JUNE 02, 2022
15 min Read
African Tech Weekly Recap: May 23 to May 27, 2022
Welcome to our weekly recap where we share the most important news of the week in the African Tech Ecosystem 🌍
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Egypt’s Sylndr raises $12.6m to scale its used cars platform
- Sylndr, an Egypt-based online marketplace for used cars, has raised a $12.6 million pre-seed round, led by RAED Ventures, with participation from Algebra Ventures, Nuwa Capital, 1984 Ventures, Global Founders Capital, and a group of regional and global angel investors.
- Founded in 2021 by Amr Mazen and former chief financial officer of elmenus, Omar El Defrawy, Sylndr allows customers to buy and sell their cars and find financing solutions.
- The startup plans to use the fresh funding to scale its operations, technology infrastructure, and double the size of its team.
With over 6 million cars on Egypt’s roads, the majority of which are passenger cars and second-hand vehicles, the northern African nation has one of Africa’s most extensive vehicle fleets. Like every populous developing country, the large market for used cars, which is dominated by unorganized dealers and classifieds, has attracted startups looking to digitize sourcing and distribution. Cairo-based Sylndr is one of those used-car sale platforms and its fresh pre-seed round of $12.6 million is the largest of its kind in the region.
Moroccan healthtech Blink Pharma raises first funding round
- Morocco-based healthcare tech startup Blink Pharma has raised investment from Azur Innovation Fund for an undisclosed amount.
- Launched in 2020 by Ali Sami and Adil Bertul, the B2B marketplace allows pharmacists, laboratories, and wholesalers to exchange orders, as well as provides them with a payment method.
- The new funding will help Blink Pharma develop its operations, including the launch of new products for the healthcare sector.
The importance of tech startups playing in Africa’s healthcare space can’t be overstated. Africa’s healthcare industry has for decades been plagued with several challenges, from supply chain challenges and fake drugs to a shortage of doctors, medical facilities, and drugs, all of which prevent universal access on the continent. importantly, increasing investor backing for startups shows one of Africa’s most crucial socio-economic problems can be tackled without forgoing returns.
Wingcopter to deploy 12,000 delivery drones across Africa
- German drone delivery firm Wingcopter this week announced a partnership with Continental Drones Ltd. to build a network of 12,000 Wingcopter 198 drones across Africa over the next five years.
- The proposed network would span 49 sub-Saharan African countries, expanding Wingcopter’s presence in Africa beyond Malawi. Once completed, the new service would become the largest commercial delivery drone deployment in the world.
- The companies also plan to focus primarily on streamlining on-demand deliveries of medical supplies like medicines, vaccines, and laboratory samples, but also essential goods.
Based on its increasing adoption, drone delivery looks set to be very much a part of the future of last-mile delivery. Moreover, Africa is a good fit for the system. The continent suffers from inefficient and unsustainable infrastructure, which has long been a barrier to universal health coverage. That creates the opportunity for a solution like a drone delivery, which requires only a digital infrastructure and is fast gaining prominence on the continent spearheaded by startups like Astral Aerial in Kenya, Drone Africa Service in Niger, UAV Industries in South Africa, etc.
South Africa’s edutech startup FoondaMate raises $2m
- South African edtech startup FoondaMate has secured $2 million seed funding in a round led by LocalGlobe, to drive uptake of its Whatsapp and Facebook-based learning chatbot across the globe.
- Foondamate helps students with their revision by giving them immediate answers to questions and access to revision papers, while also guiding them in responses to questions.
- The startup targets high-school students in emerging markets where Whatsapp is widely used and is a lot cheaper or free to access. Educators also use FoondaMate’s integrated resources to set and post homework and to share other learning materials with students.
Since its launch, FoondaMate has been used by more than 400,000 students using over 10 languages in over 30 countries, including Colombia, Mexico, Brazil, and Indonesia — where it recently launched. The startup is currently working on localizing its learning material to accommodate learners in more countries and fuel the growth of its platform to more than 50 million users.
Google launches 2nd cohort of Black Founders Fund for Africa
- Google is calling for applications for the second cohort of its Google for Startup Black Founders Fund for Africa.
- Following the success of the first cohort last year, Google will increase its commitment with an additional $1 million in funding, and support for 10 more founders this year. This will result in a commitment of $4 million to 60 eligible black-founded startups across Africa.
- Selected startups will receive between $50,000 and $100,000 non-dilutive cash awards and up to $200,000 per startup in Google Cloud credits, support in the form of training, and access to a network of mentors.
Source: Disrupt Africa
The Black Founders Fund Africa is open to startups that meet the eligibility criteria in Botswana, Cameroun, Côte D’ivoire, Ghana, Ethiopia, Kenya, Nigeria, Rwanda, Senegal, South Africa, Tanzania, Uganda and Zimbabwe. While these 13 countries are the prime focus due to their active tech and startup ecosystems, strong applications from other African countries will also be considered. Applications will close on 31 May 2022 and the winners will be announced on 29 July 2022.
MTN finally commences mobile money operations in Nigeria
- The MTN Group recently announced MTN Nigeria’s fintech subsidiary, MoMo Payment Service Bank (MoMo PSB), formally commenced operations.
- This comes after the company’s successful pilot test that was initiated on 16 May 2022 in commemoration of the GSM operations on 16 May 2001 and the company’s listing on the Nigerian Exchange Limited on 16 May 2019.
- MoMo PBS currently has an agent network of over 166,000 active agents and digitised partnership infrastructure. The company says that MoMo PSB will continue to scale its agent network in order to reach Nigerians and remove friction from everyday payment by digitising cash payments.
Despite being home to the largest unbanked population in Africa, Nigeria lags behind its peers when it comes to mobile money adoption, compared to countries like Ghana and Kenya, where leading telcos MTN and Safaricom, respectively, have driven exponential growth in penetration over the years. MTN’s MoMo operations in Nigeria is thus expected to spur the adoption of mobile money in the country, and although it poses a significant threat to other fintech players, particularly agency banks, Nigerians stand to benefit from the proliferation of digital financial services.
Egypt’s Esaal raises $1.7m to scale across MENA
- Esaal, one of the largest technology platforms for online health and wellness consultations in the Middle East and North Africa (MENA) region, has completed a $1.7 million seed funding round, led by A15.
- A15 has been backing Esaal since it was founded to solve the rising health needs in Egypt. This tranche brings the company’s total investment to date to $3M since being founded in 2018.
- The startup plans to continue to deploy this tranche of capital to scale its expansion across the MENA region, further invest in product and brand development, and increase talent acquisition.
There’s a huge unmet demand for medical consultation in Egypt due to the low supply of doctors. As of 2018, Egypt’s doctor to citizen ratio stood at 1:2,000. Since launching, Esaal has aggregated over 350 consultants covering different fields on the platform who have delivered health and wellness services to almost 1 million unique users; ensuring access to a sizable market for the health experts on the platform. Its services are currently available in 8 countries including Egypt, KSA, Tunisia, Kuwait, Qatar, Bahrain, Palestine, and Iraq.
Uber hits 1 billion rides in Africa
- Global technology company, Uber has facilitated one billion trips in Africa since entering the market less than 10 years ago.
- According to the company, over 10 billion kilometers of trips have been completed, and “this is equivalent to traveling to the moon and back over 5500 times.”
- The company adds that Uber and Uber Eats have collectively reached over 30 million riders and eaters in Sub-Saharan Africa during the same period.
Uber’s one-billionth trip milestone in Africa, in less than a decade, is a testament to the huge opportunity in proferring services to the 1.2 billion people on the continent. In the past year, the ride-hailing giant has expanded to over 21 cities in South Africa, two cities in Ghana, four new cities in Nigeria, and four cities/areas for delivery in Kenya. It plans to launch in more regional towns and cities this year.
Citigroup, BII sign $100m risk-sharing lending deal for Africa
- British International Investment (BII) and U.S. bank Citigroup Inc recently signed a $100 million risk-sharing facility aimed at boosting lending to small businesses across Africa by up to four times that amount.
- The deal between Citi and Britain’s development finance institution aims to help Citi expand its supply-chain lending on the continent, targeting Small and Medium Enterprises (SMEs) that usually find it hard to access financing.
- The partnership is aimed at providing capital in local currencies to markets where lending to SMEs is risky because of an uncertain business environment and currency fluctuations.
The private sector, comprising small and medium businesses, is widely believed to be an engine capable of driving inclusive and sustainable growth in Africa and has the potential to accelerate socioeconomic transformation on the continent. However, overcoming the daunting challenges facing players in the sector, from funding to mentorship and other forms of support, is needed to realize this potential. But with an estimated trade finance gap of $81 billion in the continent, the new facility — although commendable — is unlikely to make a dent in Africa’s supply chain financing needs.
Namibia’s JABU secures $15m for its B2B e-commerce play
- Namibia-based JABU, a last-mile distribution e-commerce company that raised a $3.2 million seed round earlier this year, has a $15 million Series A investment led by Tiger Global.
- The round, which closed sometime in March, is Tiger Global’s second investment in the B2B e-commerce space after backing Wasoko in its mega Series B round.
- YC-backed JABU plans to build around its Jwallet, which it rolled out as a standalone product. The objective is to use physical cash flows to offer withdrawals and deposit services, like agency banking, with human agents acting as ATMs in remote areas.
More venture capital is being poured into the B2B retail e-commerce space, where a host of startups like TradeDepot, MarketForce, Omnibiz, Alerzo, and others play. It’s easy to see why VC funding is increasingly pouring into the space. 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.
Morocco’s Cloudfret gets $1m for expansion
- Morocco-based SaaS startup Cloudfret, has raised a $1 million round, led by Plug and Play, PRC Ventures ICAV, Azur Innovation Fund, AfriMobility, and angel investor Khalid Zitouni. The new capital injection pushes the startup’s valuation to $20 million.
- Founded in 2021, CloudFret connects shippers to a large network of carriers in Africa and Europe. So far, It has managed to onboard 58 freight customers in Europe and Africa and plans to enlist 4,000 vehicles.
- The funding will enable the startup to grow its team, launch new loyalty services, and deepen its presence in the European and African markets.
CloudFret is part of a growing e-logistics and transport space in Africa linking on-demand apps to mobile-based connectivity to move people and goods around the continent more effectively. Within this space in other parts of the continent, a host of players such as Kobo360, Sendy, and Lori Systems compete with one another to digitize and capture revenues in the e-logistics freight delivery. Per reports, the market opportunity for e-logistics companies in Africa is estimated at $200 billion and growing every year.
Belgium firm Dstny acquires Egypt-founded Tactful AI
- Belgium-based business communications provider Dstny has acquired Egypt and UK-based Tactful AI for an undisclosed sum.
- Founded in 2016 by Mohamed Elmasry and Mohammed Hassan, Tactful offers an AI software solution that enables businesses to manage the customer experience across all touchpoints.
- The transaction is expected to help Dstny utilize Tactful’s AI stack to enhance its customer experience operations.
Africa’s technology ecosystem has over the years attracted a lot of venture capital. Now, it’s seeing a huge upturn in exits and buyouts as mergers and acquisitions (M&A) involving startups in the region have become prominent over the past year. The recent surge in M&A activity in the continent is an indication of a maturing ecosystem while setting the stage for investment inflows into the space.
Tunisia-based 216 Capital Ventures raises $9.6m
- Tunisia-based VC firm 216 Capital Ventures has raised $9.6 million in the first tranche of its 216 Capital Fund, of which $6.4 million was secured from Smart Capital’s ANAVA fund of funds.
- Smart Capital, the management company of the ANAVA fund of funds, provided up to $6.4 million to the 216 Capital Fund I.
- The fund is a generalist fund that aspires to invest primarily in local pre-seed and seed-stage startups with average ticket sizes of average ticket size of $107,000.
An increasing number of small- to medium-sized funds with around $10 million to $50 million of capital to deploy are targeting opportunities in Africa and other frontier markets. Uncovered Fund, LoftyInc Capital, Savannah Fund, Ventures Platform, and Tofino are some of such Africa-focused firms that have launched in the past year. For 216 Capital Ventures, it sees an opportunity in the fact that despite rising venture funding in Africa, young startups still draw only a fraction of funding. Its fund should be a relief for early-stage founders in the tech ecosystem struggling to raise external capital.
Egypt’s Gooo Delivery raises pre-seed round
- Egypt-based on-demand delivery startup Gooo Delivery has closed a pre-seed round. The amount raised was not disclosed.
- Founded in 2020 by Yasser Hassan, Gooo offers point-to-point delivery services through an app that enables users to order food, medication, and groceries in several cities in Egypt including Cairo, Giza, and Tanta.
- Through this funding, Gooo seeks to develop its technical capabilities and boost its services and expand the business.
Across Africa, last-mile logistics and delivery remain the bane of many businesses and a drawback for e-commerce but in recent years, quite a number of startups have emerged on the continent to solve the problem through technology. These companies, like Gooo, make courier and delivery services available to small, medium, and large businesses via mobile devices. In Egypt, the on-demand delivery services applications market grew by 8% last year to reach $2.5 billion and has more potential going forward as e-commerce adoption increases.
Untapped Global gets $10.3m for smart asset financing in Africa, others
- Untapped Global has raised a $10.3 million debt and equity pre-seed round to help it scale its smart asset financing model, which finances revenue-generating assets for entrepreneurs and SMEs in Africa and Latin America
- Based in San Francisco, Africa, and Europe, the company aims to empower entrepreneurs in frontier and emerging markets by connecting them to global investors online and in person.
- It recently announced the launch of its public beta platform, which provides transparency and insights for international investors looking to tap into Africa and other emerging markets.
Source: Disrupt Africa
To date, Untapped Global claims to have financed assets for over 5,000 entrepreneurs across a dozen countries in Africa and Latin America who work across sectors such as clean water, solar, e-mobility, and inclusive fintech. Companies such as Paga Group have worked with Untapped to make access to POS systems more affordable for SMEs throughout Africa.
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