KPMG: Higher taxes key to fulfilling Tinubu’s GDP growth targets
Independent auditors have warned President Bola Tinubu that raising the Gross Domestic Product (GDP) to an average of 6% is ambitious and unattainable for him Nigerians will pay more taxes if President Bola Tinubu’s goal of growing Nigeria’s Gross Domestic Product (GDP) by an average of 6% in the next four years is to be achieved. That’s the view of analysts from the audit advisory firm KPMG Nigeria. The auditors also added that Nigeria risks increasing its debt burden should Tinubu go all out to bring his inauguration speech- where he made this overambitious promise- to fruition. During his campaign, the president promised double-digit GDP growth. Last month, Tinubu removed fuel subsidy and spoke about plans to unify the nation’s exchange rates. The report, authored by Partner/Chief Economist KPMG Nigeria, Yemi Kale and Associate, Research and Insights KPMG Nigeria, Olanrewaju-Afuye Busayo, stated that Nigeria’s growth since 2019, has been fragile, not growing fast enough to contain population growth. The analysts have projected Nigeria’s growth in 2023 to hover between 2.7-3.2%. “Thus, if we assume a GDP growth of 3% in the first year, the economy will then have to grow by an average of 7% for the subsequent three years and moving growth from a forecasted 3% in 2023 to at least 7% in 2024 and afterward seems overly ambitious. “At the same time, attaining a 6% real GDP growth on average from 2023 to 2026 means growing the value of real GDP from ₦74.6 trillion in 2022 to ₦92.5 trillion by 2026 representing an increase of ₦17 trillion in 4 years. However, within 12 years, 2010 and 2022, real GDP grew by about ₦17 trillion, which will have to be replicated in just four years and within a much more challenging macroenvironment that cuts across the fiscal, monetary, external, and real sectors,” the report explained, justifying its position. “We are of the opinion that an average GDP growth rate of between 4-4.5% at the best is more feasible in the next 4 years. Even this will require the country to get its policies right and keep consistent faith with macroeconomic reforms,” the note explained.
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Binance is illegal in Nigeria
Lire en français Read this email in French. Editor’s Note Week 23, 2023 Read time: 5 minutes Hello hello everyone While you settle in for the long weekend, read a few of this week’s most interesting tech stories from the home front and abroad Pamela Tetteh Editor, TechCabal. Editor’s Picks Binance is illegal in Nigeria In a circular published yesterday, Nigeria’s Securities and Exchange Commission directed Binance Nigeria Limited to immediately stop soliciting Nigerian investors in any form whatsoever. Learn more. Is Tingo a scam? Tingo appears to be tango-ing in a web of lies. Hindenburg research group accused the NASDAQ-listed agri-fintech company of being an “exceptionally obvious scam.” Learn more. Twiga prunes its staff Twiga Foods is saying “Go big or go home.” Last year, the agritech fired 211 full-time salespersons and replaced them with “free agents”. There are also 2000 people waiting in line to replace these free agents if Twiga fires them for underperforming. Learn more. MTN is set to go off-grid Telecom operator MTN is looking for a way out of South Africa’s load shedding as the country’s power instability is taking a toll on its business. Now the yellow telco is preparing to go green with off-grid renewable energy. Learn more. Mara’s second layoff After a 21 million dollar fund raise, Web3 startup Mara has laid off its staff for the second time. This new wave of layoffs comes six months after it let go of nearly half its staff last year. Learn more. Bolt offers the drivers on strike more cash Fuel prices are touching the sky in Nigeria, and Bolt drivers have gone on strike to compel Bolt to increase its minimum fee to ₦2000. However, Bolt refused. Instead, it is offering them a bonus of ₦6,000 with terms and conditions to stop the strike. Learn more. Chipper Cash lays off COO In its third round of layoffs so far, Chipper Cash let go of more of its workforce last week, and this time, even the COO was affected. So far, the fintech has laid off over 150 staff members in a bid to restructure and focus on core products. Learn more. TC Daily Get the most comprehensive insights and stories about Africa’s tech and business ecosystem. TC Daily goes out every week at 7 AM (WAT). Sign up now. Tinubu suspends CBN governor Eleven days after his inauguration, Nigeria’s president, Bola Ahmed Tinubu, has suspended the governor of the country’s apex bank, Godwin Emefiele. Learn why. Nigerian banks get a discount Nigeria’s Inter-Bank Settlement System (NIBSS) has reduced the cost of transactions for Nigerian banks. However, this reduction in fees will not be extended to the bank customers. Learn more. Jumia goes offline Jumia is going offline in rural areas. On its 11th anniversary, the ecommerce company announced that it will be expanding its offline sales model (J-force) to rural areas in Uganda. Learn more. Another pricey Apple Apple unveiled a mind-blowing mixed reality and 3D camera headset this week. It costs $3499, so don’t start digging into your couch cushions for loose change. Good thing it won’t come out till 2024; you can start saving now. Read more. Who brought the money this week? This week, Helium Health, a Nigeria-based health tech company, received $30 million in Series B funding in a round led by AXA IM Alts. Nigerian logistics company Haul247 raised $3 million in seed funding. The round was led by Alitheia Capital, with participation from Investment One. What else to read this weekend? Sudan’s war is crippling its budding tech ecosystem. DFIs are playing in alleviating the pain of VC downturn in Africa. Missed GITEX in Morocco? Here is what you need to know. MTN’s MoMo is one year old but still has a lot more growing to do. Look at the state of mental health in the South African tech startup ecosystem. Why do African governments struggle with the digitalisation of public services? Written by: Ngozi Chukwu & Written by: Hannatu Asheolge Edited by: Pamela Tetteh 18, Nnobi Street, Surulere, Lagos, Nigeria Unsubscribe from TC Weekender
Read MorePresident Tinubu’s suspension of CBN Governor Godwin Emefiele raises legal questions
President Tinubu suspended the CBN governor in a move reminiscent of Sanusi Lamido’s removal as CBN governor in 2014. Once again, the move has thrown up questions about whether the President has the power to suspend the CBN governor. In an unexpected move on Friday night, President Bola Tinubu suspended the Governor of the Central Bank, Godwin Emefiele. In a statement that has now been published by several publications credited to the Director of information at the Office of the Secretary to the Government of the Federation SGF, Emefiele’s suspension was “sequel to the ongoing investigation of his office and the planned reforms in the financial sector of the economy.” Since Emefiele’s tenure as CBN governor ends in June, it is a surprising move that will now raise legal questions. In 2014, President Goodluck Ebele Jonathan suspended the then-CBN governor, Sanusi Lamidoo Sanusi. Many called that suspension illegal, citing the CBN Act. Section 11 of the CBN Act provides for the cessation of appointment by a CBN Governor, Deputy Governor and Director of the CBN. Section 11 (2) ( c & f) of the Act stipulates that “the Governor, the Deputy Governor or Director shall cease to hold office in the Bank if he- [c] he is guilty of a serious misconduct in relation to his duties under this Act; or [f] is removed by the President; PROVIDED that the removal of the Governor shall be supported by a two-thirds majority of the Senate praying that he be so removed” Against this background, many argued that Sanusi’s suspension was illegal. Tobi Balogun, a legal practitioner in Lagos, told TechCabal, “In the case of Sanusi Lamido v. President & Ors, it was decided by the Federal High Court that while the President cannot unilaterally remove the Governor, he can exercise some form of disciplinary control which includes suspension over him. The matter was not appealed.” Balogun added, “In the real sense, suspending the CBN governor as a disciplinary measure is meant to be exercised with the approval of two-thirds of the Senate. What is clear is that the President cannot outrightly and unilaterally remove the CBN governor. However, we understand that suspension more or less operates as a removal because there’s no path for him to regain office.” A move that can affect the markets Governor Emefiele’s time as Central Bank governor has been a mixed bag. Appointed under President Goodluck Jonathan, he remains the only Central Bank governor ever to serve two terms. However, since 2015, the CBN began to pursue pro-agricultural policies, which turned out to be controversial. One such policy was Anchor Borrowers Scheme. He is also rightly criticized for questionable monetary policy and an inability to exert the CBN’s independence, leading to record borrowing levels to the FG called Ways and Means. Those ballooning loans and 22% inflation have meant that Emefiele’s legacy as governor will be unflattering. His time as governor has also coincided with an increasing lack of transparency at the bank. The apex bank has not published its financial results since 2018. Chuwkwudalu Akabogu, a finance expert, told TechCabal, “The CBN is an independent body and is supposed to be run as one. Despite this, I expect the market to react positively as the CBN under Emefiele has been marred by several allegations that have weakened investor confidence. The market has eagerly anticipated this move.”
Read MoreNigeria’s central bank governor under investigation following suspension
After two recessions, a botched naira redesign scheme, and different economic policies that saw Nigerians counting their losses weekly, Godwin Emefiele, Nigeria’s central bank governor, has been suspended by the president. Godwin Emefiele, the governor of the Central Bank of Nigeria (CBN), has been suspended from office by the country’s president, Bola Ahmed Tinubu. The suspension takes immediate effect, as contained in a statement from the office of the secretary to the government of the federation (SGF). According to the statement, the office of the central bank governor is under investigation in relation to the planned reforms in the financial sector of the economy of the new administration. Emefiele’s suspension comes 11 days after the inauguration of Nigeria’s new president. Read more: President Tinubu’s suspension of CBN Governor Godwin Emefiele raises legal questions Emefiele has been directed to hand over affairs of the CBN to Folashodun Shonubi, deputy governor, Operations Directorate. “Mr Emefiele has been directed to immediately hand over the affairs of his office to the deputy governor (Operations Directorate), who will act as the central bank governor, pending the conclusion of investigation and the reforms,” the statement reads in part. The suspended CBN governor served under the former president, Muhammadu Buhari, for eight years. Before his suspension, Nigeria went through two recessions and an inflation rate that steadily increased to about 22.04%. Emefiele also instituted a naira redesign policy meant for Nigerians to swap old naira notes with newly redesigned notes. This policy caused a cash crunch in the country bringing the country to its knees due to the unavailability of cash for transactions. It was not stated how long the suspension will last or how when the investigations are expected to conclude. What do you think about our stories? Tell us how you feel by taking this quick 3-minute survey.
Read MoreIsraeli AI startup Ravin launches operations in South Africa
Israeli AI startup RavinAI is pursuing expansion of their fleet management product offering with entry into the South African market. Israeli-based AI startup RavinAI is launching operations in South Africa through a partnership with Alder Grove Automotive, a South Africa fleet management company. RavinAI offers AI-powered visual inspection across the fleet, rental, used car, and insurance industries. Using computer vision and AI, Ravin’s technology claims to automate the vehicle inspection process, ensuring fleet managers run more profitably, more efficiently, and with reduced risk. It then produces a condition report which allows for a more efficient fleet repair maintenance process. “We are excited to be partnering with Ravin on their entrance into the South African market,” said Vernen Pillay, managing director at Alder Grove Automotive. “Ravin’s technology has so much potential for the market, even beyond fleet management which itself is very important. It can be used for car buyers to inspect vehicles for purchase, insurance claims inspections, port and shipping monitoring, etc. and we aim to assist in maximising its usage here in South Africa.” For Ravin, co-founder and CEO Eliron Ekstein stated that the demand for AI vehicle inspection was the reason for the decision to enter the South African market. “Our entry into the South African market – following our recent launch in Australia and New Zealand – is further proof of the need for solutions such as ours, which brings the vehicle inspection process firmly into the 21st century. We look forward to working closely with Alder Grove Automotive to improve the experience for its customers across South Africa,” he said.
Read MoreCan streaming platforms solve Nollywood’s distribution problem?
In recent years, international streaming platforms have placed Nigerian films in front of global audiences, yet filmmakers still grapple with piracy and a local audience that cannot afford their films. The Nigerian film industry is one of the fastest growing in the world, with about 2,000 movies produced yearly. However, the industry’s high productivity does not necessarily translate to real financial benefits for its professionals as its distribution problem makes it difficult for filmmakers to recoup their investment in filmmaking. Nollywood has transitioned through various forms of distribution, from the VHS to VCDs and then cinemas, each channel coming with its own challenges. Now, the industry has the opportunity to distribute its movies via international streaming platforms like Netflix, Prime Video, and Showmax. Streaming services vs the box office Netflix pays Nigerian filmmakers between $10,000 and $90,000 for streaming rights per film, on average, although the amount occasionally goes up, depending on the director, film budget, and projected numbers. For originals, Netflix pays as high as ₦1.4 billion ($3.8 million), like in the case of Genevieve Nnaji’s 2018 film, Lionheart. In contrast, the highest-grossing movies in cinemas, like Omo Ghetto, made up to ₦636 million ($848,000). Rather than pay for individual films, Prime Video strikes licensing deals with production companies. Between December 2021 and January 2022, the platform struck multi-year deals of undisclosed amounts, with leading production companies Inkblot Productions and Anthill Studios giving it exclusive rights for all theatrical productions by these companies. Showmax employs a different tactic where they share revenue from advertising and sponsorship rather than an upfront payment. Xavier Ighorodje, a writer and producer in Nollywood, shares that, while cinema releases generate more money, compared to the VHS and VCD distribution model, the direct-to-streaming route has put even more money in the pockets of filmmakers. “To make money in film, before now, you had to go to the cinemas to have your films played. You had to pay the cinemas a certain percentage for showing your film as well as the distributors who take your film to these cinemas. For example, if you budget ₦150 million on creating a movie that makes ₦300 million, you haven’t made a profit because the cinema alone takes a large percentage—up to half—and the distributors also take about 20–25%. However, with streaming platforms, you can go straight to the platform to have them stream your film and pay only your middlemen. This means that you get to keep more of the net profit,” Ighorodje explained. There are thousands of films produced daily, but only very few of them make it to the big streaming platforms. This leaves a large number of other—often smaller—filmmakers without many viable options for distributing their films. While cinemas are an option, foreign movies get more attention in them, taking over 75% of the market share. International platforms and Nigerian problems Crime will evolve to the level of innovation, and piracy has proven that. While, in the past, filmmakers struggled with pirated VCDs and DVDs, their new-age counterparts have to deal with another form of crime: illegal streaming and download sites. With platforms like Netflix and Showmax charging a monthly subscription as low as ₦1,200 ($2.5) to access films on their platforms, there is still a large percentage of the Nigerian population who find that too expensive. This has given rise to illegal streaming websites and Telegram groups in Nigeria where popular films are recorded from streaming platforms and then uploaded for other users to download straight to their devices. This costs the industry about $2 billion in losses annually. Karima, who enjoys watching Nollywood films, gets a lot of the films she watches from Telegram. “There are different Nollywood movies now on different platforms that you have to pay for. How many platforms am I going to subscribe to? I can’t afford to pay for multiple streaming channels and so, sometimes, I just download from Telegram.” Alheri, another film enthusiast in her mid-40s, says her problem is subscription payments. “I can afford to pay for Netflix, but I don’t know how to pay for it. When I downloaded the app, my card kept getting declined and I do not know why. I heard that only people with dollar cards can successfully pay, but I don’t have one.” Netflix revealed in January 2023 that it has lost 39,000 already-active subscribers and about ₦250 million ($330,000) as Nigerian banks suspended international transactions from naira cards. Unlike in the case of DVD retailers who receive payments directly in cash, these illegal streaming sites get paid in internet currency—traffic. This traffic translates into revenue through ad placements. Has streaming impacted Nollywood’s stories? Being able to have Nollywood films on global streaming platforms has propelled the industry into placing its best foot forward in terms of the quality of movies released. Ighorodje believes that filmmakers have had to improve the quality of their films in order to be on global streaming platforms, which is great for the industry. “We have improved our shooting style and cinematics in order to measure up to international standards and compete on a global scale which is good for the business,” he shared with TechCabal. Donald Tombia, a screenwriter, agrees with Ighorodje and believes that filmmakers now tell more daring stories, all thanks to international streaming platforms. “Now we can create the kinds of films we want without being afraid of censorship. There are stories you want to tell and you already know that the Nigerian Film and Video Censors Board (NFVCB) will put restrictions on them. An example is Gangs of Lagos, which did fantastic on Prime Video. If that movie was released to cinemas alone, it wouldn’t have gone as far without being banned or having some parts censored, considering the central themes.” Netflix launched in Nigeria as a streamer in 2016, as part of its plan to expand into 130 countries. Fifty, a drama directed by Biyi Bandele, was among the first set of films to be streamed on the platform
Read MoreTingo Group denies Hinderburg reasearch allegations, appoints independent counsel
Nigerian fintech, Tingo Group, says the allegations made by Hindenburg research group are false and a deliberate attempt to damage its reputation. The company has also appointed an International law firm, White & Case LLP, to manage the situation. Tingo Group, a NASDAQ-listed agri-fintech company accused of being an “exceptionally obvious scam” by the Hindenburg research group, has publicly denied all the claims. In a press release shared on its website, the company said, “Tingo categorically refutes all the allegations and misinformation outlined in a report published by Hindenburg Research earlier today,” the statement reads in part. “The report, which contains numerous errors of fact, together with misleading and libellous content, appears to be a deliberate attempt to undermine the positive work that Tingo Group is undertaking across various worldwide markets.” In another press release, Tingo also announced that it has engaged White & Case LLP, a leading international law firm, to conduct an independent review and report to its independent directors concerning allegations contained in the report published by Hindenburg on June 6, 2023. The fintech company also maintains that it complies with the laws of every country it operates in and “maintains the highest standards of corporate governance.” Tingo also claims that Hindenburg Research did not attempt to verify the allegations made against the company. “The Company can confirm that no attempt was made by Hindenberg Research to verify the allegations or otherwise make genuine inquiries concerning the information provided in the report before its release,” the press release read. While Hindenberg Research spotted “red flags” in Tingo’s financial statements, the company [Tingo] maintains that its “accounting records are accurate and correct and that its financial results are accurately reported within its financial statements and its SEC filings.” “Tingo Group will respond in detail to the allegations made by Hindenburg Research in due course, but for the avoidance of doubt, the company believes the report published [yesterday] is a deliberate attempt to damage its reputation maliciously and unlawfully through the issuance of false, misinformed and distorted information for Hindenburg Research’s own financial gain and at the expense of the Company’s shareholders,” the statement concluded. In a move to lend credibility to some of Tingo’s operations, the All Farmers Association of Nigeria (AFAN), per a Sun report, noted a noteworthy progression in its lease and service agreement with Tingo Mobile Limited, a significant provider of mobile and fintech solutions in Nigeria. As of today, AFAN reports that an estimated 11 million of its members have adopted Tingo Mobile’s smartphone and fintech applications, including the Nwassa platform, as part of their daily operations. What do you think about our stories? Tell us how you feel by taking this quick 3-minute survey.
Read MoreStriking ride-hailing drivers in Nigeria say Bolt’s new N6,000 daily bonus is unimpressive
As the nationwide strike by ride-hailing drivers lingers, Bolt has introduced new incentives to drivers operating on its app, but they aren’t impressed. This week, ride-hailing drivers began a strike to ask for an increase in the base fares charged by Uber and Bolt in Nigeria. Bolt has now offered a bonus of N6,000 to the striking drivers. The bonus comes with conditions like completing between 9 to 11 trips, working at least 7 hours and accepting up to 90% of orders. The ride-hailing company also increased its surge pricing—a strategy used to motivate drivers to work during periods of high demand—–by 5%. Despite these new offers by Bolt, drivers who spoke to TechCabal say they’re unimpressed. “Do the right thing” For the Amalgamated Union of App-based Transport Workers of Nigeria (AUATWON), Bolt’s move still falls short. “The N6000 bonus is not bad in itself, it’s just an approach to justify their error,” Comrade Idris Shonuga, a national trustee of the union, told TechCabal. “The operating costs of drivers have increased. It’s a simple mathematics, you don’t need to dash anybody money. Do the right thing.” Shonuga also pointed out that Bolt is yet to recognise the AUATWON as a representative of ride-hailing drivers in Nigeria. He believes Bolt should organise a dialogue with the ride-hailing union to address the price dispute. “Bolt is just a moderator, they can’t determine the price of the service without carrying the stakeholders along. The price being dished out by them in response to the fuel hike does not reflect on the profit of the drivers and partners (car rentals),” he said. “The position of the union is to have a round table discussion with all the stakeholders of ride hailing platforms.” Celestine Finbar, a Bolt driver, told TechCabal that if Bolt truly wants to help drivers with incentives, they should eliminate the conditions. “Don’t give me conditions on what you claim to be a bonus,” he says. “Is the N6000 even free? You have to do a lot of trips to get that money, with what fuel? “ Finbar believes that Bolt could enhance their approach by reducing their commission. “Since they [Bolt] have N6000 to give, why don’t they reduce their commission? Everybody will be pumped to hit the road. The lower the commission, the more drivers will be willing to drive,” he said. Finbar has stopped working till Bolt reviews its prices. Felix, another driver who asked to be identified by his first name, says the conditions to be met for the bonus are ridiculous. “All we are saying is that Bolt increase the base fare. Setting conditions for that small bonus is funny when you consider the fact that they will still collect their own commission after the many trips. So I don’t see the point,” he told TechCabal. Struggling Ride-hailing drivers in Nigeria reject Bolt’s revised pricing For Bolt, the incentives aren’t about the protests Bolt claims the incentives were unconnected to the ride-hailing drivers’ strike. “Drivers are well within their human rights to engage in peaceful demonstrations, and Bolt respects this,” Yahaya Mohammed, Country Manager, told TechCabal in an email. “We offer recurring bonuses to our drivers, completely independent of the current circumstances. On the other hand, surge pricing is determined by market factors such as supply and demand.” Bolt maintains its position of being wary of decreased patronage if fare prices are too high, but the ride-hailing company adds that it is open to review the situation in the best interest of both passengers and drivers. “The welfare of our drivers is at the forefront of Bolt’s decision. We adjusted the fares taking into account the issue of demand and supply. Excessively high prices will discourage passengers from ordering rides, thus negatively impacting drivers’ earnings. Therefore, our revised fares aim to strike a balance between better compensation for drivers and manageable prices for passengers,” Mohammed said. “Bolt is committed to analysing and conducting extensive reviews to ensure that we continue to provide the best earnings for drivers on our platform and remain the most affordable and preferred platform for passengers.” What do you think about our stories? Tell us how you feel by taking this quick 3-minute survey.
Read MoreCellulant bullish on Zambia’s payments ecosystem, according to GM
Having entered the Zambian market in 2011, Cellulant is bullish on the country’s payments ecosystem, a sector the company pivoted to after dabbling in banking. TechCabal talked to Gilbert Lungu, general manager of Cellulant Zambia, to find out more about the fintech startup’s motivation for pivoting, the overall state of payments in the country, challenges they have come across in their operation, and more. Please give us a brief overview of Cellulant’s operations since it entered the Zambia market. Gilbert Lungu: Cellulant has been in Zambia since 2011. Primarily, at the time, the business was in a phase where the focus was on banking and providing mobile banking platforms, and then also doing what we call merchant aggregation, which is essentially just layering the mobile banking platforms with the actual merchants to enable payments to happen. In terms of that phase of the business, I think it went fairly well. We acquired 15 out of 18 banks, providing services in one form or the other for them. Around 2017 and 2018, there was a view that there were other opportunities in the market that spoke to payment collections and there were hypotheses around it. The main one was that there was no dominant mobile network operator in the market. The second one was that the primary product that the mobile network operators were pushing was peer-to-peer payments. Number three was that there was a clear cut case in terms of being able to do merchant acquisition, and provide digital payments for them based on the ecosystem that existed, either with the mobile network operators, as well as the banks. The fourth one was the view that there was general fragmentation in the market as a result of hypothesis number two. So the market was fragmented, because there was no one operator that was ahead of the other, and we realised that the fragmentation provided an opportunity to get into payment collections. After considering all those hypotheses, we then decided to pivot to payments. The banking business kind of took a back seat and we pushed the payments business more. Since that pivot, Zambia continues to be quite exciting as a market and we continue to experience growth month on month. Where do you think the payments landscape in the country is headed in the next 2-3 years? GL: The way I see it, Zambia is definitely poised to be a significant tech hub. There’s a lot of innovations that are going on with respect to young startups in ecommerce which I think will be big in the coming years. I think with the additional interest in terms of potential prospective investors looking for all sorts of opportunities, including in tech, when some of that money starts landing in terms of fundraising, we are going to see significant growth of the ecosystem. For a lot of these startups, I think what will then happen is that scale will begin to show. From a macro environment point of view, stability will see the economy start to take shape in terms of the growth plans that the government has put in place. I see that also being an accelerant to many sectors, including tech. There is significant consultation between the government and the ecosystem which is well needed. We are having quarterly engagements with the minister and presenting ideas and papers to him about how we can accelerate digitization in our country. In short, we are putting across ideas and he’s driving it from a policy point of view, to ensure that some of those ideas become a reality. For instance, there is an idea from a payments point of view that if the government takes a decision to start compelling some of the government departments to do payments via digital platforms and then puts the relevant policy framework to guide that, it will guide customer behaviour towards using digital means for transactions. I think over the next two to three years, opportunity size is also going to grow in terms of what else the tech startups can actually do. From a product point of view, I think payments is the thing right now. I see payouts, disbursements being the next big thing, as well as remittances, inward remittances, and then the relevant rails to be able to receive those remittances, and make sure that they’re flowing in the economy. So I see a positive picture overall. Which challenges would you say have been prominent in the Zambian tech ecosystem? GL: I think for Zambian startups, capital is still pretty much a challenge. I mean I’ve seen that there is activity now with angel investors trying to invest in these young tech startups but there is still some way to go because raising money is very difficult because of the nature of the places from which you can obtain that money. If you go into the banking sector, the cost of money is extremely high especially for startups. Challenge number two is in terms of incubation. People have a lot of ideas. I meet all sorts of youngsters that walk in here or find me on LinkedIn, and they’re telling me about very, very nice ideas, that if they got the right level of attention and training, they would become really grand ideas. The incubation to move from ideation to a point where they implement the ideas into scalable businesses is still relatively lacking in my opinion. We don’t have a lot of incubation hubs where these youngsters can take the ideas to be stress-tested. The third challenge, in my opinion, is the fact that tech businesses typically thrive and scale in the context of an ecosystem. They don’t work in isolation. Unfortunately, the ecosystem in Zambia has not developed to a point where there is sufficient trust between each of the ecosystem players in terms of who should play in what space. The bigger guys are always suspecting the smaller guys of trying to sabotage what they are doing and vice
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👨🏿🚀TechCabal Daily – Twiga prunes its staff
Lire en français Read this email in French. 9 JUNE, 2023 IN PARTNERSHIP WITH TGIF TC Daily will not be in your inboxes on Monday. We’re taking the long weekend—with June 12 being Nigeria’s Democracy Day—to squash some bugs. We’ll be back in your inbox by 7AM WAT on Tuesday, June 13, with a brand-new look and our referral system. In today’s edition Twiga prunes its staff MTN SA turns to alternative energy Ride-hailing drivers banned from Soweto malls TC Insights: Funding tracker The World Wide Web3 Event: The Moonshot Conversations Job openings TWIGA PRUNES ITS STAFF Twiga Foods has done a lot of pruning in the last year, and it doesn’t look like it’s stopping anytime soon. In a cost-cutting move last year, the B2B agritech startup laid off its entire internal sales team—about 211 people. Now, instead of full-time salespersons, it works with several independent agents. That’s a lot of firing, but Twiga defended it saying that it is converting the salespeople to “free agents”. Are they really free? It depends on who you ask, but what is apparent is that Twiga is free to immediately fire an agent that isn’t performing as well as the company would like. So are the free agents truly free? Well, they are free to work for other employers while working for Twiga Foods, as long as they are able to juggle it with the agritech’s expectations. It recently laid off some of these free agents for underperformance. Another layoff? Yes. Twiga assesses the agents monthly. If they do not serve the clients Twiga assigns to them satisfactorily, they are replaced by another agent on Twiga’s waiting list of new applicants. Currently, there are 2,000 people on that waiting list. MONIEPOINT RANKED 2ND FASTEST-GROWING AFRICAN COMPANY Moniepoint is Africa’s second-fastest growing company, as shown in FTs latest report. We also processed 1 billion transactions worth $43 billion in Q1 alone. Read all about it here. This is partner content. MTN SA TURNS TO ALTERNATIVE ENERGY TO ESCAPE LOAD-SHEDDING MTN has stated that it is actively investigating off-grid renewable energy alternatives to Eskom as it continues to battle the impact of load shedding on its operations. The launch forms part of a six-month plan, with completion targeted for the third quarter of 2023. It will involve a small-scale field trial in the Western Cape, to be followed by another one in the Eastern Cape. The company estimates that load-shedding cost its South African operations R695 million (~$37 million) in 2022 alone. Towards zero grid reliance: According to MTN, the project will allow seamless integration with MTN South Africa’s telecommunications equipment to provide hybrid renewable energy generation for [base stations] and other asset classes with low workloads. “It [will] also increase power security per site, mitigating the effects of load shedding in line with MTN’s plans to bolster network resilience,” the company said in a statement. Zoom out: Load shedding is forecasted to worsen this winter, with stage 8 expected. There is even some chatter about a total grid collapse. MORE FROM TECHCABAL Sudan’s war is crippling its budding tech ecosystem. Unity Bank’s Q1 2023 results raise questions about the bank’s financial health. SOWETO RIDE HAILING AND TAXI DRIVERS REACH TRUCE E-hailing drivers, including Uber and Bolt, have been banned from dropping off or picking up passengers inside malls in Soweto for a period of three months. This ban follows violent activities over the past few days which saw some Bolt and Uber vehicles burnt by taxi drivers who accused the operators of stealing their customers in the malls. The ban was introduced as a form of a ceasefire agreement between the taxi operators and ride-hailing drivers. A fair compromise: The discussions between the e-hailing association and the Soweto Taxi Services (STS) were facilitated by the City of Joburg. The ban will be in place until a permanent solution is found. The city of Johannesburg states that discussions for a more permanent solution will take place this Friday to plot a way forward. TC INSIGHTS: FUNDING TRACKER This week, Helium Health, a Nigeria-based health tech company, received $30 million in Series B funding in a round led by AXA IM Alts. Other participating investors included Anne Wojcicki, co-founder and CEO of 23andMe, Capria Ventures, Angaza Capital, Flat World Partners, Global Ventures, Tencent, Ohara Pharmaceutical Co, LCY Group, WTI, and AAIC. There’s only one more deal this week: Nigerian logistics company Haul247 raised $3 million in seed funding. The round was led by Alitheia Capital, with participation from Investment One. That’s it for this week! Follow us on Twitter, Instagram, and LinkedIn for more funding announcements. You can also visit DealFlow, our real-time funding tracker. EXPERIENCE VIVA TECHNOLOGY Book your pass to Europe’s biggest Startup and Business event here. This is partner content. THE WORLD WIDE WEB3 Bitcoin $26,663 + 1.02% Ether $1,852 + 0.66% BNB $264 + 1.58% USD Coin $1.00 + 0.01% Name of the coin Price of the coin 24-hour percentage change Source: CoinMarketCap * Data as of 22:10 PM WAT, June 8, 2023. EVENT: THE MOONSHOT CONVERSATIONS Moonshot Conversations is a mini-series of discussions about some of the most critical problems in African tech, and what radical solutions exist. This is part of the programs preceding and heralding our new flagship conference, Moonshot by TechCabal. The conference holds in October and will gather the most audacious players in the African tech industry. Check it out here. In the first episode of this series, we’ll be discussing AI in Africa, its impact and use cases, as well as the challenges faced in building an AI tool for the African continent. Our world is constantly evolving, and it is crucial for us to stay ahead of the curve. With this event, we aspire to create an environment where innovative ideas are shared, collaborations are fostered, and powerful insights are gained. Signup here to join the conversation. JOB OPENINGS Project Growth – Digital Marketing Associate – Africa (Remote) Bridge Talent Management – Human
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