Weekly Investor Update (July-WeekThree-2024)

7 min Read July 19, 2024 at 5:00 PM UTC

Monday

Kenyan skincare startup Uncover gets $1.4m for Ghana, Uganda expansion

Uncover, a Kenyan marketplace for skin care products, has raised $1.4 million in seed funding to expand into the US, Ghana, and Uganda.Launched in 2021 bySneha MehtaandJade Oyateru, Uncover uses data provided by users on its app—through quizzes and other interactions—to create personalized skin care products with labs in South Korea. The company distributes these products through its e-commerce platform and retail partnerships with pharmaceutical chains likeGoodlifeandMedplusin Kenya and Nigeria.This is Uncover’s third funding round. It raised $100,000 in a 2021 pre-seed round fromAntler VCand a $1 million seed round in 2022. In its latest funding round, Uncover provided exits for early investors through a secondary sale, according to its CEO.

The demand for beauty and personal care products is growing rapidly in Africa, yet there’s still a gap in consumer offerings. Fake cosmetics and skin-whitening products pose risks, while global brands that import to the continent are often expensive and not tailored to Black skin. According to Technavio, a global market research firm, Africa’s beauty and personal care market is expected to grow by $6.65 billion from 2023 to 2027. This potential has attracted global players such as L’Oréal and Rihanna’s Fenty Beauty to sell on the continent. However, their products are still predominantly focused on Western markets.

Further rate hike looms as Nigeria’s inflation quickens on food prices

Nigeria’s annual inflation has quickened for the 18th consecutive month, raising the likelihood of another interest-rate increase when the central bank meets next week.Consumer pricesrose to 34.2% in June, up from 34% in May, according to data from the National Bureau of Statistics. On a month-on-month basis, the headline inflation rate in June 2024 was 2.31%, 0.17 percentage points higher than the rate recorded in May 2024 (2.14%).Food inflation was at 40.87% year-on-year, compared to 40.66% in May 2024. On a month-on-month basis, the food inflation rate in June 2024 was 2.55%, reflecting a 0.26 percentage point increase from May 2024’s rate of 2.28%.

In response to the rising prices of essential commodities, the Federal Government has introduced several measures to address the challenge. Recently, it suspended duties, tariffs, and taxes on the importation of maize, husked brown rice, wheat, and cowpeas through the country’s land and sea borders for 150 days. Additionally, the government approved the procurement of 2,000 tractors and 1,200 trailers and established a committee to propose solutions to the ongoing food crisis in the nation. Experts have identified insecurity, lack of equipment, and other issues as major challenges affecting food production in Nigeria.

Sonatel, Ecobank, Oragroup help BRVM rebound after two weekly declines

The regional BRVM stock market reversed a two-week downward trend last week, closing positive due to a resurgence of investor confidence in stocks likeSonatel,ETI TG, andOragroup.The BRVM Compositeindexrose to 231.66 points, marking a new peak in over six years. Market capitalization increased by 0.95%, reaching 8,618.49 billion FCFA compared to 8,537.23 billion FCFA the previous week.The BRVM 30indexalso climbed by 0.75% to 115.72 points, hitting a new threshold since its launch in January 2023. The BRVM Prestige index also improved, rising by 0.86% to 109.64 points.

The market had recorded a second weekly decline in the prior week despite positive performances from large-cap stocks like Société Générale CI and Nestlé CI. Between July 8 and 12, 2024, a total of 2.49 billion FCFA was traded on the BRVM stock market. This volume was mainly supported by Sonatel (+1.57% to 19,700 FCFA), Coris Bank International (-1.20% to 10,290 FCFA), and NSIA Banque CI (-4.08% to 5,995 FCFA), which captured the most trades with respective amounts of 330.33 million FCFA, 236.39 million FCFA, and 171.89 million FCFA.

World’s biggest power project in DRC draws interest from DFIs

Five development finance institutions have joined forces to advance the world’s largest electricity-generation project, the Grand Inga hydropower complex in the Democratic Republic of Congo, which has been stalled for decades.TheDevelopment Bank of Southern Africaand theIndustrial Development Corporation, both South African state banks, are collaborating with pan-African institutions — theAfrican Development BankandAfrican Export-Import Bank— as well as theNew Development Bank, the finance arm of theBRICS nations.“These five parties have taken the initiative to say ‘let’s come together, let’s look at what we can do in terms of getting this goal off the ground’,” Mpho Kubelo, the DBSA’s chief risk officer said. The collaboration began after a global summit in Paris last June and is supported by the presidents of both South Africa and Congo. Additionally, South Africa has agreed to purchase some of the power generated by the project.

If constructed to its full capacity of up to 40 gigawatts, the Grand Inga hydropower complex on the Congo River— the world’s third-largest river by volume—would surpass China’s Three Gorges Dam as the world’s largest electricity plant. However, a history of government corruption scandals and the enormous expected cost of the multiphase project, estimated at over $80 billion, have limited development so far to just two dams with about 1.8 gigawatts of installed capacity built over 40 years ago. Most of this electricity is transmitted 1,000 miles across the country to power Congo’s copper and cobalt mines, operated by companies such as CMOC Ltd., China Railway Group Ltd., and Glencore Plc.

Rwanda’s Paul Kagame set to secure fourth term with 99% of vote

Rwandan PresidentPaul Kagamesecured another five-year term after winning 99% of four-fifths of the votes counted, extending his two-and-a-half-decade rule of the East African nation.The 66-year-old Kagame faced the same two contenders that he beat at an election seven years ago. Frank Habineza of the Democratic Green Party of Rwanda secured 0.53% of the vote, while independent candidate Philippe Mpayimana got 0.32%, per provisional results released by the National Electoral Commission on Monday.At least three other candidates were barred from running, including long-time critic Victoire Ingabire and businesswoman Diane Rwigara. Both have been imprisoned for crimes including terrorism and inciting insurrection.

Kagame has effectively ruled Rwanda since 1994, when he led a rebel army that ended a genocide in which about 800,000 people were killed. He was first elected to office in 2002 and has been able to extend his rule after the nation agreed in 2015 to abolish a constitutional two-term limit, potentially enabling him to remain in power until 2034. Critics accuse Kagame of human rights abuses, suffocating political competition, and stifling free speech. He receives accolades in equal measure, with many in Rwanda applauding him for rebuilding and strengthening the nation’s economy. The economic growth rate in the nation of about 13 million people has consistently been one of the fastest in Africa, and the IMF projects an annual average expansion of 7% over the next five years.

Egypt’s Dopay secures $13.5m Series A extension for expansion

Egypt-based fintechDopayhas closed a $13.5 million Series A extension round, adding to a previous $18 million Series A round raised in 2021. This new round was led byArgentem Creek Partners, with participation from existing investors.Founded in 2014 by Frans van Eersel and Ahmed Nassef, Dopay is part of Hub71 and offers a virtual banking platform that digitizes cash payments from employers to workers and other beneficiaries.The new funding will enable Dopay to accelerate its expansion in Egypt, its initial market, as well as to launch a range of new financial services and expand its multi-bank, multi-country platform to other markets.

With over 60% of Egyptian workers primarily relying on cash, Dopay’s mission aligns with the Egyptian Central Bank’s vision of digitizing payments and promoting financial inclusion. In August 2021, Dopay was awarded a banking agent license through Arab Banking Corporation Egypt (Bank ABC Egypt). This license allowed the company to launch a next-generation virtual banking platform, enabling businesses to instantly open accounts for their employees and other beneficiaries and pay them in real time, adhering to the guidelines set by the Central Bank of Egypt.