Welcome to our weekly recap where we share the most important news of the African Tech Ecosystem 🌍

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Egyptian B2B marketplace Fatura acquired by EFG Hermes unit

Highlights

• Egypt-based Tanmeyah for Microfinance Services, a subsidiary of EFG Hermes Holding, has acquired Fatura, a provider of B2B e-commerce marketplace and digital financing services for an undisclosed sum.
• Founded in 2019 by Hossam Ali, Ahmed Anwar, and Abdullah Mohebeldin, Fatura connects retailers to suppliers and wholesalers. It initially started by working exclusively with FMCG retailers before venturing into other sectors.
• It previously raised a $3 million Series A round led by Sawari Ventures, Arzan VC, Egypt Ventures, Khawarizmi Ventures, EFG-EV, and the Cairo Angels.

Source: Wamda

Our Takeaway

Huge amounts of venture investments are being poured into the B2B retail e-commerce space, where a host of startups like TradeDepot, Chari, MarketForce, Omnibiz, Alerzo, and others play. It’s easy to see why. More than $600 billion of consumer goods are sold in Africa through informal retail channels every year, supplying the vast majority of the 1.2 billion population yet the industry is faced with several challenges that can be addressed, profitably, with digitization. In another acquisition deal, Morocco’s Chari entered Ivory Coast through the purchase of Diago, a counterpart in the francophone country. 

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Autochek, Pezesha partner to provide asset financing to SMEs

Highlights

• Nigerian auto-tech startup Autochek has partnered Kenyan fintech Pezesha to enable SMEs in Kenya to access asset financing. 
• Founded in late 2016, Pezesha has created a holistic digital financial infrastructure that connects small and medium-sized businesses to working capital offered by banks, MFIs, and other financial institutions or networks.
• Having expanded to Kenya late last year, Autochek has now partnered Pezesha in a move that will enable SMEs to acquire auto assets for ease of business operations and growth.

Source: Disrupt Africa

Our Takeaway

Small and medium enterprises play a major role in most economies, especially in developing countries but access to finance has always been a major constraint to their growth. As many as 65 million firms, or 40% of formal MSMEs in developing countries, have an unmet financing need of $5.2 trillion every year, per the IFC. Many startups like Pezesha have found ways to profitably finance these businesses across the continent at reasonable interest rates, either through short-term loans or asset financing for necessary equipment.

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Amazon is planning a pan-Africa expansion

Highlights

• Amazon, a global e-commerce technology company, is reportedly set to expand to African countries including South Africa and Nigeria in 2023, according to multiple reports. 
• Belgium, Chile, and Colombia are also among the five markets that the giant e-commerce company is set to penetrate next year, according to leaked documents seen by Business Insider.
• This development would mean serious competition for companies that provide similar services to Amazon, like Jumia in the e-commerce space, and Netflix and Showmax in the video streaming market. Amazon currently has a presence in 20 countries.

Source: ITNewsAfrica

Our Takeaway

Africa is increasingly becoming an important growth area for streaming, e-commerce, and cloud computing services, which explains why Amazon has launched an aggressive push into the continent. Digital TV Research, an analytics firm, estimates that Amazon Prime Video will add 1.5 million new subscribers in Africa by 2027, from an estimated 600,000 currently. Meanwhile, the Middle East and Africa’s cloud computing industry is expected to grow to $31.4 billion by 2026, from $14.2 billion in 2021, amid the growing appetite for cloud computing solutions on the continent.

Ghanaian fintech Fido secures $30m Series A

Highlights

• Ghana-based fintech Fido has raised a $30 million equity investment and some undisclosed debt funding in a Series A round led by Fortissimo Capital, with participation from Yard Ventures; a VC fund by Harvard alumni. 
• Founded by Nadav Topolski, Tomer Edry, and Nir Zepkowitz, Fido gives mobile loans of up to $250 to individuals and small businesses, which are repayable through single or multiple installments for a period of up to six months.
• This round brings the total equity investment raised by the startup to date to $38 million. With it, Fido plans to roll out new products and expand across Africa.

Source: TechCrunch

Our Takeaway

Access to consumer and SME credit remains a major barrier in Africa, which many startups like Carbon, Branch, and Fairmoney are addressing through mobile lending. In terms of types of services, fintech firms specializing in digital payments dominate sub-Saharan Africa’s fintech investment landscape by both financing and transactional metrics while those focused on digital banking and lending services follow closely behind, per Brookings. Fido claims to have issued over $1.5 million in loans to 350,000 customers in Ghana.

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Nigeria’s Healthtracka raises $1.5m seed funding

Highlights

• Healthtracka, a Lagos-based healthtech that offers an at-home lab testing platform, has raised $1.5 million in seed funding. 
• Ifeoluwa Dare-Johnson launched the company with Victor Amusan in May 2021. And the news comes five months after its participation in the Techstars Toronto accelerator program last October.
• The funding will assist Healthtracka in its next growth phase as it also scales its B2B2C offering where partner companies in Nigeria can deliver at-home testing to their employees.

Source: TechCrunch

Our Takeaway

Since the outbreak of the coronavirus pandemic, the popularity of telemedicine—an innovative way of getting access to and delivering healthcare using digital devices such as mobile devices and computers—has risen significantly. Per a McKinsey study, telemedicine grew 78 times in April 2020. In Africa, where fewer than 50% of Africans have access to modern health facilities and the doctor-to-patient ratio stands at 1:5,000, the budding healthcare tool has equally made new inroads.

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Kibo School gets $2m to offer online STEM degrees to Africans

Highlights

• Kibo, an online school that is set to offer several STEM degree programs targeted at students in Africa, has launched after raising a $2 million seed funding.
• The round was led by Neo, a VC firm by the co-founder of Code.org. Future Africa, Pledges, Brooklyn Bridge Ventures, Transcend Network, and several angel investors also participated in the round. 
• The new funding brings the total capital raised by the startup to $2.4m after last year’s pre-seed round.

Source: TechCrunch

Our Takeaway

Since the Covid-19 pandemic began, nearly all face-to-face interactions in different fields, from learning and grocery shopping to even attending events, have shifted to online platforms. Almost 60% of Africa’s population are under the age of 25 while the continent has an average literacy rate of 70%, lagging behind other parts of the world. These conditions indicate the region is ripe for disruptions in education, and many startups have emerged to capture this opportunity with backing from international investors while simultaneously expanding Africa’s tech talent pool and addressing the unemployment problem that continues to plague the continent.

Zenysis gets $13m to scale its EM-focused big data platform

Highlights

• Zenysis Technologies, a big data startup headquartered in San Francisco and Cape Town, has closed a $13.3 million Series B round. This comes after a $2.8 million seed in 2016 and a $5.8 million Series A in 2018.
• Launched in 2016, the company aims to improve how developing countries respond to humanitarian emergencies and help them improve public health using big data.
• The financing was led by the Steele Foundation for Hope, a nonprofit organization, and gives Zenysis firepower to expand its range of health programs and geographical footprint with a significant focus on Africa.

Source: TechCrunch

Our Takeaway

The opportunity for big data solutions is immense in Africa and one of the key application areas is humanitarian emergency responses and public health administration. Emerging technologies such as artificial intelligence, predictive analytics, and machine learning can sort through huge data sets and return useful insights for responders. Zenysis currently provides its software to governments and partners in five countries in Africa. With more players tapping this opportunity on the continent, the Middle East and Africa’s big data analytics market is forecast to reach a revenue of $68 billion by 2025.

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Nigerian API-based company Thepeer raises $2.1m seed

Highlights

• Thepeer, an African tech infrastructure startup connecting businesses’ wallets, has raised a $2.1 million seed round led by the Raba Partnership. 
• The news comes a year after the startup raised $220,000 in pre-seed from angel investors. Participating investors in this seed round include Rali_cap Ventures, African fintechs Chipper Cash and Stitch, among others.
• The startup is now looking to roll out more functionalities and wallets in other currencies apart from the Nigerian Naira, as well as hire more talent and invest in product development.

Source: TechCabal

Our Takeaway

While most tech startups in Africa are focused on solving problems for either end consumers or businesses, quite a few build tech infrastructure such as application programming interface (API). Thepeer’s solution, for instance, addresses the lack of mobile wallet interoperability outside the ecosystem of specific fintech service providers such as neobanks, lenders, and investment and stock trading apps. As Africa’s tech ecosystem matures and the fintech landscape gets more sophisticated, we expect to see startups building for backend infrastructure attract more funding.

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Egypt-based Disruptech secures funding from AXIAN Group

Highlights

• Egypt-based Disruptech, a fintech-focused VC fund, has secured funding from Madagascar-based AXIAN Group.
• The Disruptech Egypt Fund I is dedicated to developing Egypt’s fintech ecosystem by supporting startups and is nurturing a growing number of companies in adjacent sectors that are accelerating financial inclusion. 
• The fund supports startups from the seed-round investments through scaling and eventual growth. As such, the AXIAN deal will enable Disruptech to help more fledgling fintechs to scale and expand beyond their home market.

Source: Wamda

Our Takeaway

In Egypt, only 33% of people have a bank account, according to the most recent World Bank data. Expanding access to financial services is thus a primal objective, and startups leading such efforts stand to gain significantly from increasing amounts of venture capital available in the country, which has grown more than 10-fold since 2016 and has placed Egypt as one of Africa’s leading countries by tech venture funding.

Kenya’s mTek secures $3m funding from Finclusion Group

Highlights

• Kenya-based insurtech startup mTek has secured $3 million in both debt and equity funding from the Mauritius-based Finclusion Group to help it expand across the East Africa region.
• Launched in 2020, mTek is a digital platform that provides an entirely paperless ecosystem for the insurance industry and allows customers to purchase insurance directly from the insurer, compare insurance policies, and file claims through their smart devices.
• The funding will be used to accelerate mTek’s growth in the Kenyan marketplace through continual improvements to the platform and the expansion of its customer base.

Source: Disrupt Africa

Our Takeaway

As of 2018, less than 2% of the Nigerian adult population had one form of insurance. This is reflective of what’s obtainable across the continent, where the insurance penetration rate in the same year stood at a meager 1.12% or 3% in South Africa. Many startups have emerged in recent years with the mission of broadening insurance coverage across the continent through innovative, digital-led solutions that ride on the increasing adoption of mobile devices, as Africa plays catch up in the global insurance space.

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AI startup Synapse Analytics raises $2m pre-Series A

Highlights

• Egypt-based AI tech startup Synapse Analytics has raised $2 million in a pre-Series A funding round led by Egypt Ventures, with participation from Cloudera’s founder, Amr Awadallah, as well as Africa Platforms Founder, Simon Rowlands.
• Founded in 2018 by Ahmed Abaza and Galal ElBeshbishy, Synapse aims to build trust between AI and businesses trying to adopt machine learning in their operations through its machine learning operations automation platform, Konan.
• The new funding will accelerate Synapse’s efforts to help businesses adopt AI and expand the startup’s operations.

Source: Wamda

Our Takeaway

AI-based startups in Africa are increasingly attracting VC dollars. A surprising entry into the top three African tech sectors by funding raised in May is artificial intelligence (AI)/deeptech, with startups playing in this space raising $47 million (11%) led by Instabug’s $46 million Series B raise. Since its inception, Synapse Analytics claims to have built and deployed more than 100 algorithms, in more than 12 industries including; financial services, logistics and fast-moving consumer goods (FMCGs), serving multinational clients, as well as local businesses and startups.

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Nigerian startup GetEquity expands to Kenya

Highlights

• Nigerian investtech startup GetEquity has expanded to Kenya as it looks to connect more African startups with funding opportunities.
• Founded in 2020, GetEquity is a fundraising and venture portfolio management company that aims to reduce friction between founders and the funding they need by giving them access to a wide range of funding options.
• Startups can list themselves on the GetEquity platform and market to institutional investors and public users. GetEquity enables anyone to buy equity in a listed startup for as little as $10.

Source: Disrupt Africa

Our Takeaway

Startups in Africa raised between $4 billion to $6 billion in venture funding last year. While that’s a record tally, the amount remains meager in comparison to the rest of the world. More so, there’s still relatively limited capital available to early-stage startups on the continent. Innovative platform-first startups like GetEquity are similar to daba, and aim to address this by connecting founders with a wide array of funding sources through digital infrastructures.

SA fintech startup Yellow secures $23m debt funding

Highlights

• South Africa-based fintech startup Yellow, which delivers asset-backed finance to 200,000 households, has raised $23 million in debt funding to scale further.
• Founded in 2018, Yellow is a digital retail business currently focused on access to energy and has provided power on a pay-as-you-go (PAYG) basis to 30,000 homes in its two markets – Malawi and Uganda.
• The company raised a $3.3 million Series A round back in September 2020 and has also expanded into Rwanda and Zambia. It has now concluded the final piece of a series of debt transactions, to expand its finance model.

Source: Disrupt Africa

Our Takeaway

Access to energy and infrastructure has for years been a major challenge in rural parts across Africa. More than 640 million Africans have no access to energy, corresponding to an electricity access rate for African countries of just over 40%, the lowest in the world. By incorporating digital tools with a network of agent entrepreneurs and working with mobile money platforms as a means for receiving payment, Yellow is able to reach the last mile customer in a cost-effective manner that enables the company to serve even the most remotely located households. 

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MNT-Halan acquires Talabeyah for an undisclosed amount

Highlights

• Egypt-based fintech MNT-Halan has acquired B2B e-commerce platform Talabeyah for an undisclosed amount.
• Founded in 2017, MNT-Halan provides digital solutions, including lending, buy now pay later, e-commerce, payments, mobility, and on-demand logistics. Meanwhile, Talabeyah was founded in 2020 to serve the FMCG market.
• Last year, MNT-Halan raised $120 million in investment. Adding digital FMCG offerings to its merchant network enhances the company’s breadth and scope and increases stickiness to its ecosystem.

Source: Wamda

Our Takeaway

The opportunity in digitizing Africa’s B2B retail commerce space, where a host of startups like TradeDepot, Chari, MarketForce, Omnibiz, and Alerzo play, is increasingly attracting the interest of venture investors and large startups. African markets, though diverse, have some common themes, one of which is the largely fragmented fast-moving consumer goods (FMCG) sector. More so, over $600 billion of consumer goods are sold in Africa through informal retail channels every year, supplying the vast majority of the 1.2 billion population yet the industry is faced with several challenges that can be addressed, profitably, with digitization.

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Egypt’s Lucky gets approval to roll out payment cards

Highlights

• Fintech startup Lucky has secured final approval from the Central Bank of Egypt (CBE) to launch the “Lucky One” card for all its customers.
• Founded in 2018, Lucky offers users access to a growing range of easy-to-use credit products, discounts, and cashback rewards, which can be used in person and virtually with over 20,000 local and global brands.
• In March, Lucky raised $25 million in Series A to build out its credit capabilities, expand its market share, and drive further overseas growth. It has now followed that up with approval from the CBE to roll out cards.

Source: Disrupt Africa

Our Takeaway

Digital financial services (DFS) providers have enormous potential in Egypt, a country where 2 of every 3 individuals are partly or totally excluded from formal financial services but 50% of its 100 million people actively use smartphones. In addition to high mobile and internet penetration, the North African country boasts a young and tech-savvy population with 61% below 30. Startups like Lucky have thus moved to capture this opportunity with platform-led solutions, contributing to the general booming fintech sector in Egypt. The startup has the largest merchant network in Egypt and over 8 million registered users, seen a 250% year-on-year GMV growth, and recently expanded into Morocco.

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