MAY 08, 2022
5 min Read
African Tech Weekly Recap: February 28 to March 4, 2022
Welcome to our First weekly recap where we share the most important news of the week in the African Tech Ecosystem 🌍
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🚀 15 African startups confirmed for Y Combinator W22 batch
- Five African startups were recently confirmed as participants in the Winter 2022 batch of Y Combinator accelerator, taking the total to 15 so far.
- The W22 batch of the YC program is currently taking place, and concludes with a demo day in March.
- With over 230 companies now confirmed as taking part, a further five African names on the list means this year’s tally equals the number of African participants in Summer 2021. More W22 participants are expected to be revealed.
Source: Disrupt Africa
In Africa, YC’s alumni features high-growth startups such as Flutterwave, Paystack and Kobo360 as well as Cowrywise, MarketForce, Kudi, WaystoCap, WorkPay, Healthlane, Trella, 54gene, CredPal, NALA and Breadfast. YC recently increased its standard deal size to $500,000 from $125,000 for 7% equity and it will now also invest an additional $375,000 on an uncapped SAFE with “Most Favoured Nation” (MFN) terms.
🇰🇪 M-Kopa raises $75m equity funding for expansion
- M-Kopa, which offers underbanked customers finance to acquire solar lighting, smartphones, TVs, and domestic appliances, has raised $75m in a new round, bringing its total equity funding to $100m.
- The round was led by Generation Investment Management and Broadscale Group, with participation from new and existing investors.
- With the funding, M-KOPA plans to expand into additional countries, adding to its presence in Kenya, Uganda, Nigeria, and Ghana. The company also plans to go beyond asset financing to include other financial services products.
M-Kopa launched in 2011 as a pay-as-you-go solar power provider to off-grid homes but expanded into smartphone finance in 2019. The startup has since seen remarkable growth, claiming it’s provided over $600m in financing to over 2 million customers and saw a 2.5 times growth in client base last year. Those figures confirm the huge opportunity in matching fractional payment terms for everyday essential items with the daily or weekly earning and spending cycles of customers.
🇿🇦SA crypto exchange VALR raises $50m Series B to expand across Africa
- South African cryptocurrency exchange VALR has raised a US$50 million Series B funding round led by Pantera Capital that values the company at $240 million and will use the proceeds to expand across the continent.
- Launched in 2019, VALR is a digital asset platform that allows customers to buy, sell, store and transfer Bitcoin and 60 other cryptocurrencies.
- It has so far processed over $7.5 billion in trading volume and serves over 250,000 retail customers and 500 institutional clients. The startup raised its $3.4 million Series A in 2020.
Source: Disrupt Africa
The future of cryptocurrency adoption in Africa, for both asset diversification and payments, is widely believed to be bright. This is backed by data, too. According to available estimates, the region represents the third-fastest growing cryptocurrency economy and has a bigger share of overall transaction volume. This is made up of retail-sized transfers, which at over 7% compared to the global average of 5.5%, is more than any other region at just over 7%.
🌍 Microsoft wants to back 10,000 startups in Africa
- Microsoft has announced plans to support 10,000 startups in Africa over the next five years through several initiatives including partnerships with accelerators and incubators across the continent.
- The US giant is also partnering with venture capital investors to increase funding access for startups in Africa by unlocking $500 million in “potential” investment.
- These initiatives will be carried out through the recently established Africa Transformation Office (ATO), which drives Microsoft’s strategic work in Africa by partnering with public and private organizations.
Source: IT News Africa
With the latest announcement, Microsoft joins a growing list of tech heavyweights like Google, which are looking to back startups in Africa. In 2021, Google launched a $50 million fund targeting early and growth-stage startups on the continent. These moves attest to the huge potential for Africa to become a thriving hub of digital innovation on the global startup landscape.
🇳🇬 Nigerian fintech Paga expands to Ethiopia
- Nigerian mobile payments company Paga has partnered with the Bank of Abyssinia and received regulatory approval from the National Bank of Ethiopia to launch its online payment gateway in Ethiopia.
- Founded in 2009, Paga provides Nigerians with safe and convenient ways of making payments, allowing money to be sent to any phone number for the beneficiary to redeem at a Paga agent or at an ATM via a cardless withdrawal.
- Through its online payment gateway, Paga will help drive the digital economy in Ethiopia by enabling sellers to pay and get paid easily online.
Source: Disrupt Africa
Paga’s move comes at a time when Ethiopia is moving to open up its state-controlled economy as well as accelerate the integration of banks and mobile wallets. Last May, state-run Ethio Telecom launched its mobile money service, Telebirr, which has since recorded millions of users and is connected to the Commercial Bank of Ethiopia and Bank of Abyssinia. As well as broadening access to financial services, the government aims to tap into the local payments and international remittance markets.
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