African science entrepreneurs can tap total of $125k through Next Einstein Forum initiative

Are you an entrepreneurial scientist in the fields of technology, engineering, mathematics or the social sciences?

The Next Einstein Forum (NEF) and Co-Creation Hub (CcHub) have partnered to hold a NEF investor Meetup which will offer African social entrepreneurs an opportunity to win $125 000 across five categories.

CcHub said in a statement last month that the objective of the meetup — which will be held in Nairobi, Kenya before the NEF Global Gathering in March — is to help prepare exceptional African science entrepreneurs for investors.

Applications for the NEF Investor Meetup close on this Friday (20 December)

The sessions will take the form of a bootcamp, after which participating scientists will gain knowledge of how they are delivering value, through their solution, to end-users.

In addition, they will have an understanding of funding options, valuations and how to tell a compelling story when pitching their solution to investors.

Applications for the NEF Investor Meetup close this Friday (20 December), with shortlisting of finalists set to take place between 20 December and 27 January.

Final selection of participants will take place on 27 and 28 January.

Applications are open to early-stage companies and scientists that are interested in commercialising their solutions and are available to travel from 5 March to 13 March.

Applicants must be no older than 42 years old by the end of 2019, be conversant in English or French, hold a passport from an African country, or be of African descent and living on the continent.

CcHub and NEF are looking for science entrepreneurs with proven or tested ideas or solutions that fall under the five categories of the African Development Bank’s (AfDB) “High 5’s”. These are:

  • Integrate Africa
  • Light up and power Africa
  • Feed Africa
  • Industrialise Africa
  • Integrate and improve the quality of life for the people of Africa

To be considered for the meetup, scientists are expected to have adequately researched the problem they are looking to solve and have a clear picture of the target segment it affects.

In addition, the solutions must either improve on an existing process or be completely new in Africa.

Matching with investors

Participants of the investor meetup stand a chance to win $25 000 per AfDB High 5’s category.

In addition, the startups will also be matched with investors for a chance to raise funding.

Those selected to attend the meetup will receive a free ticket and accommodation to attend the NEF Global Gathering.

Featured image: CDC via Unsplash

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SA entrepreneur Eran Eyal convicted in US over fraudulent Shopin ICO, Springleap startup

SA entrepreneur and former Springleap and Shopin founder Eran Eyal has been convicted of fraud in a New York court. While he won’t serve jail time, he will have to pay back $600 000 to investors he defrauded, among other penalties.

In a statement yesterday, New York Attorney General Letitia James announced that Eyal, 44, of Brooklyn, New York, has been convicted for operating a series of three securities fraud schemes, including a fraudulent initial coin offering in his new cryptocurrency startup Shopin.

It follows a court appearance in New York on Thursday in a case that has dragged on since the beginning of this year, after he was charged in August last year for stealing $600 000 from investors (see this story and below for more links).

It also comes after new charges were added by the Securities Exchange Commission (SEC) also on Thursday, which could see him being forced to return all $42.5-million that Shopin raised in an initial coin offering last year (see this story).

Eran Eyal, who has been convicted in a New York court, used Springleap, Passo and Shopin to lure and defraud investors of hundreds of thousands of dollars

The amount includes penalties, while the SEC wants to bar him from holding any officer or management role in a US entity.

Israel-born Eyal — who formerly lived in South Africa — pleaded guilty to felony securities fraud in violation of the Martin Act related to his scheme with Shopin.

Ventureburn understands that he will face sentencing on 24 February in a New York court.

Ordered to pay $600k

On Thursday he also pleaded guilty to two counts of Scheme to Defraud in the First Degree, a Class E felony, related to his two prior companies — Springleap and Passo.

As part of his convictions, Eyal was ordered to pay $125 000 in restitution and $475 000 in judgments to investors in Springleap, and to surrender the remaining cryptocurrency received from Shopin investors — currently valued at about $450 000.

As a condition of his pleas, Eyal was also required to step down as CEO of Shopin, and is banned from raising capital or serving as an officer in a business in New York for three years.

‘Cheated investors out of hundreds of thousands of dollars’

“My office won’t allow white collar criminals to get away with their schemes to defraud innocent victims, no matter how complex,” said Attorney General James.

“This one individual created company after company after company just to continue cheating investors out of hundreds of thousands of dollars. Using fake product trials and nonexistent contracts with major retailers he was able to lure victims to invest in his technology schemes, including his very own cryptocurrency.

“We will use every available resource at our disposal to pursue all who attempt to abuse and manipulate the system, because no one is above the law.”

‘Lured victims to invest $600k in Springleap’

In her statement, the New York Attorney General said as the founder and former CEO of Springleap, Eyal convinced investors in 2014 and 2015 that Springleap was a tech startup on the verge of transforming the advertising and marketing industries by crowdsourcing using social media and its own proprietary online platform.

Eyal falsely claimed that Springleap owned an enormous network of over 300,000 active community members and 180,000 vetted creative professionals with agency-level experience.

He also misled investors to believe that the company boasted a prestigious management team and did business on a global scale with Fortune 500 companies, such as Google and Coca Cola.

“In reality, however, the indictment and other documents filed with the court from the Office of the Attorney General show that Eyal grossly exaggerated the membership and credentials of his management team, and, instead, hired freelancers from cheap, online marketplaces, like Fiverr, in an attempt to flood Springleap’s social network with artificial likes and upvotes,” said the attorney general.

“Eyal even hired a hacker to scrape data from websites in an effort to steal the profiles of thousands of creative professionals and further bolster his fraudulent claim that Springleap had over 180 000 vetted creative professionals.

“Based on these misrepresentations, Eyal lured four victims to invest $600 000 in Springleap. Eyal directed investor monies into corporate accounts that he exclusively controlled, and then looted company funds to finance his extravagant lifestyle, that included renting a two-bedroom apartment in Williamsburg, hiring personal trainers at luxury fitness clubs, and taking vacations in Antigua and Paris.”

From Passo to Shopin

According to prosecutors, after Springleap’s funds were depleted in January 2016, Eyal became CEO of another tech startup, Passo Sync, Inc. (Passo).

“Passo purported to provide its users with a personal online shopping profile that would follow them from website to website and make product recommendations based on their shopping history and preferences.”

By June 2016, Passo similarly ran out of money and shut down.

According to prosecutors, Eyal then founded a new company, UnitedData Inc, known as Shopin, which purported to implement the personalised shopping concept through cryptocurrency and blockchain technology. Eyal forced Passo investors to transfer their equity to Shopin at a fraction of the value of their initial investments.

False pilots

In 2018, Eyal launched a public initial coin offering (ICO) in Shopin, which he promoted internationally by traveling to cryptocurrency conferences throughout the US, Europe, and Asia to pitch the company to investors.

“Eyal fraudulently solicited millions of dollars in investments through the Shopin ICO by falsely claiming that Shopin had conducted product trials with major retailers Bed Bath & Beyond and Ermenegildo Zegna.

“These false declarations achieved spectacular results, including the onboarding of over 700,000 new Shopin users.

Eyal also falsely claimed that Shopin had access to a prestigious network of advisors and investors, prominent venture capital funds, and accomplished technologists.

“Additionally, Eyal falsely publicised, online and in the press, that Shopin had achieved a technological breakthrough that would dramatically increase the speed of its blockchain from approximately 10 transactions per second to one-million transactions per second.

“None of these claims were true. Instead, Eyal showed investors forged contracts, fabricated trial data, and altered documents and communications to lure them into believing that Shopin was a tried and true piece of technology.

“The investment proceeds from the Shopin ICO flowed into Bitcoin and Ether accounts, controlled exclusively by Eyal.”

Similar to his use of Springleap investments, Eyal co-mingled company and personal funds by liquidating the Shopin investments using online cryptocurrency exchanges and transferring the funds to his personal checking accounts.

Pursuant to the announced guilty pleas, Eyal was required to immediately step down as CEO of Shopin, and forfeit the remaining 3105 Ether contained in the cryptocurrency wallets in his possession, for the benefit of Shopin investors. While the value of the Ether at the time it was invested was over $3-million, the value has now fallen to about $465 000.

Eyal pleaded guilty before the Honorable Danny K. Chun in Kings County Supreme Court on Wednesday (11 December) afternoon on all three schemes.

‘Let’s reconnect in March – Eyal’

Eyal has since removed his social media accounts from Twitter, Facebook and Telegram.

Ventureburn contacted Eyal yesterday and his phone went to voicemail, with a message asking those who wanted to get hold of him, to send a text message — which Ventureburn did.

Eyal asked if the conversation was on the record. When Ventureburn said it was, Eyal responded by saying “It’s best we reconnect in March please. Wishing you and your loved ones a blessed holiday/festive period.”

Read more: Eran Eyal disappears from social media after new fraud charges laid by SEC over $42m Shopin ICO [Updated]
Read more: Fraud-accused Eran Eyal offering three immigrant students scholarships at $3600 each
Read more: Fraud-accused Eran Eyal offers ‘reimbursement’ to media that remove articles
Read more: Former Springleap MD’s startup BigTeam raises investment from Mailchimp
Read more: I spent thousands of hours, last dollar to save former company says Eran Eyal
Read more: Questions surround involvement of Eran Eyal’s former partner in Shopin pilots
Read more: Stop misrepresenting us as Shopin investor unicorn ZocDoc tells Eran Eyal
Read more: Eran Eyal lied about existence of Springleap advisory board – UK investor
Read more: Former Springleap founder Eran Eyal named as ‘co-CEO’ of Shopin
Read more: Springleap’s Eran Eyal misrepresented me as Shopin adviser – Vinny Lingham
Read more: BREAKING: I am innocent of malicious allegations says Springleap’s Eran Eyal
Read more: BREAKING: Springleap’s Eran Eyal released from US prison, posts $250k bail
Read more: Are these the messages Springleap’s Eran Eyal sent to investors for funding?
Read more: Springleap’s Eran Eyal removed as CEO of Shopin and replaced with interim head [Updated]
Read more: Springleap’s Eran Eyal did not seem like scammer to me – DocuSign founder
Read more: Charges against Springleap founder not first time Eran Eyal’s in trouble with law [Updated]
Read more: Investor gatvol over losing R8.5m to Springleap through ‘misrepresentation’
Read more: Springleap charges: Are claims as world’s 7th most innovative firm a fabrication? [Updated]
Read more: SA entrepreneur Eran Eyal charged with fraud in the US over startup Springleap
Read more: Springleap’s Trevor Wolfe talks agencies, startups, and pivots [Q&A]
Read more: Springleap’s new Creatives Insights platform helps brands expand to foreign markets
Read more: Springleap goes big: expands into Middle Eastern, pan-African markets
Read more: SA crowdsource design startup Springleap secures R4m+ Angel round
Read more: Life after t-shirts: Ventureburn gets the exclusive behind Springleap’s pivot

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Cape Town based OceanHub Africa accelerator to launch first cohort in first quarter of 2020

Cape Town based impact accelerator OceanHub Africa has announced that it will launch its first programme in the first quarter of 2020 with six local startups.

The accelerator, whose founders are Alexis Grosskopf and Stephanie Canac, was launched last month during its Ocean Innovation Africa event which was supported by Wesgro, the French Embassy, University of Cape Town and the V&A Waterfront (see this story).

The aim of the accelerator is to inspire and support ocean-minded startups with the express aim of nurturing an environmentally conscious and profitable economy that effectively mitigates the effects of global warming as well as the over-exploitation and pollution of the oceans.

OceanHub Africa is also offering a technology transfer support programme

OceanHub Africa said in a statement last Friday (6 December) that through the accelerator programme will seek out sustainable pathways that yield stable profits and avenues for scalable growth throughout the continent.

The accelerator said it will provide startups it accepts into its programme with physical working space, access to tailored mentorship, business and scientific expertise and access to market leads.

In addition, startups accepted into its programme also stand to benefit from hands-on services from corporate partners —  these will include cloud and IT services as well as access to an engineering and software suite for prototyping and testing — and support with fundraising including pitching and structuring of deals.

OceanHub Africa will open its Cape Town headquarters in February. The accelerator is currently being hosted by venture fund and technology incubator Savant Technologies.

The accelerator is calling on ocean-impact businesses, entrepreneurs seeking an equity-free acceleration programme and impact investors interested in supporting the UN’s Sustainable Development Goal 14: Life Below Water to join it.

Tech transfer support programme

The accelerator is also offering a technology transfer support programme that it says promotes collaboration between researchers and entrepreneurs for science-based innovation.

OceanHub Africa said by partnering with local universities, its objective is to find commercial use of scientific patents through the identification of transferable technologies and the incubation of selected projects.

This programme, the accelerator said, will strengthen the pipeline of ocean-minded startups and leverage the knowledge that lies within universities and research centres.

Read more: Ocean Innovation Africa 2019 to bring together tech startups, players in sea protection

Featured image: Wesgro CEO Tim Harris speaking at the Ocean Innovation Africa event held last month in Cape Town (Supplied)

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Rapid Deploy set to double staff at new Cape Town office to 120, after hot 2019

It’s been quite a year for Steven Raucher and Brett Meyerowitz, the founders of SA startup RapidDeploy.

The startup’s cloud-based software enables public safety officials to reduce emergency response times and improve situational awareness.

In February the pair announced that their startup had landed a $12-million (over R175-million at current rates) investment in a Series-A round from US venture capital fund GreatPoint Ventures and innovation fund Samsung Next.

It’s one of the largest — if not the largest — deals scored by an SA startup in 2019.

Next week Rapid Deploy’s Cape Town team will move to new 1500 square-metre offices in Century City

And a month ago, Microsoft CEO Satya Nadella, described at the Microsoft Ignite conference in Orlando, Florida (see this video clip) how RapidDeploy protects public safety and prevents ransomware attacks.

It comes after the startup was in June named Microsoft US Partner of the Year for Government Industry 2019.

In October the startup was awarded the Innovator of the Year Award by YTexas.

Office move to Century City location

Today over 95% of the startup’s revenue is generated from clients in the US – including AT&T, which operates the country’s 9-1-1 service, as well as government contracts with the state of California and state of Kansas. Microsoft signed the startup up as a client, earlier this year.

The startup was founded by Meyerowitz (pictured above, right in 2014. He was later joined by fellow founder Raucher (above left) who is now the CEO, in 2016. In January the startup opened a US office in Austin, Texas (see this story).

The startup now employs almost 100 people – 62 in Cape Town and 35 in Austin, in the US. Next week the company will move to new 1500 square-metre offices in Century City.

Raucher says the startup is looking to double its Cape Town staff numbers to 120, by the end of next year. Currently the startup has job adverts out for seven new positions in the city.

“The people we’ve recruited in Cape Town have been the best of the best,” says Raucher.

He also revealed that the startup had been looking to raise a Series-B round in June, but that given the significant revenue (“hundreds of millions of dollars”, according to Raucher) it is currently generated from increased demand from clients, it opted to put this on hold.

Raucher says he and Meyerowitz together remain the majority shareholders in the company.

Raucher says such has been the demand, that the last time that someone from the startup initiated a sales call, was in November 2017. Most of the inbound sale leads are generated from referrals and resellers.

The startup has also added a map that allows first responders to locate a caller and call detail record as part of its cloud-based offering.

‘South Africans, don’t sit on the sidelines’

South Africa’s economic outlook might look grim, while the country battles power outages again, but the tech sector remains hot.

Meyerowitz, who worked in London as the chief technology officer (CTO) of a company there for 12 years, before returning to South Africa in 2012, says instead of sitting as a spectator on the sidelines, South Africans should get involved in trying to make a difference in the country. “Every little bit helps,” he adds.

Raucher recalls how in the 1980s many of his friends were immigrating, saying the country “was going to end” but that things didn’t quite fall apart as many had thought they would. “I still have property in South Africa that I don’t intend selling,” he adds.

As South African businesses battle amid an ailing economy, struck by power outages, Rapid Deploy’s rapid ascent provides food for thought to any South African pessimists.

Adds Meyerowitz: “We’re playing with the big boys”.

They really are.

Editor’s note (12 December 2019): In June, Rapid Deploy CEO Steven Raucher recorded a podcast on the Within The Trenches show (the most popular podcast in 911 industry). The recording walks you through the entire journey of RapidDeploy, right up to the present. Raucher also held another podcast interview with the YTexas CEO network in August.

Read more: SA startup RapidDeploy raises $12m from Samsung Next, GreatPoint Ventures
Read more: SA startup RapidDeploy opens office in Austin, Texas to meet growing US demand
Read more: Cape Town startup RapidDeploy to move HQ to US after AT&T deal for 911 product

Featured image: RapidDeploy founders Steven Raucher (left) and Brett Meyerowitz (right) (Supplied)

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The Delta Studio: Shaking up the venture and product innovation space

Innovation has always been at the core of business and yet it remains one of the hottest buzzwords.

The Delta Studio, a relatively new player in the disruption and corporate innovation business, isn’t just riding the wave — they’re making a massive splash.

Started by Louis Buys, The Delta Studio is attracting entrepreneurs and corporates whose love of building new products are making the way others build products look kind of, well, traditional.

“Innovation is no longer a choice, it is a strategic imperative,” echoes Buys.

Let’s take a look at how things used to be done and how Buys and his team are streamlining the art of innovation.

How do ventures go from 0 to 1?

Until recently, new and existing ventures have been relying on resources like incubators, accelerators and digital agencies to help them startup and scale-up.

These go-to services have been the foundation of the venture building space, but aren’t without their flaws.

How do incubators and accelerators work?

Incubators and accelerators are programs that provide a combination of seed capital,shared workspace and mentorship to new and existing ventures.

Accelerators focus on scaling businesses — for a specific period of time — while incubators focus more on innovation.

Both of these programmes are meant to supply ventures with tools and expert knowledge to help them bloom, but often these terms are used loosely and entrepreneurs might find themselves in rooms with other entrepreneurs who know as much, or as little, as they do.

How do digital agencies work?

The main purpose of digital agencies is to complete a certain part of a venture or product — for example the brand guide, the website or the app — in a certain amount of time.

Agencies specialise in a number of tools and skills and build their set services around those skill sets.

The fact that agencies only focus on one part of your venture allows them to execute with extreme precision and attention to detail, but it also means that they don’t have stakes in the big picture.

Ultimately digital agencies or development houses don’t put a huge emphasis on whether your business or venture fails or how the idea they’re helping you develop will be accepted when it goes to market. They only need to ensure that their part works.

Which of these is Delta Studio?

Although incubators, accelerators and agencies have their place in the venture building space and have proven track records, The Delta Studio is neither of these.

It’s something completely new, a venture building model that redefines how and why products are built and scaled. It’s a venture studio.

What is a venture studio?

A venture studio has all the resources, services and people needed to build and scale products under one roof they are there from the conceptualisation through to the development and commercialisation of the product.

The Delta Studio, as a venture studio, understands that the most important part of the venture building process is the first step — idea validation.

It’s crucial that there is a market for the products that they build and that those products are built as efficiently and effectively as possible

A venture studio sees themselves as a partner and in some cases may also establish themselves as co-founders of the ventures they build.

What does the Delta Studio do?

The Delta Studio works extensively in the venture builder and product innovation space. Like most entrepreneurs and companies have realised, venture and product building are complex.

The Delta Studio brings change to our industry, co-creating with companies and entrepreneurs.

Corporates are best positioned to identify, fund and market the potential businesses of tomorrow.

However, corporates often struggle to validate, build, support and champion these new products and ventures often due to resources, agility and ownership.

The Delta Studio is a corporate venture builder; they are fast, accountable, independent and transformational, their experience includes working with clients across multiple industries.

They bring a new lens to your business, data and product strategy.

Their approach includes six key pillars:

  1. Idea validation by using Google Venture design sprints, prototyping, user research and strategy workshops to ensure that they build the right products
  2. Brand development by innovating customised solutions specific to your brand creating a lasting image on customers
  3. User experience and user interface (UX/UI) design by producing the highest quality brands and user experiences
  4. Product development by working closely with their engineers, developers and product owners, ensuring they build high-quality applications and services
  5. Commercialisation by partnering with you to launch and maximise the probability of success
  6. Advisory by working with companies to bring perspective and fill gaps where needed in your technology strategy and product roadmap ensuring best practice procedures

How do they do it?

There are a few factors that determine The Delta Studio’s ongoing success in building products:

  • They’re lean and agile: The Delta Studio uses lean and agile approaches when building products. This allows for more efficient processes, increased productivity, increased quality, allowance for change, and predictable costs, schedules and delivery.
  • They hire the best people: The Delta Studio doesn’t only employ the best people, but also people with the same collective values and the ability (and drive) to be taught and teach each other.
  • They’re honest, transparent and realistic: First and fore mostly, The Delta Studio is your partner. Which means, your success is their success. They will always ask the hard questions and if they feel that a product or idea hasn’t been validated sufficiently, they will tell you.

Want to partner up?

The Delta studio is always on the lookout for new exciting ventures, products and people to partner with.

Their ideal partners are ventures and corporates who have the vision and funding to take their products from ideas to validated, tested, premium products.

If you want to launch a great product and partner up, get in touch!

Send them a message at thedelta.io to set up a free consultation.

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Here are four books you should consider reading this festive season [Book reviews]

By now most of us are winding down business as we prepare for the festive break. For most this is a great time to catch up on some reading.

Wondering what to bury your head in over the next couple of days? Here are a few books that were published this year that we’ve covered that we think should be on your list.

‘So You Want to Build a Startup’ by Matthew Buckland

Shortly after he found out he had oesophageal cancer, Burn Media founder Matthew Buckland (or Matt, as he was affectionately known) — who later passed away in April — started writing So You Want to Build a Startup?

The book is a frank account of the difficulties – and the fun – of building a business. It is filled with practical advice for entrepreneurs on how to open the door to opportunity, life lessons, and insights into South Africa’s own dotcom boom and bust.

Expect tales of crazy business expansion, wacky characters, management failures and personal growth, as well as a complete ecosystem overview for South African startups (see Ventureburn’s review of the book here and read an extract here. Also, see this obituary).

‘Sweat, Scale, $ell: Build your business into an asset of value’ by Pavlo Phitidis 

Sweat, Scale, $ell: Build your business into an asset of value is serial entrepreneur and Aurik Business Accelerator CEO and co-founder Pavlo Phitidis’s first book.

In it, Phitidis — who’s worked with over 1500 businesses across four continents — explains why so many business owners find themselves with a business that no one wants to buy, simply because they have failed to build a sellable business.

Using examples of business owners he’s come across (under fictional names) he explores the key challenges business owners face when trying to build an asset they can sell (see Ventureburn’s review of the book here).

‘Pitch To Win’ by Justin Cohen

For professional speaker, television host and author Justin Cohen, it’s not enough to have the best product, you’ve got to have the best pitch (see this Ventureburn Q&A).

In his latest book Pitch To Win, Cohen details a six-step formula which he used to train companies like Kenyan fintech Mode — which he helped win the IBM Global Entrepreneur of the Year award — as well as other companies he has worked with over the years.

The book will help you understand: the mindsets of people who win the most pitches, why winning pitches get chosen over their competition, how to reduce nervousness and develop a “big pitch temperament” and how to win without being salesy, among other topics.

Ventureburn is giving away three copies of this book to three lucky readers in South Africa (see this story for details on how to enter the competition).

‘Chasing Black Unicorns’ by Marek Zmyslowski

Chasing Black Unicorns is an autobiography by Polish serial entrepreneur Marek Zmyslowski who was the co-founder of Jovago, Jumia Travel and HotelOnline.co.

In 2014, he was chosen as one of the Ten Most Important People in Tech by IT News Africa Magazine. He is also a lead mentor at Google’s Launchpad and World Bank’s XL Africa Programme. His first startup was a dating site (see this story).

In his book, Zmyslowski details his early days as an entrepreneur in Poland as well as his experience as founding a startup in Nigeria which apparently made him powerful enemies in the country in a saga that saw him get ousted from a company he built and among other things Interpol issuing an extradition request against him.

Check out a review of the book by Ventureburn here.

Read more: Tafelberg publishers launch late Matthew Buckland’s book
Read more: You think it’s never going to happen to you, but it’s happening to me – Matthew Buckland [Book extract]
Read more: Matthew Buckland shares all in brutally honest memoir [Review]
Read more: Marek Zmyslowski releases tell-all book after Interpol drops Nigerian extradition request
Read more: Why only 5.4% of owners are able to sell their business and what to do about it [Book]
Read more: Is this the six-step formula that can help your startup deliver the winning pitch? [Book]
Read more: Polish businessman’s tales of fear and loathing in Nigeria [Book review]

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Coming from a family of entrepreneurs helped me get started, say cosmetics retailer

Switch Beauty founder 19-year-old South African Rabia Ghoor grew up surrounded by siblings and a father who were all entrepreneurs.

She founded her e-commerce website which specialises in cosmetics at the age of 14.

Ghoor (pictured above) says coming from a family who are all entrepreneurs made it easier for her to get support and empathy when she decided to start her own business — so much so that she dropped out of school in Grade 10 with her family’s support.

“The fact that there were so many entrepreneurs around me, it was never a question of can I do it…

“Whereas for other kids they kind of look at entrepreneurship or starting a business as ‘oh my G** I could never do that’ because they haven’t seen it in a relative or in a relatable setting to them,” she says.

Crowd-sourced from 2000 users on social media

Ghoor started off by doing some market research. She’d spend 11-hours in front of her computer absorbing knowledge and everything to do with cosmetics formulation.

“I actually went on a site called Fiver (a web platform for sourcing freelancers) and consulted with cosmetic chemists on certain things.

“So, I was finding out what made this product do what I like and which ingredient in here made it do what I like, and why is it so expensive.

“I’d ask myself is there not a cheaper way to source this ingredient? Is there not a cheap alternative to this ingredient to get the same performance?” she says.

Ghoor says she realised that most beauty companies “just throw shit” at the wall and see if it sticks. She believed there was a better alternative to this method.

She crowd-sourced information on her Instagram by asking her followers what they want from a cosmetics brand.

“I put my consumer at the head of the table instead of sitting and guessing what it is that she wants.

“And people came back with all kinds of feedback then we went deeper into that feedback. People were like ‘I want an eyeliner’, I was like ‘what do you want the eyeliner to do?’,”she says.

Ghoor says she ended getting up 2000 separate comments on what people wanted from an eyeliner.

She adds that crowd-sourcing information like this has been a massive help for her business. “It’s cool to have that sort of insight,” says Ghoor.

She then went to beauty retailer Savora and bought every single eyeliner the shop had worth over $45.

“I tried every single one and found the ingredient in each and every single eyeliner that made it do the things I liked about it. I went to Google and searched the ingredients, then I compiled all of these ingredients into one master eye liner.

“So, for example where a Marc Jacobs eyeliner would cost you upwards of $55 the Switch Beauty performs just as well, is marketed just as well, but will cost you R150,” she says.

‘Make do with what you have’

Ghoor says she takes that kind of approach and philosophy with all of the products on her line.

She explains that she started the business with R6000 which she borrowed from her father. “And I’ve never borrowed a cent from anyone since,” she adds.

Since her overheads were small, she never thought she’d need more money so she just made do with what she had.

“If I couldn’t (pay for a) developer I learnt how to code, if I couldn’t afford a graphic designer I found canvas. I taught myself to do a lot of the things that a business would think they need to outsource. Everything seems intimidating until you learn it or until you understand it,” she says.

“You might have told 15-year old me you could never code a website , you don’t know the second thing about it, but then you go and you research it and you learn and you learn. There are always apps and integrations to help you.

The bootstrapped business, which employs seven people, has been self-sustainable since and has grown to become what Ghoor says is a “seven-figure” business.

‘Entrepreneurship widely glamourised’

Despite her success, Ghoor believes entrepreneurship is a “widely glamourised” affair.

“When in reality it’s extreme amounts of impostor syndrome and burnout periods that are almost crippling and like twice a month you are like ‘oh shit’ I can do this I’m fine.

“And the rest of the month you’re like burning out constantly. And sometimes when you are able to see your ideas materialise your concepts come to life its rewarding, but more often than not at that point you’re already so burnt out.

“You need to have a very firm understanding of you’re doing it what you’re doing. The ‘why’ is your anchor. You also need to have a firm understanding of who you are,” she says.

Ghoor says last year she had an “existential crisis” which saw her question herself on who she was, what she was doing and whether she still wanted to do this (run the business).

“So, you need to have a firm understanding of yourself and why you’re doing what you’re doing,” she adds.

So, will she ever go back to school? Ghoor says she’s got no plans of going back.

“Not if I want to become a doctor. This is the life plan,” she adds.

This story appeared originally on the Anzisha Prize’s blog on 10 December. See it here.

Featured image: Switch Beauty Rabia Ghoor (Rabia Ghoor via Instagram)

The Anzisha Prize seeks to fundamentally and significantly increase the number of job generative entrepreneurs in Africa, and is a partnership between African Leadership Academy and Mastercard Foundation. Through Ventureburn, they hope to share inspirational and relatable stories of very young (15 to 22 year old) African entrepreneurs and the people that support them. [learn more]

The post Coming from a family of entrepreneurs helped me get started, say cosmetics retailer appeared first on Ventureburn.

Eran Eyal disappears from social media after new fraud charges laid by SEC over $42m Shopin ICO

New York based SA tech entrepreneur Eran Eyal appears to have deleted both his Facebook and Twitter accounts and has disappeared off his startup’s Telegram account, where up till yesterday he had liaised near daily with investors.

It follows charges laid against him and his startup Shopin yesterday by the US’s Securities and Exchange Commission (SEC), for defrauding investors in an initial coin offering (ICO) that raised more than $42-million from hundreds of investors.

Eyal already faces charges of fraud relating to his previous startup Springleap, brought against him on 24 August last year, in which the New York Attorney General alledges he stole $600,000 from investors by fraudulently soliciting investors to purchase convertible notes through false representations of his company, Springleap (see this story).

The SEC alleges that Eran Eyal conducted a fraudulent unregistered securities offering by selling Shopin Tokens in an ICO

In a formal statement lodged yesterday, the SEC’s alleges that from August 2017 to April 2018, Eyal, founder of UnitedData Inc, which trades as Shopin, conducted a fraudulent unregistered securities offering by selling Shopin Tokens in an ICO.

It comes after Ventureburn in June reported that the New York State Attorney General in the US and the SEC had launched a probe into Shopin (see this story).

The SEC in its complaint (opens as a PDF) says Shopin aimed to use the funds from the sales of the Shopin Tokens to create universal shopper profiles, maintained on the blockchain, that would track customer purchase histories across online retailers and recommend products based on this information. As alleged in the SEC’s complaint, Shopin never created a functional platform.

The complaint further alleges that Eyal and Shopin repeatedly lied to investors in connection with its offering, including misrepresentations about purported partnerships with certain well-known retailers and about the involvement of a prominent entrepreneur in the digital-asset space (stories broken by Ventureburn — Ed).

The SEC also alleges that Eyal misappropriated investor funds for his personal use, including at least $500 000 used for rent, shopping, entertainment expenses and a dating service.

Said Marc Berger, the director of the SEC’s New York regional office: “As alleged in today’s action, the SEC seeks to hold Eyal and Shopin responsible for scamming innocent investors with false claims about relationships and contracts they had secured in support of a blockchain-based universal shopper profile”.

“Retail investors considering an investment in a digital asset that meets the definition of a security must be afforded the same truthful disclosures as in any traditional securities offering.”

The SEC’s complaint, filed in the federal district court in Manhattan, charges Eyal and Shopin with violating the antifraud and registration provisions of the federal securities laws.

The SEC seeks permanent injunctions, disgorgement with interest, and civil penalties, as well as an officer-and-director bar against Eyal and a bar against Eyal and Shopin prohibiting them from participating in any future offering of digital-asset securities.

This is a developing story.

Read more: Fraud-accused Eran Eyal offering three immigrant students scholarships at $3600 each
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Read more: Eran Eyal lied about existence of Springleap advisory board – UK investor
Read more: Former Springleap founder Eran Eyal named as ‘co-CEO’ of Shopin
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Read more: BREAKING: I am innocent of malicious allegations says Springleap’s Eran Eyal
Read more: BREAKING: Springleap’s Eran Eyal released from US prison, posts $250k bail
Read more: Are these the messages Springleap’s Eran Eyal sent to investors for funding?
Read more: Springleap’s Eran Eyal removed as CEO of Shopin and replaced with interim head [Updated]
Read more: Springleap’s Eran Eyal did not seem like scammer to me – DocuSign founder
Read more: Charges against Springleap founder not first time Eran Eyal’s in trouble with law [Updated]
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Read more: Springleap charges: Are claims as world’s 7th most innovative firm a fabrication? [Updated]
Read more: SA entrepreneur Eran Eyal charged with fraud in the US over startup Springleap
Read more: Springleap’s Trevor Wolfe talks agencies, startups, and pivots [Q&A]
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Read more: SA crowdsource design startup Springleap secures R4m+ Angel round
Read more: Life after t-shirts: Ventureburn gets the exclusive behind Springleap’s pivot

Featured image: Former Springleap founder Eran Eyal (Facebook)

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Kenyan insurtech startup Turaco raises $1.2m seed investment

Nairobi-based insurtech startup Turaco has raised a $1.2-million seed investment which it intends to use to further scale its operations across Africa.

Turaco, which also has an office in Atlanta in the US, partners with local companies and mobile lending organisations to provide simple and affordable medical cover to under-served and un-served communities.

The startup, whose founders include CEO Ted Pantone (pictured above), announced in a statement yesterday that the investors who contributed to the seed round include Gan Ventures, Mercy Corps Ventures and Musha Ventures.

Turaco was launched in 2008, its founders include CEO Ted Pantone

Launched in 2008, Turaco offers life and health insurance products — for monthly premiums that are as low as $2 — which are distributed through partnerships.

Turaco’s subscription model which enables consumers to opt in for automated medical policy renewals which are bundled with their existing payments. The startup says it has insured more than 30 000 users in Kenya and Uganda.

Turaco explained in its statement that the funds will be used to cement it presence in new markets and further develop its ongoing pilots and partnerships with businesses and fintech companies.

Ventureburn sought comment on when the deal was concluded as well as details on its expansion plans, but had not received a response by the time of publication.

Pantone, commenting on the round in the statement, said Turaco was “blessed” to be able to choose from a group of investors with different specialities.

“These range from social impact and value alignment to industry understanding and connections in Silicon Valley.

“In our next round of funding, we are looking for additional value-aligned investors who have the capacity to support us in our vision to insure a billion people,” he added.

In June, Turaco was selected to join the Catalyst Fund‘s fintech accelerator programme along with three other Africa-focused and one Brazilian startup (see this story).

US tech publication TechCrunch reported in an article at the time that each of the four startups would receive between $50 000 and $60 000 in non-equity funding.

Last year Turaco received a $40 000 grant from Villgro Kenya.

Featured image: Turaco co-founder and CEO Ted Pantone (LinkedIn)

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Microtraction invests in Ghanian fintech startup Bit Sika

Lagos-based early-stage investor Microtraction announced yesterday that it has invested in Ghanaian fintech startup Bit Sika.

The Accra-based startup provides a money transfer service which uses digital or crypto currencies to enable users to move money across borders at negligible or no fees.

The investment, which marks Microtraction’s first non-Nigerian investment, is the third transaction it has announced this year.

The investor ordinarily invests $65 000 in two stages. The first investment is usually about $15 000 in exchange for a 7.5% equity stake.

This is followed by an additional $50 000 convertible note at a $1-million valuation cap for companies that Microtraction says have shown “significant progress” after the platform’s initial investment.

Ghanaian fintech Bit Sika was founded in 2018 by Atsu Davoh

Bit Sika was founded last year by Atsu Davoh (pictured above, centre with Bit Sika head of growth Samuel Boahen to his left along with members of Twitter’s team including co-founder and CEO Jack Dorsey, second from right) who dropped out of Carleton College in the US to work on the startup.

Davoh was also one of the first African participants of US tech entrepreneur Daniel Gross’s remote accelerator Pioneer (see this Q&A).

Microtraction explained in a statement yesterday that the first iteration of the startup was a USSD platform which it released in March last year that enabled Africans with basic feature phones to acquire and send Bitcoin between phone numbers without the internet.

Microtraction said the traction Bit Sika’s has achieved each time the startup released a product has given the early-stage investor “a lot of confidence”.

Bit Sika’s USSD platform, it pointed out, attracted over 200 users within 30 hours of being released was able to attract “a few thousand dollars” worth of transactions during its short run.

Microtraction said at the time it invested in the startup, its current version of the product had attracted nearly 1000 users. In addition, the app has processed transactions worth over $860 000 after 12 weeks of operation.

‘Relentless effort on crypto second to none’

Explaining why it backed the Ghanaian fintech, Microtraction said Davoh’s “relentless effort” to spread the adoption of crypto — first with a USSD wallet, then with a crypto-focused charity platform and now with an app focused on cross border payment — is “second to none”.

“The team’s ability to push out products quickly with a laser-focused customer-centric approach is admirable,” said Microtraction.

Microtraction said the present iteration of Bit Sika, which is available on both the Androis and iOS platforms, was built in seven weeks.

“The pilot phase is focused on remittances between Ghana and Nigeria. Their ability to execute and build products fast has been impressive,” said Microtraction.

The early-stage investor also said the Bit Sika team, which includes head of growth Samuel Boahen, is quick to seek advice, open to feedback and judicious in implementing feedback into their product.

Read more: Microtraction invests in Nigerian online marketing platform Termii
Read more: Microtraction backs Nigeria’s Sendbox in investor’s first deal of the year [Updated]
Read more:
 Nigeria’s Microtraction launches Scout Initiative to search for more deals
Read more: Microtraction looking to invest outside Nigeria says partner Dayo Koleowo
Read moreNigeria’s Microtraction announces its sixth deal, with cloud accounting startup
Read moreNigerian rewards platform Thank U Cash secures funding from Ventures Platform
Read moreNigeria’s Microtraction announces investment into Lagos-based fintech Riby

Featured image: Bit Sika founder and CEO Atsu Davoh (middle), Bit Sika head of growth Samuel Boahen (second from left) with Twitter co-founder and CEO Jack Dorsey (second from right) together with members of Twitter’s team (Opentraction)

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