Startup - Afrikan Heroes

How Sairui, The African New Retail Option Would Disrupt E-commerce In Africa

June 29, 2019

Nothing lasts forever, goes the saying. For the Baby Boomers and Generation X who existed without the internet, it was a shock that the traditional, physical retail business model could fade away, to be replaced by the business at the click of a button.

Today, Amazon Effect means that traditional, physical retail shops continue to wind down and call it a quit, giving in to the stiff competition from Amazon, eBay, Alibaba, Jumia and online shops. For emerging markets and developing countries, what remains for these physical shops to be completely rendered to ruins is trust.

With massive trust and pervasive internet connectivity in developing economies such as Africa’s, physical shops may soon be bidding their last farewell. In fact, Statista predicts that e-commerce penetration will grow from 9% in 2017 to 12.4% by 2020.

But here is the caveat: internet commerce itself is not safe.

Image result for number of online ecommerce consumers in Africa — 2013 e-commerce preferences of African consumers in Nigeria, South Africa, Kenya.

Chinese billionaire, Jack Ma, understood this early enough. In 2016, Jack Ma started a revolution he called the ‘New Retail’ that would itself redefine what commerce really means for all of us. Jack Ma is the 21st richest man in the world and the number one richest man in the most populous nation on Earth— China.

He is piercing the heart of commerce and extracting what has fueled commerce over the course of thousands of years ago — human beings. Through new retail trade, he is relaunching the whole idea of technology in commerce and trade itself to the people that originally own them — human beings, consumers.

“Commerce as we know it is changing in front of our eyes. E-commerce” is rapidly evolving into “New Retail.” ,” Ma wrote to Alibaba shareholders in a letter sent ahead of the New York-listed company’s annual shareholders in 2016. ”The boundary between offline and online commerce disappears as we focus on fulfilling the personalized needs of each customer. We anticipate the birth of a re-imagined retail industry driven by the integration of online, offline, logistics and data across a single value chain. This is why we are adapting, and it’s why we strive to play a major role in the advancement of this new economic environment.”

This may sound more Utopian than realistic, but in China where the concept was formed, Hema Supermarket, an arm of Alibaba that specializes in new retail, has opened 64 Hema stores in 14 cities, with over 10 million customers shopping at these supermarkets since the beginning of 2016.

On average, for a Hema Supermarket that has been open for at least 1.5 years, daily average sales are upwards of 800,000 yuan (US$116,500) — about 60 percent of which comes from online orders. Based on Alibaba’s data, offering a combination of online and offline shopping options results in an increase in average monthly spending by customers. Consumers who shopped both online and offline at Hema spent an average of 575 yuan monthly, compared to under 300 yuan for purely online, or purely offline shoppers.

See Post: Airtel Africa Initiates IPO On The London Stock Exchange, Public Trading Still July 4

Pinduoduo, the $1.5B Chinese startup is also another Chinese e-commerce company, engaged in new retail. The startup is challenging the giant Alibaba in China’s towns and villages. In January, Pinduoduo had 114 million active users, surpassing that of New York-listed Chinese discount retailer Vipshop. Currently, the startup has captured a projected 7.0% of all retail e-commerce sales in China this year, not a bad showing for a firm that launched in 2015. In three short years, Pinduoduo has emerged as one of China’s fastest growing shopping startups, with as many as 55 million users accessing the site per day.

Pinduoduo’s idea of new retail comes by way of offering group discounts.

Here Is How The Idea of New Retail Works

The idea of new retail lies in thinking beyond the boundaries of the two-party system of retail operations, that is, e-commerce and legacy brick-and-mortar retailing. New retail, instead, focuses on employing an entirely new operating system for reaching and inspiring consumers to shop.

‘‘New Retail trade is trying to solve two particular core challenges in the industry,’’ Emmanuel Elem, an advocate of Sairui, Africa’s new retail startup said. ‘‘The first challenge is the challenge of cold war between offline and online malls. Shoprite is an offline multi-billion dollar shopping mall, for example. On the other hand, Jumia is an online mall. These two different malls are doing things differently and the truth is that they are struggling for the same customers.’’

Now, there are people who have sworn [or who are so internet phobic] that they cannot buy or make payment on the internet because they cannot see the person they are buying from. There are also people that say they don’t have the time to go to Shoprite and begin to buy things [be in the queue and waste their time?] when they have Jumia that can get them what they want in their houses while they wait patiently for delivery to be made. So what new retail is trying to do is to bring a marriage between online malls and offline malls.

By new retail, it will no longer be about online shopping malls.
They will also have offline shopping malls or offline distribution centers where people can go, select what they want, pay online and if they don’t want to pay online, they can go to the mall offline and make payment and collect the goods, with the coupon they present to the owner of the shop.’’

He says new retail trade represents a system that blends the best of what both offline and online worlds have to offer. Apart from that, it also offers the best of an entirely new mix of human, digital and physical experience design, giving consumers a new means of inspiration, selection, immediate gratification, physical sensation and convenience, and that ultimately renders the distinction of digital vs. physical irrelevant.

Sairui, The First African New Retail Option Is Gaining Momentum

Although launched this year, March, Sairui is on course to change the idea of internet retail trade. Modeled after Chinese Pindoudou, the startup, which has its Africa headquarters in Accra, Ghana sells everything from clothing to hardware and other commodities and offers large discounts to purchasers. The startup has a strong presence in Nigeria and is also extending to other Africa countries like Cameroon, Uganda, Zambia, Tanzania, and other places.

‘‘We are doing this simultaneously,’’ said Elem. ‘‘Sairui is all about supporting grassroots entrepreneurship. Sairui shows people the possibility of starting to build a business no matter how small they have because with as small as less than 10,000 naira, they can become a business build through Sairui. This is exactly what it’s called pure grassroots entrepreneurship. Sairui also has bigger packages for those that don’t want to start with such small amounts of money.’’

The startup says it has multiple certified safeguard mechanisms, genuine licensed goods at lower prices and more reliable quality.

The Major Changes The Startup Is Bringing To The Table Are In The Logistics And The Customer Experience Areas

The startup offers large discounts to its online shoppers, bringing on-board an entirely new way of buying and selling.

‘‘What Sairui has brought in is the possibility of online and offline shoppers becoming business owners while also shopping. This has nothing to do with network marketing,’’ Elem said. ‘‘Network marketing is a different ball game altogether. Sairui has variety of products.’’

Elem said to handle logistics, the startup has physical shops where the online shoppers can go, present their coupons and redeem their goods or simply make new purchases.

‘‘Sairui is not opening up physical shops on its own. Sairui is opening up these physical shop through partnership or mini-franchising. These shops are called service centers. The centers are there to service our customers who can come and pick up these products. It is either you pay the company online or through these service centers. You can select your products online or you go to the service centers, give them your cash and carry your products. But the simple truth is that the products are going to be very affordable.Right now, we have about three physical malls in Nigeria through what we call Service centers. We service our customers through our customers centers there. We have centers in Cameroun. We have in South Africa. Right now, we have in about seven African countries.’’

Three ‘digital forces’ — disintermediation, disaggregation and dematerialization — are expected to shift value from slow-moving incumbents to more nimble businesses, and from one part of the value chain to another.

For a startup that is just three months old, this appears a great streak of success, but the startup believes its incorporation of Jack Ma’s concept of new retail trade into its business strategy doesn’t just stop at setting up physical locations to enhance internet commerce experience but also that the strategy means consumers on the platform would get a chance to develop business interests from their purchasing or consumption needs.

‘‘Sairui is not a B2B company. Sairui deals directly with end users. We are dealing directly with the end users; people that are consuming these products. We are not dealing with business owners . We are making the end users business owners and also consumers linking them up directly with the manufacturers of these products, removing the middle person involved,’’ Mr. Elem said.

But it does appear that even the B2B middlemen would still have a say after all since the aim is to turn your consumption cost into instant profitability.

‘‘If you do some shopping on a $100 product on Sairui, for instance, we are giving you a discount of 60% on each product, meaning you’re getting a chance to buy two more products. Now, Sairui will help you sell those two discounted products you bought through its wholesale store,online or offline, free of charge. Sairui will sell each of them on your behalf at $100 each, the initial retail price at which you bought them.’’

The startup boasts it would sell off the products on behalf of its customers within a 7 to 10 days period, leaving customers with some unexpected side profit, long hours after they have made their first purchases.

‘‘We are the pioneer of this kind of system,” Elem said. ‘‘It may be strange to African markets, but the simple truth is that over 20,000 e-commerce companies are already using new retail to run their businesses in China. You can trade as many times as you want with one-time principal.’’

42% of global e-commerce is happening in China

Elem said offering discount does not represent any loss for the startup because of a direct partnership with manufacturers of the goods sold by the startup. He said Sairui mall is an open market place just like Amazon, and as such, anything is bound to happen.

‘‘It is just like asking people why they drink water from a clean cup,’’ he said. ‘‘Nobody would see what is good and wouldn’t want to go for it. The general ideology of new retail is encouraging grassroots entrepreneurship. Sairui is a unique opportunity that anyone shouldn’t miss, even though not for the sake of profit, but for the sake of buying things affordable prices and getting free products from its online or offline shops.’’

Getting Started With Sairuimall Africa

To learn more about how to be part of the Sairui value chain, contact the startup’s country director on +2348039421770

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

What You Have To Understand About Signing Term Sheet With Your Next Investors

June 25, 2019

When your startup is ready to go looking for funds, term sheet usually serves as the first set of document you send to investors or investors send to you. It is a negotiation document that details the intended equity participation from the investors in your startups. Most times, term sheet is a bullet-point document outlining the material terms and conditions of a business agreement. Term says in details what your start-up is giving, and what it is getting in return. It then lays out the guidelines of how both parties will act to protect the investment.

More or less, a term sheet is generally not binding, unless the parties say so. Once a term sheet has been “executed”, it guides legal counsel in the preparation of a proposed “final agreement”. The length or the volume of a timesheet depends on the stage of funding your startup is in.

Generally, term sheets for seed rounds are usually much lighter and shorter than for series A or beyond. That is, once you have less at stake, you should expect a term sheet that is less complex, as no one wants to unnecessarily spend on extra legal fees, or burn hardly found the time. In all, term sheet could be a pager, or 10 pages of documents, in simple, clear terms.

What To Look Out For In Every Term Sheet

For every founder or investor reviewing a term sheet proposed by potential investors, or drafting one, they should specifically look out for:

Unfavorable terms. Such terms include a harsh term on debt financing and convertible note terms that could bankrupt you
Demand for too much controlling stake that may replace you
Terms that can restrict your ability to raise further funding
Investors that are impatient and or want a short and quick exit, and that are not willing to respect your timeline of breaking even.

What And What Should Be Found In A Term Sheet?

Who is issuing the note or stock
Type of collateral being offered
The valuation
Amount being offered
Shares and price
What happens on liquidation or IPO
Voting rights
Board seats
Conversion options
Anti-dilution provisions
Investors rights to information
Founders obligations
Who will pay legal expenses
Non-disclosure requirements
Rights to future investment
Signatures

General Points About Reviewing These Common Terms In A Term Sheet

Investors may want to generally prolong the negotiation after term sheet stage may have been completed. When you see this coming, just exercise some patience. Every single provision in that document may not matter today as they would in the long run.
Make the term sheet a win-win for everybody. Founders do not want difficult or greedily overbearing investors, much as investors would not want dishonest or crooked founders.
As a general rule, aim for dilution of around 20% per round of financing. Don’t be in a hurry to go beyond that amount. Your startup may still have a long way to go.
Dilution occurs when holders of stock options, such as company employees, or holders of other optionable securities exercise their options. As the number of shares outstanding increases, each existing stockholder owns a smaller, or diluted, percentage of the company, making each share less valuable.
When you are still at the seed stage of your fundraising and you desire to give up a good amount of your stocks or company’s shares to outsiders, just know that those shares will not come back to you, until you, of course, restructure your startup.
A term sheet is not permission to go on a spending spree. Founders should not make the mistake of thinking the money will be transferred once they receive a term sheet, and therefore go on a spending spree. Wait until the deal is closed. This is because a term sheet itself is not an executed deal or even a promise.

Negotiating A Term Sheet

The best way to win the whole term sheet episode is to carry a lawyer with you who understands the intricacies of every clause inserted into the term sheet. Hone your negotiation skills.

‘‘Having information that the other side doesn’t have gives [you] an advantage… [VCs] take advantage of entrepreneurs who haven’t been through this before… they were totally willing to take advantage of us.” — Mitch Kapor, Founders at Work

Make Sure You Do Not Leave Due Diligence Out Of The Question

Due diligence is very important both for the investor and the founders. Due diligence can cover a wide range of many subjects ranging from legal to technological to human resources. Your in-house team can do this, or you hire an external solicitor or organization. So take time and conduct due to diligence on your potential investors, and particularly answer the following questions:

Do you trust the investor? Trusting is the make-or-mar of your startup.
Are you going to get along with the investor even if funding is immense? This is better imagined than never.
Are there companies that have benefited from their contributions?
What do the investors do when a portfolio company doesn’t do well?

Then Seal The Deal

A little space is usually allowed for investors to conduct their due diligence on your company. Make sure your technology is well patented and that trademarks and designs are registered, and that the documentation of your company is well preserved at the company and trademark registries. This is because investors usually check to see if those things are in order and if the sole owner of the products or business rightly belongs to you.

Sign A Binding Contract

Having noted that the term sheet is not a binding agreement, have it at the back of your mind to negotiate any term you feel deeply uncomfortable with. The best advice is usually to let your lawyer do the job and help you reach a win-win deal.

Time-Lines

Negotiation from the stage of the term sheet to the final agreement usually takes some weeks, depending on whether the deal is simple and the parties are easily agreeable. For complex deals, however, expect a long time for due diligence, legal restructuring, and aligning with many investors.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

Nigerian Solar Energy Startup Anergy Raises USD 9 Mn To Scale Operations

Startups in Nigeria do not seem to be leaving any stones unturned. Nigerian based solar energy distribution startup, Anergy has raised 9 million (NGN3.2 billion) in Series A to fund its commercial growth with new business models, improve on partnership avenues, and expand its activities.

The Funding At A Glance

The funding round was led by Breakthrough Energy Ventures, while Shell-funded All On Energy, the European Union-backed ElectriFI and the Norwegian Investment Fund for Developing Countries (Norfund) participated in the capital injection.
Founded in 2014 by Femi Adeyemo and Kunle Odebunmi, Anergy provides solar power systems to homes and businesses, with a special focus on companies spanning the hospitality, education, financial, agriculture, and healthcare industries.
In the last half-a-decade, the startup claims to have installed over 2 MW of clean energy solutions for more than 2,000 clients.

Funding Was To Scale Operations

“We believe that energy needs in Nigeria have surpassed rudimentary requirements of low power utilization and our product offerings are solving for reliability and not just access,” says CEO Femi Adeyemo, Anergy

“ElectriFI, an EU-funded access to energy impact facility, is thrilled to join such a strong group of investors backing visionary entrepreneurs who will positively impact thousands of local businesses in Nigeria,” said Dominiek Deconinck, ElectriFI Fund Manager.

What Anergy Does

Anergy’s distributed energy systems leverage the amalgamation of solar power, superior storage solutions, and proprietary remote management technologies. The startup uses this to deliver scalable, reliable, and affordable solutions designed to address the problems associated with intermittency and grid unreliability.

“Arnergy inherently understands the West African market and its need for power reliability. Creating accessibility to reliable renewable energy sources is paramount to economic growth in this region.With Arnergy’s technology, we can significantly decrease carbon emissions, and it’s a model that can be replicated all over the developing world,” said Carmichael Roberts of Breakthrough Energy Ventures.

What Attracted Investors To The Startup

The startup got the investment because, according to Mark Davis, EVP Clean Energy from Norfund,

“Access to clean and stable energy is a prerequisite for job creation and development.’’

Davis said Norfund is proud to support the expansion of Arnergy which will provide Nigerian households and businesses on a weak-grid connection with a cheaper, cleaner and more reliable power solution to meet their daily needs.

‘‘ElectriFI, an EU-funded access to energy impact facility, is thrilled to join such a strong group of investors backing visionary entrepreneurs who will positively impact thousands of local businesses in Nigeria,” said Dominiek Deconinck, ElectriFI Fund Manager.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

Nigerian ed-tech Startup ScholarX Raises $100k in pre-seed Round

June 24, 2019

Nigerian ed-tech startup ScholarX has joined the league of African startups that raise funds to kick-start their businesses. The startup has raised US$100,000 towards an intended US$200,000 pre-seed funding round to launch new products and grow its team.

At A Glance

The startup was launched in Nigeria in 2016. The ScholarX app allows users to select parameters and scroll through lists of available scholarships that match their requirements.

Co-founder and chief executive officer (CEO) of ScholarX, Bola Lawal said this round of funding for ScholarX (US$100,000 of a pre-seed round so far) came mostly from angel investors.

“We are primarily raising for our new model, called SkillsFund, which we are ready to run a full pilot of in July,” he said.

“SkillsFund democratises labour-force reconditioning by providing financing to help new entrants — recent graduates — get up-skilled via verified training partners in in-demand skills and then help place them with local employers seeking fresh talent.”

The World Bank ‘s map of tech hubs in Africa. Click here for a more expanded view

The startup said funds raised would also go towards building the startup’s capacity in terms of staff and technology to handle funding, recruitment, and placement of successful students in the program.

“This means that ScholarX will be positioned to actualise its goal of building an ecosystem around education financing for current students and recent graduates. It means that we won’t just stop at providing scholarships but provide additional training opportunities that will directly lead to jobs for the growing youth population,” he said.

ScholarX last rolled out a new product back in 2017 when it launched Village, an education crowdfunding platform that allows African secondary school and university students to create fundraising campaigns for backing by sponsors.

The Nigerian startup took part in the global WISE Accelerator and the Cape Town-based Injini ed-tech incubator last year and was named part of the third Google Launchpad Africa accelerator cohort in March.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

Nigeria: Ride-Hailing Startup MAX.ng Raises $7M Round To Go Electric

June 20, 2019

The competition just got hotter now. Nigerian ride-hailing startup MAX.ng is not taking the recent triumph of its competitor Gokada for granted. The Nigerian motorcycle transit startup has raised a $7 million funding round led by Novastar Ventures, with the participation of Japanese manufacturer Yamaha. This is the 8th largest funding so far in 2019 by any African startup.

Here Is The Deal

The $7 million new funding came from Novastar Ventures, with the participation of Japanese manufacturer Yamaha.
Breakthrough Energy Ventures, Zrosk Investment Management, and Alitheia Capital joined Novastar Ventures and Yamaha in the $7 million round. The new funding takes MAX’s total funding to $9 million.
This move by Yamaha is the second in less than a year in an emerging market ride-hail company.
Just last December, the Japanese company invested $150 million in Grab, a Southeast Asian two and four-wheel on-demand transit company.
Yamaha’s investment in MAX indicates global interest in Africa’s two-wheel ride-hail space. Overall, the motorcycle taxi market is becoming a significant sub-sector on the continent’s mobility startup landscape.
Co-founded in 2015 by MIT Sloan alumni Adetayo Bamiduro and Chinedu Azodah, MAX has completed over 1 million trips and is one of the largest delivery partners in West Africa for Jumia — the e-commerce unicorn that recently listed on the NYSE.
Based in Lagos, the startup’s app-based platform coordinates motorcycle taxi and delivery services for individuals and businesses. Six-million of the investment is in Series A capital followed by $1 million in grants.

New Funds, Bold Moves

Things are going to be interesting. MAX.ng is going for a shocker, a history-breaking feat: electric motorcycles, backed by the new funding. This could be a first in Africa’s growing motorcycle ride-hail market, should this happen. The new funding will go into Electric Vehicles development.

“We’re piloting electric motorcycles in partnership with EV manufacturers and working with grid operators across Nigeria to deploy charging stations,” MAX.ng CFO Guy-Bertrand Njoya said.

MAX has an extended menu for the round, including the company’s payment infrastructure.

“We intend to invest massively in our technology capabilities,”Njoja said.

The startup will also expand to 10 cities in West Africa (starting in Ghana and Ivory Coast) and add new vehicle classes — including watercraft and three-wheeled tuk-tuk taxis.

MAX’s current fleet consists primarily of Yamaha Crux Rev and Indian manufacturer Bajaj’s Pulsar motorcycles.

This Round Of Funding Will Also Fuel Massive Research

Yamaha, the lead investor is looking at connecting the startup to market research and Yamaha’s existing Nigeria operations.

“We want to work with good entrepreneurs in Africa to develop new business in Africa,” Shoji Shiraishi of Yamaha Motor Company’s New Venture Business Development Section told TechCrunch.

“We really want to understand local needs for motorcycles and…to support [MAX] expanding their business,” he said.

He added that Yamaha sells and manufactures motorcycles in Nigeria

The Competition Is On And Is Steaming

Just last month MAX competitor Gokada (also based in Lagos) raised a $5.3 round and announced it would expand in East Africa. Rwanda has motorbike taxi startups SafeMotos and Yegomoto. Uganda-based motorcycle ride-hail company SafeBoda expanded into Kenya in 2018 and recently raised a Series B round, co-led by the venture arms of Germany’s Allianz and Indonesia’s Go-Jek.

On the question of how MAX will compete in a market with more players, co-founder Chinedu Azodoh named diversification and satisfying drivers.

“We’re a very driver-centric business and at the end of the day the driver is where the business is at,” he said, highlighting the ability of MAX’s platform to deliver market-share to those drivers.

“[Also]Strategic for us is making sure we’re doing the right thing at the right time,” he said, indicating the company has already scaled up and scaled down certain service offerings in response to market needs.

“If we find that maybe there’s something else we’re missing out on, we’re happy to jump into that,” Azohdo said.

Also on the big edge, the startup has over others, Azodoh says MAX’s mix of business delivery and personal transit offers an advantage over competitors. He noted that MAX.ng has local developer team and is always looking at new revenue opportunities.

Electric Motorcycles Powered By Renewable Energy

Max.ng is banking on this, at last as the ultimate winner.

“The economics are promising and could offer significant value to the drivers and end-users,” MAX CFO Guy-Bertrand Njoya said

Motorcycle transit ventures are vying to digitize a share of Africa’s boda-boda and Okada markets (the name for motorcycle taxis in East and West Africa) — representing a collective revenue pool of $4 billion (now) that’s expected to double by 2021, per a TechSci study.

Uber began offering a two-wheel transit option in East Africa in 2018, around the same time Bolt (previously Taxify) started motorcycle taxi service in Kenya.

With electric motorcycle taxis in African cities powered by renewable energy becoming a reality, a new stage is set for the continent’s current position in the transformation of global mobility.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

Getting Your Startup Started: Startup Founders Share Their Experiences

June 19, 2019

Getting your startup up and running can be one of the most demanding tasks every startup founders can face. The experience could be overwhelming, but seeking advice from the right mentors could make the work less cumbersome.

Below, we share the experience of most startup owners on how they got started.

Mostapha Kandil — SWVL, (Egyptian Startup)

‘‘Obviously, I am very happy about the fact that my team and I have reached this far in such a small amount of time. When we first came into this space, everyone thought we are crazy. They thought we are taking on Careem & Uber and we wouldn’t be able to survive. No investor was willing to take us seriously. This investment by Careem proves that we can actually make it.

But happiness is not the only feeling. I am scared as well. All this hype and attention we’ve been getting esp. after Careem’s investment comes with a lot of responsibility towards all our stakeholders; captains, customers, everyone. We are trying to build something that even some governments struggle to do; a public transportation system.

It’s one of the most difficult things for countries to build a public transportation system in emerging markets and we are some 24-year-olds trying to take on this challenge so yeah it’s scary. Normally public transportation is a loss making machine in these countries as it requires huge infrastructure. What we are trying to achieve is a sweet spot between quality and pricing.

‘‘I think the biggest risk was to shift from being Petroleum Engineer to doing something else. It was not easy to study something and then end up doing a completely different thing. Also, your parents could never really understand what you’re doing. When I called my mom to tell her how I made it to Forbes after Careem’s investment. She was like ‘good for you’

For every startup, he advises:

Don’t over-engineer everything, just get it done. You’ll figure it out on the way.
2) Take risks because what you’re already doing is a risk in its own. You probably left a job to start a business so you’re already taking it. Make sure you keep doing it onwards a well.
3) Learn more by learning faster. If you do 9 experiments a week vs your competition doing 10 experiments then your competition ends up learning 52 times more over a year.

Gregory Rockson — mPharma, (Ghanaian Startup)

Gregory Rockson is the Co-founder and CEO of mPharma, a drug benefits startup in Africa. He holds a Bachelor’s Degree in Political Science from Westminster College.

mPharma works with drug manufacturers, service providers, and third-party payers to develop products and services that improve the access and affordability of high-quality drugs for patients across the continent. He shares his experience as a startup:

‘‘It was an early morning in downtown San Francisco a few months ago and I was sitting in a Starbucks, thinking about what next to do with my life. After two successful interviews with Google, I had a good feeling that I would receive a job offer, but something just did not sit right with me. Around 9am, I received an email from a friend which had a link to an investigative article titled “Dirty Medicine” on CNNMoney. It tackled the issue of criminal fraud in Ranbaxy Laboratories, an Indian multinational pharmaceutical company. This article marked my return to Africa and my quest to use big data to help African governments develop better drug surveillance and monitoring systems.’’

At that moment, all I could think about were the 84 children who died in Nigeria in 2008 after consuming adulterated baby teething mixture and the many other families who have lost a loved one due to substandard/fake drugs. I was frustrated by the silence on the part of drug regulators in Africa.

I moved from asking myself why to thinking how. How do we develop technology solutions to address the challenges with pharmacovigilance in Africa?

Grant Brooke — co-founder, Twiga Foods (Kenyan Startup)

Three years ago, on the stage of an international pitch competition, I stood in front of judges and a thousand entrants with a single PowerPoint slide of a banana, which simply stated: “This is a Banana”. Its simplicity got a big laugh.

When in the African e-commerce space players were aiming for tens of thousands of stock-keeping units (SKUs), our banana revenue alone made us one of the largest tech commerce players in Kenya. While we are doing more than bananas now, it is worth keeping in mind that the average Kenyan household buys about 50 different consumer products a month.

To build a unicorn startup in Africa — a relatively small consumer economy — you had better be in a segment with a lot of spending.

Say no: We are good at saying no as an organisation. Lots of people want to partner with us, use us to distribute their products, to build things on our platform, to photo op with us, and so on. We are not easily distracted from our core objective of ‘selling bananas’. I was once given the academic advice: “Early in your career, say something specific about something specific, and once you do that, you can say it all.” The same holds for business: do something specific about something specific, and a few years down the line you can do it all.

Founded in 2014, Twiga Foods is a business to the business food distribution startup that builds fair and reliable markets for agricultural producers and retailers through transparency, efficiency, and technology. The startup is one of the best-funded on the continent,

Deji Oduntan, former CEO Gokada, (Nigerian Startup)

Build a Base then Tell Your Story

There’s a phrase that goes, ‘Build it and they will come’. I’m here to tell you it’s a lie! Build customer confidence and loyalty in your product(s)/service and once you do, tell your story with pride. Gokada had a strong organic social media following of tens of thousands before we began any serious PR work. The story is sweeter when the customer base is already in existence and it’s this customer-centricity that has sprouted significant investor interest in the industry and Gokada specifically, as news of this recent funding round indicates.

Be Laser Focused

Prior to Gokada, I led Customer Experience efforts at Jumia, where I imbibed a very important lesson: Know your target market and be laser focused. No service can work for the entire market, or indeed Nigerians, as we are a diverse people. Thus, identify a target customer segment and accelerate to product-market fit in the shortest possible time. To do this requires a lot of qualitative research and hypothesis testing. Don’t be afraid to spend time and resources into gathering insights quickly and effectively. It could be make or break.

Bank on Trust

Behavioral change was critical to the branding efforts I drove at Gokada. How do you take a nascent and almost non existent industry and turn it into an industry with promise of a sustainable future in Nigeria? I led with trust, by using operational excellence and social media to position Gokada as a brand worth trusting. We dispelled a lot of mistrust in the market about motorcycle taxis by promoting safety, cleanliness (we introduced disposable hair nets to the sector after recognizing the concerns and superstitions people had about sharing helmets) and verified drivers. This trust system was central to Gokada’s success over the past 14 months.

Nigerian Lagos-based on-demand motorcycle taxi app Gokada has proven to be up to the game. The startup has raised US$5.3 million in Series A funding with a plan to expand the number of its motorbikes and available drivers, increase its daily ride numbers as well as grow the startup ‘s team.

Onyeka Akumah — Founder, Farmcrowdy, Nigeria

In 2015, I was looking at investing in Agriculture. I wanted to work with a farmer and trying to decide which farmer to work with, which one I would be able to invest in and he would get the work done so I can get the return on investment after the harvest. I got in touch with one of my co-founders (Ifeanyi Anazodo) and asked if he could help me identify someone to work with. We met a lot of farmers. While they were talking, I noticed that they had certain challenges they were facing — access to funding, technical know-how to improve their yields, and market access to sell whatever it is they produce. That became for me an opportunity to see how I could connect these farmers with so many other people interested in investing in agriculture beyond me, that were constantly told by this (Nigerian) administration to invest in agriculture.

He advises every startup to shun these common mistakes:

One mistake was that we raised money and felt like we could change the model immediately. It’s a mistake that many people make when they raise money or have a bit of breakthrough. It’s advisable to create your niche and stay on it. And even if you raise money, just amplify the efforts of what it is you’re doing.

One of the things that happened with Farmcrowdy is, even when we raised money, the 5 farms we started with remain the 5 farms we run till today. Although we are in a better position to scale our operations into other things and add new farms. Don’t change your model, especially if what you’re doing is working. You can add one or two things, but it’s important that you maintain what you’re doing that is working.

The second thing is, as much as I had brilliant people working with me, I was the only founder. I didn’t have people to bounce ideas off, rather I had people I only dished out instructions to execute what I had spent my time working on. Do not travel alone, that’s something I would tell everyone. You need people with complementary skill sets.

Three is when you raise money, you have to raise more. Even if you don’t have an active window for investors to come in, you need to be providing updates to potential investors that want to come in. So, it’s not when you want to raise money that you start having conversations. Let people already know your business before you have those conversations.

The other thing is, I promised myself that whatever I do again, it must be something that is making money from the onset. I’m not going to wait 3 years before I look at how to make money with any business. It must be something that I can see the margins already. It doesn’t have to make us profitable from day one, but at least I know that if we are able to get to a certain level in our operations, we will break even.

Zodidi Gaseb, Founder African Naturals, (Namibian Startup)

Save up as much as you can and network like your life depends on it. Tap into your network and finally, go to as many workshops as you can to brush up on your business knowledge. Always remember why you started when things get tough.

Jacqueline Shaw, Founder African Fashion Guide, Ghana

You are defined by the actions you take not the dreams you make. Because your actions are the antidote to fear, just feel the fear and do it anyway, be extraordinary in your thinking and your actions to stay relevant and to stand out in the crowd. As entrepreneurs we define the game we want to win, we are only limited by our imagination, so think bigger, and then think bigger than that.

Finally, as Nelson Mandela said, there is no passion to be found playing small, in settling for a life that is less than the one you are capable of living. Because when you are uber passionate about your WHY then your goals become non-negotiable.

Jason Njoku, Founder Iroko Tv, Nigeria

In mid 2015 I had a problem. We were months away from running out of money and needed to do something. There was no commercial solution. We needed to invent our way out of this. We had an Android app that sucked and needed to reallocate capital to product and engineering in NY in order to try and invent the future. We had just launched the channels with StarTimes and they were totally pissed at us for under performing and being a dysfunctional organisation. The deal was at real risk. Our foray into linear TV was turning into a total nightmare. Terrible start. I was living in NY, trying to lead the efforts to build our Android app.

For someone untuned to the sometime chaos of creation, IROKO was a mess. To make matters worse, I wasn’t even in Lagos. I was causing all this havoc from NY. I would drop in unannounced for a few days and retrench entire divisions. Rumours of a coup d’etat were reaching me from Lagos.

This was right in the middle of the due diligence for the $19m content and capital fund raise that closed a few months later. If I was a seasoned executive with experience, I probably would have found a way to not give people the impending sense of gloom and implosion over at IROKO, whilst negotiating the biggest deal of my life. Alas, I am not sophisticated like that. I am a simple man. I needed to reallocate capital.

But hey. It could also fail. Woefully. Nonetheless. It’s all about that deep experimentation nature and being comfortable with the 90% failure rates. But what I know now is if that were to happen, we at IROKO would fully embrace it. Accept our role in it. Do a full autopsy and then institutionalise it.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

Kenya: How Smallholder Farmers Can Benefit From The Newly Signed EU Bank ’s EUR 50 Million Deal For Smallholder Farmers

June 17, 2019

Good news for small-scale farmers in Kenya. This is a huge opportunity to benefit from the newly signed deal between the European Investment Bank and Equity Bank of Kenya. The two banks have signed an Sh5.7 billion (EUR 50 Million) deal to finance agricultural development in the country.

Here Is The Deal

In the deal with EIB, Equity Bank through the program termed Kenya Agriculture Value Chain Facility will provide smallholder farmers and small agriculture-based Small and Medium-sized Enterprises (SMEs) with credit to expand their operations.
Working with Equity Bank across the country, the new Kenya Agriculture Value Chain Facility will help agriculture companies to modernize and harness the full economic, employment and export potential of agriculture as well as expand business with local smallholders.
The European Investment Bank aims to extend the project to other financing partners in the future with a focus on service providers expanding their reach to rural communities and smallholder farmers.
Agriculture is the leading source of economic activity, employment, and exports in Kenya. Agriculture contributes directly and indirectly to 51% of Kenyan GDP and accounts for 60% of jobs in the country.

Who May Get The Loan?

The loan program is strictly for agriculture companies and ventures that intend to modernize their ventures as well as embark on agriculture projects that are capable of creating employment opportunities for Kenyans. Agricultural businesses that are also interested in expanding their venture capacities may also apply. The enterprises targeted include Value Chain SMEs in agribusinesses that are supporting a smallholder farmer base.

“Equity Bank has aligned its strategy with the Big Four agenda, which includes agriculture, and our focus is on growing the agribusiness portfolio through servicing all segments from retail to SME to large enterprises and corporate banking customers,” said Equity Bank Kenya Managing Director Polycarp Igathe.

Is The Loan Attractive Enough For Kenyan Small Scale Farmers?

The sum of £50 Million has been budgeted to make this happen. This is the first ever dedicated support for long-term investment by agriculture companies in Africa backed by the European Investment Bank, the world’s largest international public bank.

When procured, beneficiaries will have up to seven (7) years to pay back. This is expected to take care of the highly risky agricultural sector mostly affected by adverse weather patterns.

The maximum amount of loan to be procured by the beneficiaries is 50% of the project cost as long as the beneficiaries are eligible.

Presently, the duration of most loans in Kenya is 12 months. 7 years to pay back the principal sum is a big edge. The new funding would be made available in Kenya Shillings. This will mitigate exposure to foreign exchange risks that currently hinder agriculture investment in Kenya.

“It is good to see the European Union’s bank, the European Investment Bank, partner with Equity Bank. This is the first time the EU funds the private sector in the agricultural sector in Kenya directly. There is a great deal of expectation on this new approach. The EU chose it in Kenya because we recognize that smallholder farmers do not need handouts: they need an enabling environment to be successful market operators. This requires access to finance and reducing the risk of investing in a difficult environment.” said Walter Tretton,Chargé d’affaires of the European Union delegation to Kenya.

Which Bank To Get The Loans From?

Equity Bank is the only Kenyan bank to get the loan from, in the meantime.

Equity Bank is the first Kenyan partner to participate in the Kenya Agriculture Value Chain Facility and other financial institutions are expected to join later. Equity Bank is one of the key financial institutions supporting the agricultural sector in Kenya and is a leading provider of financial services to rural communities and smallholders, the EU bank noted.

The EIB also noted that Equity Bank has identified the potential for growth, by adding medium size and large commercial farmers to the Agriculture portfolio as well as focusing on the financing of the Agri-Food processing companies.

Since 2007, the European Investment Bank has made available one billion euros (Sh114 billion) for private sector investment in East Africa through credit lines in both local and international currency in partnership with more than 25 banks and financial institutions.

Equity Bank Now Has Branch In Addis Ababa Ethiopia

Small scale farmers and businesses in Ethiopia may also now benefit from Equity Bank’s line of credit. This is because the bank has set up a commercial representative Office in Addis Ababa, Ethiopia as it prepares to expand into the hitherto protectionist economy. The bank’s Ethiopia branch is expected to be fully operational next month.
The entry into Ethiopia, a country with a population of nearly 100 million people, follows the Government’s appointment of a privatization commission and the ongoing reforms which are aimed at promoting a growing private sector.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

At Last Ethiopia Opens Up Its Telecom Industry, Bidding To Start September

June 16, 2019

At the moment, there is no MTN, Airtel, Safaricom, Vodafone or any other mobile telecom operator in the East African country of Ethiopia, but that will no longer be the case before this year ends. The country is set to award its first set of telco licenses to multinational mobile companies by the end of 2019.

Before this happens, Ethiopia’s government has continually monopolized the country’s telecom industry. Hence, this is expected to end a state-wide monopoly and open up one of the world’s last major closed telecoms markets.

When This Happens, Investors Would Be Looking At Ethiopia’s Population As A Big Bait

With a population of 105 million people, the second most populous country in Africa after Nigeria will be baiting in squads of investors.

“There will be a bidding war. It’s the last greenfield site. There’s an opportunity to be market dominant,” said one company executive.

A law to create the new watchdog — the Ethiopian Communications Regulatory Authority — is already being debated by parliament. The new telecoms regulator will issue the licenses when the law is approved and this institution set up.

“By this time next year, we hope that many Ethiopians will be using different SIM cards. We are operating on a very aggressive timeline,” Ethiopia’s State Minister of Finance Eyob Tekalign Tolina said.

Vodafone, South African operator MTN, France’s Orange and Etisalat of the United Arab Emirates are likely to be among the leading contenders vying for entry into the Ethiopian market. Senior executives from those companies attended a telecoms conference in Addis Ababa this week and met with government officials.
The bidding process for two licenses will open in September and the licenses would be awarded in December.
Company executives who met with government officials this week were told to expect an announcement on the liberalization plan, possibly next week.

A Look At Ethiopia’s Telecom Market

Right now, the average rural inhabitant of Ethiopia has to walk 30 kilometers to the nearest phone. The ETC announced 7 September 2006 a program to improve national coverage and reduce the average distance to 5 kilometers. The ETC has also stated that the rural telecom access within 5 km radius service has currently reached 96 percent.
Since 26 September 2017, it is not possible to buy and use Ethio Tel SIM cards in mobile devices that haven’t been purchased in Ethiopia or registered with the authorities.
As of 2012, 20.524 million cellular phones and 797,500 mainline phones were in use.
Use of voice over IP services such as Skype and Google Talk was prohibited by telecommunications legislation in 2002.
In 2007, there were just 89 internet hosts. There were 447,300 internet users in 2009. In 2010, just 0.75 percent of the population was using the Internet, one of the lowest rates in the world.
Telecommunications in Ethiopia is a monopoly in the control of Ethio Telecom, formerly the Ethiopian Telecommunications Corporation (ETC).

With the proposed new reforms, Ethiopia would be seeking to liberalize the country’s economy.

Government officials are already looking at several potential options, including the sale of a minority stake in Ethio Telecom, granting of new licenses to multiple telecoms operators or a combination of both.

The government will expect the winning companies to start operations next year, initially using Ethio Telecom’s infrastructure to run their networks, the sources said.

Ethiopia’s potential as an untapped market could outweigh concerns about any risks, including Ethiopians’ low-income levels and the country’s over-valued birr currency.

There are 31 countries in Africa where there is a state-owned incumbent telco that is either dominant or has monopoly privileges that hamper the growth and efficiency of the market.

These are: Algeria; Angola; Benin; Burundi, Cameroon, Central African Republic, Chad, Comoros, Congo-Brazzaville, DRC, Djibouti, Egypt, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Libya (which has several state entities), Mali, Mozambique, Namibia, Niger, Sao Tome, Sierra Leone, Swaziland, Tanzania, Zambia and Zimbabwe.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

WorldRemit: Ugandan Businesses Can Now Receive Or Send Money To UK Faster

June 13, 2019

Businesses, entrepreneurs or contractors in Uganda selling goods and services to small and medium-sized enterprises (SMEs) in the U.K. can now receive payments faster and more conveniently following the launch of WorldRemit for Business in the country.

What This Means

With this launch from the world leading digital remittances firm WorldRemit, U.K.-based SMEs can quickly pay their employees and contractors in 140 countries worldwide, including fast-growing emerging markets such as Kenya, Uganda, and South Africa. The new service will first be available to U.K.-registered businesses.
For Ugandan entrepreneurs and contractors doing business with clients in the U.K., this service will lead to significant time and cost savings.
Traditional bank payments, which are still the dominant international transfer method for businesses sending money abroad to Uganda, can take up to a week, and often incur high fees and exchange rates. In contrast, WorldRemit’s low fees and exchange rates are shown up-front and customers can send money easily via the app or website.

Transfers To Uganda To Be Processed With 24 Hours

With this new service, users sending funds to Uganda can easily track their transfers in real-time on the WorldRemit app and opt-in to receive daily exchange notifications to send money at the optimal time.

Transfers to Uganda are processed within 24 hours or less and local entrepreneurs can receive payments via bank account, mobile money or cash pick-up — whichever method is most convenient for them.

“When I first started WorldRemit, I was frustrated with the high charges and long delays in sending money abroad both as a business owner and consumer. Over the past 9 years, we’ve made it easier for 4 million people around the globe to send and receive money,’’ Ismail Ahmed, Founder and Executive Chairman at WorldRemit said.

Today, we’re pleased to extend that service offering to businesses, and put an end to the steep fees that many pay, especially when sending to Uganda. We’re committed to making it quick, safe and easy for you to pay individuals across borders, leaving you to focus on growing your own business.”

WorldRemit customers complete over 1.4 million transfers every month from over 50 countries to over 140 destinations using its app or website and remains committed to providing innovative solutions to meet money transfer needs across the world. Earlier this year, the company announced a new partnership with FINCA and Diamond Trust Bank to further solidify its vast partnership network.

Image result for which country most dependent on remittances

The U.K. is one of Uganda’s most important trading partners, with Uganda mainly exporting tea, coffee, and horticultural products. However, with the advent of digital technologies such as e-commerce, smaller entrepreneurs have been able to capture a growing share of U.K.-Uganda trade, especially in the services sector. WorldRemit for Business will enable this new class of digital savvy Ugandan entrepreneurs to get paid quickly and securely.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Facebook: https://web.facebook.com/Afrikanheroes/

Three Months After Launch, South Africa’s First Digital Bank Hits 500,000 Customers.

The stage is set for South Africa ’s new fully digital bank, TymeBank. The bank is on track to hit one million customers by the end of the year. Its current customer base is just a few numbers close to 500,000 customers.

A Look At TymeBank

If you are looking to find any physical branch of the bank in South Africa, you may have to look harder. This is because there is none. The branches exist only in the clouds, that is, the bank is only digitally focused. In February, it launched its EveryDay transactional account bundled with a savings tool called GoalSave, its MoneyTransfer solution, and its TymeCoach App, which gives consumers free access to their credit report, supported by tips on how to make better decisions about the money.

“We are planning to introduce credit products later this year, as well as an SME (small medium sized enterprise) proposition, but for now our focus is on getting simple and cost-effective banking solutions into people’s hands,” said TymeBank chief executive officer, Sandile Shabalala. “Our mission is to drive meaningful financial inclusion, by making banking more accessible to all South Africans. We see it as our responsibility to take the complexity out of banking for consumers and to give them insights into how the financial system works.

“We believe that uncomplicated banking coupled with relevant knowledge will empower people to make more informed and responsible decisions about their own financial futures. Why shouldn’t banks be more transparent with customers about what they are paying for?”

TymeBank is owned by African Rainbow Capital (ARC) Financial Services, a company within billionaire Patrice Motsepe’s Ubuntu-Botho Investments stable. It is South Africa’s first majority black-owned bank focused on retail and business banking.

ARC bought the bank from the Commonwealth Bank of Australia in November 2018.

“TymeBank brought synergies that are complementary to ARC’s existing insurance and asset management businesses. Given ARC’s focus to, mostly, invest in businesses with established client pools, we’ll be looking for synergistic opportunities to the benefit of both the client and TymeBank,” said Tauriq Keraan, deputy CEO of TymeBank.

The latest figure came from the digital bank ’s latest investor prospectus, which detailed its customer acquisition since launching in February.

Chief executive officer, Sandile Shabalala said the group is averaging 100,000 new customers each month.

After bringing on board around 40,000 clients during its ‘soft launch’ phase between November 2018 and February 2019, the bank moved to a high growth phase where it was adding 4,000 new clients a day.

The bank said that it has a total addressable market of around 21 million customers in the middle market, as well as 2 million small-to-medium enterprises, which opens up the potential for products and services it wants to introduce.

TymeBank is looking to disrupt traditional banking in South Africa whose operations are usually expensive to maintain.

“We are leveraging our cloud-based technology which doesn’t come with a legacy burden and it’s one of the many reasons we’re able to pass cost savings onto the consumer. We have built an open banking platform, which allows us to move with speed with the partners we engage with,” said Shabalala.

The Bank Is Relying On Partnership As Its Strength Both For Money Deposit Or Withdrawal

TymeBank has created a network of partners including Pick n Pay and Boxer, with the former’s Smart Shopper program now fully embedded into TymeBank’s technology stack.

“We’ve partnered with companies whose business ethos aligns with what we want to do in the market, which is to do good. The customer will always be at the centre of our banking practices and going forward we will be doing some really exciting things with our partners, it will go way beyond just occupying floor space,” said Shabalala.

The implication of joining forces with Pick n Pay and Boxer stores is that TymeBank now has access to a relatively significant distribution edge.

“By the time we complete our bank kiosk roll-out we will have 730 points of presence where customers can open accounts inside a Pick n Pay or Boxer store — we have over 500 bank-enabled kiosks in the market today.”

Even in stores without a bank-enabled kiosk, customers can still do their everyday banking transactions, TymeBank said.

As part of its acquisition strategy, TymeBank said it will further leverage its partnership with Pick n Pay and Boxer stores, which gives it access to 730 physical stores across the country, where customers can withdraw money free of charge and deposit money for just R4, said Shabalala.

“We have a strong proposition, which competitors will find hard to match right now and the tens of thousands of customers that have opened and are using their accounts are testament to that,” said Shabalala.

TymeBank is part of a trio of banks launching into the South African market in 2019, with the other two banks including Bank Zero, the brainchild of former CEO of FNB, and Discovery Bank.

Again, Rain has recently entered into a partnership deal with Tymebank to test the distribution of its SIM cards at Tyme kiosks, making it easier for its clients to sign up for a new service.

TymeBank’s Strategy Is To Make It Simple and Cheap For Customers

Indeed, signing up to the digital bank could cost little or nothing. No documents are required and no charges demanded.

To open an account, you need a South African ID number and a South African cellphone number, which the bank verifies through several questions and a One-Time PIN (OTP).

If the process is done at a kiosk, biometric data will be captured and compared to the data with Home Affairs, which is connected to the Tyme systems, and a free Visa debit card is issued immediately.

If done online, you will have access to your account, but it will be limited in how much you can transact until you go to a kiosk and “upgrade” your account (for free) to a full account through capturing biometric data and registering your residential address.

Getting a debit card is free and immediately.

Service Fee for new registration is free. There is no monthly account or withdrawal at Pick n Pay and Boxer stores, only R2 at other major retailers.

By July 2019 Customers Can Borrow From TymeBank Without Collateral

TymeBank’s CEO, Sandile Shabalala, has also told analysts and investors that the digital bank would start piloting unsecured term lending in July and a credit card in partnership with consumer lending company RCS later in 2019.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.