Exclusive: Kippa Cofounder Duke Ekezie exits after agency banking shutdown, embarks on new venture
Duke Ekezie, the co-founder and President of Kippa, the fintech startup backed by Target Global, left the company after Kippa Pay, the agency banking product he was in charge of, was shut down. Duke had been absent on the company’s Slack channel for months, two ex-employees said. When TechCabal requested comments in December 2023, Duke said he could not “confirm or deny his exit.” The Kippa cofounder has now confirmed his exit from the company and has begun working on a different venture he declined to share specifics. “I am still very involved in Kippa as I have been providing advisory services to [Kennedy] who is first my brother before my co-founder,” Duke told TechCabal on a call. He remains a shareholder and co-founder in Kippa even though he is currently working on a different business. He also declined to comment on the 2022 exit of Uche Jepthat, the CTO and third cofounder. [ad] Uche Jepthat left Kippa in November 2022—two months after the startup announced that it had raised $8.2 million in a second round of funding, per his LinkedIn profile. He has co-founded another business— Earna, which offers benefits and wellness plans to employees. Moving on from agency banking and Kippa “In the last quarter of 2023, after [Kennedy and I] decided to exit the agency banking business due to its unprofitability, I handed over the day-to-day operations of Kippa to [Kennedy], ” said Duke. Duke coordinated the company’s growth, marketing and strategy teams and led Kippa Pay, the now-divested agency banking business, said two persons who worked with him at the time. In October, the Kippa Pay business was shut down, and 40 employees who worked on the product were laid off. After closing the agency banking business, Duke and Kennedy Ekezie returned to the drawing board. “We went back to talk to SMEs and large businesses to see what problems they had that we could solve. Two problems stood out for us.” “One of the problems aligned with my long-term goals and ambitions, and the other aligned with Kennedy’s. So we have decided to solve these problems individually,” Duke told TechCabal. He declined to share specifics of the problem he’s looking to solve with his new venture. Kippa’s pivot to edtech On Wednesday, TechCabal exclusively reported that Kippa is pivoting to edtech with an AI-powered platform that creates courses and teaches them to learners via messaging apps. It’s a creative pivot, considering where the business began. Two years before starting Kippa, Kennedy and Duke spent a year in Beijing supporting TikTok’s expansion into Africa. Alongside Jephthah Uche, they launched the finance management platform in June 2021 after traveling to Lagos, Uyo, Owerri, and Aba—Nigeria’s bustling commercial centers—to meet small businesses and learn what problems they could solve for them. Upon learning that manual reconciliation of business transactions was a major pain point for these businesses, they came up with an app that automates accounting processes and called it Kippa— possibly a wordplay on the word “bookkeeper.” They eventually raised about $11.6 million across two rounds from VC firms like Goodwater Capital, Target Global, TEN13 VC, Rocketship VC, Saison Capital, Crestone VC, VentureSouq, Horizon Partners and Vibe Capital, Entrée Capital, Alter Global and Rally Cap Venture. Angel investors across those rounds included Babs Ogundeyi, Kuda CEO; Sriram Krishnan, an investor in Khatabook; Raffael Johnen, Auxmoney CEO; Chris Bouwer; Kyane Kassiri; Edward Suh of Goodwater Capital; and Sajid Rahman also funded the startup.
Read MoreAirtel Africa’s profits plunge 99% on the back of currency devaluation in Nigeria and Malawi
Airtel Africa, a telecommunications firm with a presence in 14 African countries, reported a 99% decline in profits last year after currency devaluation in some of its biggest markets, including Nigeria, Malawi, Zambia, and Kenya. Massive devaluations of Nigeria’s Naira and the Malawian Kwacha squeezed Airtel Africa’s margins and resulted in profits of $2 million for the year. The Naira’s devaluation cost Airtel $301 million. Excluding these impacts, profit before tax for the nine months ended 31 December 2023 would have been $840 million. The telco’s $2 million profit is far from the $523 million profit it recorded in the nine months ended December 2022. The poor results also dragged down Airtel’s revenue by 1.4% to $3.8 million from $3.9 million a year ago. The company’s Group Chief Executive Officer, Olusegun Ogunsanya, is undeterred by the results. “Whilst further currency devaluation, particularly in Nigeria, has weighed on our reported financial performance, it will not affect the execution of our growth plans,” he said. Ogunsanya said the group will focus on capital allocation priorities, enabling the firm to fully repay HoldCo debt when due in May 2024, ensuring the continued success of their balance sheet de-risking strategy. The GCEO also said they would invest in new business opportunities like their new data centre business, Nxtra by Airtel, which was launched in December. The board intends to launch a share buy-back programme of up to $ 100 million, starting early March 2024 over 12 months. The telco’s financial statement also reported that its group mobile services revenue grew by 18.6%, driven by voice revenue growth of 11.2% and data revenue growth of 28.5%. Mobile money revenue grew by 31.8% in constant currency. Similarly, its total customer base grew by 9.1% to 151.2 million as the penetration of mobile data and mobile money services continued to rise, driving a 22.4% increase in data customers to 62.7 million and a 19.5% increase in mobile money customers to 34.3 million.
Read MoreMultiChoice will invest a further $89 million in Showmax by March
Pan-African broadcaster MultiChoice has announced that it will make a further $89 million investment into streaming platform Showmax by 31 March 2024. MultiChoice, the pay-TV giant that is the subject of an acquisition bid by Canal+, will invest $89 million into the revamped Showmax by March 31, 2024 according to a statement the company shared with the Johannesburg Stock Exchange. The investment will be part of a $129 million investment by MultiChoice and NBCUniversal which owns a 30% stake in Showmax. So far the two parties have invested $20 million into the streaming platform. “Equity funding is provided monthly or at other intervals, depending on [Showmax’s] then current working capital requirements and as may be determined by the board of [Showmax] for budget purposes, subject to a maximum capped amount,” MultiChoice said in a statement to the Johannesburg Stock Exchange. The first tranche of the investment, $30 million, will be made tomorrow, February 2. MultiChoice is positioning Showmax to be Africa’s premier streaming service and will relaunch the service later this month after a bunch of partnerships to increase its already large content library and improve the underlying technology. Some of its planned offerings include an English Premier League-only package, data-saving streaming bundles as well as content from NBCUniversal’s subsidiaries including SKY and HBO. The pay-TV giant hopes these changes will help it achieve the goals of 50 million subscribers and $1 billion in revenue in five years, trading profit breakeven by 2027, a 25% EBITDA margin, and 20% free cash flow margins, both at scale. Additionally, Multichoice has bumped up its growth expectations of the platform by a multiple of three by 2032 and content production by a multiple of 10 by 2033.
Read MoreExclusive: Africa’s Blockchain pioneer Zone will launch remittance product in 2025
Zone, Africa’s first licenced blockchain payment infrastructure company, will launch a remittance product in 2025, Obi Emetarom, the company’s CEO, told TechCabal this week. “Work is actively going on” to develop the product, Emetarom added. Zone plans to address the three critical pain points remittance providers, and International Money Transfer Operators (IMTOs) face: distribution, liquidity, and licensing. Remittance startups need robust distribution networks to deliver funds to recipients, even without direct connections to the local banks. They also struggle with managing liquidity in different local currencies, which can be expensive. The third hurdle is navigating the complex licensing requirements across different jurisdictions. “We want to deliver these services. The integration is possible because we are a switch and already connected to banks. Secondly, liquidity is possible because our settlement is instant,” Emeratom said. “And in terms of licensing, we already have a switching license, and our roadmap is to ensure that we have all the licenses that we need to operate in different markets.” In December 2023, Nigeria’s Central Bank reversed a two-year ban on crypto-related bank accounts and later released stringent rules for banks opening crypto accounts. At least two crypto startups have applied for licences from the country’s capital markets regulator, the Security Exchange Commission (SEC). Emeratom describes this as a “fantastic development” that will open up opportunities in cross-border payments. Canal+ tests the waters with a bid to buy MultiChoice Beyond its current role as a payments processor and switch, Zone has ambitious plans to reshape the financial landscape. The company envisions a future defined by regulated decentralized finance (DeFi), combining the strengths of blockchain technology and the legitimacy of traditional finance. “We’re working on a white paper to design what that future will look like. We are also building Zone to become the foundation for that future,” he said. Founded in 2008 by Emeka Emetarom, Obi Emetarom, and Wale Onawunmi, Zone (formerly Appzone) rebranded from a fintech software provider to a blockchain payment infrastructure company in 2022. The transition saw the company split into two entities: Appzone’s cloud-based Software-as-a-Service (SaaS) platform rebranded into Qore, while Zone remained the blockchain-based payment gateway. Zone, licenced by the Central Bank of Nigeria as a payments switch, runs a blockchain network that enables direct transaction flow between financial service providers without an intermediary. Thirteen Nigerian banks use Zone’s blockchain network to process ATM transactions. Zone earns a fee for every transaction processed through its channels, and in 2023, the startup claimed it processed $1 million daily, but Emeratom says “the number has gone up,” though he declined to share specific figures. The startup plans to roll out more use cases for its blockchain payments technology, including online payments and direct debit. “The ATM was just to showcase the technology. The big deal for us is that we have been able to get in as a new payments infrastructure, and now we can move to higher value channels.” Zone will also launch Zone 2.0, a new blockchain infrastructure built on the Ethereum standard, allowing instant settlements for financial institutions. The startup has plans to launch in the Global South markets, particularly Latin America, Southeast Asia, and the Middle East.
Read MoreOnly Four African Countries Secured>$100m Funding In 2023 + Stark Decline Realities
The curtains may have closed on 2023, but the African tech landscape is still adjusting to the aftershocks of a watershed year that tested the resilience and adaptability of startups across the continent. To make sense of it all, TechCabal Insights has released its retrospective State of Tech in Africa Report for Q4. Its analysis is comprehensive and delves into the critical aspects that shaped the ecosystem while offering actionable insights for the journey ahead.Our report is divided into five key sections. The funding winter unmasks the realities of doing business in Africa. Simply put, 2023 was a difficult year for African startups, with only four countries raising above $100 million in funding. By comparison, eight African countries raised above that figure in 2022. Venture Capital (VC) experienced a funding decline of 40.2% compared to 2022, forcing innovative entrepreneurs to explore alternative avenues. However, fintech stood strong, maintaining its status as the most funded sector despite a 79% dip in funding. Weathering the storm explores the strategies for growth and adaptation. One silver lining was the utility of mergers and acquisitions as a startup lifeline, which will remain a mainstay in 2024. For all the challenges faced, 2023 still recorded the single largest acquisition deal in the history of African tech, with fintech, once again, being the pacesetter. The report also examined multimarket models and pivots, highlighting notable examples that can serve as a compass for investors needing a strategic shift. Regulation and policy look at the regulatory framework shaping African tech as policymakers and innovators thread carefully between navigating the digital frontier and staying compliant, in line with best practices. It covers regulation around digital identity, financial inclusion, cryptocurrency, open banking, anti-competition and data protection. For our two-part survey, we collated primary data to provide a nuanced understanding of the impact of tech layoffs on the workforce and a founders’ outlook for 2024, offering a real-time pulse on the sentiments within the tech community. Lastly, we provide an outlook for the future. What does the uncharted terrain look like? Can bootstrapping take the place of VC funding? What imperatives lie ahead for founders, investors, and policymakers alike? Which trends from the past can serve as a prognosis for 2024? What multipolar forces will define Africa’s digital economy in the future? The answers to these and more can be found in our State of Tech Report Q4. Click this link to download it. We also value your feedback. Help us fill this brief survey to let us know how our reports can serve you better.
Read MoreCanal+ tests the waters with a bid to buy MultiChoice
Canal+, the French pay-TV giant owned by Vivendi SE, has made a non-binding offer to buy MultiChoice, per reports from Bloomberg and Tech Central, four years after it first bought a 6.5% stake in Africa’s biggest pay-TV company. Per Bloomberg, the offer from Canal+ is 105 Rands per share, a significant markup on MultiChoice’s current share price of 79 Rands. Canal+ increased its focus on Africa in the past decade and has grown from just 1 million African subscribers in 2016 to 7.6 million in 2023. In July 2019, it bought ROK Studios, a prolific Nigerian film production company, from IrokoTV to increase its slate of original content offerings. A timeline of Vivendi’s MultiChoice stake Canal+ has gradually increased its stake in MultiChoice since 2020 Buying MultiChoice will represent a grand step in Vivendi’s African ambitions if it can get the deal over the line. With Vivendi’s history of hostile takeovers, industry watchers had predicted it would attempt the same play with MultiChoice. In October 2015, Vivendi spent €180 million to acquire minority stakes in two publicly traded gaming companies, Gameloft (6.2%) and Ubisoft (6.6%), eventually buying a 10% stake in each company, a TechCabal report from 2020 said. A MultiChoice acquisition is perfect for Canal+ but regulatory hurdles loom It also made a hostile takeover of Gameloft by buying over 30% of the company before convincing other shareholders to sell their stakes. In June 2016, Gameloft became a Vivendi subsidiary. Since 2020, Canal+ has increased its stake in MultiChoice from 20.1% to around 32.6%. In 2022, Vivendi received $40m in dividends from Multichoice Group (up from $23.3m in 2021). Under South African law, Canal+ must make a mandatory takeover offer when its shareholding reaches 35%. But a complete takeover of MultiChoice may be impossible in the near future. Regulation pumps the brakes By law, Canal+, a foreign company, cannot have more than 20% of the voting rights on the board of directors of a South African broadcaster. MultiChoice enforces this rule through a voting rights cap. “A full takeover of MultiChoice looks unlikely to us,” said a Bloomberg intelligence analyst in February 2023.
Read More👨🏿🚀TechCabal Daily – Google launches first African cloud centre
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Happy new month You can start your month with learnings from Africa’s tech ecosystem. Last week, we launched the State of Tech in Africa Q4 2023 report, and it contains critical details on how the ecosystem performed in 2023, and forecasts by industry experts. Download it for free here. In today’s edition Google launches its first African cloud centre Kippa pivots to edtech Bolt expands to Zimbabwe Bboxx moves its HQ to Rwanda Ghana’s mobile money agents have a new deadline The World Wide Web3 Opportunities Big Tech Google Cloud has set up shop in South Africa The clouds are gathering over South Africa, and it’s not just a weather forecast. The high cost of cloud computing is stifling African startups. Just last week, social media erupted with frustrated founders and operators complaining that cloud services eat up a huge chunk of their budget, making it difficult to stay afloat. This sparked debates about whether Africa needs to develop its own cloud solutions to break free from this financial burden and empower its growing tech scene. While homegrown cloud solutions hang on the horizon, more international cloud service providers are setting up shop in the continent. The news: Yesterday, Google announced the launch of its cloud service in South Africa, its first on the continent. Google became the latest cloud service provider in the country after the launch of Microsoft Azure in 2018, Amazon Web Services (AWS) in 2020, and Alibaba Cloud in 2019. Why does it matter? Google’s entry into South Africa means that local businesses get direct access to Google’s powerful cloud services, giving them improved speed and storage space to help optimise their service delivery. While the launch in South Africa serves as a huge boost for its tech ecosystem, the move also signals fierce competition to existing cloud service providers. The diverse cloud landscape might force cloud service providers to offer competitive prices to businesses in the country. For the everyday Joe, the move means faster downloads; and no more buffering videos or lagging apps. Zoom out: While Google’s entry into South Africa offers exciting opportunities for businesses and individuals, it also raises concerns about data privacy and security, particularly with local data now stored on the cloud. Recent high-profile data breaches and government surveillance programmes, both globally and within Africa, highlight the need for robust data protection laws. South Africa should consider policies similar to the EU’s General Data Protection Regulation (GDPR) to ensure user control over personal data, increase transparency from cloud providers, and hold them accountable for data breaches. Access payments with Moniepoint Moniepoint has made it simple for your business to access payments while providing access to credit and other business tools. Open an account today here. Startups Kippa makes an edtech play It’s not every day you get to see a fintech become an edtech. What? In an interesting turn of events, Kippa, a Nigerian startup which started as a fintech is pivoting to provide edtech services. Kippa’s new edtech play will allow users create new online courses or deliver existing ones in bite-sized formats using AI. Kippa’s new website Why? While Kippa’s pivot might have you howling, its pivot remains unsurprising given the startup’s recent turn of events. Kippa laid off 40 of its employees in 2023 after it shut down its agency banking subsidiary, KippaPay. The startup later transferred KippaPay to Nigerian fintech, Bloc, with some of its employees moving to the startup as a result. Kippa also struggled to make severance payments for its laid-off employees after it suffered a ₦30 million ($33,516) internal fraud. Before the eventual shutdown of KippaPay, the startup made efforts to resuscitate the ailing business. Kippa tried to unify KippaPay with the bookkeeping app. It also tried to monetize its Invoice service, all of which yielded no results. Zoom out: While its effort to salvage the troubled startup continues, Kippa has embraced an edtech play, putting out a new website that would allow users to produce online courses and deliver those courses using messaging tools like WhatsApp and Telegram. It remains uncertain what Kippa will do to its existing fintech customers. Secure payment gateway for your business Fincra’s payment gateway enables you to easily collect Naira payments as a business; you can collect payments in minutes through bank transfers, cards, virtual accounts and mobile money. Create a free account and start collecting NGN payments with Fincra. Mobility Bolt expands to Zimbabwe Bolt has crossed the 12-country mark in Africa, with a launch in Harare, Zimbabwe. In Zim, Bolt is taking the same route it used in its 2022 Zambia launch: it’s starting with a zero-commission policy for its first six months and 300 drivers. Bolt’s Zimbabwe expansion aligns with its plan to invest $530 million in Africa over the next two years, which will also see the creation of 300,000 driver jobs across the continent. The company operates in over 45 countries globally, serving over 150 million customers and working with over 3 million drivers. A familiar strategy: New market entrants are sacrificing short-term commissions to drive down prices and attract customers. This strategy, witnessed in the relaunch of rival companies like inDrive and Rida in Zimbabwe, relies on retaining price-sensitive consumers as prices undergo eventual adjustments. Bolt enters the fray: Local players like Hwindi have been the dominant ride-hailing platform in Zimbabwe since 2015. However, with the recent launch of inDrive and Rida in 2023, the landscape has shifted. They’ve lured customers with low fares fueled by massive ad campaigns and no initial commissions. According to drivers, inDrive reportedly charges a 10% commission while Hwindi charges 16%. With Bolt joining in, the competition is set to intensify even further. Accept fast in-person payments, at scale Spin up a sales force with dozens – even hundreds – of Virtual Terminal accounts in seconds, without the headache of managing physical hardware. Learn more → Cleantech Bboxx shifts headquarters from London
Read MoreAs Nigerian stock market booms, SEC board’s absence casts shadow over rally
While Nigeria’s stock market continues to soar globally, its regulator, the SEC, continues without oversight. In January, NGX, Nigeria’s stock market, was the world’s best-performing stock market, but amidst this rally, a crucial watchdog is missing: the board of the Securities and Exchange Commission (SEC). Nigeria’s SEC oversees the exchange and protects investors but has operated without a board for nearly a year. [ad] “President Tinubu has not made any appointments yet,” an investment analyst at the SEC who declined to be named told TechCabal. Typically, the president appoints board members, and the Senate confirms the appointees to insulate the board from political interference in its job to keep the SEC accountable. The NGX and the SEC did not respond to TechCabal’s request for comments at the time of this report. The term of the previous board expired in May 2023. Per the SEC website, the board comprises a chairman and four other members, including the Ministry of Finance and Central Bank representatives. The SEC’s Director-General, Lamido Yuguda, is the highest-ranking official on the board, per the SEC’s organogram. [ad] Despite the optimism around the NGX in the last year, there have been concerns that need regulatory attention. The market’s frothiness has masked allegations of insider trading and a vital criticism: the NGX’s inability to attract new and exciting listings. EDC Nigeria, a securities research firm, says the rise in stock prices is due to investors taking positions “in fundamentally driven stocks as we approach the earnings season.” [ad]
Read MoreLatest news on SRD SASSA payment for February 2024
As we approach the month of February 2024, beneficiaries of the South African Social Security Agency (SASSA) grants eagerly anticipate the upcoming SASSA Payment 2024 schedule. SASSA plays a pivotal role in supporting vulnerable individuals through various grant programs, and here’s a detailed breakdown of the payment dates for February: 1. SASSA Payment 2024 for Older Person’s Grants What you should know includes: Payment Date: Friday, February 2, 2024. Beneficiaries of Older Person’s Note: Grants can expect their SASSA Payment 2024 to be credited to their accounts on this day. This includes any arrears owed to the recipients. 2. SASSA Pay 2024 for Disability Grants For the Disability Grants: Payment Date: Monday, February 5, 2024. Note: Recipients of Disability Grants will receive their SASSA Payment 2024 starting from this date. This encompasses any grants linked to the specified accounts. 3. SASSA Pay for Children’s Grants Children’s wards should note the following: Payment Date: Tuesday, February 06, 2024 Final thoughts SASSA emphasizes responsible financial planning, encouraging beneficiaries to avoid rushing to withdraw funds immediately upon receipt. This patient approach ensures access to funds when necessary and contributes to financial security. For any inquiries or assistance related to SASSA Pay for 2024, SASSACARES is available through their toll-free helpline at 300000, operating from 10 am to 11 am. Beneficiaries are encouraged to reach out for support or clarification regarding their grants. As the payment dates approach, beneficiaries should remember to check their account balances regularly and verify the credited amounts. This proactive measure ensures transparency and addresses any discrepancies promptly. Additionally, SASSA urges recipients to update their contact information promptly to receive important notifications and announcements regarding their grants. It’s essential for beneficiaries to understand the significance of the provided payment dates and adhere to the recommended financial practices. Ultimately, responsible handling of grant funds contributes to the overall success of the SASSA program and enhances the well-being of the individuals it serves.
Read MoreHere is why SA startups saw an uptick in average valuations in 2023
South Africa was the only ecosystem in sub-Saharan Africa to see an increase in average valuations in 2023, according to data by MAGNiTT. Experts explain how the country managed to go against the grain. While valuations of tech startups in Sub-Saharan African countries broadly declined in 2023, South African tech startups were the exception, with an average increase of 21% in their valuation, according to data from MAGNiTT, a data research firm. The tenacity of South African startups is further reiterated by Partech, who stated: “Despite a -34% YoY decline in total equity funding in 2023, South Africa has been the most resilient ecosystem in the top 4, emerging as the new leader of the African tech funding landscape.” According to three VC firm managing partners who spoke to TechCabal, tougher competition for deal flow at early-stage startup investment drove up valuations in the South African tech ecosystem. “The global fundraising slowdown affected fund managers looking to raise funds, leading to delays in closing new funds,” said Naeem Sayes, senior research associate at MAGNiTT. ”This correlated with an adjustment in their strategies, favouring early-stage investments with a longer horizon to exit.” The shift in priorities to early-stage startups led to tougher competition among local funds in earlier stages, driving up round sizes and valuations from Seed to Series A. South Africa also saw a best-of-the-worst decline in seed investments, decreasing by 44%, while the rest of the continent averaged a 77% decline. On a per-deal basis, seed-stage deals increased by as much as 40%, according to data from Partech. The tenacity of some South African entrepreneurs and business models might also explain the trend, said Keet van Zyl, managing partner at Knife Capital.” When the heat of cash burn got too much in some other markets, SA startups suddenly became more attractive,” van Zyl told TechCabal However, despite this increase in valuations, van Zyl cautioned startups to focus on building resilient business models instead of being blinded by paper valuations. Instead of the hype, build a capital-efficient [business] with a recurring revenue model that consistently outperforms the ‘Rule of 40’ (revenue growth rate plus profit margin exceeding 40%),” van Zyl concluded. “Strive for a local cost base and hard currency revenue.”
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