTME) who narrated the challenge they face in not being able to choose Lagos as their preferred location. The limited capacity issue arises from the fact that only one day has been designated for the mock exams, and admission for it is granted on a first-come, first-served basis. This means that candidates resident in Lagos and who want to sit for the mock exam but have missed out on securing a slot in Lagos may need to consider travelling to neighbouring states where availability still exists. The exclusivity of slots in Lagos has created a challenging situation for local candidates, adding an unexpected hurdle to their preparation for the upcoming JAMB exams. This emphasises the need for a more robust JAMB infrastructure in densely populated states like Lagos. Notes to draw from the Lagos JAMB mock 2024 development 1. Alternative Locations Since JAMB mock slots are full in Lagos, candidates can consider exploring neighbouring states like Ogun and Oyo before theirs get filled too 2. Prompt registration If you are in neighbouring states like Oyo and Ogun, or in other states too, ensure timely registration for the JAMB mock exam to increase your chances of securing a slot, given the limited availability. 3. Use the JAMB Syllabus to study If you won’t eventually get to sit for the JAMB CBT mock exams, simply dedicate sufficient time to practising past JAMB exam questions and especially use the JAMB syllabus to familiarise yourself with likely questions. 4. Time Management skills Hone your time management skills during mock exams if you’ll be taking it or while practicing by yourself at home. Time yourself less than the potential time you’ll be allotted on the exam day and try to answer questions as efficiently as possible. these will help optimise your performance on the designated day. Final thoughts on JAMB CBT mock updates 2024 As candidates adapt to these unforeseen circumstances, staying informed and proactive in their approach will be essential for a successful JAMB mock exam experience in 2024.
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