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South Africa Finally Introduces 30% Rule For ICT Companies. What You Need To Know

April 2, 2021

African-tech-startup-funding-rises-51-to-195M-in-2017

A new regulation in South Africa has now been approved and it demands that black people must own at least 30% equity in every ICT company in the Southern African country. This is according to the Independent Communications Authority of South Africa (Icasa) which has released new Broad Based Black Economic Empowerment (B-BBEE) regulations for South Africa’s Information and communications technology (ICT) sector.

“The Authority has consistently required licensees to have 30% of their equity held by HDGs upon application for any kind of Individual Licence,” the new rules read, in part.

“The Authority has noted that not all Individual Licensees have been complying with the HDG Equity Requirement throughout the duration of their licence period. In order to ensure that Licensees comply with and maintain compliance with the HDG Equity Requirement throughout the licence period, this regulation introduces the HDG Equity Requirement as a condition which Licensees are required to comply with during the licence period,” it further reads.

Here Is What You Need To Know

Who Do The Rules Apply To?

The rules apply to all individual license holders under the Independent Communications Authority of South Africa, in charge of the country’s IT industry. Individual licences are operated for commercial purposes on a provincial and/or national scope in South Africa.

The rules are, however, not applicable to holders of Class Licenses issued by the authority as well as wholly owned state entities.

Holders of class licenses are allowed to operate only in local or district municipal scope — that is, the holders can only provide commercial electronic communications services within a particular geographical area (for example, the City of Cape Town).

What Are Expected Of All ICT Companies Under The New Rules?

Under the new rules, all ICT companies are expected to ensure that the percentage of equity ownership held by persons from Historically Disadvantaged Groups (HDG) in the companies are not less than 30%.

Consequently, all license holders have been mandated to submit information on an annual basis to prove compliance with the Historically Disadvantaged Groups Equity Requirement (of 30%).

For the purposes of determining who are historically disadvantaged groups, the rules provide that the 30% consists of either or combination of Black People; Women, who are citizens of South Africa; People with disabilities, who are citizens of South Africa; Youth, who are citizens of South Africa.

However, given the diversity of people who make up the historically disadvantaged groups, as a general rule, the regulations state that:

“The Black Equity Requirement does not remove an Individual Licensee’s duty to comply with the HDG Equity Requirement, however given the overlap between the two requirements, the Authority will recognise compliance with the Black Equity Requirement as compliance with the HDG Equity Requirement.”

The rules provide that where an individual license holder does not have individual persons holding ownership equity directly in the licensee, the individual persons may hold their ownership rights indirectly through some form of an entity such as a company, closed corporation, trust or any form of person recognised under South African law.

The regulations further mandates individual licenses to ensure that there is no material dilution of HDG/Black equity in an Individual Licence in any given year.

Any Punishment For Not Complying With The New Rules?

According to the regulations, if there is a violation of the HDG/B-BBEE or the minimum B- BBEE Contributor Status Level requirements, the license holders will pay up to R5 million or 10% of the licensees annual turnover in penalties, whichever is higher.

When Are South African ICT Companies Expected To Comply?

The rules state that the transitional period for compliance for existing license holders shall be (a) for Class Licensees and SMMEs, 48 months of the promulgation of these Regulations; and (b) for Large Individual Licensees, 36 months of the promulgation of these Regulations.

Nevertheless, the rules require licensees to submit progress reports and any necessary documents to the Authority during the transitional periods.

*Historical VC Investments in South Africa (2009–2018) — Source: Southern African Venture Capital and Private Equity Association’s (Savca) Venture Capital Industry Survey*

The New Regulations Follow Reports Of Poor Inclusion Of Black People In The Ownership Of Businesses In South Africa

Data published by the South African Broad-Based Black Economic Empowerment (B-BBEE) Commission at the end of July indicates a slight change in the levels of transformation, with the overall black ownership reflecting a four percentage point increase from 25% black ownership in 2018 to 29%.

Only 3.3% of entities listed on the JSE are 100% black-owned, which was 1.2% in 2018 and 1% in 2017, the commission found.

The three worst-performing sectors on ownership in 2018 were AgriBEE (11.19%), media, advertising and communication (19.55%) and finance (21.64%).

The commission said that there are also worrying trends observed over the three-year period between 2017–2019.

“Though black ownership indicates slight change, the black ownership percentage does not always correspond with the management control scores,” it said. “For instance, an entity is able to score full points for ownership and very low on management control, which gives the impression that despite black ownership recorded, black people are not involved in the control and core operations of the measured entity. Also, the saturation of management control points is still between junior and middle management, also noting the rotation of black executive from one measured entity to another, without utilising the skills development element to create a pipeline of new black executives.”

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

30% South Africa ICT 30% South Africa ICT 30% South Africa ICT

Investors Flock To Nigerian Ecommerce Startup PricePally, Make Six-figure Investment

Lagos-based ecommerce startup, PricePally, has raised six-figure funding from Samurai Incubate, Launch Africa Ventures, and Angel Investors. The investment comes as the startup demonstrated strong early growth.

“We are psyched to be backed by the VCs and angels that took part in this round. We have a lot of work ahead and this gives us the pump to execute on our plans,” said Luther Lawoyin, chief executive officer (CEO) of Pricepally.

Luther Lawoyin — Founder, Pricepally. — *Luther Lawoyin is the founder of PricePally.*

Why The Investors Invested

The investment came partly from Japanese Venture Capital firm Samurai Incubate Africa which in January, 2020 announced the launch of their USD 18.250 Mn (JPY 2 Bn) second Africa focused fund — Samurai Africa Fund 2nd General Partnership with target on startups based in Kenya, Nigeria and South Africa. The ticket size for Samurai’s investments ranges between USD 50 K to 500 K for startups developing solutions for FinTech / insureTech, logistics, Medtech / healthcare, retail & e-commerce, agritech, transport & mobility, and entertainment sectors. (Startups still interested in checking out Samurai Incubate Africa may follow this link).

Rena Yoneyama, managing partner at Samurai Incubate, said she was “extremely happy” to be able to support Pricepally. “Inflation has escalated rapidly in Nigeria, influencing food prices, though food is one of the most important necessities for daily life. We believe that Pricepally’s solution would give huge benefits for many people, families and businesses” she added.

Headquartered in Ebene, Mauritius, Launch Africa Ventures is a frontier Pan-African fund solving the significant funding gap in the Seed to Series A bridge funding investment landscape in Africa. The VC offers its portfolio companies equity investments between $100k — $300k. Most investments are made via SAFE or convertible notes. It targets B2B and B2B2C early-stage, technology driven startups with strong management teams solving the most meaningful problems on the continent.

A Look At What The Startup Does

Founded in 2019 by University of Lagos graduate, Luther Lawoyin, on principles of the Shared Economy, Pricepally brings consumers together directly with farmers, manufacturers, and wholesalers to mutual benefit.

“We are solving the problem of the high cost of food and daily needs in urban cities in Africa by aggregating demand and matching them directly with supply from farmers and producers,” the startup noted on its social media account.

A novel feature of the Pricepally platform is a social component which allows users to make purchases as groups for even deeper savings. According to Lawoyin, the site’s customers save at least 15% on the food they buy.

PricePally had about 320 paying users before the virus hit last year — that number shot up to more than 1,000 after the country’s lockdown kicked in on March 30, Lawoyin said.

Currently, Pricepally is available in the Lagos area and offers 1–2 day delivery on orders.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

PricePally ecommerce

Liquid Embarks on Major Regional Expansion Across South Africa

April 1, 2021

Deon Geyser, CEO of Liquid Intelligent Technologies South Africa

Recently rebranded Liquid Intelligent Technologies (Liquid) has announced the successful completion of two key digital corridors – NLD5 and NLD6 connecting Durban to Cape Town via the inland route. The completion of this fibre network is expected to support the surging demand for high-speed internet as an increasing number of local businesses continue their digital transformation journeys.

“The completion of these two digital corridors is yet another milestone achieved as part of our on-going investment into the South African economy. Liquid has been instrumental in the fruition of routes 1 through to 8, providing a digital backbone that connects metropolitan cities like Cape Town, Johannesburg and Durban to more remote areas like Nelspruit Bloemfontein, Lady Smith, Mthatha,” says Deon Geyser, CEO of Liquid Intelligent Technologies South Africa.

“This is also part of our Group’s continued focus on bringing world-class digital services like Cloud, Unified Communications, Internet of Things (IoT), and Artificial Intelligence (AI) to local businesses in the public and private sectors.”

Spanning over 1700 km, the near-unlimited capacity and redundancy offered on these digital corridors is expected to positively impact numerous industries, especially educators and healthcare practitioners, as they increase their reach to the remotest parts of the country. Access to improved digital services will also impact the education system in the country as the government gears to empower more youth with digital skills as newer vocations develop through the 4IR.

Liquid Telecom Unveils New Identity and Pan-African Strategy

Liquid Telecom has unveiled its new identity as Liquid Intelligent Technologies. The pan-African technology group also revealed its plan to go from being a telecommunications and digital services provider to a full one-stop-shop technology group through a group-wide rebrand.

Over the last two decades, Liquid has firmly established itself as the leading pan-African digital infrastructure provider with an extensive network spanning over 73,000 KM. This rebrand to Liquid Intelligent Technologies highlights the organisation’s expansion of its Cloud business, Cyber Security services, and other technologies added to its existing telecoms and connectivity capability.

This furthers the Group’s aim of accelerating growth by providing tailor-made digital solutions to businesses in the public and private sectors across the continent. This strategic rebrand reflects Liquid’s new digital-first product offerings, enabling employees and customers to interact with each other digitally irrespective of the time or location. By aggressively expanding into new countries, including Nigeria and the Democratic Republic of Congo, Liquid Intelligent Technologies expects to bring its award-winning high-performance network connectivity closer to more people and accelerate the development of the digital workplace.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Bolt Launches Food Delivery Service to Rival UberEats in Kenya

Bolt Food Country Manager, Edgar Kipngetich Kitur

The food delivery service in Kenya is about to witness stiffer competition with the launching by Bolt of its branded food delivery service which is expected to rival Uber Eats. So far the service – which aims to give users access to restaurants and menus from the palm of their hands – has partnered with around 200 restaurants, including KFC, Big Square, Pizza Mojo, Urban Gourmet Burger, Debonairs Pizza, Steers, Ohcha Noodle Bar, The Chef House, Wings Kenya Alchemist, Shokudo Japanese, Barista & Co, Mercado, Awash Ethiopian restaurant, Charlie’s Bistro and Bao Box.

“Food delivery has been a popular request for quite some time and we are glad to bring this service to the millions of people who are using our platform. The infrastructure and experience we have built up with our ride-hailing business give us a good platform to expand and diversify our services,” says Bolt Food Country Manager, Edgar Kipngetich Kitur.

“We have a rich history in disrupting markets and will be applying our experience to our food delivery platform and offer affordable delivery fees, better working conditions for our couriers and you can find our favourite brands selection. We are launching with amazing restaurant promotions and free delivery.”

To make use of the service, Kenyan’s must first download the new Bolt Food app. Bolt has launched Bolt Green – a new eco-friendly ride offering – in Kenya. The service part of the company’s effort towards reducing its carbon footprint.

“We continue to scale up our operations for the benefit of our customers and the communities in which we operate. Having electric and hybrid vehicles on our platform is a step towards ensuring environmentally conscious ways for people to move around in the city and reduce our ecological footprint,” says Ola Akinnusi, Country Manager for Bolt Kenya.

“The new category also aims at expanding Bolts ride options thereby creating more economic opportunities for drivers and providing passengers with more options to choose from.”

The service is currently only available in Nairobi, but Bolt plans to expand it across the country soon.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Why Cybersecurity is Crucial in the Age of Tap-to-Pay

Simeon Tassev, Managing Director of Galix

By Simeon Tassev

Tap-to-Pay is by no means a new technological development, but thanks to the COVID-19 pandemic, it has become increasingly popular as a method of payment since it is ostensibly contactless. It is also a payment method that can be used even without a card, since many wearable devices such as smartwatches feature tap and go payment options.

With rumours that Apple Pay will be launching in South Africa this year, it is likely to become increasingly available. However, this begs the question, what about security? When no physical card is required and often not even the authentication of a Personal Identification Number (PIN) for smaller transactions, who is responsible? The reality is that banks, merchants and users all need to play their part to minimise fraud and safeguard their money.

Are contactless payments secure?

Tap-to-Pay is based on Near-Field Communication (NFC) technology, with a small chip and antenna inside either the card or the wearable device. When you tap your device against the reader, a randomised token is sent via radio waves to complete the transaction. While the concept of contactless payments might seem daunting to some, there are actually a number of inbuilt features that make them as secure as transactions where the card is inserted into the machine.

To start, because each token is randomised, it is unique and distinct to every purchase. This means that even if it is intercepted, it cannot be used again. It is also not directly linked to the card number, so hackers cannot reverse engineer this from an intercepted transaction. In addition, proximity needs to be extremely close, with the card or the wearable needing to be within a few centimetres of the reader in order to complete the payment.

But what about wearables and smart devices?

Many people are becoming more familiar and comfortable with tapping their card to pay, but contactless payments extend beyond the physical card. Some smartwatches like Garmin offer Garmin Pay, a wallet where payment information from participating banks can be stored and the wearable used as the payment device. The actual card number is not stored on the device but uses the same NFC technology with randomised tokens as the chip in the card. Apple Pay uses the same principles as the wallet app on iPhone, Apple Watch and iPad devices, and rumour has it that this will be available in South Africa by the end of the year.

So, what does this mean for security? It adds a new element, but at the end of the day, the basic security principles still apply, and everyone involved in the payment chain has a role to play. The Payment Association of South Africa (PASA) has defined R500 as the limit for which no PIN is required, and most banks and merchants will adhere to this limit. However, there are some banks that still require random PINs to provide an additional layer of security. When a PIN is not requested, the user cannot be held liable for a fraudulent transaction, so banks have the responsibility to honour these.

From a merchant perspective, the pad device or reader needs to be protected. This is defined under the Payment Card Industry (PCI) Data Security Standard (DSS), which forms the minimum benchmark requirement for all parties involved in the payment card chain. From a user perspective, it is our responsibility to own and manage PINs and not give them out to anyone. No matter what you use to make a payment, whether it is a bank card, a watch, a phone or another device, it needs to be treated as if it is cash, because that is exactly what it is. We need to do everything we can to protect these devices.

The bottom line

Tap-to-Pay payments are safe, secure and convenient, but they are not infallible. Everyone is responsible, as always, for preventing fraud and protecting sensitive data. Users still need to be vigilant, and this now extends beyond safeguarding the card to include wearables and smartphones.

Merchants too have a responsibility to provide a safe environment for transactions to take place and ensure the security of the reader device.

Finally, banks need to play their part by providing the highest levels of security, ensuring valuable transactions are protected by a PIN, and by honouring transactions where a PIN was not requested. As more devices become options to be used for payment, security is increasingly everyone’s responsibility.

Simeon Tassev is the Managing Director of Galix

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

South African Customers Get Online ‘Buy Now Pay Later’ Service

Paul Behrmann, CEO and founder of Payflex

South Africa’s Payflex has launched its buy now pay later online retail service to South Africa. The company – which has seen extraordinary popularity in Australia, the USA and Europe – lets users shop online and pay later, interest-free over six weeks.

“Traditionally paying via instalments in South Africa has been associated with high-interest charges, as you are penalised for paying for the item over time,” says Paul Behrmann, CEO and founder of Payflex.

“But by using Payflex, every purchase you make is interest-free. You’ll know exactly when each of the four interest-free payments is due and there are no hidden costs. It puts you in control of your finances.”

When making an online purchase, select Payflex as the payment method at checkout – Payflex accepts any Visa or Mastercard cards (debit, credit or cheque). Users will then need to provide their South African ID number in order to be assessed.

According to the company, fees only become due if users miss a scheduled payment, but they’ll receive email reminders in advance of each payment to help budget and make all payments on time. Behrmann says that it is important for South Africans to budget and ensure they’ve prioritised their purchases. “The hassle-free Payflex option allows you to see exactly how and when you will make your payments. Provided you make your scheduled payments on time, you won’t be paying one cent extra in interest or fees for your purchase.”

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Enygma Ventures Reopens Applications For Southern African Startups

Enygma Ventures has continued to throw its weight behind founders in Southern Africa — female or male. In its latest move, the Southern African VC has announced that it is now accepting applications from Southern Africa startups, irrespective of gender or stage of startup.

“In partnership with Startup Circles we have launched a program to help support new and existing businesses that are focused on solving issues and systemic problems to help build a new world going forward. We provide either seed funding or mentoring scholarships to those selected. We believe it’s time for businesses to seize the moment, adapt, change and reinvent in order to build a better world,” Enygma Ventures said in a statement.

Here Is All You Need To Know

Through the new in partnership with Startup Circles, Enygma Ventures is expecting to provide seed capital for startups as well as provide mentoring, training and business validation scholarships through Startup Circles.

“We are looking for entrepreneurs with a vision to solve big problems, to change the status quo, create meaningful solutions and take advantage of this window of time to rebuild our world,” the firm noted in a previous statement.
Read also:Renewable Energy Startups Offered $1.2m Innovation Fund

“This fund will award successful candidates either with scholarships to get their business off the ground in conjunction with StartupCircles.AI mentorship and education or seed funding from Enygma Ventures. Startup Circles works with mentors from all around the world who assist in facilitating moving quickly through ideation to validation to operation. Applications are open to both men and women entrepreneurs, creative thinkers and innovators who are focused on creative solutions that benefit SADC or African entrepreneurs from the region,” it further added.

Sandras Phiri, founder and chief executive officer (CEO) of Startup Circles, said previously entrepreneurs needed to be based in a startup hotspot like Cape Town or Nairobi to gain access to the right circles of mentors and investors.

“But now with Startup Circles, entrepreneurs have the same access to opportunities, mentorship and investment whether they are in Lilongwe or Luanda, male or female. Anybody with access to the internet can apply to access startup support and funding,” he said.

Female-led businesses that are selected for investment will be allowed to participate in the Enygma Ventures’ Investor Readiness Programme which allows businesses to receive an equity investment ranging from $25 000 to $1-million.

Early-stage innovation startups that are selected will be offered a scholarship to Startup Circles’ Acceleration Programme and upon graduation, startups will receive a pre-seed equity investment valued at $25 000.

About Enygma Ventures And How Startups Can Apply To The New Fund

Enygma Ventures, is a US-based VC firm founded by award winning entrepreneurs Sarah and Jacob Dusek. Last year, the VC launched a fund with a focus on investing in women entrepreneurs in the SADC region, making its first set of investments in Play Sense and Lupiya recently.

“We received over 3 000 applications for funding in 2020 which demonstrates what an incredible talent pool there is in the region. We are excited to see the progress of many of the businesses that didn’t get funded in 2020 and to discover new business gems,” said Lelemba Phiri, Principal and COO of Africa Trust Group.

Here Is How To Apply

Applicants interested in the investment fund can apply online before April 30, 2021.

Startups that do not qualify will be allowed to access support at a cost from Startup Circles which is the leading startup school in Africa and a large contributor to online acceleration.

Enygma Ventures is looking for:

Businesses that are focused on solving problems for Southern Africa (SADC). The business must either be based or serve/operate in the region.

The idea/business must be scalable and able to operate on a large scale or have a large addressable market.

For profit ideas/businesses. It does not support charitable concepts at this time.

Both male and female applicants.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

Futuregrowth Makes Exceptional Pre-seed Investment In South African Startup Impulse Biomedical

Futuregrowth Development Equity Fund (DEF) has committed for the first time in a startup— Impulse Biomedical — in the pre-seed phase, which does not yet generate income, but whose solutions and services could “revolutionize the technologies of health in South Africa.”

*Amrish Narrandes, Head of Unlisted Asset Transactions at Futuregrowth*

Here Is What You Need To Know

The vehicle managed by South African investment firm Futuregrowth did not disclose the amount invested in Impulse Biomedical, a biomedical engineering platform headquartered in South Africa.

“While we normally focus on late stage venture capital investments, Impulse Biomedical is an exception. We salute its revolutionary technology and products which, together with its founding team, give us confidence that this investment will grow ever larger, ”commented Amrish Narrandes, Head of Unlisted Asset Transactions at Futuregrowth.
Read also:Mauritius Sets Up Committee To Clear Way For Fintech Startups

Healthcare technology is one of the priority areas for investment at Futuregrowth. In a note published earlier this year, the firm said it will target sectors with attractive investment opportunities, such as energy and technology, during 2021.

Impulse Biomedical will bring to market by April 2023, two medical devices that will provide relief to asthma patients and help patients allergic to foreign substances.

With the covid-19 crisis, digital-backed health solutions are increasingly attracting the interest of investors on the continent.

Over the past three months, North Africa has attracted international donors who have funded and acquired significant shares in hospitals and health care centers.

Futuregrowth makes investments from its Futuregrowth Development Equity Fund, a venture capital fund devoted to supporting disruptive businesses and propositions that show strong high growth potential. Futuregrowth just recently, in 2020, invested in SweepSouth.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

Uganda’s Tugende Secures $6.3m In Partech-backed Investment Round

The Ugandan leasing company, Tugende, dedicated to the capital leasing of transport vehicles (motorbikes-taxis, cars) has obtained a financing of $3.6 million in a round led by Partech Partners, a venture capital firm active in Africa and Enza Capital which operates out of Kenya. The latest investment is coming after Tugende secured a $6.3 million series A financing round in October 2020 from the Japanese Toyota.

“Tugende’s focus has always been on meeting our clients where they are today, and finding win-win ways to grow together,” said Tugende CEO Michael Wilkerson. “We started with three motorcycle taxi clients, a tiny office without water, and many negative perceptions about lending to the informal sector and motorcyclists in particular.”

Here Is What You Need To Know

The investment, which is an extension of the $6.3 million Series A round raised last year and led by Toyota Tsusho investment fund Mobility 54, brings Tugende’s total Series A financing to $9.9 million.

The new investment will help Tugende further enhance its technology platform, both for internal operations and client-facing offerings — including Tugende’s transparent, dynamic credit score all clients already receive automatically.

Tugende will also use the capital to further grow its core financing product for motorcycle taxi drivers and accelerate its diversification into other MSME asset finance products including equipment for retails shops, agriculture, and further mobility assets, including e-mobility.

Mobility 54 and its group network will help Tugende with further market expansion, partnerships, and technology development.

Tugende has previously raised more than $20M in debt capital to grow its portfolio. Current debt partners include Partners Group Impact Investments, U.S. Development Finance Corporation, Symbiotics, Frankfurt School Financial Services, ADA Microfinance, Agora, Yunus Social Business, Global Social Impact Fund, and Oikocredit.

Why The Investors Invested

“Last year, in the midst of a pandemic, we decided to invest in Tugende. The company combines technology and strong operations to help professionals grow their businesses. We will help Michael and his team strengthen the technology platform, refine their model and expand into new markets, ”said Tidjane Deme, Partner at Partech.

“Tugende has demonstrated its ability to carry out sustained entrepreneurial activity thanks to its activity of financing productive assets for entrepreneurs in the informal sector […] We are delighted to support it in this phase of rapid growth”, indicated Mike Mompi , partner at Enza Capital.

A Look At What Tugende Does

Based in Kampala, Uganda and launched in 2012, Tugende’s core product is a lease-to-own/hire-purchase package for motorcycle taxi drivers in Uganda and Kenya. The package includes training, medical and life insurance, safety equipment and hands on support through the journey to ownership. With over 43,000 clients served, Tugende is tackling the $331 billion credit gap MSMEs face across Africa.

Outside of 2020, the company has more than doubled its work team each year since 2012 and currently has more than 500 full-time employees.

Tugende recently launched a client app and has invested heavily in its technology backbone for scalability, data analytics, and operational efficiency. In addition to building ownership, Tugende clients earn a digital credit profile which allows them to unlock new opportunities like discounts, rewards, and products exclusive to top performers in the network.

Tugende currently has 17 branches in Uganda and one in Kenya and has already resumed growth in both countries after Covid-related lockdowns. While also commercially sustainable, Tugende has won numerous awards for its social impact and responded to challenging lockdowns in Uganda and Kenya in part with an unconditional household support grant for all clients to help their households survive the worst of the lockdowns

“Our clients have proven that they are creditworthy tens of thousands of times now and want opportunities to drive their own growth. We are committed to expanding those growth opportunities beyond credit alone — something we have already started by providing smartphones, family insurance, and digital credit profiles clients can access themselves,” Wilkerson said.

“Tugende is a launchpad for our clients and a partner for many years to come. We are excited and energized about bringing on strong new investors who also share our long term focus and will catalyze our ability to help clients own their future.”

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

CodeLn Launches Remote Freelancer Management Tool for Companies in Nigeria

March 31, 2021

Elohor Thomas, CodeLn chief executive officer (CEO)

Remote CodeLn, an online platform that helps companies to manage their freelancers and track their tasks throughout the product development process has launched a remote management tool for companies in Nigeria. CodeLn was established three years ago as a fallout from the Meltwater Entrepreneurial School of Technology (MEST) where four participants; Philisiah Mwaluma, Dennis Nduta, Dexter Ouattara and Elohor Thomas met and arrived at the idea of CodeLn to automate the entire tech recruitment process end-to-end. The startup then bagged US$100,000 in funding from MEST upon completion of the programme and followed it up by launching an automated tech recruitment platform that makes it easy for companies to hire African software engineers in 2019, and has seen an increase in requests for remote freelancers since the beginning of the COVID-19 pandemic. This comes with peculiar challenges, however, and CodeLn identified an opportunity to make the adoption of the gig workforce seamless for companies.

Its new platform, Remote CodeLn, helps companies or individuals to post their tech project, receive bids from freelancers, pick from verified bidders, draft a product development contract, assign and manage product development tasks, and pay freelancers in tranches based on milestones completed, all without leaving the platform.

Both the company and the programmer set tasks and timelines for each milestone, which is documented in a contract. The platform stands as an intermediary between both parties, guaranteeing milestones are completed before payment is made as the funds are kept in escrow.

“We saw the need to enlighten companies on how to manage programmers working remotely as it was not the norm in Africa before COVID-19 hit. But we soon realised the additional need for a tool to help them manage this process seamlessly. That is why we built Remote CodeLn. This platform ensures a smooth process for both the company and the programmer,” said Elohor Thomas, the startup’s chief executive officer (CEO).

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry