AUGUST 20, 2022
13 min Read
African Tech Weekly Recap: August 22 to August 26, 2022
Welcome to our weekly recap where we share the most important news of the African Tech Ecosystem 🌍
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Cape Town’s stock exchange closes $5m funding round
- The Cape Town Stock Exchange (CTSE), South Africa’s technology-driven stock exchange for small and medium-sized businesses, recently closed a $5-million funding round.
- In addition, the company has expanded its board, adding Mark Fitzjohn, Bruce Ndidi (both from Empowerment Capital), and Stephan Van Der Walt (Pallidus Alternative Investments).
- The oversubscribed round was led by a new investor to the group, Imvelo Ventures, a venture capital investment company founded by Capitec Bank and Empowerment Capital Investment Partners, with participation from several existing investors in the CTSE.
Raising funding via traditional capital markets has historically been a long and complicated process. However, CTSE’s cloud-based technology and end-to-end exchange architecture, combined with a marketplace of supporting partners, help reduce cost, risk, time, and complexity in the capital raise process. Africa-wide, CTSE is a leading name in the next wave of exchange and investment banking technologies, and the fresh funding round is a much-needed fuel for its bid to change the fundraising experience for many small businesses in South Africa.
Africa Data Centers gets $83m for continental expansion
- Cassava Technology’s pan-African data center group Africa Data Centres (ADC) has today announced a drawing of the first portion of its $300-million strategic investment made by the United States International Development Finance Corporation (DFC).
- The company says that this first $83 million is being applied towards expanding ADC’s data centers in South Africa.
- Subsequent disbursements from DFC will be used to realize the expansion of the company’s footprint of data centers in other DFC-eligible African cities, including Abidjan, Accra, Lagos, Cairo, and Casablanca.
The increasing demand for cloud and other digital technologies on the continent has directly increased the demand for African data to reside within the continent. The huge untapped potential in Africa’s cloud computing market has pulled big operators like Microsoft, Amazon, Huawei, and Equinix Inc. along with huge investments into data centers on the continent. Furthermore, the investment by DFC follows ADC’s recent announcement of a $50 million investment by C5 Capital into Cassava Technologies and a partnership to build Cyber Security Operations Centres across six markets in Africa.
Facebook owner Meta to host African AR/VR Hackathon
- Facebook’s parent company, Meta, has announced that applications for the AR/VR Africa Metathon in partnership with Imisi 3D and BlackRhino VR are now open.
- The Metathon is a series of programs and activations under the Meta global extended reality (XR) fund aimed at supporting African XR talents to build innovative solutions and use cases of the metaverse in Africa.
- Three significant components will feature at the AR/VR Metathon, including a training program. The Africa-wide hackathon will take place across 16 countries physically and open to everyone virtually, followed by an intensive boot camp to further develop solutions.
On a continent where over half of the population don’t have access to electricity and hundreds of millions are without smartphones, concepts like extended reality and the metaverse may be seen as peripheral. However, many startups on the continent have shown that low-cost XR can be leveraged to tackle pressing challenges, from education to healthcare. The AR/VR Africa Metathon is an opportunity to demonstrate how artificial intelligence, augmented reality and virtual reality technologies, are core to the future of the metaverse and what Africans are building in the industry.
Egypt’s ArabyAds raises $30m pre-Series B funding
- Egypt-born and UAE-headquartered advertising technology company ArabyAds, has raised $30 million in pre-Series B funding from AfricInvest.
- Founded in 2013, with headquarters in the UAE and tech hubs across Egypt, Tunisia, and Jordan, ArabyAds helps advertisers in customer acquisition, retention, and monetization by leveraging its technology platforms for influencer marketing, coupon-based advertising, retail media, live commerce, and on-device contextual advertising.
- ArabyAds plans to use the new financing to expand its footprint and further invest it to accelerate its technological advancement and talent acquisition to support its growth.
In Africa, startups like ArabyAds and Stllr have emerged offering platform-based solutions that help African businesses optimize marketing tasks across online and offline platforms. And as the e-commerce industry, particularly in the Middle East and North Africa (MENA) region grows, the market opportunity is substantial. In 2017, the market was worth $8.4 billion, with an annual growth of 25% since 2014, and is predicted to reach $28.5 billion by the end of this year.
Neobank Zywa raises $3m seed round to expand across MENA
- UAE-based neobank Zywa, has raised $3 million in a seed round from Goodwater Capital, Dubai Future District Fund, Rebel Fund, Trampoline Venture Partners, Zemu VC, alongside some angel investors.
- Founded in 2021 by Alok Kumar and Nuha Hashem, Zywa offers a gamified community-based banking app and payment card to Gen Z between the age of 11-25 years old.
- The seed fund will help the YC-backed startup focus on product, growth, and strategic partnerships to accelerate its growth in the UAE and Egypt markets while prepping it to launch in Saudi Arabia by early 2023.
Over the past few years, new fintech startups trying to take on legacy banks in Africa have sprung up as the digital banking wave takes shape. In Egypt, the need is glaring. Only 33% of people have a bank account, according to the most recent World Bank data. Expanding access to financial services is thus primal, and startups leading such efforts stand to gain significantly from increasing amounts of venture capital available in the country. Such neobanks have been attracting a significant share of fintech investment on the continent.
Cameroonian digital business card provider Taaply raises $500k
- The Cameroon-based Taaply, which began life digitizing business cards, has raised $500,000 in funding as it announces the release of a new app and website update.
- Launched in 2021, Taaply is a digital business card solution aimed at cutting down on carbon emissions in Africa.
- The recent funding, app, website updates, and improvements will enable Taaply to effectively compete for the growth opportunities in the healthcare and health insurance markets.
Source: Disrupt Africa
Digitization is increasingly proliferating daily life in Africa and nearly all activities, from learning and grocery shopping to the way events are organized and work is done. In the same light, Taaply’s exciting solution offers a new way to digitize and manage social and professional connections. It is currently active in several countries in Africa, Europe, and North America, and plans to expand beyond its currently marketed products, in order to meet growing demand from both private and business customers.
Google Wallet launches in South Africa to tap payments boom
- Google Wallet is now available in South Africa, the first market for this product in Africa, to make it easy for users to save and easily and securely access their payment cards, loyalty cards and boarding passes.
- Cardholders of partner banks including FirstRand Bank, Discovery Bank, Investec, Standard Bank, ABSA, and Nedbank can now add their details to the wallet, and make contactless payments using their android phones and Wear OS devices.
- The list of items that can be added to the wallet is expected to grow in the future, as Google aims to replace physical wallets.
Across Africa, payment services lead the fintech pack as foreign and local startups scramble to digitize payments on the continent. The Google Wallet launch in South Africa comes more than a year after Apple Pay entered the market too. With the majority of financial transactions in Africa still cash-based, there remains a massive under-tapped market. In South Africa, for instance, over $10 billion is moved within the country annually with over 24 million South Africans sending money to each other daily. The country is thus the right first step in Google’s broader pan-African expansion journey.
MTN rolls out commercial 5G network operations in Nigeria
- MTN Nigeria has turned on its fifth-generation (5G) mobile internet services at 190 sites across Nigeria, with the main concentration of sites in Lagos and Abuja.
- Some users in these areas are reportedly already experiencing internet speeds greater than 1.4GBs per second. The country’s National Communication Commission (NCC) had previously set Wednesday 24 August as the date for the rollout of 5G after nearly 3 years of preparation from the Federal Government.
- By October, MTN expects to increase the rollout of 5G sites exponentially, taking the superfast internet to 500 – 600 more sites across Africa’s most populous nation.
Nigeria joins South Africa and Kenya as the three African nations to launch 5G services. South Africa received 5G first in 2019 through a humble rollout by provider Rain, while Kenya saw Safaricom launch its first 5G services in March 2021. In the rest of the continent, Ghana and Egypt are hot on the heels of these three nations, expecting a rollout sooner rather than later. For the African tech industry, 5G could potentially unlock a broad range of opportunities, including the optimization of service delivery, decision-making, and end-user experience.
Nigerian B2B e-commerce startup Sabi expands to South Africa
- Sabi, an early-stage startup digitizing merchant operations across Africa, has launched a new office in Johannesburg to help enable the digital transformation of South Africa’s informal economy.
- It is partnering with Vumele to enable and empower South Africa’s informal economy. This includes over 200,000 spaza shops and spazarettes, 100,000 Kasi Kos traders and taverns, and 500,000 street hawkers and tabletop traders – mostly small businesses.
- Before now, the startup had offices in Nigeria and Kenya and plans to expand to the Ivory Coast and the Democratic Republic of Congo.
Across Africa, merchant acquisition is proving to be the “new” scramble for digital services on the continent. In an estimated $800 billion informal trade economy comprising more than 56 million micro, small and medium-sized businesses, most merchants operate offline with little or no exposure to the formalized, digital economy. These account for up to 90% of businesses on the continent and a significant share cited in South Africa. Many startups like Sabi are striving to address this across the continent.
Algerian Startup Fund to invest $411m in local startups
- The Algerian Startup Fund (ASF) has signed an agreement with the country’s General Directorate of the Treasury to launch a new fund with a target corpus of $411 million to invest in local startups across the country’s 58 regional provinces.
- The Fund will invest up to $1 million in each startup, to enable entrepreneurs of innovative projects to start their businesses without the bureaucratic restrictions of conventional financing mechanisms.
- The ASF was established by the President of the Republic of Algeria, Abdelmadjid Tebboune in October 2020 during the first edition of “Algeria Disrupt”.
Algeria’s startup ecosystem is rapidly evolving thanks to a number of initiatives and conditions put in place by the current government such as tax exemptions for five years and easier access to risk capital. The agreement between the ASF and the Treasury is yet another reflection of the administration’s efforts to create an ecosystem favorable to the development of startups and the digital industry– and bodes well for the tech ecosystem in North Africa and the continent at large.
Roam launches first electric mass transit bus in Kenya
- Kenyan startup Roam has launched a new electric mass transit bus, the Roam Rapid, designed to address the unique challenges of public transport in Nairobi.
- Founded in 2017, and rebranded earlier this year, Roam is a provider of electric vehicles designed and manufactured locally. Its vision is to create reliable and cost-effective products designed for the pan-African mass market.
- The company raised $7.5 million in equity and grant funding late last year to help it scale its operations, and it has now launched the Roam Rapid, which has a capacity of 90 passengers.
Source: Disrupt Africa
Globally, the acceptance of electric vehicles is gaining momentum with adoption estimated to have risen six-fold since 2015. In 2020, there were more than 11 million registered EVs including cars, buses, vans, and trucks globally, and the number is expected to hit 145 million by the end of the decade, suggesting a global transition from gas-powered vehicles is right on track. By continents, however, Africa lags behind its peers and has shown little progress so far. Electric vehicles remain rare in most of Africa but local initiatives like Roam offer a ray of hope that the region won’t be totally left behind.
Kenyan startup Bimaleo launched to offer auto insurance policies
- Kenyan startup Bimaleo has launched a platform offering private and commercial drivers access to real-time, personalized auto insurance policies.
- Formed in late 2020 by Shreyas Patel and George Richard, Bimaleo spent over a year developing its platform and building relationships with partners and is now live to onboard customers.
- Bimaleo has set out to utilize existing infrastructure to offer personalized auto insurance policies based on use.
Source: Disrupt Africa
The insurance sector in East Africa, and Africa as a whole, is ripe for digital disruption. As of 2018, the insurance penetration rate in Africa stood at a meager 1.12% or 3% with South Africa, highlighting an ever-growing need for innovative insurance solutions to address the significant lack of coverage on the continent. Many startups have emerged in recent years to address this, riding on the increasing adoption of mobile devices, as the continent plays catch up in the global insurance space.
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