Binance 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.
Read MoreMTN sees decline in internet subscription over NIN-SIM compliance
MTN Nigeria’s internet subscribers dropped in January due to efforts to comply with the Nigerian Communications Commission’s (NCC) mandate to link all SIM cards with a National Identity Number (NIN). MTN, the largest telecom operator in the country, saw over 2.8 million subscribers drop from its internet business leaving 67.8 million subscribers in January from 70.6 million subscribers in December. The decline was the most MTN Nigeria has seen since May 2023. The drop, however, didn’t affect Airtel and Globacom as both telcos gained subscribers in the same month, according to the latest data from the regulator. Airtel gained the most subscribers in January with 890,935 subscribers joining the network and helping to solidify its position as the second-largest internet service provider with 45.9 million subscribers. Globacom also gained 192,313 subscribers in January. Subscriber gains from Airtel and Globacom helped to reduce the impact of MTN’s subscriber decline on the industry. Airtel grew its subscriber base from 45.0 million subscribers to 45.9 million subscribers. Globacom also grew its subscriber base from 43.9 million subscribers to 44.1 million subscribers. In December 2023, the NCC directed all the telecom operators in the country to deregister all phone lines without a NIN and those with unverified NINs. A spokesperson for MTN Nigeria told TechCabal that the operator started compliance almost immediately after the directive was issued. The company also made several advertorials regarding the directive which led many subscribers to take steps to update or register their NIN. The deadline was supposed to have expired on March 29, 2024, however, the NCC has now extended the deadline for the disconnection of unlinked lines to July 31, 2024, per TheCable. The telecom operator has had a history of fines with the NCC which it is still trying to put behind it. In 2015, the company was fined $5.2 billion for failing to disconnect customers with unregistered SIM cards. MTN Nigeria’s subscription decline dented the overall industry internet figures in January. According to the NCC, the total number of subscribers that dropped off across all networks was 1.84 million leaving operators with 161.5 million subscribers from 163.3 million in December 2023. Aside from MTN Nigeria, 9Mobile continued its nearly nine-year decline with 94,824 subscribers leaving the network in January. 9Mobile now has 3.53 million subscribers.
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👨🏿🚀TechCabal Daily – Mono’s master cards
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning We’ve identified a bug in your inbox settings that might be affecting how often you read TC Daily. Moving us from your Promotions folder to your Primary/Main folder ensures you won’t miss any critical African tech news (or hilarious puns). In today’s edition Mono partners with Mastercard Triply is YC’s latest bet on the continent Facebook accused of sharing private DMs with Netflix How fintechs can adapt to FX reforms The World Wide Web3 Opportunities Fintech Mono partners with Mastercard Open banking, which permits banks to voluntarily share users’ data with fintechs, has been a long-battled phenomenon between Nigerian banks, regulators, and fintech startups. Poised to be a game changer in Nigeria’s financial space, open banking allows convenience for users as sharing of users’ account data could allow them to manage their finances in one place, let digital lenders make informed decisions for borrowers, and make for a seamless experience for both businesses and users. However, Nigeria’s central bank has delayed releasing guardrails to regulate the industry, thereby slowing the adoption of open banking. Yet, open banking startups like Okra and Mono have forged on in the industry, allowing startups to connect to user bank accounts, verify identities in real time, and initiate payments directly within their applications. Now, Mono is taking things a notch higher. A Mastercard marriage: Yesterday, Mono announced it was tying the knot with global payment giant Mastercard to enable payments directly into bank accounts without cards or USSD codes. The bigger picture: Mono has been on a major drive to increase its revenue and inch toward profitability. Before the partnership with Mastercard, Mono partnered with Flutterwave, Nigeria’s payment behemoth, to allow merchants to receive payments via an account-to-account (A2A) option which it calls DirectPay. Mono claims to have made transactions worth over ₦5 billion ($3.8 million) through this payment since it launched in 2022. The new partnership with Mastercard aims to increase that number. The partnership allows Mono to facilitate more transaction volumes through the Mastercard Payment Gateway System which is available to merchants across countries—Kenya, Ghana, South Africa, and Nigeria—where Mono currently operates. What’s in it for Mastercard? Mastercard has been trying to diversify beyond non-card payment options on the continent in recent times. It has partnered with several payment providers to explore alternatives in mobile money wallets, contactless payments, and QR payments. The new partnership with Mono further aligns with this goal. Experience fast and reliable banking with Moniepoint 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. Startups Triply is YC’s latest bet on the continent Kenya’s tourism industry is one of its biggest cash cows for foreign income, earning about $2.13 billion from it in 2022. The East African country also expects an uptick in the number of tourists by 2026—with 2.4 million visitors up from 2.1 million in 2021. With a growing middle class and increasing disposable income, Kenyans are also increasingly exploring their own country. Travel startups across the country are lining up to benefit from this. One of those startups is Triply, the latest member of the Y Combinator 2024 winter batch. The news: Triply, a Kenyan fintech that helps travel businesses collect payments has been selected for Y Combinator’s winter 2024 batch. Triply is the latest African startup in the cohort after Cleva, the cross-border payment service, and Miden, the API startup. Small businesses account for 90% of Africa’s travel industry. However, due to inadequate payment infrastructures, these businesses are unable to receive payments; as a result, they frequently have to use manual payment methods, which reduces the efficiency of their booking systems. Launched in 2021 by Peter Wachira and Collins Muthinja, Triply helps travel businesses collect payments and automate their operations. The startup also advertises these businesses on its marketplace to help match the needs of Kenya’s local travel market which is projected to grow by $749,000 in 2027. With Y Combinator’s backing and a booming domestic travel market, Triply is well-positioned to empower small travel businesses and become a key player in Kenya’s flourishing tourism industry. 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. Social Media Facebook allegedly shared private DMs with Netflix for a decade A new lawsuit is accusing Meta of giving Netflix special access to users’ private messages for nearly a decade. This alleged partnership, according to the class action lawsuit, helped Netflix tailor content for its viewers. The lawsuit claims Facebook and Netflix had a close relationship, with Netflix receiving special access to user data through an “Inbox API” agreement. This would have allowed Netflix to see private messages related to what users were watching on its platform. In exchange, Netflix would reportedly provide data on how users interacted with its service. Meta says no: Meta, of course, denied the claims, stating the agreement only allowed users to message their Facebook friends about what they were watching on Netflix within the Netflix app. If you think this might violate privacy agreements, you’re wrong. The second time’s the charm: This isn’t the first time Meta’s been accused of giving other platforms access to users’ DMs. In 2018, a New York Times investigation revealed that Meta—then Facebook—had given several companies including Amazon, Netflix, Spotify and Sony, the ability to read and even delete Facebook users’ DMs. At the time, Meta also denied the claims, stating, “None of these partnerships or features gave companies access to information without people’s permission.” The company was not fined for this as it did in fact, not violate user agreements. It has however faced over $1 billion in fines over the past five years for data
Read MoreMastercard’s direct bank payment with Mono may boost the Nigerian startup in its race to profitability
Mastercard, the second-largest payment network in the world, has partnered with Mono, a Nigerian YC-backed open banking startup, to enable payments directly into bank accounts without cards or USSD codes. For Mono, this partnership is another leap forward in its race to profitability. “In 2023, we moved from negative to positive gross profit, and we want to be profitable by the end of the year,” Abdul Hassan, founder & CEO of Mono, told TechCabal. The startup expects to achieve profitability by scaling the adoption of its open finance tools. “We have more partnerships like this in the pipeline.” The startup, like its competitors, has been expanding its focus from providing lenders with open banking APIs to servicing a wide range of fintechs to increase revenue. Before partnering with Mastercard, it had partnered with Flutterwave, one of Nigeria’s largest payment providers, to enable merchants to receive payment through the account-to-account option. According to Mono, Direct Pay, which powers this A2A payment option, has handled payment transactions exceeding N5 billion since it launched in 2022. Mono can expect to facilitate even more volume as the Mastercard Payment Gateway System services numerous merchants across several African countries, including Kenya, Ghana, South Africa and Nigeria, where Mono currently operates. On the other hand, this partnership is advantageous for Mastercard, as it has been finding new ways to digitalise spending. Through partnerships with payment providers, Mastercard has been exploring non-card payments in Africa for years: mobile money wallets, contactless payments, and QR payments. Around 2020, over 1 million merchant locations across Africa were accepting Mastercard QR payments. ”In three years, cards will mostly be used for offline payments,” said Hassan, who claims that Mono has connected more than 3 million financial accounts across Nigeria, Ghana and Kenya. He predicts that this account-to-account payment method will see even quicker adoption, especially in Nigeria, where QR payments and contactless payments have slower uptake rates. Mastercard to buy a minority stake in MTN’s fintech unit, after investing $100m in Airtel’s fintech This optimistic outlook might be a breath of fresh air for established card networks like Mastercard and Visa, whose deployment of account-to-account payment in developed markets like the US and UK has met reluctance from users. Experts believe the consumer market in those regions favours the familiarity and ease of card payments for everyday spending and argue that users might require more incentives to adopt A2A options. In contrast, in Nigeria, a lot of merchants are enabling the pay with bank option, which is repeatedly used even when there are USSD and card options, according to Hassan. “I think it is because of the ease and perceived security.” Also, the settlement is instant and much faster than cards. Hassan reasons that the success of this payment method for Mastercard spells good tidings for Mono’s dream to become a household name. “We currently have a web-based app that allows users to see how many fintech apps their bank details are linked to.” The four-year-old startup hopes to gain familiarity with the larger consumer market and eventually launch the web app as a mobile app with added features. It looks like the company is playing a long game, but in a precarious market like Africa’s, it can be dangerous. However, Hassan himself has once said, “Most of the time you can win by just not dying.”
Read MoreNigerians switch to other p2p options after Binance clampdown
It was a routine Thursday for Pascal*. He’d planned to convert some Naira to USDT on his favourite exchange, Binance, a strategy he used to hedge against inflation and build a safety net. He soon found out that he wasn’t able to access the Binance website. Flustered and worried, he hobbled around for new alternatives to carry out his transactions. This sudden disruption wasn’t unique to Pascal. On Wednesday, February 22, news broke that Nigeria’s telecom regulator, the Nigerian Communications Commission (NCC), had restricted user access to the websites of Binance, Coinbase, and Kraken, accusing the companies of manipulating prices of the naira/dollar pair in unofficial markets. These crypto exchange platforms became the go-to for direct crypto transactions—through their peer-to-peer trading feature—after Nigeria’s central bank abolished local financial institutions from enabling crypto transactions in 2021. The crypto exchanges have also played a significant role in determining unofficial exchange rates for the naira, with platforms like Binance often serving as benchmarks for local foreign exchange rates. While the websites of Binance, Coinbase, and Kraken have been inaccessible in the country, crypto traders who spoke to TechCabal claim they now use alternatives like Bybit, Bitget, Kucoin, and Coincola and messaging platforms like Telegram, (which comes with an in-app wallet) to make transactions. However, Bybit has emerged as a favourite for these crypto traders who say the exchange’s low transaction fee—0.2%—is a reason for the choice. “Law enforcement in Nigeria notoriously follows a scapegoat approach,” claimed Caleb Nnamani, a technology reporter at Cardano-backed publication, Nodo. “If you’re going to do a thing, do it thoroughly,” Rume Ophi, a crypto analyst, told TechCabal, speaking on the spared exchanges. “It’s like robbing Peter to pay Paul.” As Nigerians turn to foreign alternatives to transact crypto, these traders have ignored local exchanges such as Zap, Furex, and Quidax. “Crypto-savvy Nigerians trust foreign exchanges because of their outsized liquidity,” Nnamani told TechCabal. “A hack to a global exchange behemoth comes with some assurances of payback.” According to him, Nigerian crypto traders don’t trust local exchanges to keep their funds safe in the event of a hack. “I think it comes down to popularity. We are more familiar with Binance, OKX, and the rest.” One crypto user said. “They have proven to be very good. I think that’s what is giving them the edge [over local platforms]” A risky shortcut Users’ options for crypto trade have not been limited to just alternative exchange platforms. Two Crypto traders who spoke to TechCabal said they have been trying out Telegram’s newly launched P2P trading platform as a workaround. Launched in September 2023, Telegram’s crypto wallet—a bot embedded within the messaging platform—allows users to trade cryptocurrencies directly with each other and even purchase crypto using their bank cards. While this method allows for the convenience of trading within Telegram, it is not a perfect fit for crypto traders. One crypto trader who spoke with TechCabal was sceptical about trading safely on the app. “It’s new and untested, and I’m unsure how they handle user complaints,” expressed the cautious trader. These user’s fears are valid. Telegram offers a custodial wallet, which means it holds onto users’ access keys—critical for authorizing crypto transactions—which raises security concerns, as a third party holding the keys increases the risk of a leak if Telegram’s security is compromised. A big concern with Telegram is its custodian wallet. Unlike other platforms, Telegram holds onto users’ private keys, which are essential for crypto transactions, meaning that in the event of a hack on Telegram, a user’s crypto could be stolen. Telegram did not respond to TechCabal’s request for comments.Nnamani also expressed concerns about the limitations of trading on Telegram. “You’d prefer a fintech you can send, save, and probably do multiple money functions on,” he said. “Why would I p2p here then go and look for my other crypto needs elsewhere.” Before the presence of crypto exchanges in Nigeria, crypto traders often clustered in messaging platforms like WhatsApp to source for crypto deals. Unlike regulated exchanges, trading on these messaging platforms lacks the security of escrow services offered by crypto exchanges, leaving users vulnerable to scams. However, the administrators of these groups often take the place of an escrow. Nigerians are fast returning to this mode of sourcing for deals since the closure of Binance. “I used to trade on a supposedly ‘trusted escrow’ group on WhatsApp,” shared a crypto trader who wished to remain anonymous. “Unfortunately, some members who didn’t use escrow got scammed.” Binance, the embattled exchange While crypto traders in the country continue to explore workarounds to trading since the ban of their darling exchange, Binance continues to slug it out with the Nigerian government. One of the company’s two executives, who flew into the country to resolve its blocked website, remains in detention, while the other, has reportedly absconded. As a result of the squabble, the exchange discontinued all naira services on its platform. The Nigerian government has repeatedly suspected Binance of manipulation of forex prices on its platform. The suspicion was confirmed after the government analysed peer-to-peer trading transactions on the platform and found huge buy orders—as much as $1.9 million—for USDT by Nigerian retail traders who never followed through, raising suspicion about an attempt to manipulate prices for personal gain. The report also reviewed that artificial demand for USDT resulted in the naira’s quick drop from $1/₦1,500 to $1/₦1,950. Before the restriction of its website, Binance placed limits on how much naira could be traded for the USDT, to help salvage the naira after the currency sank to new lows. The exchange also disabled selling USDT altogether and limited buying it to a fixed price of ₦1802. However, the recent report by the CBN claimed that more than 40% of the buy offers came from the same accounts. TechCabal reported earlier this week that the Nigerian government had filed tax evasion charges against the company, and its detained executives, Nadeem Anjarwalla and Tigran Gambary. The government accused Binance of three tax offences:
Read MoreBaobab Network acquires Reflector to support portfolio companies’ marketing efforts
Baobab Network, the Nairobi-based early-stage investment firm that has pledged to invest in over 1,000 African startups by 2033, has acquired South Africa strategy and branding agency Reflector Marketing. The financial details of the transaction were not disclosed. The acquisition of Reflector Marketing comes at a time when early-stage investors are under pressure to have portfolio companies with solid business cases beyond just venture capital cheques. In Reflector Marketing, Baobab states that it will help its portfolio companies with specialised in-house marketing, branding, and digital services, amplifying their potential for success and further funding. Through the acquisition, the Reflector Marketing team will join Baobab to provide portfolio companies with in-house digital marketing support. Klyne Maharaj, founder of Reflector Marketing, will assume the role of director of Baobab Network’s accelerator. Founded in 2016, Baobab Network is a sector and geographically agnostic investor who issues a ticket size of $100,00 to its portfolio companies. The company claims that its portfolio’s cumulative valuation is more than $225 million from 50 companies. According to Toby Hanington, co-founder of Baobab, the move is evidence of Baobab’s ambitious plans and long-term commitment to investing across Africa. “We’ve worked with the Reflector team since early 2023, and the move to acquire them is a testament to the work they’ve already done with our portfolio,” he said. In the past, digital marketing, which comprises elements such as Search Engine Optimisation (SEO), social media marketing, product strategy, pitch deck preparation and branding, has been the go-to marketing medium for startups. This is because of its affordability compared to traditional marketing, relevance to target customers of startups, and its ability to adapt to the changing interests of the target market. According to Maharaj, the acquisition is in line with its mission to enable the growth of startups via digital marketing. “Our goal has always been to help the world’s best startups nail their positioning, win their markets, and raise capital to fuel their growth.”
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