Exclusive: TikTok cuts jobs in Africa as part of global layoffs
Several employees on the TikTok African team were laid off in June 2024 after the social media giant announced planned global layoffs. Before employees were told about the scheduled layoffs in May, the ByteDance-owned company cut a few roles on the African team in March, one person with knowledge of the matter said. June’s layoffs cut deeper, affecting employees in content operations, marketing, and trust and safety teams, the same person said, claiming more layoffs are expected in the third quarter of 2024. The exact number of job cuts could not be determined, but over half the African team based in South Africa and Nigeria were affected, according to two persons who worked on those teams. One person said the African team had at least 100 people. TikTok declined to comment on any part of this story. While several publications linked the layoffs to the company’s regulatory troubles in the United States—President Joe Biden signed a law demanding that China-based ByteDance sell TikTok within nine months or be banned across the US—one person familiar with the company rejected that framing. “The changes are not a reaction to anything,” said an executive who asked not to be named as they were not authorised to speak on the matter. “It is a function of assessing the business on an ongoing basis and making necessary changes.” According to The Information, this is TikTok’s most significant layoff. The same publication said it typically prefers smaller reorganisations across teams. TikTok isn’t alone in these sweeping changes. Meta and Microsoft have also reduced the size of their African teams, although they insist they continue to invest in Africa.
Read MoreEquity Group’s half-year profit grows 12.5% to $229 million
Equity Group, Kenya’s biggest bank by market capitalisation, has reported a 12.5% growth in net profit in H1 2024, despite difficult macroeconomic conditions that saw businesses and individuals default on loans. On Monday, the lender reported $229 million (KES29.6 billion) in net profit, up from $203.4 (KES26.3 billion) in half-year 2023, on strong interest income performance. Equity Group’s interest income rose 22% to $656 million (KES84.8 billion) against high inflation and interest rates. Equity Group’s strong performance comes when top Kenyan banks are betting on regional expansion as growth slows in East Africa’s biggest economy. Double-digit growth in the region has offset a dip in earnings from Kenyan operations. “We are now a regional bank, with the bank slowly moving half the balance sheet and P&L out of Kenya,” said James Mwangi, group managing director and CEO. “The group’s regional subsidiaries have improved efficiency, contributing 47% to the group’s balance sheet in terms of deposits and loans, and driving a 55% revenue growth.” The bank also recorded a steady non-interest income growth by 16% to $737.2 (KES95.1 billion). Customer deposits grew 11% year-on-year to $10 billion (KES1.3 trillion), and its customer base now is 20.7 million. The growth in deposits saw a 55% increase in cash and cash equivalents to $2.6 billion (KES341 billion) and growth in investment securities to $3.5 billion (KES459 billion), giving the lender a strong liquidity position. Equity’s gross non-performing loans (NPLs) grew 4.4% to $929.4 billion (KES119.9 billion), forcing the lender to increase provisions for loan defaults by 35% to $65.8 million (KES8.5 billion). The Central Bank requires Kenyan banks to set aside funds to cover loans where borrowers fail to pay principal or interest for 90 days. “We are proud that Equity Group has a sufficient cushion on its key balance sheet buffers being liquidity, capital and NPL coverage while at the same time, it continues to report above industry profitability metrics,’’ Mwangi said.
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👨🏿🚀TechCabal Daily – Egypt expands electricity export to Asia
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning We’re still on the hunt for a Sales Manager to help us close strong deals fast. If you know someone who can help us sell our market, send them our way by sharing this link. In today’s edition Why did Jumia’s stocks decline? Nigeria partners Proforce to develop new satellites Egypt to expand electricity export to Asia The World Wide Web3 Opportunities Companies $JMIA comes down to earth after tepid Q2 results Jumia, the Africa-focused e-commerce company, has had mixed fortunes as a public company. While much of it has been rehashed to the point of boredom, Jumia’s stock price makes for intriguing tracking this year. After trading between $3-$6 per share from January to May, it saw an unexpected price rally by July. $JMIA hit a year-high of $14.56 and a market capitalisation of $1.33 billion. In a report by one hedge fund seen by TechCabal, the stock was rated a “buy” on the strength of its understanding of the African market and cash efficiency under Francis Dufay. Yet things can change quickly when you’re a public company. A testy week for American and Asian markets saw $JMIA trade in the $8 range, and the company’s release of its Q2 results didn’t do it any favours. While it led with positives, like narrowing its losses, it completely missed analysts’ revenue expectations. While Wall Street analysts estimated $41.7 million in revenue for the quarter, the reported revenue figures came in at a tepid $36.5 million. Publicly traded companies have seen their share prices suffer for less. Yet, Jumia will live to fight again in Q3. As anyone who tracks public companies knows, one quarter is more than enough time for a turnaround. “We’ll prove the doubters wrong in Q3,” we imagine Dufay muttering as he prepares to deliver on the company’s promise to shareholders. Read Moniepoint’s 2024 Informal Economy Report Did you know that 57.7% of the business owners in Nigeria’s informal economy are under 34 years old? Click here to find out more about the demographics of Nigeria’s informal economy. Space Nigeria partners Proforce to develop new satellites Nigeria’s lofty space ambitions have always been hindered by a lack of resources. Although Nigeria has 4 satellites in space, it has yet to launch new ones. In March 2024, Nigeria’s National Space Research and Development Agency (NASRDA) announced it was shutting down a 2025 satellite launch due to a lack of funding. NASRDA is not letting its failed launches stop it from building more satellites. It has partnered with ProForce, a Nigeria-based private security firm, to build three new satellites, NigeriaSAT 3, 4, 5, and a Synthetic Aperture Radar (SAR). NASRDA’s Director-General, Matthew Adepoju said that the satellites will be used in defense, maritime, and the oil and gas sectors. The news comes months after Nigeria secured a partnership with the Space Exploration & Research Agency (SERA), a global space agency, to send the first Nigeria into space. SERA will reserve a seat on an upcoming Blue Origin New Shepard suborbital spaceflight for a Nigerian citizen. Collect payments anytime anywhere with Fincra Are you dealing with the complexities of collecting payments from your customers? Fincra’s payment gateway makes it easy to accept payments via cards, bank transfers, virtual accounts and mobile money. What’s more? You get to save money on fees when you use Fincra. Get started now. Energy Egypt to expand electricity export to Asia Egypt has installed a transformer in Badr to link to Saudi Arabia and make inroads into other Asian and European countries as a key electricity distributor. This is part of the Egypt-Saudi Arabia electrical interconnection project first announced in 2021. The $1.8 billion initiative involves three high-voltage substations (two in Saudi Arabia, one in Egypt) connected by 1,350 km of overhead lines and 22 km of undersea cables across the Gulf of Aqaba. The project, expected to be fully operational by 2026, will allow Egypt to supply 3,000 megawatts (MW) directly to Saudi Arabia. Electricity distribution has become an important revenue source for Egypt, and it already supplies power to neighbouring countries like Sudan, Libya, Lebanon, and Jordan. Last year, Egypt earned $1.3 billion from electricity exports. Despite being one of Africa’s largest electricity producers with 209,677 gigawatts, Egypt only expends a small amount of that energy. With a production capacity that large, it makes sense for Egypt to sell its surplus to other countries. It is now eyeing opportunities in Asia, where recent energy crises have caused power outages during high-demand periods. Although Egypt already supplies electricity indirectly to Asia through resale—for example, in February, Jordan agreed to sell 40 megawatts of its imported electricity to Iraq—it is entering the Asian market through a central hub that connects other Asian countries. Paystack Virtual Terminal is now live in more countries Paystack Virtual Terminalhelps businesses accept secure, in-person payments with real-time WhatsApp confirmations and ZERO hardware costs. Enjoy multiple in-person payment channels, easy end-of-day reconciliation, and more. Learn more on the Paystack blog → Crypto Tracker The World Wide Web3 Source: Coin Name Current Value Day Month Bitcoin $58,433 – 3.90% + 2.72% Ether $2,545 – 3.95% – 17.49% Ethena $0.29 – 6.74% – 25.06% Solana $143.78 – 7.40% + 3.88% * Data as of 06:20 AM WAT, August 12, 2024. You should definitely read these Entering Tech #71: Career lessons from Tyrion Lannister The business of selling out is warping the music industry Can anyone stop Google’s illegal monopoly? Nigerian entrepreneur Tony Elumelu: “America was colonised too and look at where they are” Written by: Emmanuel Nwosu & Faith Omoniyi Edited by: Muyiwa Olowogboyega & Timi Odueso Want more of TechCabal? Sign up for our insightful newsletters on the business and economy of tech in Africa. The Next Wave: futuristic analysis of the business of tech in Africa. Entering Tech: tech career insights and opportunities in your inbox every Wednesday at 3 PM WAT. TC Scoops: breaking
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🚀Entering Tech #71: Career lessons from Tyrion Lannister
Size doesn’t matter, but likeability does. 10 || August || 2024 View in Browser Brought to you by Issue #71 Career lessons from Tyrion Lannister Share this newsletter Greetings ET people It’s true that your competence opens doors for you, but your people skills get you so far. One character that exemplifies this ethosis Tyrion Lannister, the “Imp” from Game of Thrones who outlasted the bravest, strongest, cunning characters in the show. I watched the show recently (please don’t judge me for being late to the party), and got fascinated by Tyrion. I promised to write about him. And like every Lannister, I always pay my debts. I think you’d agree that the Imp is one of the likeable characters in the show—heck, even CBR agrees. But not my editor, Timi, and maybe Cersei who hated Tyrion’s guts. But whichever fence you stand on, we can all agree that Tyrion’s aura and steeze stood out throughout the show. Despite his size, he carried himself with the confidence of a giant and spoke with the eloquence of a king. I am almost done with the series, and I have learned so much about Tyrion that can apply to my career and yours. So, here I am, seven seasons into the series, ready to deliver what I have learnt to you! Faith Omoniyi Much ado about bravery and empathy When we first meet Tyrion, he’s a man with a wandering eye, and he reeks of the booze served at the northern feast. By the end of the show, he still pretty much had his head in a brothel. So why even take this guy seriously? Image source: Adaeze Chukwu/TechCabal. Well, let’s be honest, what Tyrion lacks in a stand-up guy, he makes up for in crucial aspects that help him play the hand he was dealt. Despite his physical stature, Tyrion’s cunning and strategic mind was his moat. This earned him an interim Hand of the King position while his father was away, and later as the Targaeryen Queen’s trusty Hand. Even Lord Varys, the Master of Whisperers, gave him a nod. People didn’t always like him, but they knew his use. Tyrion dined with kings, counselled the wise and foolish, and escaped death on more occasions than we can count. Yet, he went all the way. By contrast, a stand-up character on the show like Ned Stark lost his head, unwilling to play the game of thrones. Tyrion’s smarts and silver tongue got him through the cutthroat world of Westeros politics. Even the slickest operators like Littlefinger eventually ran out of tricks. Working with smart folks is helping me find my own moat—(read: that competitive advantage that sets you apart in your career.) It’s crucial to spot your moat and double down on it, but don’t forget to shore up your weak spots too. GIF Source: Tenor Empathy for Tyrion was both poison and relief. His kindness for every Tom, Dick, and Harry typically set him up for situations he wished he wasn’t in. But you cannot deny that his empathy—something the Lannisters were not known for—also earned him good graces with other people when it mattered. That’s how he buddied up with Jon Snow, for example. Many folks get promoted for being aces at their jobs, but few have the people skills and empathy to really nail those roles in ways that impact people they work with. Hence why you end up with bosses who care more about results than the poor lads doing the work. *Newsletter continues after break The man for the job and for play Size doesn’t matter. Does it? Not for Tyrion. Though he never was warrior material, when it mattered most at the Battle of the Blackwater, he led an army to defend Kings Landing against Stannis Baratheon’s invading army. Cliché, but you’ll never get some things in your career if you don’t stand up for yourself and make big bets. You think you deserve a pay bump and you have the results to show for it? Ask! You’ve been unfairly judged at work and you want to air your opinion? Do it! And even when you make these ballsy bets, remember that people help people they like. My favourite tweet of all time from UnkleAyo makes a pity case for people who undermine the role the ability to be liked plays in your career growth. “I understand a dissenting dogma like, ‘It’s not my job to be likeable—it’s my job to be myself and the right people will gravitate towards me’. But if they like you, they’ll hire and train you.” They will hire and train you! And this doesn’t have to even be about work. Humans are social creatures. They’ll naturally help and spend time with people they like. Like, for people, can be reserved for those with great networking skills, those who they get favours from, those who they can have long-winded conversations with and come out better, and those who show genuine interest in others’ well-being. Image source: YungNollywood I bid you to choose your own “likeable” but etch it in your memory that to play the corporate game of life, you need the vote of likes from people. Not the competitive, soul-sucking, esteem-dependent likes. Just the one that makes people genuinely want to do things for you. *Newsletter continues after break The man with stories controls reality “What unites people? Armies? Gold? Flags? Stories. There’s nothing more powerful than a good story.” As you grow in your career and take up leadership roles, your job will involve bringing people together to achieve a set goal. And what better way to do it than to tell a story. Your ability to tell the right story at the right time can be the difference between success and failure. To tell great stories, you must read. “A mind needs books like a sword needs a whetstone.” Whether you’re just starting your career or well into it, the key to reaching the top
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Wigwe University admission scholarships 2024
Wigwe University is offering merit-based scholarships for students enrolling in 2024. This prestigious opportunity is designed for individuals who have consistently demonstrated outstanding academic performance, leadership qualities, entrepreneurial spirit, and an eagerness for continuous personal and professional development. See eligibility criteria and application details: Eligibility criteria for Wigwe University admission scholarships 2024 To be considered for the Wigwe University admission scholarship 2024, candidates must: Have selected Wigwe University, Isiokpo, as their first choice of institution Secure a minimum score of 170 in the Unified Tertiary Matriculation Examination (UTME) Upload their qualifying results to the Joint Admissions and Matriculation Board (JAMB) CAPS portal Additional notes: Candidates awaiting their O’Level results must upload these to JAMB as soon as they are available. Failure to upload results to JAMB will result in disqualification from the scholarship consideration. Candidates who did not initially choose Wigwe University as their first choice but meet the cut-off score may still apply. They must first effect a change of institution on the JAMB website, making Wigwe University their first choice before the Change of Institution process closes on the JAMB portal. Application process To apply for admission to Wigwe University: 1. Visit the official Wigwe University Portal at wigweuniversity.edu.ng and complete the admission application process. 2. After submitting your admission application, proceed to the Scholarship section of the website and click on “Apply Now” for the Wigwe University admission scholarship 2024. Important dates: Successful applicants will be notified by the first week of September. The application window closes on the 26th of August 2024. Note: This scholarship opportunity does not extend to Direct Entry candidates. Final thoughts on Wigwe University admission scholarships 2024 The Wigwe University admission scholarship 2024 is a remarkable opportunity for students with strong academic records and leadership potential. By supporting these students, Wigwe University continues its mission to nurture the next generation of innovators and leaders.
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How and where to buy cheap MTN data in 2024
In 2024, staying connected to the internet is very important to people. Importantly, you also want to stay connected without breaking the bank to purchase data. In this article, we will be highlighting two ways MTN users can explore to buy cheaper MTN data in 2024 compared to the regular tariffs the telecoms company offers. Here we go: 1. Buying Cheap MTN Data with MobileNig There are several third party vendors retailing data to consumers these days. One of them is MobileNig that has become a go-to platform for Nigerians looking to purchase discounted and affordable data plans across various networks, including MTN. Here’s how to use MobileNig to buy cheap MTN data in 2024: Step-by-Step Guide Visit MobileNig: Open your browser and go to the MobileNig,com. Create an account: If you’re a first-time user, sign up by clicking get started and providing the necessary details. 3. Fund wallet: Fund your MobileNig wallet with about ₦1000. MobileNig will charge you a onetime fee of only ₦100 and you can use the rest of your money to buy data as you want. 4. Select data plans: Navigate trough the menu to the data section and choose MTN as your network provider. You’ll see a variety of data bundles available at discounted prices. 4. Choose a Plan: MobileNig offers two MTN data categories – MTN SME and MTN Corporate. Do not be confused by the names. Simply browse through the options and select the data plan that suits your needs. Apart from the fact that MobileNig offers special discounts that make it easier to buy cheap MTN data in 2024, you also get to know the data server status which is usually either Excellent/Good/Fluctuating/Unavailable. This helps you know when to hold on before purchase or after buying. 5. Make payment: Proceed to checkout and pay using your preferred method, such as the money in your wallet, a debit card, bank transfer, and the likes. 6, Receive your data: Once payment is confirmed, your MTN line will be credited with the data bundle instantly. Using MobileNig not only provides you with cheaper data options but also offers convenience, as you can compare prices and choose the best deal available at any time. 2. Buy cheap MTN data with TopDealForMe/Data4Me (*121#) Many people do not know that apart from the default MTN data plans available via *312#, MTN’s TopDealForMe/Data4Me service is another excellent way to buy cheaper data directly from MTN in 2024. This service provides personalised data offers based on your data usage patterns, allowing you to access exclusive deals. How to use TopDealForMe/Data4Me Dial *121#: On your MTN line, simply dial *121#. This code opens up the menu. Select the data offers: From the menu, select the option for TopDealForMe or Data4Me. The first usually has the biggest plan available to you. The second one will present you with a list of personalised data plans tailored specifically for you. 3. Choose your plan: Review the options in relation to the airtime you have or can afford and select the data plan that offers the best value to you. The deals on Data4Me/TopDealForMe are often cheaper than standard data bundles, making it an effective way to buy cheap MTN data in 2024. 4. Confirm Purchase: Follow the prompts to confirm your purchase. The data will be credited to your line immediately. Advantages of TopDealForMe/Data4Me Share data: When you subscribe for the substantial data plans under the TopDealForMe/Data4Me options, you can also Gift family and friends MTN data using the *312# route. Personalised offers: TopDealForMe/Data4Me uses your past usage to offer plans that are more suited to your needs, often at a lower cost. Convenience: The service is available directly from your phone without the need for internet access, making it accessible anytime and anywhere. Exclusive deals: MTN frequently updates its TopDealForMe/Data4Me offers, ensuring that you always have access to the best deals available. Tips to maximise savings when you buy cheap MTN data While both Mobile.ng and the TopDealForMe/Data4Me option are great for buying cheap MTN data in 2024, there are additional tips to ensure you’re getting the most value: Compare regularly: Prices and offers can change frequently. Make it a habit to check Mobile.ng and especially TopDealForMe/Data4Me regularly to ensure you’re always getting the best deal. Buy in bulk: Sometimes, buying larger data bundles offers better value per MB. If you’re a heavy user, consider opting for bigger plans. Use Wi-Fi when possible: Save your mobile data for when you’re on the go by using Wi-Fi at home or work. This can help your purchased data last longer. Monitor your usage: Keep track of your data usage to avoid unnecessary top-ups and ensure your current plan meets your needs. Final thoughts on how and where to buy cheap MTN data in 2024 In 2024, staying connected on a budget is easier than ever with options like MobileNig and MTN’s Data4Me service. Whether you’re looking for the best deals online or personalised offers directly from MTN, these methods ensure you can buy cheap MTN data in 2024 without compromising on quality. By following the steps outlined in this article, you’ll be able to enjoy more data for less, keeping you connected wherever you go.
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👨🏿🚀TechCabal Daily – Hohm Alone in the Dark
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية TGIF This is your final reminder! Early Bird tickets to Moonshot 2024 close TODAY. Don’t miss out on this incredible opportunity to be part of Moonshot 2024. Get your ticket now! In today’s edition Hohm Energy in financial distress Kenyan banks to track high-value transactions Credit agencies say Liquid Intelligent Technologies is now credit-risky Glovo extends ads service to Nigeria Funding tracker The World Wide Web3 Opportunities Startups Hohm Energy in financial distress months after it raised $8 million When Hohm Energy, a startup that provides access to loans for solar installations, announced an $8 million raise in February 2024, it was the largest seed round ever raised by a South African company. Founded in 2021, Hohm Energy launched at a time loadshedding had worsened electricity supply in South Africa. People turned to renewable energy solutions to meet their power needs. The company claimed it had helped customers access up to $90 million in financing. Hohm Energy looked like a runaway success. Yet things aren’t always what they seem. Last week, CEO Tim Ohlsen left the company amid unconfirmed reports of cashflow problems. The company also laid off an undisclosed number of employees. Ephraim Modise set out to find out what had happened at Hohm, and how a business flush with money just a few months ago has now entered business rescue. Read all about it here. Read Moniepoint’s 2024 Informal Economy Report Did you know that 57.7% of the business owners in Nigeria’s informal economy are under 34 years old? Click here to find out more about the demographics of Nigeria’s informal economy. Banking Banks in Kenya to track high-value transactions Since 1970, Kenya has lost $10.6 billion to illegal financial activities like money laundering and terrorism financing. While the country has worked to tighten its anti-money laundering laws, the Financial Action Task Force (FATF) included Kenya in its greylist in February—a list of countries with deficiencies in safeguarding their financial systems against money laundering and counter-terrorist financing. The FATF grey list meant more scrutiny for banks and other financial institutions in the country. And so, the Central Bank of Kenya (CBK) asked commercial banks in the country to comply with global ISO 20022 messaging standards, which demand banks clear details about every money transfer. On Wednesday, NCBA, Kenya’s fourth-largest commercial bank, told users that it would start tracking cash deposits and transfers above 1 million Kenyan shillings ($7,700). The bank is among the first banks in the country to implement the rule. Banks across the country will be keen on following the rule, as non-compliance attracts a $155,000 (KES 20 million) fine. A previous attempt to grant tax authorities access to bank and mobile money transactions was unsuccessful. In its bid to uncover tax cheats, Kenya’s tax regulator sought to look through bank and mobile money transactions. However, the Law Society of Kenya said the move was against users’ right to privacy. Collect payments anytime anywhere with Fincra Are you dealing with the complexities of collecting payments from your customers? Fincra’s payment gateway makes it easy to accept payments via cards, bank transfers, virtual accounts and mobile money. What’s more? You get to save money on fees when you use Fincra. Get started now. Telecoms Credit agencies downgrade Liquid Intelligent Technologies, now credit-risky Debt is cheaper than equity. But during low interest rate periods, it becomes tempting for companies to raise more money than they need. And that oversubscription can be problematic because debt must be paid back. One such company, Liquid Intelligent Technologies (formerly Liquid Telecoms), a pan-African telecommunications company, is now struggling with debt repayments. Within the last 7 years, Liquid raised $1.4 billion through debt instruments. The raise had a debt agreement that required them to maintain a debt-to-earnings (DTE) ratio of 3.5x. This means their debt could not exceed 3.5 times their net earnings. The agreement also stated that the DTE ratio threshold is supposed to decrease to 3.0x by August 2024. However, as of the end of June, Liquid’s DTE ratio was still 3.46x. Its next repayment schedule is due in March 2026 for a $220 million loan. Another $620 million from issued bonds is due in September 2026. Lenders are growing impatient: Liquid has to either increase its earnings or lower its debt. Only the former is conceivable as there’s low confidence that Liquid will meet this deadline given its slow performance. Although its revenue grew to $183.7 million in the last quarter, its profit margin took a beating to 65.5% as the company struggled with forex losses from its Zimbabwean business. Liquid still suffers from a net debt of $930.6 million. To worsen things, credit rating agencies Fitch and Moody’s downgraded the company’s rating from B to CCC+ and B3 to Caa1 respectively, making Liquid a company with “substantial risks”. This outlook is bad for a company that has historically been dependent on debt to finance its infrastructure-heavy telecoms business. Refinancing the business again through debt will mean getting loans at high interest rates—if at all it gets another loan. Amid all this, former CEO and deputy executive chairman, Nic Rudnick left the company. Liquid is staying low and seeking to raise $90 million equity funding from the US International Development Finance Corporation. Question marks still hover around how the company will use the cash; a few critics question Liquid’s run-up debts that led it here. Startups Glovo extends ads service to Nigeria Food delivery businesses are small-margin businesses. The businesses often offer services in adjacent verticals to earn more revenue. For example, Chowdeck, popular offers Relay, a parcel delivery service. In July, Chowdeck also said it was building an ad-product. A customer base of 600,000 also meant that the startup could offer ad placement in its app. And so it did, offering slide-show banners on its app at ₦250,000 ($152) per week. The startup also advertises other businesses via push notifications, charging ₦250,000 per notification. Chowdeck’s
Read MoreExclusive: Hohm Energy in financial distress months after $8m raise
Hohm Energy, the South African solar company that announced a $8 million seed round in February, is currently not operational due to cash flow problems and an inability to service existing debts. The company has entered business rescue, a process that helps financially distressed companies get help, and has laid off an undisclosed number of employees. Under South African law, business rescue lasts three months. Within that time, a business rescue practitioner must investigate the company’s affairs, convene a meeting of creditors, and advise on the company’s prospects. “We are working with legal counsel to get a better understanding of a way forward, but Hohm is currently not trading,” Franc Gray, CEO of Hohm’s parent company, Spark Energy Services, told TechCabal. CEO Tim Ohlsen left the company last week, people familiar with the matter said. After Ohlsen’s resignation, managing director Ryan Steytler took over the company leadership and decided to put the business into business rescue. Gray alleges Steytler made the decision unilaterally and against shareholder advice. Steytler and Ohlsen could not be reached for comments. Founded in 2021, Hohm Energy’s flagship product is a solar marketplace that lets customers digitally determine their solar energy requirements and access loans for rooftop solar installation. The platform also enabled solar installers to design, manage, and finance projects. As South Africa’s load shedding worsened, renewable energy alternatives like Hohm enjoyed more demand. By February 2024, the company claimed to have generated over 17,000 custom solar rooftop designs worth $190M and $90M in financing applications to implement them. Ohlsen told TechCabal in February the company was on track to be profitable by the end of 2024. Hohm rapidly increased its headcount in anticipation of growing demand for solar, said Bas Hochstenbach, managing partner of E4E Africa, one of Hohm’s investors. However, as grid electricity improved in South Africa, Hohm’s business started to show the first signs of cracks. “Hohm had a lot of sticky costs and could not act quickly enough to restructure that cost base as revenue tapered off because of slowing demand for solar,” said Hochstenbach. EXCLUSIVE: Hohm Energy raises $8 million seed to tackle loadshedding in SA Hohm also had lax governance structures in its early days which impacted the efficiency of its operating model. It only formed a board in early 2024 ahead of its seed round, said one investor who asked not to be named so they could speak freely. Gray also claimed there could have been more transparent reporting of the company’s health by Hohm’s management, which would have enabled Spark to offer sufficient help. “At the moment, the goal is to create the best outcome for all parties concerned in a situation that is not ideal,” one investor said. Parent company Spark plans to invest more money in the business after the rescue process, but under a new business model and management team.
Read MoreBuilding a security-first culture critical to protecting Africa’s digital financial ecosystem
This article was contributed to TechCabal by Omotayo Ogunlade. As the digital payments landscape in Africa expands, the need for robust cybersecurity measures becomes increasingly urgent. Trust and security are foundational to financial services, and as cybercriminals continue to become more aggressive and sophisticated, addressing any vulnerabilities is critical to safeguarding the integrity of Africa’s digital financial ecosystem. In fact, Africa experienced the highest average number of cyberattacks per week per organisation in 2023, with a 23% increase compared to the previous year. Africa’s digital financial ecosystem is still maturing. As digital payments become more integrated across countries and regions, and more interoperable across payment platforms, this increasingly complex environment can introduce new cybersecurity vulnerabilities. And, as in an interconnected landscape, a single weak link can jeopardise the entire network, the continent’s financial institutions, governments and decision-makers must come together to collectively work towards establishing and maintaining baseline security standards across the industry. This requires building meaningful partnerships with relevant stakeholders, substantial investment and greater harmonisation of regulations and policies across the continent. The imperative for investment and standardised regulations Several challenges hinder the attainment of robust cybersecurity in Africa. One of the primary issues is the lag in regulatory frameworks, while a lack of significant investment in security would lead to vulnerabilities within the continent’s financial sector being exploited. Fortunately, investment in cybersecurity has seen a notable increase over the past five years, reflecting a growing recognition of its importance. The rise of artificial intelligence (AI) and sophisticated cyber threats has driven firms to allocate more resources to cybersecurity. Digital payment networks like Onafriq have strengthened their security posture by investing in intelligent tools that predict and proactively address potential threats. Despite these advancements, there remains a disparity in investment levels across the continent. Ensuring that all financial institutions meet necessary security standards requires coordinated efforts and substantial capital. This includes investing in state-of-the-art technology and continuous monitoring systems to detect and prevent malicious activities. Additionally, regulators play a crucial role in setting and enforcing security standards. And yet the pace of regulatory development often falls behind the speed of innovation in the fintech space. Harmonising regulations across different African countries is essential to create a consistent and secure environment for digital payments by adopting best practices and global standards. This is necessary to avoid fragmentation of the digital payments landscape, and effectively enforcing these standards is vital to maintaining a secure financial ecosystem. A need for cybersecurity skills and a security-first culture A secure payments environment requires buy-in from every part of the ecosystem’s value chain, including the end user. Not only must financial institutions adopt a security-first approach, embedding robust security measures into every aspect of their operations, but educating users about security practices is just as crucial. As digital payments become more prevalent, financial institutions must design products with built-in security features and continuously educate users on safe practices. This includes secure PIN usage, recognising phishing attempts, and safeguarding personal information. For example, Onafriq exemplifies this approach by ensuring that security is a priority from the design stage. By securing networks, protecting sensitive data, and conducting regular third-party audits, we have maintained a strong security record. This proactive stance is essential for preventing breaches and ensuring customer trust. More than this, there is a growing need to build the cybersecurity capacity to sustain the digital payments landscape. Africa needs more skilled cybersecurity professionals, which hampers the ability to address emerging threats effectively. A cybersecurity assessment conducted by the African Union Commission and the United Nations Development Programme found that African countries had a cybersecurity competence of 0.21 out of 1, with more than 70% of African nations requiring additional cybersecurity infrastructure. Financial institutions and governments must invest in training programs, internships, and continuous education to develop a skilled workforce capable of managing cybersecurity challenges. But, retaining talent within Africa also remains a significant issue. Many trained professionals seek opportunities abroad, exacerbating the skills gap. Addressing this requires creating conducive environments that offer competitive opportunities and career growth within the continent. Cybersecurity is a cornerstone of Africa’s digital payments landscape. To achieve a secure and resilient financial sector, Africa must invest in robust cybersecurity infrastructure, foster regulatory harmonisation, and prioritise collaborative efforts among financial institutions. By addressing these challenges, Africa can build a secure digital payments ecosystem that supports economic growth and instils trust among users. — Omotayo is the Group Chief Technology Officer at Onafriq. He has a distinguished career in fintech and a proven track record in driving technological transformation, leading Onafriq’s global expansion.
Read MoreJumia’s plan to raise $100 million in doubt as share price plummets on weak Q2 earnings
Jumia’s ($JMIA) share price plunged sharply on Thursday, continuing a beating that began on Tuesday after the company posted revenues of $36.5 million in Q2 2024, missing analyst estimates of $41.7 million. A market rally in the last three weeks saw Jumia’s share price hit $13 and a valuation of over $1.3 billion, but those gains have quickly been wiped out. Before the market opened on Thursday, Jumia was trading at $4.91, implying a valuation of $496 million. It will put question marks around the company’s plans to raise $100 million through the sale of new shares, as reported by TechCrunch on Tuesday. The company had planned to take advantage of July’s rally to sell new shares. Selling secondary shares would have boosted its cash position, as it has $92.8 million in cash and cash equivalents. Jumia raised $386 million in 2021 after its share price unexpectedly jumped to $49. “The new funding will be used to expand our supply chain network, particularly by enhancing logistics to reach smaller cities and broadening our overall network,” CEO Dufay told TechCrunch. If it eventually raises funding, it will invest in technology and scale “the company faster and break even faster.” While the company narrowed its losses to $19 million in Q2 cutting advertising spend and using its cash more efficiently, active customers remained flat and currency devaluation in key markets like Nigeria made it difficult to grow revenue. Jumia did not immediately respond to a request for comments.
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