The path forward for growing Nigeria’s digital economy
This article was contributed by Oswald Osaretin Guobadia the outgoing Senior Special Assistant on Digital Transformation to the President of the Federal Republic of Nigeria and Project Lead for the Nigeria Startup Act. He is the Co-founder and Executive Vice President of DBH Solutions, an African infrastructure and information technology company. He is also an author, a business strategist and a technology consultant with over 20 years of demonstrated expertise in information technology (IT) and business strategy development. When I got the call to serve my country at the height of the COVID-19 pandemic, I was not only elated, I also felt the weight of a huge sense of responsibility. I have been an entrepreneur in Nigeria for close to two decades and the impact of policymaking has always directly affected my entrepreneurial experience. For me, it was an opportunity to go from talking about how to make Nigeria great to contributing what I could to make it happen. Now, as my tenure as Senior Special Assistant on Digital Transformation to the President of the Federal Republic of Nigeria draws to a close, I’m reflecting on how rewarding the journey has been. I am incredibly grateful for the opportunity to have been a part of a team that has brought about significant changes in a short period of time. I would like to express my deepest gratitude to the federal government of Nigeria for entrusting me with the responsibility to participate in the governance of our great country. It has been a privilege to serve alongside so many dedicated and talented individuals who equally share a common goal of driving the growth and development of Nigeria. As I reflect on my journey, one of the greatest achievements and milestones I cherish the most was the passing of the Nigeria Startup Act (NSA) into law. Yes, I will be adding “policymaker” to my profile, having led the programme, which is landmark legislation that will have far-reaching implications for the digital economy. This act is a significant step towards fostering an enabling environment for innovation and tech entrepreneurship in the country. The significance of this act lies in the fact that it positions Nigeria as a contender in the global competition for technology as a core industry, and as a driver for the emergence of a better, more inclusive society. The NSA provides a collaborative framework for supporting the growth of tech and tech-enabled startups, which are essential components of any thriving economy in the 21st century. It will also facilitate access to funding, talent development, and other resources, which are crucial for the success of these startups. Furthermore, the Nigeria Startup Act will enable the government to collaborate and engage more effectively with private-sector stakeholders to promote innovation and build a more robust digital ecosystem. I have no doubt that this act will serve as a catalyst for further growth, innovation, and exploitation of Nigeria’s tech ecosystem; indeed, ample evidence of this is already visible in the ecosystem. But enacting the act is only one piece of the puzzle. There’s more that goes into building a thriving and inclusive digital economy. Oswald Osaretin Guobadia led the project team for the Nigeria Startup Act. He is the outgoing SSA Digital Transformation to The President, Federal Republic of Nigeria Charting a path forward There is absolutely no doubt that Nigeria has the potential to be a global leader in tech and innovation. Policy development and articulation that support the sector and allow for the government and stakeholders to collaborate better are vital to charting a path forward for a country to realise its potential. However, in order for policies or legislations to serve the purpose for which they were created, they must be implemented. The danger of doing otherwise is that the policies sit and gather dust on a shelf. Government must throw its full weight behind the implementation of the NSA in the same way the ‘Big tent approach’ pulled support from all ministries, departments and agencies (MDAs) and the private sector in the development of the then-bill. This will ensure that the interests of Nigerians are protected, which, in this case, is to yield benefits primarily for young people across the country. The second hurdle in the path ahead is to lay a solid foundation for future growth that is all-inclusive and sustainable. We certainly cannot afford to repeat limited value chain participation in our natural resources. Our valuable resources and opportunities in this case are our young and talented citizens that can be trained to deliver, real hard problems that can be solved through market-creating innovations, and our large domestic market to service en route to global market entry. We need to ride the momentum of the mobilisation for the NSA to make the right investments now that will help us achieve this goal. We cannot wish it into existence. We cannot leapfrog and avoid critical steps in the technology developmental cycle. I believe that the next great idea and startup that impacts the world will start and grow in Africa. The question is, how do we get there? It is crucial to understand where in the journey we are and only then can we map a development path that is relevant and pragmatic for us as a nation. Asides from enacting and implementing policies, another major key to success is ensuring we are executing infrastructure initiatives that support our growth. Here are a few symptomatic questions that can get us started in the right direction: Have we digitised public services to make them accessible on an e-governance platform? What is our pathway to reducing our reliance on paper? Can a paper-driven mindset stimulate productivity that is on par with digital processes and services? Have we moved digital citizenship from enumeration and control to providing services to our citizens? Do we have digital access to our vast market population via rural connectivity and broadband medium diversity? How can we increase digital literacy as part of our universal basic education
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C. Moore Media and Allison+Partners collaborate with Google Africa to launch the fourth edition of the Future is Female Mentorship Program
The Future is Female Mentorship Program is the first and only PR and communications program dedicated exclusively to African women in tech. Applications to the program have grown by over 160% in recent years, with applications received from 36 African countries in 2022. In celebration of the 60th anniversary of Africa Day, C. Moore Media and Allison+Partners have announced the launch of the fourth edition of The Future is Female Mentorship Program, the first and only PR and communications program dedicated exclusively to African female tech founders and their business development needs. For the first time, Google for Startups Accelerator: Women Founders Africa Program and Salesforce Ventures Impact Fund will collaborate with the program, highlighting both organisations’ support in developing tech across Africa. In line with the goals and objectives of the Future is Female Mentorship Program, the Google for Startups Accelerator: Women Founders Africa Program aims to empower and support female founders on the continent by providing resources and opportunities to scale their startups and address African problems. Salesforce Ventures Impact Fund is actively interested in Africa and continues to assess opportunities across the continent. The Fund has invested in some of the region’s top tech startups, including Flutterwave and Andela. As part of their support for the program, they will host a session on VC funding for the selected female founders from across Africa. Launched on Africa Day in 2020 by Africa tech-focused PR agency C. Moore Media International PR, recently acquired by global agency Allison+Partners, The Future is Female Mentorship Program is the first and only PR and communications program dedicated exclusively to African women in tech. Applications to the program have grown by over 160% in recent years, with applications received from 36 African countries in 2022. “African female tech founders are often unsupported in the male-dominated world of tech, which is why The Future is Female Mentorship Program was established. We are excited to launch the fourth edition of the initiative with Allison+Partners, who acquired C. Moore Media, International Public Relations,” said Claudine Moore, The Future Is Female mentorship program founder and managing director of Africa at Allison+Partners. “We are also delighted to collaborate with Google Africa and their Women Founders Africa Program, and Salesforce, who will be hosting a session on VC funding with the selected finalists of the program,” she continued. Selected alumni from the Google for Startups Accelerator initiative will be invited to take part in the program, which will provide African female founders with PR and communications expertise, insights, knowledge, and skills needed to gain visibility and grow their businesses. Applicants selected for the initiative will learn storytelling best practices, strategic business communications with multiple stakeholders, how to position their startups for investment opportunities, and more. The program will also provide mentees with insights customised for the unique needs of their business and sector. “We are excited to be collaborating with The Future is Female Mentorship Program as it aligns with the mission of the Google for Startups Accelerator: Women Founders Africa Program to support and empower women founders building great tech startups in Africa or for Africa,” said Folarin Aiyegbusi, head of Startup Ecosystem, Sub Saharan Africa. “By increasing the representation of women in the startup ecosystem, we can help bridge the gap between the number of women-led startups and the amount and quality of support they receive, ultimately leading to more diversity and innovation.” Leading pan-African tech publication TechCabal, and Africa Communications Week, a global platform that builds bridges between communications professionals focused on Africa’s transformation, return for their third consecutive year as official partners of the program. What the 2023 program offers The fourth edition of the Future is Female mentorship program promises to reach even more African female founders across the continent, while introducing additional partners in more diverse sectors, expanding the resources, network, expertise, and knowledge available to mentees. Mirroring previous editions, this edition of the Future is Female Mentorship Program will provide African female tech founders of early-stage startups with the PR and communications insights, knowledge, and skills needed to gain visibility and grow their businesses. It is aimed at African women based on the continent or in the diaspora and is launching or growing a tech business for African markets or serving Africans in the diaspora. The program is delivered virtually, and the mentees are invited to participate in masterclasses and sessions customised to the specific needs of their sector and business. During the mentorship program, female founders will learn insights into the fundamentals of PR and communications for tech startups, including creating a communications plan, incorporating storytelling into their business communications with multiple stakeholders, and more. During the selection process, special consideration will be given to startups that focus on health, education, finance, agriculture, and sustainability. In addition, startups that provide solutions and/or address African women’s and girls’ needs will also receive special consideration. How to apply The application portal for the Future is Female Mentorship Program is now open and closes Monday, June 26, 2023. The successful female founders will be announced on Tuesday, July 25, 2023. We encourage all women building great tech startups in or for Africa to apply to the program and take advantage of this opportunity. Follow #CMMtheFutureIsFemale on social media for program updates. Follow @Allisonpr @CMooreMedia and @ClaudineMoore on Twitter and Instagram for announcements. Please visit www.thefutureisfemalementorshipprogram.com for regular news and updates. Press Contacts: David Idagu, Africa Regional Consultant, Allison+Partners David.idagu@allisonpr.com About Allison+Partners Allison+Partners is a global marketing and communications agency driven by a collaborative approach to innovation and creativity. It was named by PRovoke Media as one of its Global Agencies of the Decade, 2023 North American Agency of the Year and Best Agencies to Work For. In July 2022, Allison+ Partners acquired C. Moore Media International Public Relations expanding its presence in Africa and named Claudine Moore the Managing Director of Africa. Allison+Partners operates in 50 markets worldwide and is organized around five practices: Consumer Brands, Corporate, Reputation Risk + Public Affairs, Health, and
Read MoreAmid intense controversy, the NITDA Bill is pushing its way to the presidency
Nigeria’s tech ecosystem is rejecting a bill put forward by the country’s ICT policy-implementing government agency, but the unrelenting agency is somehow pushing the bill forward—amid contentions and ecosystem cries of foul play. A controversial bill that seeks to ascribe new powers to the National Information Technology Development Agency (NITDA), Nigeria’s governing body for information and technology, has passed a public hearing at the Senate and will soon make its way to the presidency. About a year ago, TechCabal broke the news that Nigeria’s Federal Executive Council was considering a new bill put forward by NITDA that would repeal the NITDA Act of 2007, and enact a new NITDA Act that provides for “the administration, implementation, and regulation of IT systems and practices, as well as the digital economy in Nigeria and for related matters”. The proposed bill aims to grant NITDA the authority to regulate and oversee technology and communications companies. Under the bill, NITDA would be responsible for issuing permits and licences to these companies, as well as establishing and managing a fund. The fund would be financed by collecting a standard 1% profit before tax from companies with annual turnovers exceeding ₦100 million. This move means that NITDA, mostly known for its work as a digital development agency, is seeking to punch its weight as a super regulator of the tech ecosystem. This would give it regulatory control over startups, tech hubs, telecommunications companies, and everything else in between. To this, the ecosystem disagreed. But an unrelenting NITDA pushed the bill into the National Assembly, where it is now completing a favourable run. Several ecosystem stakeholders have decried the bill, with ALTON labelling it as an incoming “bundle of chaos”. But that has done nothing to stop the bill’s advancement. The present situation is that NITDA is on its way to becoming the prime regulator of “operators in Nigeria’s information and technology sector”, raising concerns about what this portends for the Nigerian tech ecosystem. For stakeholders, the NITDA Bill is unnecessary Most stakeholders who have expressed their discontent with the bill hinge their reasons on the resulting duplicity of functions between NITDA and other agencies. According to the Computer Professionals Registration Council of Nigeria (CPN), the bill will arrogate more powers to NITDA, including the ability to fix licensing and authorisation charges, collect fees and penalties, and issue contravention notices—all of which are presently handled by separate government agencies. “The proposed NITDA Bill is an usurpation of the statutory powers of other agencies of government that had been in existence before NITDA, and have been performing their statutory roles,” the body said. The Association of Licenced Telecommunications Operators of Nigeria (ALTON), another stakeholder present at the Senate public hearing where the bill passed, maintained that the bill would both turn NITDA into a super regulator of the whole ICT/Communications sector and unnecessarily duplicate the regulatory powers of some existing government agencies in the country, particularly the Nigerian Communications Commission (NCC). Babalakin and Co, a leading commercial law firm in Nigeria, pointed out that the bill confers powers on NITDA which transcends beyond being a regulator. According to them, section 9(i) of the bill proposes that NITDA functions as a “coordinator” and “supervisor” over the activities of incorporated entities which are wholly or partly owned by the government—-and this is not in line with global best practices. “In a situation where NITDA is the coordinator or supervisor of entities wholly owned or partly owned by the government, there is a real likelihood of bias where there is any issue or dispute between such entities and wholly privately-owned companies. This will be against the principles of natural justice which is constitutionally guaranteed,” the firm’s representative, Boonyameen Babajide Lawal, shared at the hearing. Big tech companies including Google and Meta have also decried the levies and ambiguousness of the bill, asserting that giving NITDA the position to “issue permits and authorisations” to tech companies is not in line with global best practices. Meta raised concerns about the punitive measures drafted into the bill, maintaining that criminal liability for offences emanating from non-binding documents such as regulations, guidelines, and circulars is contrary to basic criminal law principles. For context, the bill contains strong punitive measures to ensure compliance, including hefty fines and/or imprisonment of operators. Ecosystem players suspect foul play Three stakeholders in the tech ecosystem who spoke to TechCabal on condition of anonymity shared that the NITDA Bill is being pushed by government officials close to the presidency. A brewing concern is that these government officials are seeking to insinuate themselves as key stakeholders in a promising tech ecosystem. Gbenga Sesan, the executive director of Paradigm Initiative, an organisation that supports digital rights for Africans, told TechCabal that the probable reason for the bill’s advancement despite ecosystem clamours can be linked to the willpower of Nigeria’s minister of communications and digital economy.“ [It is] probably because the minister, Isa Ali Pantami, wants it done. There is no other logical reason for NITDA to exhaust its near-zero goodwill and seek to do what NCC already does,“ he said. The executive secretary of ALTON, Gbolahan Awonuga, told TechCabal that the bill is being set up for selfish interests by a few parties. “Stakeholders are saying they don’t want this bill, but some people keep pushing it at all costs. Does that not prove that they are representing themselves?” he asked. “Besides, I saw the favourable report from the senate committee on ICT. That report is a lie. A lot of the parties who supported the bill are filler organisations that were brought in to force the bill on Nigerians,” he added. Sesan shares similar thoughts on this, asserting that some names of some of the supporting organisations “are suspect and don’t show any relationship with the [technology] sector”. TechCabal can confirm that in the aforementioned report, 17 institutions were listed as supporters of the bill. But out of these, three organisations were repeated in the list, which corrects the number of
Read MoreKenya’s first publicly accessible fast-charging station for electric buses launched
BasiGo, an e-bus company, has set up a charging station in Nairobi, becoming the first connected through the new e-mobility tariff. Its electric buses replace imported diesel with clean power, fostering the growth of the EV industry. Electric mobility is slowly taking shape in the Kenyan market, particularly in Nairobi. Several electric vehicle companies have set up shops in the country, led by BasiGo and ROAM Mobility. BasiGo, as its name suggests (Basi is a Swahili name for bus), is taking electric mobility to the masses who use public transport in Nairobi. ROAM has a similar business model, but has other products, such as electric motorcycles. Companies like Hummingbird, have taken a different approach in the sector, by partnering with the hospitality industry to offer electric vehicles for their customers. While these developments have been made over the last couple of years, Kenyans have always wanted to know how the companies plan to roll out charging stations for their vehicles. Charging stations can influence and facilitate EV adoption. The availability of charging stations is a key factor influencing consumers’ decisions to switch to electric vehicles. By installing charging infrastructure in new markets, it becomes more convenient for people to charge their EVs, alleviating range anxiety and making EV ownership more practical and accessible. Now, BasiGo has launched the first publicly available fast-charging station for its fleet of electric buses in Kenya. Located in Nairobi’s Buru Buru area, the facility is the first one linked to the nation’s e-mobility tariff approved by the Energy & Petroleum Regulatory Authority (EPRA) in 2023. The tariffs offer affordable electricity for charging electric vehicles during nighttime in Kenya, taking advantage of the surplus of renewable energy available during those hours. In the past three years, around 90% of the electricity supplied to the grid has been generated from renewable sources like hydro, geothermal, solar, and wind. During the off-peak hours at night, this percentage increases to 100%, indicating that the grid is entirely powered by clean energy during most of that time. “Thanks to the support of Kenya Power in establishing the E-mobility tariff, we can invest in infrastructure like this charging station and enable the rapid growth of the electric vehicle industry in Kenya,” BasiGo CEO Jit Bhattacharya said. The station can charge six buses simultaneously, but by the end of the year, it will be upgraded to accommodate up to 25 vehicles. With the addition of this new station, BasiGo now operates three charging stations, collectively capable of charging more than 20 electric buses. This latest station will be the dedicated charging location for electric buses operated by OMA Sacco and Embassava Sacco. Each electric bus the company deploys and charges replaces the consumption of 20,000 litres per year of imported diesel with 50 MWh of clean, renewable electricity generated locally in Kenya. The introduction of the e-mobility tariff enables investments in infrastructure like this charging station, fostering the rapid growth of the electric vehicle industry in Kenya. According to Dr. (Eng.) Joseph Siror, the Managing Director and Chief Executive of Kenya Power, says the transportation sector in Kenya contributes to 67% of all emissions in the energy sector and 12% of national emissions. These emissions are projected to rise to 17% by 2030. Supporting the growth of the E-mobility sector is crucial in combating this trend. Kenya, as the largest economy in the region and a leader in clean energy, has the opportunity to become the launch pad for the rest of the continent in the development of the electric vehicle industry. BasiGo has plans to make its charging stations accessible to the public for charging electric cars and trucks by the end of 2023. It also intends to deploy similar charging stations throughout Nairobi and eventually across the country. These efforts aim to facilitate the deployment of 1,000 electric buses to Nairobi bus operators within the next three years. The state is also in the process of building robust facilities for e-mobility. Kenya Power, for instance, is currently engaging a consultant to assist in developing an E-mobility Network Infrastructure System (ENIS). ENIS aims to pilot electric vehicle charging stations, serving the company’s internal needs and demonstration purposes. Kenya Power has also allocated KES 40 million ($290,000) to buy three electric cars and build three electric vehicle-charging points in Nairobi. The company aims to replace its 2,000 vehicles powered by fossil fuels in the next four years. This transition will involve retrofitting electric engines onto current vehicles and acquiring new electric cars.
Read MoreCBN licence clampdown: Your money is safe, Eyowo tells customers
Eyowo says the revocation of its license by the CBN will prevent its users from sending or receiving money from their accounts for a while. But said its users’ funds are safe. Eyowo, one of the banks whose licence was revoked by the Central Bank of Nigeria, has assured its customers their money is safe. The digital bank tweeted a statement on Wednesday. On Wednesday, the Central Bank of Nigeria revoked the operating licences of the microfinance bank, Eyowo, and more than a hundred financial institutions across the country for non-compliance. According to Eyowo, its users won’t be able to transfer or receive money from their accounts for a while because of this move by the apex bank. But said it is actively working with the CBN to fix the issue. “To our users, rest assured that the CBN directive has no immediate impact on the safety of your money, nor is it connected in any way to the planned service improvements and ongoing onboarding freeze we announced. We remain committed to ensuring the security of your money and apologise for any inconveniences that you will experience in this period,” the statement reads in part. “Over the next few hours, you will experience challenges sending and receiving money with Eyowo. This may take up to 24-72 hours to completely resolve, we will keep you abreast of the progress made and the next steps.” Eyowo said transactions by customers would be halted for a while, and it’s working on a “quick fix” to address the issue. The digital bank has promised its customers continued communication until the issue is resolved. “We recognise the significance of open communication during this period and will keep you informed of any developments and progress made towards resolving the situation,” the statement said.
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👨🏿🚀TechCabal Daily – Hackers attack Kenyan government
Lire en français Read this email in French. 25 MAY, 2023 IN PARTNERSHIP WITH Happy salary day Is becoming a technical writer easier than becoming CEO or president? Here’s what a content creator has to say in this one-minute edition of Entering Tech. In today’s edition Chinese hackers attack Kenyan government Nigeria suspends licences of 179 banks South Africa to limit energy consumption Nigeria’s ICT minister moves to change Startup Act The World Wide Web3 Event: The Moonshot Conference Opportunities CHINESE HACKERS ATTACK KENYAN GOVERNMENT A recent investigation by Reuters reveals that Chinese hackers specifically targeted Kenyan ministries, state institutions, and the State House from 2019 to last year. A debt owed: Their objective was to gain unauthorised access and assess the substantial debt owed to Beijing, which amounts to billions of dollars. Kenya’s debt to China stood at $6.31 billion in March, the lowest since March 2019 when it was $6.01 billion, following a peak of $7.06 billion in June 2021. According to Reuters, the defence contractor, pointing to identical tools and techniques used in other hacking campaigns, identified a Chinese state-linked hacking team known as “BackdoorDiplomacy” as having carried out the attack on Kenya’s intelligence agency. The security breach started with a “spearphishing” attack after a State employee downloaded an infected document unknowingly in 2019 and went on up to last year, Reuters said, quoting three cybersecurity experts familiar with the attacks. Several ministries targeted: Documents provided by the analyst reveal Chinese cyber spies subjected the office of Kenya’s president, its defence, information, health, land and interior ministries, its counter-terrorism centre and other institutions to persistent and prolonged hacking activity. Per Reuters, “A review of internet logs delineating the Chinese digital espionage activity showed that a server controlled by the Chinese hackers also accessed a shared Kenyan government webmail service more recently from December 2022 until February this year.” So far, neither Chinese officials nor the Kenyan government have responded to the allegations. 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. CBN REVOKES LICENSE OF 179 MICROFINANCE BANKS On Tuesday, the Central Bank of Nigeria (CBN), revoked the licences of 179 microfinance banks (MFBs), four primary mortgage banks, and three finance companies in Nigeria. This information was disclosed in the official gazette of the Federal Government, published on the CBN website. The revocation was done in two tranches with the first list suspending licences of 47 MFBs, and the second affecting 132 more MFBs. Why? Per the gazette, the financial institutions’ licences were revoked because they “ ceased to carry on, in Nigeria, the type of business for which their licences were issued for a continuous period of 6 months; failed to fulfil or comply with the conditions subject to which their licences were granted; failed to comply with the obligations imposed upon them by the Central Bank of Nigeria by the provisions of Banks and Other Financial Institutions Act (BOFIA) 2020, Act No. 5.” The licences were revoked by the CBN Governor Godwin Emefiele by the authority granted to the CBN by Section 12 of BOFIA 2020, Act No. 5. The affected institutions include fintech Eyowo, Premium Microfinance Bank, Royal Microfinance Bank and others. Customers affected too: The effect of revocation means these institutions can no longer carry out services independently, or the behalf of their customers. Eyowo, yesterday, issued a notice stating that customers would not be able to withdraw or send money until the issue was resolved. The fintech, however, assured customers that their monies were safe. MORE FROM TECHCABAL Entering Tech #31: How AI can help in job hunting Jumia’s Q1 2023 report shows path to profitabliity. SOUTH AFRICA TO LIMIT ENERGY CONSUMPTION In a move to enhance energy efficiency and manage the load-shedding crisis, South Africa is set to ban the sale of high-energy-consuming lighting technology, and this could include fluorescent bulbs and lights. A two-year journey: In April 2021, the country’s Trade, Industry & Competition Department published regulations set to improve the safety, performance and energy efficiency of lightbulbs. The regulations, which were initially published for public comments, set a high bar for minimum luminous efficacy—90 lumens per watt. The final regulations were supposed to be published by September 2022, but the department missed the deadline and instead published it yesterday, May 24, 2023. Side-bar: Luminous efficiency is a measure of how much light a lamp can produce for the power it consumes. Incandescent and fluorescent lights produce less than 79 lumens per watt while LEDs produce roughly 130. Trade, Industry & Competition minister Ebrahim Patel highlighted the aim of these specifications: to eliminate inefficient and environmentally damaging lighting products. The first phase of implementation, commencing 12 months after publication, will require regular electric lamps to have a minimum luminous efficacy of 90 lumens per watt (lm/W), a target currently attainable only by light-emitting diodes (LEDs). The second phase, beginning three years after publication, will further increase the minimum efficiency to 105lm/W. A few exceptions: The regulations make exceptions for specific applications outside general household lighting, such as studio lighting, theatre lighting, and medical use. For South Africa, this marks a significant step towards energy efficiency and underscores the country’s commitment to sustainable and eco-friendly practices in its lighting sector. FUNDRAISING, EXPANSION AND EXIT Today, May 25, at 1:00 pm WAT, Endeavor Entrepreneur and CEO of Daystar Power, Jasper Graf von Hardenberg, will share valuable insights for entrepreneurs in the Journey To Scale webinar. Alexis Akwagyiram, managing editor at Semafor Africa, will moderate this webinar. Register here. This is partner content. NIGERIA’S ICT MINISTER MOVES TO CHANGE STARTUP ACT Nigerian minister of communications and digital economy, Isa Ali Pantami As Nigerian president Muhammadu Buhari prepares to bow out of office in barely five days,the country’s minister of communications and digital economy, Isa Pantami, is trying to institute a new board to
Read MoreHow Lagos traffic is hindering food delivery businesses
For a Mega City like Lagos, waiting for a food delivery is a test of your patience, time, and an invitation to anger. “I would say that it has been traumatic and has been a huge test of my patience. Food delivery is terrible. That’s if you ask me,” Femi Adetuberu, a finance expert insists and frequent user of such services. In summing up his experience, Adetuberu admits that it has not been easy for him, especially when he is famished and expecting instant food delivery. He strongly believes there is a disconnect between the restaurant and the delivery personnel. “You meet a delivery person who feels they are doing you a favour or they expect to be compensated for doing their job,” he said. Uzor Gift, a creative designer resident in Lagos has lost trust in expecting his food to be delivered on time. “I order when I need it the most. Imagine waiting two hours for something that should have come in 35 minutes. And you’re hungry,” he exclaimed. Gift eventually moved on from ordering all through last year and only resumed this year, still unsure of improved service delivery. Data by the National Bureau of Statistics (NBS) revealed that Lagos residents spent N830 billion ($2 billion) eating out in 2019, representing 34% of total food expenditure. Similarly, Jumia Food in its 2020 Nigeria Food Index Report has highlighted Lagos and Nairobi as the leading cities in volume of food orders. However, for many customers and food vendors, the usual pain point has always hovered around prompt delivery and turnaround time. Lagos traffic situation In 2021, a Lagos-based research institute, Danne Institute for Research (DIR), revealed that the state was losing about ₦4 trillion annually as a result of its notorious traffic congestion problem. The report, titled, ‘Connectivity and Productivity Report’, said the economic cost resulted into 14.12 million wasted hours as people commuted to work every day. The Lagos state commissioner for transportation, Frederic Oladeinde, in another briefing, disclosed that an average of 5,766 vehicles got into Lagos, while 5,831 moved out of the state on a daily basis. The founder and executive director of the DIR, Professor Franca Ovadje, explained that long commutes between where Lagosians live and work, among other factors, is a major cause of unending traffic jams. Ovadje said, “We found that the cost to individuals of traffic congestion is N133,978.68 per annum for those who own their vehicles, and N79,039.40 each year for those who use public transport. The total loss to Lagos is estimated at 14.12 million hours per day, or N3,834,340,158,870 per annum.” She lamented that the growth of the city was a cause for reduced productivity due to the state’s poor road network. The state’s commissioner for information and strategy, Gbenga Omotoso, however denied this. Omotoso, during a stakeholder engagement in January 2022, argued that it was unfair to say that individuals or tourists lost significant man-hours while plying the state roads. He said, “Let me say this loud and clear. I will not join the ranks of those who describe Lagos traffic as a nuisance, quoting all manner of figures. I saw one saying that an average Lagos tourist loses some incredible man-hours on the road. I felt it was unfair to the government or people that have been employed to manage traffic in Lagos. “So I contacted some experts and they told me that the figure could not have been right even though it was from a reputable organisation. Some of the facts that they sent to me really showed that the situation is not as bad as people are making us believe.” Cost issues, lack of communication Deborah Johnson, who owns and operates a confectionary business, admits that timing is a huge gap to be filled. She notes that cost and regulation have, in a way, hampered the speed of delivery. “My experience with them generally is bad communication, especially in Lagos. In Lagos, it is terrible and unnecessarily expensive. I get Lagos is expensive itself plus traffic, but bikes can literally enter anywhere so deliveries shouldn’t be so slow. And the prices are ridiculous,” Johnson stated. She recounts a certain experience where she hired a delivery service to drop small chops for a customer and the rider was harassed by the police. She explained that she was agitated about the incident as she wanted to deliver good service to the customer and poor communication could have fixed that issue. In a nutshell, Johnson admits that she has not been very satisfied. “I was trying to deliver a cupcake recently and the price was half the price of cupcakes. How does a box of 12 cupcakes cost ₦12,000 and you are paying ₦6,000 for delivery? It is weird, crazy and insane. I find it unrealistic. Do they get there on time, a few do, many don’t. Do they communicate 0.1% do, the remaining don’t,” she responded. Navigating the traffic situation Founder and CEO of Glovo, Oscar Pierre, admits that fast delivery is something that is wanted by everyone. “In Tokyo, New York, Barcelona, or Lagos, you will find customers that want to get food and products delivered very fast and at a cheap price,” Pierre said. However, he notes that there are teething problems in sub-Saharan Africa, which border on underdeveloped infrastructure—road, electricity, and traffic. “None of that stops us from building this value proposition of convenience. In Lagos, a very large majority of orders close to 80-90% are delivered below 45 minutes. That is quite convenient even though we can do better. If you go to Barcelona, you see the service works even better. The thing is that the bicycles and motorbikes skip the traffic.” Dealing with regulation In 2020, the Lagos state government rolled out a new law that prohibited commercial motorcycles, including bike-hailing startups, from operating in some specified local areas of the state. Several bike-hailing startups were affected and made to reconsider their business models. Pierre responds that he has always
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This SA legaltech startup wants to make legal services easily accessible
In a country with one of the highest crime rate in the world, access to legal services is vital for victims. However, access to legal services in South Africa is still pretty much a privilege reserved for those with legal aid coverage or disposable income to afford the hourly lawyer rates. To address this problem, legal tech startup Legal Standpoint has developed a mobile app which avails legal information, as well as attorneys, at a fee much lower than the traditional legal coverage. Founded by Keitumetse Pule, a graduate of law from Wits University, Legal Standpoint in a journey to democratise legal access not only in South Africa, but eventually beyond. TechCabal caught up with Pule to share more about the legal tech startup. TechCabal: Please tell us more about Legal Standpoint and the problem you are addressing through the startup? Keitumetse Pule: Legal Standpoint is a legal tech startup that’s working to democratise access to legal education and services. In essence, everything we do is geared towards making legal resources more widely available and readily accessible to everyone in the country, and eventually, in Africa and on a global platform at some point. It’s really about saying that the law is the one thing that applies to all of us and making it as easy as possible for people to be able to talk to a lawyer and just get good legal help when they find themselves in tricky situations. TC: How much traction would you say the offering has garnered since launch? KP: At the moment, we have onboarded over 1,500 users on the app. The app is available for download on all major app stores including the Huawei App Gallery, Google Play Store and Apple App Store. In terms of lawyers, we have about 14 verified on the platform. The number of lawyers that have signed up is higher than that, but we have very stringent verification processes on the app, so you’ll only appear in the directory if we verify you on our side because we always want to ensure that users are talking to verified vetted lawyers at all stages. We’ve also gotten quite a lot of visibility since we started, which has been great in terms of increasing brand awareness and getting people to know about the app. In March, we were invited to pitch at Harvard Business School and that was quite a great milestone for us. We’ve also been recognised as one of the top five democracy affirming startups in Africa earlier this year. So all in all, I think traction is going well. Pitching at Harvard Business School. (Image source: Provided) TC: What challenges have you faced in scaling Legal Standpoint and how did you traverse through those challenges? KP: The first one is that the legal industry is not the most receptive to legal technologies, so just getting through to lawyers and getting them to see and adopt technology and see the advantage that it could have for them, and how it could aid them in doing the work has been a bit of an uphill battle. Across the board, I think the legal industry is one of the slowest adapting and responding to technology. The other challenge has been funding, which I think a lot of entrepreneurs, you know, deal with when they are starting out. But we’ve tried to make the most with what we have. Like when we launched for example, we didn’t have a massive budget for marketing. We had to rely on our own personal social media platforms and that has really helped. For example, when we launched the app, I put out a tweet which I did not think would garner any traction. But amazingly, it did and garnered over 300,000 impressions. So I would say those two challenges, adoption and funding, have been at the forefront and that’s how we have been trying to work our way around them. TC: Do you think legaltech solutions like Legal Standpoint can impactfully disrupt the way legal services are accessed in South Africa? KP: Absolutely! I think the beauty about the time in which we entered the space is that legaltech was still in its infancy in Africa. So there’s still so much unexplored territory and if you’re wanting to start out, this is probably the perfect time. We also know that COVID-19 really accelerated technology and the way in which we interact with each other. Technology is going to be a core part of how we interact with each other, with the environment, and literally, with everything. So I think that’s another great opportunity if you want to be in the legal tech space. And now we’re seeing AI taking over and that’s a direction that we want to take a Legal Standpoint. as well, So, there’s really great opportunities if you’re wanting to solve the problem of access to justice and leverage technology to do that. Image source (Provided) TC: How do you think legaltech solutions like Legal Standpoint can help foster inclusivity with regards to legal services in South Africa? KP: I think they can go very far. One of the main reasons Legal Standpoint was created is because we saw that there is a huge access to justice problem in the country and there’s a lot of factors that can be attributed to that. But the two that we found, and which we’re focused on specifically, are lack of access due to jargon loaded legal texts.That’s where people don’t really understand where the law stands. They don’t understand what the law says, because it’s just so overwhelming and complex. That’s discouraging when you’re wanting to get a hold of legal resources. The other fact which is probably the biggest issue is that legal services tend to be priced quite exorbitantly so they are out of reach for a substantial number of South Africans. With the economy getting tougher, just getting legal services is quite expensive. Legal Standpoint then sought to come
Read MoreJumia’s Q1 2023 report shows path to profitabliity
Coming on the heels of its financial woes last year, eCommerce giant Jumia has reported a 5% growth in its gross profit and a 54% reduction in operating losses in the first quarter of 2023. After failing to achieve its goal to be profitable by 2022 despite its cost-reduction moves, Jumia—the “Amazon of Africa”—appears to be stemming the tide. In its Q1 2023 financial results [pdf], the eCommerce giant says it recorded a significant reduction in operating losses as it hopes to hit profitability. According to the report, Jumia’s operating loss in the first quarter of 2023 was $30.9 million, representing a 54% decline year-over-year, its lowest quarterly level in over 4 years. Similarly, the company’s revenue fell by 3% year-over-year to $46.3 million. However, its gross profit hit $28.6 million in the first quarter of 2023, a 5% jump year-over-year. TechCabal earlier reported how Jumia’s staggering liquidity position—due to its declining stocks—has left the company with difficult fundraising options to reduce costs. With a new CEO, Francis Dufay, the company hopes to rewrite its story from a giant business losing runway amid losses to a thriving and profitable one with optimised internal operations. “We’re in a tough macroeconomic environment. We’re also deeply reviewing our strategy. We also need to make radical changes to ensure we get to profitability and make better use of our cash,” Dufay said in an interview with Rest of World in March. In the Q1 2023 report, he restated his commitment to taking Jumia to profitability, saying the company is “focused on both cost efficiency and usage growth.” According to Jumia’s Q1 2023 numbers, its quarterly active consumers and orders declined by 22% and 26%, year-over-year respectively. Similarly, gross merchandise value (GMV) and total payment value (TPV) fell by 22% and 31.3%, respectively. The GMV is the total value of items sold on an e-commerce website within a period, while the TVP is the value of payments that are completed through the payments platform and excludes the transactions processed through the company’s gateway products. While quarterly active consumers dropped from 3.1 million in Q1 2022 to 2.4 million in Q1 2023, orders also fell from 9.3 million to 6.9 million in the period under review. GMW dropped from 252.7 million to 198.2 million, just as the total payment value fell from 70.7 million to 48.6 million. According to the report, JumiaPay’s TPV fell to $48.6 million in the first quarter of 2023, representing a 31% decline year-over-year, with the JumiaPay app TPV accounting for almost 60%. The company attributed this decline to its decision to move away from highly promotional services on the app that drives limited consumer lifetime value. Similarly, transactions on JumiaPay dropped by 38% year-over-year to 2.0 million. 29% of orders placed on the Jumia platform in the first quarter of 2023 were completed using JumiaPay, compared to 34% in the first quarter of 2022. The report says the decline in penetration is largely due to the reduction of JumiaPay app services in terms of transactions.
Read MoreTECNO, Infinix and itel remain unbeaten in Africa’s market share
While smartphone purchases have dropped, Transsion Holding, which owns TECNO, Infinix and itel, continues to record notable growth in Africa and other emerging markets. However, how does the competition fare? People are not buying phones as much as they used to, primarily because the devices have become expensive lately. This development is due to several reasons, such as strained supply chains, harsh dollar exchange rates, and overall inflation. It can also be argued that modern smartphones have become so much better that users do not see the need to replace them after a year or two, meaning they hold onto them for much longer. Where, in the past, users would purchase a new device due to their current phone developing an issue like faulty software, poor battery life, or failing hardware, modern phones are more durable, eliminating the need for frequent replacement. Research firm Canalysis has released some data showing the market share of different phone brands worldwide. The numbers paint an interesting picture of the African market, where it remains obvious that people love purchasing affordable phones. Not many brands are known to have nailed the budget segment other than Chinese manufacturers, particularly Transsion Holdings. Transsion is known for its affordable devices manufactured by offshoots such as TECNO, Infinix, itel, Oraimo (accessories), and Syinix (TVs). Specifically, Transsion topped Africa’s smartphone market share for Q1 at 48%. While it slumped in annual growth rate by 13%, it still showcases its strong presence in the continent. Samsung then followed Transsion at 30%. Positions three, four, and five were occupied by three Chinese brands: Xiaomi at 6%, OPPO at 4%, and realme at 3%. Like Transsion, all the brands recorded a drop in annual growth, save for realme, which jumped by 11 points. In countries such as Morocco and Algeria, Samsung took the lead in market share at 11% for both. Transsion picked the second position in Morocco at 19%, followed by Xiaomi, OPPO and realme. Only Xiaomi showed a positive annual jump at 16%. realme picked the second position in Algeria at 31%, followed by Xiaomi at 18%. The first and second runners-up recorded positive annual growth at a massive +412% for realme, and +40% for Morocco. Transsion and Apple closed the top five chart at 13% and 1%, respectively. It should also be noted that this is the first time Apple has featured in these rankings, considering it hardly sells its devices in Africa, save for many markets. Apple devices are also known for their high price and are a reserve for very few people who can afford them. “We continue to record increased popularity of smartphones under these different segments with the entry-level segment, especially from a youthful customer base, in these three countries. We are very proud of such a performance that reflects on our resolve to meet dynamic needs of our customers even in difficult times, with innovative solutions and budget-friendly devices,” notes realme Kenya PR & Marketing Manager Mildred Agoya. Transsion, the star of these statistics, has since launched the Camon 20 series of devices. For instance, the TECNO Camon 20 Premium costs $400 or more. Therefore, it can be argued that these devices are no longer affordable, although it makes sense why TECNO is doing this. For a long time, it has been known as the ‘cheap’ brand. To this end, it wants to dissociate itself from such assumptions and is actually doing the work to prove that. For example, TECNO has a $1000 phone, the Phantom V Fold. It is a quality device that bends like the Samsung Fold line of smartphones. It also has plans to launch a flipping device, which will be named the Phantom V Flip. The point here is that Transsion, especially TECNO, may soon transition to a premium brand similar to Samsung. Will the market accommodate its ambitions? Probably, but that will only remain to be seen. The likes of Samsung, for instance, have experienced what an expensive handset can do to market share. The current A series by the South Korean phone maker, including the Galaxy A54, are prohibitively expensive. This is the same mistake the manufacturer made with the now-discontinued J-series back in the day, but the market may self-correct in the coming days.
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