Africa isn’t just a victim of the climate crisis; it’s also a place where infrastructure decisions will shape how it unfolds.
She traveled the world, but she was best known for the photographs she took in Uganda, which brought pathos and humanity to charged subject matter.
Scientists believe that lions everywhere can climb up into branches, but they’re just not very good at it and need help from the right kind of tree.
Many countries have closed classrooms on and off, but Uganda had kept more than 10 million students at home since March 2020. Critics say it took a heavy toll.
Two journalists and one politician said they received alerts warning them of “state-sponsored” attacks on their iPhones. At least one of those attacks was linked to the powerful Israeli cyberespionage tool, Pegasus.
The hack is the first known case of the spyware, known as Pegasus, being used against American officials.
Witnesses said there was a blast near a police station and another near Parliament. At least 24 people have been hospitalized.
The loss of international tourism had decimated the livelihoods of thousands of travel and hospitality workers, who have had to take on odd jobs and borrow money to endure the pandemic.
Constance Collins and Matthew Steuer, 24 years her senior, met five years ago as each was about to begin a teaching job in Africa.
Overblown fears that the coronavirus could be transmitted through surfaces have created a stigma around handling nonhazardous trash, experts say. Some recyclable waste has been junked or burned.
Nigerian automotive tech company Autochek today is announcing the acquisition of Cheki Kenya and Uganda from Ringier One Africa Media (ROAM) for an undisclosed amount.
Per a statement, Autochek will finalize the deal in the coming weeks. With the acquisition, Autochek completes its expansion into East Africa and follows the first acquisition made almost a year ago when it acquired both Nigeria and Ghana businesses from Cheki.
In 2010, Cheki launched as an online car classified for dealers, importers, and private sellers in Nigeria. The startup, headquartered in Lagos, expanded operations to Kenya, Ghana, Tanzania, Uganda, Zambia, and Zimbabwe.
Cheki got acquired by ROAM in 2017 and joined a list of online marketplaces and classifieds in its network like Jobberman.
Per ROAM’s website, Cheki still has operations in Tanzania, Zambia, and Zimbabwe. However, these markets are quite inactive so it is safe to say Autochek has fully acquired all of Cheki’s main operations.
Cheki Kenya is an exciting market for both parties. The subsidiary has 700,000 users and lists over 12,000 vehicles monthly. It also claims to have grown 80% year-on-year in the last two years, making it a valuable asset for Autochek’s plan for regional expansion.
“Cheki Kenya has always been sort of the crown jewel,” Autochek CEO Etop Ikpe said to TechCrunch. “At the time, when we completed the Nigeria and Ghana acquisition, it wasn’t a conscious effort to make this happen, but it’s great that it happened.”
Credit penetration in terms of vehicle financing is higher in Kenya than in Nigeria and Ghana. The East African country has a 27.5% penetration compared to the whole West African market at 5%. Therefore, it explains why Autochek is optimistic about the East African market. Before making the acquisition, the one-year-old company ran a stealthy pilot with some banks in Kenya — a similar strategy used in Ghana and Nigeria — to provide car owners with financing. So, the acquisition cements the company’s position in the market, Ikpe says.
The sale of Cheki operations in all of its major markets, which happened within a year, might lead some to ask if the four entities did poorly and forced the classifieds giant to find a suitable buyer quickly.
But CEO Ikpe refuted any claims of a distress sale when asked. He stated that the acquisition happened in quick succession because both parties understood that the classifieds model (run by Cheki) needed to make way for the more modern transactional model (employed by Autochek and leading automotive players in Africa). Therefore, ROAM Africa saw it as a needed transition for Cheki.
Building off Ikpe’s past relationship with Ringier (one arm of ROAM before the merger), where he ran DealDey, a classifieds deal company Ringier eventually bought, it wasn’t a tough decision to sell the company to Autochek, Ikpe tells TechCrunch.
“I think for them it’s really long term strategy and they believe in our business model. And there’s a lot of hope that we can do things in the future. It was also really about finding the right home for the business and their employees.”
From a statement, ROAM CEO Clemens Weitz said, “Across the world, we see a new evolution of digital automotive platforms, requiring deep specialization. Specifically in Africa, we believe that Autochek is the one player with the best team and expertise to truly create a game-changing consumer experience. For ROAM Africa, this deal is more than a very good transaction: It unleashes even more focus on our strategic playbook for our other businesses.”
Autochek’s expansion to East Africa is coming at a time when automotive tech companies like Moove, Planet42, and FlexClub are receiving attention from investors as the need for flexible vehicle financing keeps growing across the continent.
The most important car financing market on the continent is arguably South Africa. Other automotive companies have some form of presence in the market and for Autochek, the plan is to expand there too, and understandably why.
South Africa is the crème de la crème market and has the highest car financing penetration on the continent. Yet despite the seeming competition, Ikpe believes opportunities exist for the company to provide services tailored to the market different from what other companies have.
“The beauty of our platform is that we can be diverse; for instance, we can have a retail or B2B approach. There’s a lot of dynamic ways we can work. So I think it’s natural that our goal is to typically be in every region. We’ve made our inroads into East and West, and we’ll continue to work as we want to be in North and South Africa,” he said.
Autochek says a funding round is in the works to execute on this front and might close before the end of the year.
Insurgents who seize power tend to be authoritarian but pragmatic, desperate for legitimacy and ruthless toward classes they see as hostile.
Several users from Zambia have taken to Twitter informing the general public that WhatsApp has been restricted in the country amidst ongoing general elections holding today.
The president and parliamentary elections culminate in a face-off between current President Edgar Lungu and opposition Hakainde Hichilema.
Internet monitoring organization Netblocks further corroborated these reports adding that multiple internet providers in Zambia had restricted access to the American social messaging platform. Some of these networks include Zambian government-owned Zamtel, Airtel Zambia, Liquid Telecom, and MTN.
Just this week, reports circulated that the Zambian government had threatened to shut down the internet if Zambians “failed to use the cyberspace during this year’s election correctly.” The reports say the government intended to go through with its plans from Thursday, the polling day, till Sunday, when vote counts are expected to have ended.
However, the Zambian government, via its Information and Broadcasting Services Permanent Secretary, Amos Malupenga, came out to deny the reports, calling them ‘malicious.’ Nevertheless, he mentioned that the government would not tolerate abuse of the internet and if any mischief occurred, there would be no hesitation to take appropriate measures.
“The government, therefore, expects citizens to use the internet responsibly. But if some people choose to abuse the internet to mislead and misinform, the government will not hesitate to invoke relevant legal provisions to forestall any breakdown of law and order as the country passes through the election period,” Malupenga said.
Zambia isn’t the first African country to witness this during an election as social media restrictions and internet shutdowns are now a recurring theme for most African states.
Countries like Cameroon, Congo, Uganda, Tanzania, Guinea, Togo, Benin, Mali, Mauritania have faced social media restrictions and internet shutdowns during elections. A handful of others like Chad, Nigeria, and Ethiopia, on the other hand, have experienced similar restrictions for unrelating events.
Most governments argue that they carry out social media restrictions and internet shutdowns to maintain security during elections; however, it’s glaring to see the process as a means to curb the spread of vital information among voters and the media within and outside the country.
Today’s event shows that despite denying reports about an imminent internet shutdown, the Zambian government is heading in that direction by first cutting off WhatsApp. While writing on the WhatsApp restriction, Netblocks also reported that the Zambian government has proceeded to restrict other social media platforms, including Facebook, Instagram, Messenger, and Twitter.
Still, internet users in Zambia are now using VPN services to bypass the restrictions on WhatsApp and these other social media platforms. Yet, it remains to be seen if the government will enforce a full internet shutdown.
The pandemic is worsening in Africa as more contagious variants spread, vaccinations lag and hospitals in some places are pushed beyond their limits.
Every startup is trying to fix something but Terraformation is tackling the only problem that must matter to all of us: Climate change.
This is why it’s in such a big huge hurry. Its mission — as a ‘forest tech’ startup — is to accelerate tree planting by applying a startup-y operational philosophy of scalability to the pressing task of rapidly, sustainably reforesting denuded landscapes — bringing back native trees species to revive former wastelands and shrinking our carbon emissions in the process.
Forests are natural carbon sinks. The problem is we just don’t have enough trees with roots in the ground to offset our emissions. So that at least means the mission is simple: Plant more trees, and plant more trees fast.
Terraformation’s goal is to restore three billion acres of global native forest ecosystems by scaling tree replanting projects in parallel, scaling the use of existing techniques, and working with all the partners it can. (For a little context, the U.S. contains some 2.27BN acres of total land area, per Wikipedia).
So far it says it’s planted “thousands” of trees — with live projects in North America, South America, Africa and Europe which it hopes will yield up to 20,000 replanted acres. It’s also in talks with partners about more projects that could clad hundreds of thousands of acres with carbon-consuming (and biodiversity-prompting) trees, if they come to full fruition.
That’s still a long way off the 3BN-acre-wooded moonshot, of course. But Terraformation claims it’s been able to achieve a forestry restoration work-rate that’s 5x the average already. And that’s definitely the kind of ‘gas stepping’ that climate change needs.
Its elevator pitch is also punchy: “Our mission is explicitly to solve climate change through mass reforestation,” says founder Yishan Wong — whose name may be familiar as the ex-Reddit CEO (and also a former early-stage engineer at PayPal/Facebook). “So it’s getting trees in the ground and getting faster at getting trees in the ground.”
It’s not going it alone, either. It’s just announced a first closing of a $30 million Series A funding round, led by Sam & Max Altman at Apollo Projects, the brothers’ ‘moonshot’ fund; plus several high-profile institutional investors (whose names aren’t being disclosed); along with nearly 100 angel investors, including Sundeep Ahuja, Lachy Groom, Sahil Lavingia, Joe Lonsdale, Susan Wu, and OVN Cap.
“The [Series A] was a bit larger than we anticipated and the idea is to get us to the next stage of planting orders of magnitude more trees every year,” says Wong. “So it’ll be used both for supporting forestry projects directly, as well as for the development and deployment of forestry acceleration products and technology.”
“The very, very nice thing about mass reforestation or mass restoration as a solution to climate change is that it’s extremely parallelizable,” he adds. “You can plant any tree at the same time as your planting some other tree. This is the primary reason why this solution can potentially be implemented within the timetable that we have left. But in order to do so we have to start and drive an enormous, decentralized reforestation campaign across multiple continents and countries.”
The funding follows a $5M seed last year, as the young startup worked to hone its approach.
Terraformation is targeting the main barriers to successful reforesting: Through early research and pilots it says it’s identified three key bottlenecks to large-scale forest restoration — namely, land availability, freshwater, and seed. It then seeks to address each of these pinch-points to viable reforesting — identifying and fashioning modular, sharable solutions (tools, techniques, training etc) that can help shave off friction and build leafy, branching success.
These products include a seed bank unit it’s devised, housed in a standard shipping container and kitted out with all the equipment (plus solar off-grip capability, if required) to take care of on-site storage for the thousands of native seeds each projects needs to replant a whole forest.
It also offers a nursery kit which also ships in a shipping container — a flat-packed greenhouse that it says a couple of people can put together, and where thousands of seedlings can then be tended and irrigated in pots until they’re ready to plant out.
A third support it offers to the replanting projects it wants to work with is expertise in building solar-powered desalination rigs so young trees can be supplied with adequate water to survive in locations where poor land management may have made conditions for growth difficult and harsh.
It goes without saying that planted trees which fail because of poor processes won’t help cut carbon emissions. Badly managed replanting is at best wasteful — and may be closer to cynical greenwashing in some cases. (Poor quality projects can be a known problem where claims of corporate carbon offsetting are being made, for example.)
Terraformation is thus zeroing in on repeatable ways to scale and accelerate the successful planting and nurturing of trees, from seed to sapling and beyond, to accelerate sustainable reforesting.
Ultimately, it’s the only kind of tree planting that will really count in the fight against climate change.
Its first pilot restoration projects begun in Hawai’i in 2019 — where it’s been able to plant thousands of trees at a site called Pacific Flight, reviving a native tropical sandalwood forest that had been logged unsustainably. To enable the young trees to grow in land which had also become arid as a result of cattle grazing, the team built the world’s largest fully off-grid, solar-powered desalination system to supply sustainable freshwater to the baby forest.
“The arid environment, high winds, and degraded soils meant that if a team could restore a forest there, they could do it anywhere,” is the pitch on its website.
The Series A will go toward spinning up lots more such native species forest restoration projects — working via partnerships, with organizations such as Environmental Defenders in Uganda, and other groups in Ecuador, Haiti and Tanzania — as well as on more R&D (additional products are in the pipeline, we’re told); and on expanding headcount so its team has the legs to run faster.
Interestingly, for a startup with Silicon Valley engineering pedigree at its core, the team’s approach is intentionally light on technology — leaning only on vital tech (like solar and desalination), rather than experimental bells and whistles (drones, robotics etc) to ensure the processes it’s packaging up for massive replanting parallelism remain as simple, accessible and reliable as possible. So they are able to scale all over the globe.
It’s clear that sci-fi robotic gadgetry isn’t the answer here. It’s sweating toil plus tried and tested horticulture processes, done systematically and repeatedly, in mass parallelism all over the world that’s required, argues Wong, whose years in tech have given him a healthy scepticism on the issue of over-engineering. (“The biggest lesson I learned was, you want to solve a big problem? You want to use as little technology as possible… Technology’s always breaking, it’s always got flaws. The biggest problem with technology is technology.”)
“I would say that the key contribution that ‘tech’ — if you think of a monolith or a culture or whatever — will make to climate change, is not in fact some new invention or some gadget or some sort of special magical technology… I think it really is the practice of scalability,” he goes on. “Which is an organizational end. A management way of thinking. Because that is actually something that has been carefully and painfully developed… over the past 20 years in Silicon Valley. How to take small working solutions, how to solve very big problems, how to scale them. And it isn’t a very glamorous thing — which is why I think it’s one of the more pure disciplines.
“It just has been less corrupt… Scalability is just people thinking hard and grinding it out to address really hard big problems. And I think that practice and all the little tips and rules that we have to doing that is the real contribution that tech is going to make — with one of those principles being use as little tech as you can.”
Terraformation is building software tools too — such as a mobile app to help with cataloguing and monitoring seeds. But the really critical technologies involved, solar and desalination, are very much at the ‘tried and tested’ end of the tech scale (“very, very reliable and refined”.).
Wong points out that a key development for solar and desalination is related to the unit economics — with falling costs allowing for scalability and thus speed.
Asked whether Terraformation is a business in the typical startup sense, Wong says it’s been set up in a familiar way — as a Delaware C Corp — but purely because he says that’s just the quickest way to be able to operate. Doing stuff as a non-profit would be way too slow, he says, describing it thusly as a “non non-profit” (rather than a business with a for-profit mission).
Aka: “It’s a corporate with investors but primarily the aim is to solve climate change.”
Startup investors are of course often betting their money on the chance of a quick and meaty return. But not here, confirms Wong. “When we raised funding all of our investors invested primarily because they wanted to see climate change solved,” he tells TechCrunch. “To many of them this was the first time that a plausible, full-scale solution to solving climate change had been presented.
“It’s still very, very hard. It’s very, very large. It’s really daunting. But it’s the first time someone has mapped out a path that could actually get us there. And so all of our investors invested because they want to see that happen.”
So how will a ‘non non-profit’ startup (even with $30M just banked) get its hands on enough land to plant enough trees? A variety of ways, per Wong. (Perhaps even, in some instances, landowners could end up paying it to turn their dirt into beautiful woodland.)
“The short answer is anywhere we can!” he adds. “The solution is structured to give us maximum flexibility, given that we can use a large variety of land. We don’t want to count on any particular land owning entity — and I use that very broad term to mean like people, communities, governments, municipalities — we don’t want to rely on any one particular land-owning entity wanting to work with us or allowing us to reforest the land, because you can’t guarantee that.”
He also notes that Terraformation’s plan to fix climate change is based on “worse case scenarios” — where “no one who owns any land that gets enough natural rainfall for forest restoration will allow it to reforest it”. “We use the least valuable land — basically desertified, degraded land,” he adds. “Is there enough of that? And it turns out there is.”
Even though personal financial upside clearly isn’t front of mind for Terraformation’s investors, Wong still believes there’s plenty of ‘value’ to be unlocked as a byproduct of spreading leafy-green goodness all over the planet vs funding more extractive exploitation.
“It turns out that solving climate change is actually a huge value creating act,” he argues. “My experience in Silicon Valley is if you have people who believe in you and believe in the thing that you’re creating is ultimately value-creating then it’s actually also wealth creating. If you do something that is fundamentally very, very valuable and you’re right next to it, you will be able to monetize it in some way. You will capture some of that value for your shareholders. So it’s a bet that if you really can solve climate change, that’s super valuable, both for the world and to the entity that’s [investing].”
Of course climate change is more than just a problem; it’s an existential threat to all life on Earth — one which affect humans and every other living creature and thing on the planet.
Given such terminal stakes, reversing climate change should be the highest global priority. Instead, humans have procrastinated — putting dealing with rises in atmospheric CO2 on the back-burner and worse (cutting down existing forests like the Amazon Rainforest, for one).
Set against that backdrop, Terraformation’s answer to humanity’s greatest crisis looks compellingly simple. Its bet is that climate change can be fixed by scaling the most proven technology possible (trees) to capture carbon emissions. Who can argue with that?
But it does also seem clear that reforesting will need to go hand in hand with a mainstreaming of conservation, as a prevailing societal attitude, if the mission is to be pulled off — otherwise all these beautiful baby trees could just meet the same sad fate as all the Earth’s already lost forests.
Nonetheless, conservation is something Wong’s team is deliberately not focusing on.
Not because they don’t care. Rather their hope is that by building the baby forests, the protective partners will come — to watch over and get value from the trees as they grow.
“I don’t want to make it seem like we don’t care about [forestry conservation] but one of the things that I try to do is figure out where people are already doing work and things are already moving in the right direction — and then go work on the thing that other people are not working on,” he says when we ask about this. “When I talk to people in the forestry world many, many people are working on avoiding deforestation, helping solve the broader socioeconomic issues that result in deforestation. And so I feel like there is momentum moving in that direction — so we have to work on this other issue that other people aren’t working on.”
Wong also argues that forests are naturally more valuable than the denuded waste/scrub ground they’re replanting — implying that pure economic interest should help these baby forests survive and thrive far into the future.
However the history of humanity shows that unequal wealth distribution can wreak all sorts of havoc on a resource-rich natural environment. And people who live in poverty may well be disproportionately more likely to like in a rural location, on or near land that Terraformation hopes to target for replanting. So if these forests can’t provide — in crude terms — ‘value’ for their local communities the risk is the same cycle of short-term economic harm will rip all this hard work (and hope) out of the ground once again.
Wealth inequality lies at the core of much of humanity’s counterproductive destruction of the environment. So, seen from that angle, reforesting the planet may require just as much effort toward tackling — root and branch — the wider socioeconomic fault-lines of our world, as it will washing, sorting and storing seed, watering seedlings and nurturing and planting saplings.
And that further dials up an already massive climate challenge. But, again, Wong is quietly hopeful.
“People aren’t cutting down trees because they’re evil, they’re cutting down trees because they need to make a living. So we have to provide them with ways to make a living that is more valuable than cutting down the trees. I think that recognition is moving in the correct direction — so I’m hopeful there,” he says.
Asked what keeps him up at night, he also has a straightforward answer to hand — one we’ve heard many times already from a new generation of climate campaigners, like Greta Thunberg, whose futures will be irrevocably stamped by the effects of climate change: Humanity simply isn’t moving fast enough.
“In order to do this we have to make order of magnitude improvements in both speed and scale — which is technically a thing that we know how to do but is among the most daunting things that you ever try to undertake. So… are we moving fast enough? Are we doing enough? Because time is running out,” warns Wong.
“The timeframe that we have left is very small when compared to the planetary scale of the problem. And so I think the only way that we’re going to get there is with proven solutions, moving, growing at exponential speed.”
“I am [hopeful],” he adds. “I’m a big fan of humans working together. People can really do it. I’m very I guess what you’d call pro-human. We have a lot of flaws, we fight amongst ourselves a lot, but I really think that when people work together they can really do amazing, amazing things… Trees gave us life and so now it’s our time to repay that debt.”
Apple announced a handful of privacy-focused updates at its annual software developer conference on Monday. One called Private Relay particularly piques the interest of Chinese users living under the country’s censorship system, for it encrypts all browsing history so nobody can track or intercept the data.
As my colleague Roman Dillet explains:
When Private Relay is turned on, nobody can track your browsing history — not your internet service provider, anyone standing in the middle of your request between your device and the server you’re requesting information from. We’ll have to wait a bit to learn more about how it works exactly.
The excitement didn’t last long. Apple told Reuters that Private Relay won’t be available in China alongside Belarus, Colombia, Egypt, Kazakhstan, Saudi Arabia, South Africa, Turkmenistan, Uganda and the Philippines.
Apple couldn’t be immediately reached by TechCrunch for comment.
Virtual private networks or VPNs are popular tools for users in China to bypass the “great firewall” censorship apparatus, accessing web services that are otherwise blocked or slowed down. But VPNs don’t necessarily protect users’ privacy because they simply funnel all the traffic through VPN providers’ servers instead of users’ internet providers, so users are essentially entrusting VPN firms with protecting their identities. Private Relay, on the other hand, doesn’t even allow Apple to see one’s browsing activity.
In an interview with Fast Company, Craig Federighi, Apple’s senior vice president of software engineering, explained why the new feature may be superior to VPNs:
“We hope users believe in Apple as a trustworthy intermediary, but we didn’t even want you to have to trust us [because] we don’t have this ability to simultaneously source your IP and the destination where you’re going to–and that’s unlike VPNs. And so we wanted to provide many of the benefits that people are seeking when in the past they’ve decided to use a VPN, but not force that difficult and conceivably perilous privacy trade-off in terms of trusting it a single intermediary.”
It’s unclear whether Private Relay will simply be excluded from system upgrades for users in China and the other countries where it’s restricted, or it will be blocked by internet providers in those regions. It also remains to be seen whether the feature will be available to Apple users in Hong Kong, which has seen an increase in online censorship in the past year.
Like all Western tech firms operating in China, Apple is trapped between antagonizing Beijing and flouting the values it espouses at home. Apple has a history of caving in to Beijing’s censorship pressure, from migrating all user data in China to a state-run cloud center, cracking down on independent VPN apps in China, limiting free speech in Chinese podcasts, to removing RSS feed readers from the China App Store.
Fintech in Africa is a goldmine. Investors are betting big on startups offering a plethora of services from payments and lending to neobanks, remittances and cross-border transfers, and rightfully so. Each of these services solves unique sets of challenges. For cross-border payments, it’s the outrageous rates and regulatory hassles involved with completing transactions from one African country to another.
Chipper Cash, a three-year-old startup that facilitates cross-border payment across Africa, has closed a $100 million Series C round to introduce more products and grow its team.
It hasn’t been too long ago since Chipper Cash was last in the news. In November 2020, the African cross-border fintech startup raised $30 million Series B led by Ribbit Capital and Jeff Bezos fund Bezos Expeditions. This was after closing a $13.8 million Series A round from Deciens Capital and other investors in June 2020. Hence, Chipper Cash has gone through three rounds totalling $143.8 million in a year. However, when the $8.4 million raised in two seed rounds back in 2019 is included, this number increases to $152.2 million.
SVB Capital, the investment arm of U.S. high-tech commercial bank Silicon Valley Bank led this Series C round. Others who participated in this round include existing investors — Deciens Capital, Ribbit Capital, Bezos Expeditions, One Way Ventures, 500 Startups, Tribe Capital, and Brue2 Ventures.
Chipper Cash was launched in 2018 by Ham Serunjogi and Maijid Moujaled. The pair met in Iowa after coming to the U.S. for studies. Following their stints at big names like Facebook, Flickr and Yahoo!, the founders decided to work on their own startup.
Last year, the company which offers mobile-based, no fee, P2P payment services, was present in seven countries: Ghana, Uganda, Nigeria, Tanzania, Rwanda, South Africa and Kenya. Now, it has expanded to a new territory outside Africa. “We’ve expanded to the U.K., it’s the first market we’ve expanded to outside Africa,” CEO Serunjogi said to TechCrunch.
In addition and as a sign of growth, the company which boasts more than 200 employees plans to increase its workforce by hiring 100 staff throughout the year. The number of users on Chipper Cash has increased to 4 million, up 33% from last year. And while the company averaged 80,000 transactions daily in November 2020 and processed $100 million in payments value in June 2020, it is unclear what those figures are now as Serunjogi declined to comment on them, including its revenues.
When we reported its Series B last year, Chipper Cash wanted to offer more business payment solutions, cryptocurrency trading options, and investment services. So what has been the progress since then? “We’ve launched cards products in Nigeria and we’ve also launched our crypto product. We’re also launching our US stocks product in Uganda, Nigeria and a few other countries soon,” Serunjogi answered.
Crypto is widely adopted in Africa. African users are responsible for a sizeable chunk of transactions that take place on some global crypto-trading platforms. For instance, African users accounted for $7 billion of the $8.3 billion in Luno’s total trading volume. Binance P2P users in Africa also grew 2,000% within the past five months while their volumes increased by over 380%.
Individuals and small businesses across Nigeria, South Africa and Kenya account for most of the crypto activity on the continent. Chipper Cash is active in these countries and tapping into this opportunity is basically a no brainer. “Our approach to growing products and adding products is based on what our users find valuable. As you can imagine, crypto is one technology that has been widely adopted in Africa and many emerging markets. So we want to give them the power to access crypto and to be able to buy, hold, and sell crypto whenever,” the CEO added.
However, its crypto service isn’t available in Nigeria, the largest crypto market in Africa. The reason behind this is the Central Bank of Nigeria’s (CBN) regulation on crypto activities in the country prohibiting users from converting fiat into crypto from their bank accounts. To survive, most crypto players have adopted P2P methods but Chipper Cash isn’t offering that yet and according to Serunjogi, the company is “looking forward to any development in Nigeria that allows it to be offered freely again.”
The same goes for the investment service Chipper Cash plans to roll out in Nigeria and Uganda soon. Presently, Nigeria’s capital market regulator SEC is keeping tabs on local investment platforms and bringing their activities under its purview. Chipper Cash will not be exempt when the product is live in Nigeria and has begun engaging regulators to be ahead of the curve.
“As fintech explodes and as innovation continues to move forward, consumers have to be protected. We invest millions of dollars every year in our compliance programs, so I think working closely with the regulators directly so that these products are offered in a compliant manner is important,” Serunjogi noted.
Six billion-dollar companies in Africa; the fifth fintech unicorn
During our call, Serunjogi made some remarks about Nigeria’s central bank which resembles comments made by Flutterwave CEO Olugbenga Agboola back in March.
While acknowledging the central banks in Kenya, Rwanda, Uganda for creating environments where innovation can thrive, he said: “Nigeria has probably the most exciting and vibrant tech ecosystem in Africa. And that’s credit directly to CBN for creating and fostering an environment that allowed multiple startups like ourselves and others like Flutterwave to blossom.”
Most fintechs would argue that the CBN stifles innovation but comments from both CEOs seems to suggest otherwise. From all indication, Chipper Cash and Flutterwave strive to be on the right side of the country’s apex bank policies and regulations. It is why they are one of the fastest-growing fintechs in the region and also billion-dollar companies.
“Obviously, we’re not getting into our valuation, but we’re probably the most valuable private startup in Africa today after this round. So that’s a reflection of the environment that regulators like CBN have created to allowed innovation and growth, ” Serunjogi commented when asked about the company’s valuation.
Up until last week, the only private unicorn startup in Africa this year was Flutterwave. Then China-backed and African-focused fintech came along as the company was reported to be in the process of raising $400 million at a $1.5 billion valuation. If Serunjogi’s comment is anything to go by, Chipper Cash is currently valued between $1-2 billion thus joining the exclusive billion-dollar club.
But to be sure, I asked Serunjogi again if the company is indeed a unicorn. This time, he gave a more cryptic answer. “We’re not commenting on the size of our valuation publicly. One of the things that I’ve been quite keen on internally and externally is that the valuation of our company has not been a focus for us. It’s not a goal we’re aspiring to achieve. For us, the thing that drives us is that we have a product that is impactful to our users.”
Serunjogi added that this investment actualizes the importance of possessing a solid balance sheet and onboarding SVB Capital and getting existing investors to double down is a means to that end. According to him, a strong balance sheet will provide the infrastructure needed to support key long-term investments which will translate to more exciting products down the road.
“We look at our investors as key partners to the business. So having very strong partners around the table makes us a stronger company. These are partners who can put capital into our business, and we’re also able to learn from them in several other ways,” he said of the investors backing the three-year-old company.
Just like Ribbit Capital and Bezos Expeditions in last year’s Series B, this is SVB Capital’s first foray into the African market. In an email, the managing director of SVB Capital Tilli Bannett, confirmed the fund’s investment in Chipper Cash. According to him, the VC firm invested in Chipper Cash because it has created an easy and accessible way for people living in Africa to fulfil their financial needs through enhanced products and user experiences.
“As a result, Chipper has had a phenomenal trajectory of consumer adoption and volume through the product. We are excited at the role Chipper has forged for itself in fostering financial inclusion across Africa and the vast potential that still lies ahead,” he added.
Fintech remains the bright spot in African tech investment. In 2020, the sector accounted for more than 25% of the almost $1.5 billion raised by African startups. This figure will likely increase this year as four startups have raised $100 million rounds already: TymeBank in February, Flutterwave in March, OPay and Chipper Cash this May. All except TymeBank are now valued at over $1 billion, and it becomes the first time Africa has seen two or more billion-dollar companies in a year. In addition to Jumia (e-commerce), Interswitch (fintech), and Fawry (fintech), the continent now has six billion-dollar tech companies.
Here’s another interesting piece of information. The timeframe at which startups are reaching this landmark seems to be shortening. While it took Interswitch and Fawry seventeen and thirteen years respectively, it took Flutterwave five years; Jumia, four years; then OPay and Chipper Cash three years.
BuffaloGrid, a startup that provides phone charging and digital content to people in off-grid environments, is teaming up with the Techfugees refugee non-profit to provid free educational content and device charging to displaced people across East Africa and the Middle-East.
The initial service will see solar-powered ‘BuffaloGrid Hubs’ deployed in refugee camps across Kenya and Uganda, providing unlimited free access to education and health content, as well as other streaming services and mobile power charging.
The “Knowledge is Freedom” joint campaign has a goal of raising $3 million over the course of the next two years.
Daniel Becerra, CEO of BuffaloGrid, said: “Our mission is to remove barriers for internet adoption and provide the next billion with information, energy, and digital skills. I hope this campaign will raise awareness of the plight of displaced people and how collectively we have the power to change things. The entire team is excited to work with Techfugees. I believe together we have the technical expertise, experience, and connections to make a real difference.”
Raj Burman, Techfugees CEO, said: “In an increasingly digital and climate change stricken world, our mission is to make sure forcibly displaced people don’t get left behind. Around 400,000 marginalized refugees reside in the Rwamwanja and Kakuma-Kalobeyei settlements camp in Uganda and Kenya respectively. Our collaboration with BuffaloGrid presents a unique opportunity for an innovative, responsible digital solution to empower displaced communities with the support of our Chapters in Kenya and Uganda to overcome the access barriers to education and health content to better their livelihoods.”
Techfugees says 80 million people (roughly one percent of humanity) have been displaced because of climate change, war, conflict, economic challenges, and persecution. This figure is expected to grow to over 1 billion displaced people by 2050.
Belfast HQ’d BuffaloGrid has raised $6.4 million to date and counts, Tiny VC, ADV, Seedcamp, Kima Ventures and LocalGlobe among its investors.
(Disclosure: Mike Butcher is Chairman of Techfugees)
On April 16, Uganda-based two-wheel ride-hailing platform SafeBoda announced that it had completed 1 million rides in Ibadan, a southwestern city in Nigeria. This might not seem spectacular from a global perspective because it took the startup a year and two months to achieve but it’s a noteworthy feat in African markets.
Ibadan is one of the cities where SafeBoda operates. The company, which first launched in Uganda, is disrupting the offline market of local motorcycles referred to as boda-bodas in Uganda and okadas in Nigeria.
In 2017, SafeBoda officially started operations in Kampala and almost immediately began to deal with the threat posed by new entrants at the time: uberBODA and Bolt boda.
Uber and Bolt are two of the most well-known ride-hailing companies in the markets in which they operate. Uganda was the first African country the pair decided to test out their two-wheel ride-hailing ambitions and it was the second market globally after Thailand for Uber. So given the clout and money these companies hold, most people anticipated they would give SafeBoda a run for its money. But that didn’t happen.
According to Alastair Sussock, co-CEO of SafeBoda, who founded the company with Ricky Rapa Thomson and Maxime Dieudonne, SafeBoda was clocking about 1,000 rides daily at the time. He argued that even though the company’s volumes were one of the best, there was a misrepresentation in the media that SafeBoda wasn’t in the league as other platforms.
“Everyone thought Uber and Bolt would enter Africa to revolutionize the informal boda market,” Sussock told TechCrunch. “There was mention of other players, some of which have folded now, but no one mentioned SafeBoda although we were actually doing quite good stuff. And that energized us to prove the perception wrong, which was that SafeBoda didn’t really exist”.
Strategy, hard work and a large Series B investment followed the next couple of years, which has established SafeBoda as a market leader in Uganda. Sussock said the company now completes about 40,000 rides a day. Uber and Bolt barely complete 10,000 rides in the country.
So what has been pivotal to this growth? Before founding SafeBoda, Rapa Thomson was also a boda rider. As the company’s director of operations, he’s pivotal in making sure the company adopts localized methods with its riders. And despite its exciting features, pieces of equipment and safety measures employed, what stands out is how SafeBoda adapts to the boda boda community. This has been responsible for the 80% year-on-year retention the company currently enjoys, Sussock said.
“We tend to localize our product and take a local approach where we hire local guys to be part of the team. They help to have boots on the ground and of course, what you see with Nigeria, is not as much a dissimilar story,” the co-CEO added.
When starting in Nigeria, most two-wheel ride-hailing startups begin from Lagos, the nation’s hotbed of commerce and transport. In recent times, the city has had entrants like Opera’s OPay, Gokada and MAX.ng. These startups, like SafeBoda, are heavily backed by U.S., Chinese and Japanese investors. They have been at loggerheads with each other to capture on-demand mobility market share in Africa’s most populous country.
SafeBoda first hinted at a possible expansion into Nigeria in 2019. All the aforementioned ride-hailing companies were already in operation and it appeared as if SafeBoda was a very late entrant. But according to Babajide Duroshola, the country head for SafeBoda in Nigeria, the team knew it was going to thrive in spite of the timing and what competition looked like. “For us, it was a no-brainer decision to come into Nigeria and do the same thing that we did at Kampala, which is to grow quickly and make SafeBoda a household name,” he said to TechCrunch.
When time came to reveal which city it was going to start with, it was Ibadan, not Lagos. SafeBoda caught everyone unawares with the decision and subsequently faced heavy backlash. This was in December 2019 but fast-forward to February 2020; it proved to be a masterstroke because in one fell swoop, the Lagos State government rendered bike-hailing operations obsolete with new regulations. For the next couple of months, SafeBoda was the only reliable source of two-wheel ride-hail service in the country. While the regulations forced others to pivot into asset financing for bikes and logistics services, SafeBoda was waxing strong with its ride-hailing operations in Ibadan.
In its first five months, SafeBoda had completed more than 250,000 rides and onboarded thousands of drivers. Once again, adopting a local strategy and community building proved vital to the seemingly modest but explosive growth it experienced in a market no company had really tested.
“One of the things that really separated us from all the other guys in the market was a localization play. The fact that we could connect with and employ these people who were okada drivers right off the streets to become part of our operations team was very key,” Duroshola said.
The country manager added that SafeBoda’s progress showed other two-wheel operators that a market outside Lagos existed. “Lagos is the commercial capital. There’s a lot of money in the city and income per household is high. But then, it is not a true representation of Nigeria. We saw that if you really want to scale across the country, Ibadan was actually a very good place to start because it had all the kinds of people you’d typically find in Nigeria.”
The ease of doing business for a ride-hailing platform in Ibadan is also easier than in Lagos. The latter is known for endorsing NURTW, a transport group known to legally extort riders daily or weekly in the city. Such activities are prohibited in Ibadan giving SafeBoda a smooth path to achieving scale and allowing its drivers to work effectively.
A year in the city has rewarded the company with over 2,500 drivers and 40,000 customers. Together, they performed more than 750,000 trips in SafeBoda’s first year, which has since surpassed more than 1 million trips.
SafeBoda’s progress in Uganda and Nigeria makes it one of the most active players in Sub-Saharan Africa. The company has completed more than 35 million rides across both countries, with over 25,000 registered riders. It also claims to hold more than 80% market share in the two countries.
Despite this success, SafeBoda struggled in its third market, Kenya — a market it expanded to and left before Nigeria. The company had onboarded over 1,500 riders in less than a year, but it wasn’t growing at the pace it wanted. The pandemic made SafeBoda’s struggles obvious and per this report, riders’ dissatisfaction with pricing caused an upheaval that sent the company out of the Kenyan market.
In addition to rider troubles, Sussock noted that Kenya’s motorcycle taxi market wasn’t as highly dense as Uganda and Nigeria which, according to him, contributed to the exit.
“We were the market leader in Kenya, and we were doing like the most rides in Kenya. But it was still quite small in terms of volume compared to Uganda. And we knew what the potential would be in Nigeria, which we hadn’t done at the time. So it was just quite clear that Kenya, while very developed for tech, and developed per capita, was just really quite hard to scale in terms of motorcycle taxi transportation,” he said.
SafeBoda isn’t ruling out a return to the East African market. But with the East African market out of the way for now, it has the resources to focus ride-hailing efforts on Uganda and Nigeria. The ultimate goal, however, is to scale its super app play.
In Uganda, it is already in motion. SafeBoda offers on-demand food, grocery, pharmacy, essentials and beverages delivery services, of which more than 500,000 orders have been completed. This model is inspired by the Go-Pay model at GoJek, where two-wheel ride-hailing was an entry point to high-frequency wallet spend behavior.
The Asian multi-service company is one of the investors in SafeBoda via its GoVentures arm. Other backers include Transsion Holdings, Beenext, and serial entrepreneur Justin Kan.
SafeBoda has no real competition in the bike-hailing wars in Uganda and Nigeria as it stands. The company’s challenge remains the large offline market, where more than 1.5 million rides are completed daily in Uganda alone. The plan for SafeBoda is to convert more of this base to its existing online market share. Additionally, it wants to expand into P2P, merchant and bill payments and grow its on-demand business in Uganda. Its plan in Nigeria? Maintaining its core transport business before venturing into payments and deliveries.
When Vanessa Nakate, 24, was cropped out of a wire photo featuring her and four white activists, it drew attention that she now uses to expand her work in Uganda and beyond.
WayaWaya’s customers and partners include the likes of I&M Bank, Interswitch and MTN. The company offers a range of services, from digital banking and payment services to financial services APIs and payment bots.
According to Ajua, the acquisition is primarily focused on WayaWaya’s payments bots system known as Janja. The platform, which has customers like Airtel, Ezee Money, Housing Finance Company of Kenya (HF Group), enables borderless banking and payments across apps and social media platforms. Teddy Ogallo, the entrepreneur who founded WayaWaya, joins Ajua as VP of Product APIs and Integrations.
Per Crunchbase, WayaWaya has just raised $75,000. Although the two companies did not disclose the financial details of the acquisition, Ajua is expected to have paid 10 times more than WayaWaya’s total raise.
“There’s a lot of commerce happening on the continent and Ajua wants companies to move from transaction numbers to the customers behind such transaction,” Griffith told TechCrunch. “Imagine if we knew what drove consumer habits for businesses. I mean, that’s a huge exponential curve for African businesses.”
Nigeria’s SME market alone is valued at $220 billion annually. And while businesses, mostly big enterprises, can afford customer communication tools, a large segment of small businesses are being left out. Ajua’s play is to use data and analytics to connect companies with their customers in real time. “We’ve taken what makes enterprise customers successful, and we’re capturing it in a simple format so SMEs can have the same tools,” Griffith added.
Since most consumer behavior for these SMEs happens offline, Ajua gives businesses unique USSD codes to receive payments, get feedback and offer discounts to their customers. It is one of the products Ajua has launched over the years for customer feedback at the point of service to businesses that cumulatively have over 45 million customers.
The company’s partners and clients also include Coca-Cola, FBNQuest, GoodLife Pharmacy, Java House, Safaricom, Standard Chartered and Total.
As an intelligent messaging bot, Janja is used by individuals and businesses across WhatsApp, Facebook Messenger and Telegram to automate customer support and make cross-border payments. So, Janja’s integration into Ajua’s product stack will close much of the acquirer’s customer experience loop by automating responses and giving customers what they want, when they want it.
This acquisition comes a month after Ajua announced that it partnered with telecom operator MTN Nigeria to launch a customer management product for Nigerian businesses. The product called MTN EnGauge carries the same features present in Ajua but, in this case, is tailored solely for businesses using the MTN network. The roll-out is expected to generate more data for Ajua’s thousands of users. It will also be upgraded to incorporate Janja and other services.
In hindsight, it appears Ajua could have created a product like Janja in-house due to its vast experience in the consumer experience space. However, the company chose an acquisition and Griffith gave two reasons why — building a similar product would have taken a long time and Ogallo seemed to know Janja’s business and operations so well, it just made sense to get him on board.
“Teddy was going the same direction we’re going. We just thought to acquire WayaWaya instead and make a really good company out of both products attempting to solve the same problem. To me, it’s all about solving the problem together rather than going alone,” said the CEO.
On why he accepted the acquisition, Ogallo, who now has a new role, noted that Ajua’s ability to scale customer service and experience and also help businesses was one reason and earned admiration from him. “Seeing how WayaWaya’s technology can complement Ajua’s innovative products and services, and help scale and monetize businesses, is an exciting opportunity for us, and we are happy that our teams will be collaborating to build something unique for the continent,” he added.
This is a solid infrastructure play from Ajua coming from a founder who is a massive advocate of acquisition and consolidation. Griffith believes that the two are strategies for a speedier route to new markets and channels in Africa.
“I think there are lots of ways we can build the ecosystem. There are lots of young talent building stuff, and they don’t have access to capital to get to the next stage. The question is if they want to race to the finish line or take off time and get acquired. I think there’s a huge opportunity in Africa if you want to solve complex problems by acquisition.”
There has been an uptick in local acquisitions in Africa from startups within a single country and between two countries in the past three years. For the former, Nigerian recruitment platform Jobberman’s acquisition of NGCareers last year comes to mind. And there are pan-African instances like Lagos-based hub CcHub’s acquisition of iHub, its Nairobi counterpart; Ethiopian software provider Apposit sell-off to Nigerian fintech Paga; and Johannesburg-based fintech MFS Africa acquiring Uganda’s Beyonic.
The common theme among the acquisitions (and most African acquisitions) is their undisclosed sums. For Ajua, Griffith cited regulatory issues as one reason why the company is keeping the figure under wraps.
Since launching nine years ago, Ajua has raised a total of $3.5 million, according to Crunchbase. Given the nature of this acquisition and partnership with MTN, the company might set sights on another fundraise to scale aggressively into Nigeria (a market it entered in 2019) and other African countries.
More than a year after the pandemic began, remote work shows no signs of going away. While it has its cons, it remains top of mind for potential employees around the world before joining a new company.
But while most people in Africa still go to physical offices, despite the pandemic, a few companies have nevertheless embraced this concept. Andela, a New York-based startup that helps tech companies build remote engineering teams from Africa, was one of the first to publicly announce it was going remote on the continent.
Today, it is doubling down on this effort by announcing the global expansion of its engineering talent. Over the past six months, the company has seen a 750% increase in applicants outside Africa. More than 30% of Andela’s inbound engineer applications also came from outside the continent in March alone. Half this number came from Latin America while Africa saw a 500% increase in applications, as well.
When Andela launched in 2014, it built hubs in Nigeria, Kenya, Rwanda and Uganda to source, vet and train engineers to be part of remote teams for international companies. It also tested satellite models in Egypt and Ghana as substitutes to physical hubs.
The company would issue a call for applications, select a few (less than 1%), pay them a salary for the first six months and provide them with housing and food. It also helped developers improve their skills via training and mentorship. Over 100,000 engineers have taken part in the company’s learning network and community, and, as of 2019, Andela had more than 1,500 engineers on its payroll.
However, after noticing that this model wasn’t sustainable, it began to make changes.
In September 2019, it let go of 420 junior engineers across Kenya, Uganda and Nigeria. Nine months later, citing the pandemic, it laid off 135 employees while introducing salary cuts for senior staff. But despite the layoffs, the pandemic provided some form of clarity to how Andela wanted to operate — which was remote, judging by the success of the satellite models.
“In the very beginning, a developer had to be in Lagos to work with Andela. Then it became living in Nigeria. Then Kenya. Then Uganda, Rwanda,” CEO Jeremy Johnson told TechCrunch. “Before the pandemic, Andela was opening applications in country after country. The pandemic came and changed that as we opened up to the entire continent.”
Shutting down its existing physical campuses and going remote also helped the company focus on getting engineers with more experience to meet its clients’ requirements. That experiment, which the company conducted in less than a year, is also part of its mission to be a global company.
“That went so well and we thought ‘what if we accelerated it now that we’re remote and just enable applicants from anywhere?’ because it was always the plan to become a global company. That was clear, but the timing was the question. We did that and it’s been an amazing experiment,” Johnson added.
Now with its global expansion, its clients can tap into regional expertise to support international growth.
According to a statement released by the firm, it currently has engineers from 37 countries across Africa, Asia, Latin America, North America and Europe.
Johnson didn’t go into details about how many of these engineers are getting jobs from Andela, or even its total developer count. He’s more interested in helping its clients solve the diversity issues that have plagued many Western corporations.
Andela is currently working with eight companies that have hired its engineers in Latin America and Africa. In addition to the diversity play, the CEO says that means Andela engineers get to prove themselves on a global playing field in a way the company has “always wanted to see.”
Andela serves more than 200 customers, including GitHub, ViacomCBS, Pluralsight, Seismic, Cloudflare, Coursera and InVision. GitHub is one company that seems to be benefitting from Andela’s new offerings. The company’s VP of Engineering, Dana Lawson, in a statement said, “As a business in the developer tool space, a lot of us are trying to enter those areas of the world (Southeast Asia, Latin America and Africa) where the emergent developers are coming so we can better understand their needs. Having a local presence there with amazing talent is super valuable to building a global product.”
In its quest to become a global company, going up against competition is unavoidable for the seven-year-old company. But since most of these companies are horizontal marketplaces (providing a wide range of expertise), whereas Andela is vertical, Johson believes there’s enough market share to be acquired by the company.
“We are focused on building digital products, and because of that, we’re able to do more, essentially, for our customers… That’s where our focus is — [building long-term relationships] and around building great digital products.”
The company was founded by Jeremy Johnson, Christina Sass, Nadayar Enegesi, Ian Carnevale, Brice Nkengsa and Iyinoluwa Aboyeji. It has raised more than $180 million (up to Series D) from firms like Chan Zuckerberg Initiative, Generation Investment Management, Google Ventures and Spark Capital, at a valuation of about $700 million.
While announcing the layoffs last year, Andela said it was on an annual revenue run rate of $50 million. But when asked how this number has changed over the past year, Johnson said the company is “growing at a healthier pace as we’ve ever had.”
The future of remote work is global and Johnson believes Andela provides the vital link to talent wherever it is found. The company’s head of talent operations, Martin Chikilian, echoes similar sentiments.
“We’ve seen exponential growth and interest from engineers from across Africa who want to work with some of the world’s most exciting technology-focused companies,” he said. “Growing our network of talent from Africa to include more markets is a unique proposition and we continue to match talent with opportunity beyond geographical boundaries.”
Small businesses in Africa need digital banking services including plenty of credit. Although these businesses drive economic growth and contribute up to one-third of the continent’s GDP, they are often financially excluded from credit and other financial services due to their size and informality.
One such company tackling this challenge in the eastern part of Africa is Ugandan fintech startup Numida. And today, the company is announcing the close of its $2.3 million seed round.
Mina Shahid, Catherine Denis and Ben Best founded Numida in 2017 and capitalized on the opportunity to build one of East Africa’s first digital fintechs targeting semi-formal micro and small businesses. Typically, these businesses access credit from family, loan sharks and informal money lenders that offer poorly designed consumer credit. They can also get loans from a traditional microfinance institution, although with ridiculous interest rates.
But the founders didn’t set out to offer credit to businesses when they first started. An initial pilot in 2016 was centered around a bookkeeping tool that enabled traditional microfinance institutions (MFIs) to provide unsecured credit to semi-formal businesses.
“One of the major reasons why financial institutions don’t give loans to these businesses is because they don’t have good financial track records and cash flow history,” Shahid said to TechCrunch. “That was the problem we set out to solve — to create the mechanisms to get that cashflow data and present it in a form that can be used and incorporated into the underwriting processes.”
The founders thought that these microfinance institutions would begin to use the data obtained from months of bookkeeping to serve these businesses. But they didn’t envisage what happened after nine months. Shahid stated that even though the MFIs claimed to love the data that Numida could bring out, they were unwilling to adjust their underwriting practices. In turn, they rejected all Numida’s customers who applied for loans on the platform because they lacked collateral.
“So we thought among ourselves that if our mission is to unlock access to resources that these mom and pop shops need in order to grow their businesses, we’re not going to do that by partnering with these traditional MFIs; we had to do that ourselves,” he continued.
Via a proprietary credit score, Numida offers risk-based pricing on an applicant’s first loan. After that, businesses can access unsecured working capital loans of up to $3,500 in less than two hours, according to the company.
From May 2017, when it pivoted to September 2019, Numida kept its outstanding portfolio very small and iterated on its underwriting process and credit risk algorithm. After making several iterations, the company went full on to the market in October 2019, and the CEO says the company has grown 6x in lending volumes.
To date, it has provided more than $2 million in unsecured credit to 3,000 micro and small businesses in Uganda, disbursing around $250,000 per month. This is with outstanding collections, repayment rates and client retention, the CEO added.
Although the consumer digital lending space in East Africa has seen an abundance of transactions in recent years, the same cannot be said for startups targeting the micro and small business segment. As one of the few facing this segment, the business has faced issues around getting relevant data to improve its model but doesn’t collate data it thinks isn’t necessary (social media activities, SMS or mobile money transactions) for the sake of aggregating data.
“We look at the business fundamentals, the cash flow of the business, and some demographic data about the applicants. We’ve had to build our own data set because there are no readily available cashflow data on semi-formal, micro and small businesses in Africa,” remarked Shadid.
Its underwriting model was built off 15,000 loans, which took a long time to execute, and this timing puts some strain on how fast it can onboard customers and serve them. However, the pandemic helped in accelerating this model, and with this new investment, Numida is poised to grow further.
Pan-African payments company MFS Africa led the seed round. There was also participation from firms like DRK Foundation, Equilibria Capital and Segal Family Foundation alongside angel investors.
The last time MFS Africa was in the news regarding an investment dates back to June 2020, when it acquired Ugandan fintech startup Beyonic for an undisclosed amount.
Numida is another Ugandan fintech, and a similar play might be in the cards. According to Shahid, the most obvious acquisition path for any successful lending startup to small businesses in Africa is a payments platform. His reason? Because credit is one of the core financial products that will create loyalty and retention to a specific payments platform.
He adds that MFS is a strategic investor in Numida and not the typical VC. He sees the Pan-African company as owning infrastructure, which his company can ride on as a solid foundation for scale. “That’s an opportunity we see in the future. We were concerned about scaling across the continent and who would be the best partner for this. We thought MFS has a lot of expertise and footprint on the continent that will allow us to scale moving forward.”
With this new financing, Numida plans to expand aggressively in Uganda and pilot in a new market, preferably in West Africa. There are some parallels between Uganda and Ghana, Numida’s primary choice in the region. They both have similar mobile money penetration, issues with traditional financial service providers and similar businesses that Shahid says make an enticing market. Per plans, Numida will introduce additional financial services like payments, micro-insurance and deposits to its customers.
Bobi Wine, the pop star who became a presidential candidate, considers rebuilding his anti-government movement after a violent election season that left many aides and supporters imprisoned.
Hundreds have been detained, many brutalized, after a bloody, contested election. The government of Yoweri Museveni appears intent on breaking the back of the opposition.
According to a McKinsey report, the total number of mobile money services worldwide was 282 in 2017, with more than half of those operating in sub-Saharan Africa.
In 2020, these numbers increased significantly, but the ratio remained similar. In 96 countries, there are 310 live mobile money services, according to a GSMA report. Out of that number, 171 are from Africa, while 157 are in sub-Saharan Africa.
In Tanzania, mobile money services can be relatively difficult to use due to unstable internet and high service fees. Benjamin Fernandes noticed this as a national television host while building a mobile money service to enable people to pay for TV subscriptions in East Africa back in 2011.
Six years later, he would start his own mobile money and wallet aggregator, NALA, to solve these issues. Its first mobile application allowed users to make mobile money payments and utilize mobile banking without an internet connection. The business grew to 250,000 users in over a year after its official launch.
Last year, the WorldBank predicted a sharp decline of international remittances to Africa. But even though Africa is still the most expensive region to send money to with averages of 10.6% in transaction fees, the opposite happened. There was an increase in remittance activity on the continent.
Kenya, for instance, had its highest-ever inbound remittance at $3 billion, while WorldRemit acquired Sendwave in August 2020 for $500 million and Mama Money claimed to have grown 500% within the year.
NALA also noticed an uptick in remittance requests where 1 in 7 users wanted to receive money internationally. This happened despite not being in that business at the time. It’s not hard to see why: Presently, over 70% of money sent to Sub-Saharan Africa is transacted through physical stores. When many over-the-counter services were suspended or limited due to coronavirus restrictions, people were left with expensive, unreliable or hard-to-access alternatives.
Combined with the increasing trend for digital-first financial services and listening to some users’ requests, NALA began testing international money transfers in August 2020 to facilitate payments from the U.K. to Kenya, Uganda and Tanzania. By building a multi-currency ledger where people can send money from the U.K. to Tanzania and back to the U.K., Fernandes says NALA can build a Wise for Africa.
“I believe international payments are only 1% built today. Until you can send money both ways seamlessly, our work isn’t done,” Fernandes told TechCrunch. “We believe African markets should be ‘sender’ markets, too; there is a lot of trade happening with other countries, and most of the money is sent via costly bank wires or at physical stores. It doesn’t need to be this way; it’s time for something better.”
Various platforms are trying to achieve this, but none specifically targets the East African region. That is NALA’s play, according to the CEO. “This is where we see a big advantage for us. We are local, we understand mobile money, we built bill payments on our previous product, and this is an extension of that,” he added.
Since graduating as the first East African company from Y Combinator in 2019, NALA has brought other interesting investors on board to support its mission. The most notable is Accel, which has been kept under wraps for some time. The VC firm rarely makes deals on the continent and has only invested in NALA and Egypt’s Instabug. Other backers include NYCA Partners and angel investors like Shamir Karkal (co-founder of Simple), Peeyush Ranjan (former Flipkart CTO and current head of Google Payments), and Thomas Stafford (DST Global).
NALA also enlisted the services of Nicolas Esteves, who was the VP of engineering at Osper and had a stint at Monzo to become the company’s CTO which, according to Fernandes, will considerably improve the company’s chances of achieving its goal. “When we brought someone of his calibre on our team, it just opened up the doors of what we could accomplish because he has built multi-currency ledgers across different large companies.”
For now, though, the company will be rolling out a beta product next month for U.K.-based customers sending money to Kenya and Uganda (Tanzania will come later). The company claims that the service will support instant payments to all major mobile money accounts and says it is closing some banking partnerships that will allow it to facilitate money transfers from East Africa to the U.K.
Ugandan technology-enabled asset finance company Tugende today announced that it has closed $3.6 million in a Series A extension round.
The investment, which, according to the company, was agreed on and structured in 2020, follows the $6.3 million raised in November 2020 and led by Toyota Tsusho investment fund Mobility 54. This brings Tugende’s total Series A financing to $9.9 million.
San Francisco and Paris-based VC firm, Partech led the round. Enza Capital participated, alongside some unnamed angel investors.
Michael Wilkerson founded Tugende in 2012. The company uses asset finance, technology and a customer support model to help micro, small and medium-sized enterprises own income-generating assets.
While primarily based in East Africa, the company wants to tackle the $331 billion credit gap facing these businesses across Africa. Its core product is for motorcycle riders in Kenya and Uganda, with a lease-to-own or hire-purchase package. These riders get some training, medical and life insurance, safety equipment and hands-on support from their first use of the motorcycle to owning it.
Between 2006 and 2010, CEO Wilkerson, then a journalist and researcher, spent a great deal of time using motorcycles (Boda bodas) for quick and flexible transport. It was such an effective means for transport for him that he built a large contact list of “go-to” boda boda riders he would call for rides when need be. This was long before ride-hailing made its way to East Africa.
These boda boda riders earned enough to pay motorcycle rent and survive, but not enough to build significant savings. While the little amounts they paid for rent could actually service a loan, traditional banks either required significant collateral or very high down payments.
So in 2010, Wilkerson launched Own Your Own Boda, a for-profit enterprise to put these riders on a path toward owning their motorcycles. They began informally with handwritten contracts, but progressed into using technology to scale the solution from 2013 when it rebranded to Tugende.
Once boda boda riders get on board, they can double their take-home profit from $5 per day to $10 per day after becoming owners, the CEO claims.
“With an average household of five people, this can really transform the lives of our client and their families. Besides just increased daily profit, ownership of an asset is also wealth in itself,” Wilkerson told TechCrunch. “Some clients sell the fully owned motorcycle and use that lump sum of capital to make other investments while coming back to Tugende for a new lease, which is affordable from their daily cash flow.”
In addition to motorcycle taxis, Tugende has broadened the productive assets it finances to boat engines, cars, equipment for retail shops, refrigerators and other income-generating equipment. The company is also currently piloting financing for e-mobility assets.
The pivot to using technology in 2013 allowed Tugende to move fully to digital payments, build its own interoperable payment gateway in 2017 and launch an in-house credit score in 2019 to allow clients to see how they are performing.
Talking about clients, Tugende currently has more than 43,000 across Kenya and Uganda. Out of that number, 16,000 have achieved full ownership of at least one asset.
Last year was a challenging one for the company, as the pandemic disrupted some of its activities; excluding 2020, Tugende has doubled in team size year-on-year. The company currently has more than 520 employees, with 20 branches in Uganda and four in Kenya.
While the pandemic presented challenges that the company has since maneuvered, it also brought a new investor in Partech. “Last year, in the middle of the pandemic, we decided to invest in Tugende”, said Tidjane Deme, partner at the firm that invested in 82 startups across 24 countries in 2020. “Tugende combines technology and strong operations to aid millions of professionals to grow their businesses and drive economies forward. We will support Michael and his team to build up the tech platform, fine-tune the model and expand in new markets.”
Over the years, Tugende’s demand has come mainly via word of mouth, a strategy Wilkerson says the company has struggled to keep up with. That’s the purpose of the new investment — to provide supply for growing demand. Also, the investment will support the closure of new debt capital to fuel Tugende’s strong portfolio growth in Uganda and Kenya.
Because of the nature of its business, Tugende needs a steady influx of debt capital. Since its inception, it has raised more than $20 million from debt partners like Partners Group Impact Investments and the U.S. Development Finance Corporation.
So why opt for equity financing this time when it mostly thrives on debt capital? Wilkerson says with the company’s long waiting list of new clients, Tugende has been trying to close new capital fast enough to keep up with this demand.
You see, most lenders require a minimum equity cushion, and even though Tugende has been net income positive for most of the last five years through 2019, its internally generated equity couldn’t anchor enough debt to meet its word of mouth client demand. Now, when you add the company’s goals to grow in new geographies and new asset products, the reason for this equity financing is apparently clear.
“Debt is Tugende’s fuel for growth. But good equity financing is like upgrading the engine, getting a top-notch mechanic and driving coach thrown in on top to help you handle the speed,” the CEO added.
There is also the need for balance sheet strength, leading to more capital runway with larger and better-priced debt deals. Besides, there is the multiplier effect of having hands-on equity support.
Unlike many digital or digitally-enabled lenders, Wilkerson says Tugende’s prime focus on long-term value, not today’s credit transaction alone, is what will keep customers in the Tugende ecosystem in the coming years.
“We are particularly enthused by the team’s innovative application of technology, which incorporates a range of social considerations to build a new type of credit score, and which will increase access to capital across a range of African markets where entrepreneurs currently have a limited credit history or access to collateral,” added Mike Mompi, partner at Enza Capital of the investment.
Dominic Ongwen was abducted by the Lord’s Resistance Army militia as a child, and later rose to be one of its commanders. He was once a victim of some of the same crimes he was accused of later in life.
The United States is considering action against the government of President Yoweri Museveni, a longtime ally who has crushed dissent at home. The European Union has also expressed concern.
President Yoweri Kaguta Museveni was declared the winner although his main opponent said the result was “fabricated.”
One day after the election, Bobi Wine, the top rival to the incumbent president, sounded an alert from his home, saying, “We are under siege.”
As the senior wildlife veterinarian at the Uganda Wildlife Authority, Dr. Robert Aruho, 36, finds himself in the very tricky business of moving giraffes.
Voting is underway in the East African nation, with the long-serving leader, President Yoweri Museveni, facing 10 rivals, including Bobi Wine, a lawmaker and musician.
President Yoweri Museveni accused the company of “arrogance” after it removed fake accounts and pages linked to his re-election campaign.
The leading opposition presidential candidate, Bobi Wine, urged the International Criminal Court to investigate human rights violations that have intensified in the run-up to this month’s election.
Like someone put a giraffe’s head and neck on a horse’s body.
The coronavirus killed far fewer people in Africa than in Europe and the Americas, leading to a widespread perception that it was a disease of the West. Now, a tide of new cases on the continent is raising alarms.
The world’s food supply must double by the year 2050 to meet the demands from a growing population, according to a report from the United Nations. And as pressure mounts to find new crop land to support the growth, the world’s eyes are increasingly turning to the African continent as the next potential global breadbasket.
While Africa has 65% of the world’s remaining uncultivated arable land, according to the African Development Bank, the countries on the continent face significant obstacles as they look to boost the productivity of their agricultural industries.
On the continent, 80% of families depend on agriculture for their livelihoods, but only 4% use irrigation. Many families also lack access to reliable and affordable electricity. It’s these twin problems that Samir Ibrahim and his co-founder at SunCulture, Charlie Nichols, have spent the last eight years trying to solve.
Armed with a new financing model and purpose-built small solar power generators and water pumps, Nichols and Ibrahim, have already built a network of customers using their equipment to increase incomes by anywhere from five to ten times their previous levels by growing higher-value cash crops, cultivating more land and raising more livestock.
The company also has just closed on $14 million in funding to expand its business across Africa.
“We have to double the amount of food we have to create by 2050, and if you look at where there are enough resources to grow food and a lot of point — all signs point to Africa. You have a lot of farmers and a lot of land, and a lot of resources,” Ibrahim said.
African small farmers face two big problems as they look to increase productivity, Ibrahim said. One is access to markets, which alone is a huge source of food waste, and the other is food security because of a lack of stable growing conditions exacerbated by climate change.
As one small farmer told The Economist earlier this year, ““The rainy season is not predictable. When it is supposed to rain it doesn’t, then it all comes at once.”
Ibrahim, who graduated from New York University in 2011, had long been drawn to the African continent. His father was born in Tanzania and his mother grew up in Kenya and they eventually found their way to the U.S. But growing up, Ibrahim was told stories about East Africa.
While pursuing a business degree at NYU Ibrahim met Nichols, who had been working on large scale solar projects in the U.S., at an event for budding entrepreneurs in New York.
The two began a friendship and discussed potential business opportunities stemming from a paper Nichols had read about renewable energy applications in the agriculture industry.
After winning second place in a business plan competition sponsored by NYU, the two men decided to prove that they should have won first. They booked tickets to Kenya and tried to launch a pilot program for their business selling solar-powered water pumps and generators.
Conceptually solar water pumping systems have been around for decades. But as the costs of solar equipment and energy storage have declined the systems that leverage those components have become more accessible to a broader swath of the global population.
That timing is part of what has enabled SunCulture to succeed where other companies have stumbled. “We moved here at a time when [solar] reached grid parity in a lot of markets. It was at a time when a lot of development financiers were funding the nexus between agriculture and energy,” said Ibrahim.
Initially, the company sold its integrated energy generation and water pumping systems to the middle income farmers who hold jobs in cities like Nairobi and cultivate crops on land they own in rural areas. These “telephone farmers” were willing to spend the $5000 required to install SunCulture’s initial systems.
Now, the cost of a system is somewhere between $500 and $1000 and is more accessible for the 570 million farming households across the word — with the company’s “pay-as-you-grow” model.
It’s a spin on what’s become a popular business model for the distribution of solar systems of all types across Africa. Investors have poured nearly $1 billion into the development of off-grid solar energy and retail technology companies like M-kopa, Greenlight Planet, d.light design, ZOLA Electric, and SolarHome, according to Ibrahim. In some ways, SunCulture just extends that model to agricultural applications.
“We have had to bundle services and financing. The reason this particularly works is because our customers are increasing their incomes four or five times,” said Ibrahim. “Most of the money has been going to consuming power. This is the first time there has been productive power.”
SunCulture’s hardware consists of 300 watt solar panels and a 440 watt-hour battery system. The batteries can support up to four lights, two phones and a plug-in submersible water pump.
The company’s best selling product line can support irrigation for a two-and-a-half acre farm, Ibrahim said. “We see ourselves as an entry point for other types of appliances. We’re growing to be the largest solar company for Africa.”
With the $14 million in funding, from investors including Energy Access Ventures (EAV), Électricité de France (EDF), Acumen Capital Partners (ACP), and Dream Project Incubators (DPI), SunCulture will expand its footprint in Kenya, Ethiopia, Uganda, Zambia, Senegal, Togo, and Cote D’Ivoire, the company said.
Ekta Partners acted as the financial advisor for the deal, while CrossBoundary provided additional advisory support, including an analysis on the market opportunity and competitive landscape, under the United States Agency for International Development (USAID)’s Kenya Investment Mechanism Program.