SA SME, Michanic defies odds during covid-19

A South African SME has utilised smart technology and a customer-centric business model to disrupt the auto repair industry. 

Similiar to that of Uber, Michanic is a technology platform that allows users to request assistance and repair services from several trustworthy car mechanics. Unlike other auto repair services, Michanic will come to the user’s selected destination to complete the service. 

Michanic is utilising smart technology and a customer centric business model.

Founded by South African entrepreneur, Lesetja Dikgale, Michanic was born out of the desire to improve the existing automotive industry offering. Initially founded as Car Care Click in 2016, the startup has grown in strides over the years. 

In 2016, the disruptive startup was selected as one of the top 20 startups out of 170 competitors in Google’s Developer Launchpad Programme. The accelerator program aids technologically innovative startups to grow by pairing them with the best of Google’s people, networks and technologies. 

Praesidium Capital Management, an Investment Manager provided seed funding which allowed Michanic to launch in 2018 after years of development. Currently, the service is available in Gauteng and the Western Cape with plans to launch in KwaZulu-Natal 

The impact of Covid-19 has prompted many South Africans to opt for less contact in terms of their daily activities and Michanic offers a service that means users do not have to leave the comfort of their homes or offices. 

Approved by the Retail Motor Industry Association (RMI), users can be assured that mobile mechanics are qualified to do the job. 

Technology 

The innovative platform forms part of the Fourth Industrial Revolution by using a data-first approach on its user-friendly interface to pair suppliers to customers in real-time.

Currently, Michanic is the only company that has the technology to offer this service in Africa which means that they are pioneering this hassle-free service.  

Customers first  

With a customer-centric focus throttling their business forward, Michanic allows users to choose any convenient location to have their car serviced or repaired. In an effort to develop its current offering, Michanic has launched a range of new features including installment payments (paying via credit), pensioner discounts and a new web app. 

Perhaps most importantly of all, in a struggling South African economy, the growth of this innovative technological business has directly created over 30 much-needed job opportunities for mechanics and support staff, including many female mechanics and female support technicians. 

As it grows, Michanic is looking to hire many more young and hungry professional South Africans, with plans to grow its partner mechanics to over 2000 qualified and vetted mechanics.

Read more: ProfitShare Partners secures R100-million for SA SME’s
Read more: Tech startups share their lockdown experiences
Read more: SA Crypto startup partners with one of the world’s largest exchanges

Featured image: (Supplied)

The post SA SME, Michanic defies odds during covid-19 appeared first on Ventureburn.

Media24 outlines plans to close major print publications

Media24 has announced major restructuring plans, including the closure of five magazines and several newspapers.

The company made the announcement on 7 July, with the planned restructuring expected to affect over 500 staff members.

CEO Ishmet Davidson said that the coronavirus pandemic had negatively affected business and worsened the decline of the print industry.

As a result, the company plans to close a number of its print publications and move some to digital-only publishing.

“The pandemic has accelerated the pre-existing and long-term structural decline in print media, resulting in a devastating impact on our own already fragile print media operations with significant declines in both circulation and advertising since April,” Davidson said in the announcement.

The company will announce final decisions following the consultation process with employees.

However, it outlined a number of planned closures of major magazines. Several community newspapers will also close, along with planned newspaper merges.

Media24 will also outsource the publication of numerous magazines.

You can read the full report on planned Media24 closures on Memeburn.

The COVID-19 pandemic has negatively affected businesses both large and small in South Africa.

In fact, the pandemic caused a 32% revenue decline in the local startup sector.

Read more about funds to help local entrepreneurs and businesses below:

Government interventions for entrepreneurs around Covid-19

Black Business Council and Ubank set up R1bn township and rural economy fund

Department to set up fund to help SA small businesses affected by coronavirus

The post Media24 outlines plans to close major print publications appeared first on Ventureburn.

SA Crypto startup partners with one of the world’s largest exchanges

ChainEx, a local South African cryptocurrency exchange has partnered with one of the world’s leading exchanges, OKEx. The new partnership will allow crypto traders more liquidity and an opportunity to access a global exchange. 

ChainEx has partnered with a globally recognized exchange, OKEX

Ryno Mathee, Chief Technology Officer of ChainEX comments on the new partnership and what it means for traders. 

“This collaboration will give many South Africans and Africans access to a Top Tier, Global Cryptocurrency Exchange, as well as bring new liquidity and volume to ChainEX.” 

OKEx is a Malta-based secure crypto exchange that provides advanced financial services to traders through the use of blockchain technology. It claims to secure a nearly $1.5-billion daily trading volume with hundreds of trading pairs to help traders optimise their strategy.

The new partnership between the crypto exchanges aims to eliminate barriers to transactions and increase the efficiency of transactions. With this new venture, ChainEX will have access to creating an international footprint in the industry. 

Ivan Chen, Business Manager of OKEx Africa explains that the partnership will benefit both parties and its users. 

“OKEx respects partnership as the key steps to develop and provide local services to users. In the meanwhile, building a win-win cooperation with ChainEX will lead us to a better future.”

This new partnership follows after the announcement that the Jefferey’s Bay based startup introduced a quick buy and sell feature (see this story) .

The new partnership signifies a milestone for the South African crypto startup who claims that it is pioneering the industry with new features and innovations.

These include a zero-percent maker fee, a knowledge base, dedicated ticket-based support, BTCV markets, and referral programs. Any trader can begin with ZAR and then diversify with thousands of cryptocurrencies.

The startup was founded in 2017 by Ryno Mathee, Otto Lessing (who serves as CEO), and Martin de Bruin.

Mattheee is an entrepreneur with a software development background, while Lessing was admitted as a lawyer in 2001 and has been involved in multiple ventures before becoming involved with ChainEX.

De Bruin is a financial manager at one of the largest dairy farms in South Africa.

Read more: SA crypto exchange which has raised $1.3m introduces quick buy and sell feature for traders
Read more: Vinny Lingham’s Civic launches consumer-first digital wallet
Read more: African regulators are holding back growth of cryptocurrency on continent, finds report

Featured image: Nick Chong via Unsplash

The post SA Crypto startup partners with one of the world’s largest exchanges appeared first on Ventureburn.

An insight into how Ingressive Capital invests in African startups

Techpoint Africa

This article is brought to you as part of a new partnership between two of Africa’s foremost news and information platforms for African tech startups, Ventureburn and Techpoint Africa.

Ingressive Capital, the venture capital fund focused on early-stage African tech, recently completed its $10 million fund.

According to information on the firm’s website, the fund is committed to supporting the next generation of African innovators.

Ingressive Capital is one of Africa’s most recognised early-stage venture capital funds

Launched three years ago, Ingressive Capital has become one of Africa’s most recognised early-stage venture capital funds. Before the completion of its $10-million fund, Ingressive was investing $50 000 to $100 000 but now, it has doubled that. For perspective, Ingressive Capital’s ticket size is larger than that of US-based accelerator, Y Combinator.

The fund also claims to provide follow-on funding for portfolio companies via its own top-tier investor base which includes names like Michael Seibel, Y Combinator CEO; Techstars; and Platform Capital.

Therefore, there is no better time to find out how the venture capital fund invests from its founder and managing partner, Maya Horgan Famodu, one of the most ambitious VCs you’ll meet on the continent.

At 23, she began working towards bringing ten of some of the world’s top investors to invest in African startups. These investors have either established joint ventures (JVs) or made angel investments or made partnerships with companies in Nigeria.

Over time, Ingressive Capital has worked with 50 different international firms that have gone on to do more than 40 deals in Nigeria.

Here are some insights into how the venture capital firm invests.

 What market Ingressive Capital is interested in and why?

Ingressive Capital is mostly interested in Africa’s traditional billion-dollar industries. And the tech-enabled solutions that plug in either drastically impact unit economics that either bring transparency to marketplaces or provide Internet connectivity solutions that didn’t previously exist.

These are some of the areas we are very interested in and on the B2C side, we look at the Internet and financial services. I love unsexy tech: infrastructure technology, agriculture tech, the stuff that doesn’t sound very cool, stuff that isn’t trending. I love basic practical technology that is geared towards and built for Africa’s traditional billion-dollar industries.

How do you determine that a startup is investible?

We determine if a startup is investible by the traditional venture metrics as well as the number of proprietary diligence points that we built out from companies that we’ve looked at.

So we look at everything from where the company is incorporated, its structure, how much equity the founders own, how many more rounds they need to raise before potential liquidity, and of course, the total addressable market (TAM), the financials, and the growth projections (last 6-12 months of growth).

We only invest in post-launch founders and we look at the traction because we really want to understand the integrity, responsibility, and the founders’ critical analysis skills. Now that we are remote, our diligence process has changed in that we now have proxies for trust-building which have proven to be more efficient than the process that we had before COVID-19.

For the trust components, we are now doing a lot more interviews with former employees and employers as well as co-investors and people who’ve worked with the founders. Of course, we also look at the traditional diligence components like total addressable markets, product-market fit, defensibility and financials, growth projections, proprietary technology and things like that. The TAM, defensibility, the founder, and team are the most important things to us.

By Ingressive Capital’s standards, what should a startup not be doing?

Startups should not be presenting anything over a 10-12 or 15-page deck. A startup should not send a lot of text and pages of documents to an initial investor.

A startup should not randomly call investors without accessing their investment strategies and looking for businesses within the same industry and geographical focus, they need to do their research first.

Also, a startup should not launch without having a team, a finished product, or an initial prototype. Startups should not be so concerned with idea poaching that they refuse to talk about their ideas to investors, potential colleagues, or potential partners, and end up shooting themselves in the foot, consequently.

A startup should not waste money on marketing before they have understood their retention and engagement components. A startup shouldn’t start fundraising for short periods; they should always be thinking of 12-24 months of fundraising when they raise capital.

A founder should not try to build multiple businesses at the same time. They should not disavow their own spiritual, emotional, and mental health when building a business. It is fundamental that they prioritise those things so that they can successfully build the company.

A founder should not ignore the need to properly incentivise the workforce. Finally, in a startup, everyone should be paid the market-rate or have additional incentives that align with the company’s interests.

At what stage of growth do you usually invest in startups?

Typically, we invest in companies that have traction and a valuation below $5m. They must have found product-market fit and also, they must be a complete team with industry expertise and in-house technical skills that are within our specific verticals where we invest. They should also target billion-dollar market opportunities.

How does Ingressive Capital deal with bad investments?

We don’t have any bad investments and ideally, we don’t do any bad investments. But if our companies are struggling, of course, we provide all the support and guidance that we can from our limited partners.

We don’t leave anyone behind; as long as they’re willing, open, and receptive to our support and advice, we are there for our companies.

I think the biggest feedback we get from our portfolio companies is that we provide consistent business development and fundraising support, as well as advice in any way that we can. Also, we offer them our network and access to ensure that they have the resources required to succeed.

I think how close and open we are with our resources is what differentiates us from other firms. Through our network of Limited Partners, we have a lot of global access that we are constantly sharing and getting feedback and input on our portfolio companies’ needs.

What industries are of most interest to you?

The industries that are always interesting to me are B2B tech-enabled solutions targeting Africa’s traditional billion-dollar sectors.

What is Ingressive Capital’s average ticket size?

We write $200k to $400k cheque sizes in the companies and target 10% ownership.

What investment opportunities have you regrettably passed on and why?

When we passed off on the great deals we were looking at there were good reasons. They either didn’t fit with our investment strategy or were far outside our target ticket size and at what point we invest. Also, there were some specifics with the legality of the team dynamics that didn’t pass our investment committee.

Although our diligence process is constantly changing, each of the deals we invested in, or didn’t invest in, helped fine tune our investment strategy and teach us something new.

So I would say there’s nothing that we deeply regret, there’s a reason we didn’t do the deals that we considered. Those other deals are still part of our diligence process which we’ve consequently updated, so all of them were necessary.

Which startups are currently in your portfolio? Would you like to disclose how much you’ve invested in them?

We would not like to disclose how much we’ve invested in them individually but we’ve invested in a couple of startups like Paystack and 54gene among others. They are listed on our website.

How can startup founders reach Ingressive Capital?

Founders can apply for funding by emailing uwem@ingressive.co for deals in Nigeria; william@ingressive.co for opportunities in Ghana; or apply at www.ingressivecapital.com for opportunities elsewhere in Africa.

The original version of this article appeared on Techpoint Africa on 6 July. See it here.

Featured image: Ingressive team members (Supplied)

The post An insight into how Ingressive Capital invests in African startups appeared first on Ventureburn.

Tech startups share their lockdown experiences

Several of South Africa’s startups, associated with AlphaCode, share how the country’s extended lockdown has provided some with growth opportunities as some individuals adapt to how they engage with their finances while a few other fintechs share challenges faced due to the pandemic.

Andile Maseko, head of ecosystem development at AlphaCode explains that a digital-first approach adopted by various fintech startups is yielding positive results during the pandemic.

“Mixed experiences are expected for our members but those with a digital-first approach are benefiting the most. Those experiencing difficulties are evaluating product offerings to better address the new normal, but the uncertainty of the Covid environment adds complexity to pivoting.”

Business is better than usual

Luno, a global cryptocurrency platform with close to four million users across 40 countries worldwide, is achieving records. As the most popular crypto platform in South Africa, record trading volumes were achieved in March and a visible 50% increase in the number of active users each month.

Marius Reitz, General Manager for Africa at Luno explains that the data recorded has shown an increased interest in cryptocurrency.

“This indicates continued cryptocurrency investment by existing holders and entirely new investors entering cryptocurrencies for the first time.”

Thomas Brennan, CEO of Franc, a digital investment platform that offers investors an affordable way to access money market and exchange-traded funds, says the business has seen the strongest monthly growth (25%) in terms of new investors.

Covid-19 has reminded people of the importance of having an emergency fund. With Franc, investors can get better returns than a bank without having to lock up their money in a fixed deposit.

Tami Ngalo, the founder of Oyi medical card, a savings card for medical spend explains that they tapped into the use of a digital-driven product increasing the number of customers.

“We’ve had some challenges but we managed to unlock opportunities from people being at home and hungry for digital. Our complete digital experience came through for us as we acquired 150% more customers last month.”

Hayley Parry, co-founder of Worth, an EdTech business that delivers financial education to employees and customers through its online training portal explains that Covid-19 has resulted in people wanting to become more financially savvy.

“Because finances are such a significant source of anxiety for staff, we have seen that online learning through our platform has increased significantly. Employees are using this time to take control of their finances. We have seen the highest course completion rates during the lockdown. We also created a new course around Covid-19 – a financial shock course via webinars and an online short course for employees developed for in a household that’s had a financial shock.”

Graham Rowe heads Guidepost, a health- and insurtech innovator that allows insurers to significantly better manage their diabetes risk. Guidepost has seen an overall demand for their offering during Covid-19.

” We had one of best months ever during April. Providing virtual and remote healthcare services we have seen even more appetite from our customers, medical aids, and pharmaceutical companies to get great healthcare services to people that they can access telephonically from their home. Patients suffering from diabetes are at risk during this pandemic and there has been an increased willingness to engage with our nurses to improve the management of their condition.”

Reviewing these businesses Maseko comments that, in addition to the digital-first approach, what is also evident about these businesses is that they are offering services that address the health and financial security concerns of consumers.

“Solutions in these areas, as well as contactless payments and credit, could be the theme for at least the remainder of 2020 in the South African fintech space,” he adds.

Difficulties

Nicky Swartz, founder of Spoon Money, a company that provides loans at fair rates to women in Cape Town townships expresses that the lockdown has been enormously challenging.

“Our clients, informal traders in township environments, have been deeply constrained in trading point and then, where they can trade, from decreased demand. This has a direct knock-on our revenues and planned growth. Like every other business, we have re-forecast the rest of the year looking at the worst-case scenarios.”

“On the upside, we have automated processes and have tested for levels of digitisation in anticipation of growth post lockdown. We’re using the opportunity to engage with our clients to understand their immediate and medium-term business needs and that’s opening our eyes to new possibilities,” she adds.

Idan Jaan, the founder of Fundrr, an alternative lender for SMEs explains that Covid-19 has drastically impacted their revenue.

“The lockdown has been a setback. We have had to cut salaries and operational expenditure to ensure that we can provide the relative payment holidays for our clients. Over 90% of our clients are on payment holidays which has taken a massive toll on our revenue. We are getting a lot of requests for funding and have accepted applications for businesses that can continue to operate during lockdown levels 5 and 4.”

Fincheck is the country’s biggest financial comparison site as well as the biggest lead aggregator having signed on 71 banks, lenders and insurers.

Michael Bowren, CEO of Fincheck, reports that the impact of the pandemic has changed the market environment.

“Some banks and insurers have tightened their belts and risk appetites due to a rise in default rates and employment uncertainty, whilst others have remained open to new business and potentially more risk. The companies who have remained open are looking to take advantage of having ‘less competition’ during this period and move ahead with client acquisition.”

Simon Purdon, a business development manager at FundingHub which offers 30 alternative lenders and banks for SMEs looking for finance to grow their businesses has noted a substantial increase in business applications. There has been a visible increase in applications for purchase order funding and unsecured funding to cover cashflow shortages.

“We have seen a reduction in lenders’ appetite to disburse funds due to uncertainty as to whether that business will make it through.”

Businesses being forced to change

Peach Payments, which is enabling South African businesses to accelerate online commerce solutions and transform or pivot during Covid-19. Its monthly customer acquisition has grown by 400% since February.

Rahul Jain, CEO of Peach Payments commented, “The challenges faced by local tech startups vary but the most significant is declining demand. Tech startups in the travel, tourism, food, and beverage sectors are hit quite significantly with revenues drying up.”

“However, we are seeing a huge push from SMMEs to embrace online sales and payments to supplement their existing business. Many are pivoting to new models. We’re seeing our merchants go from physical to online retail. We’re working with restaurants, coffee roasters, personal trainers, gyms, dieticians among many others. People are now creating videos, lessons, food plans, and sharing via email, whatsapp, their websites, and we help them to get paid digitally, ” he added

There’s also increased demand for contactless (no-touch or remote) payment options. Says Leonard Shenker, joint CEO of walletdoc, which offers several payment solutions for merchants.

“Businesses are implementing digital payment solutions to cater for a changed consumer engagement. These include payment links, a ‘pay now’ button which is easily sent to customers via SMS, WhatsApp or email enabling customers to settle via card immediately. Because of the increased demand for delivery services, drivers can be equipped with mobile tap-to-pay enabled credit card machines minimising contact. Another safe payment channel is equipping drivers and websites with QR codes, ” he said.

Advice

FundingHub’s Covid-19 resources page lists everything you need to know about the different forms of relief available for SMEs in South Africa.

Dov Girnun CEO of Merchant Capital, which offers small business loans explains that the pandemic has created chaos in an already weakened economy. “Turbulence has always been the official climate for SA’s SMEs.” He recommends that SMEs embrace the situation and try to find opportunities in the chaos.

Girnun adds that businesses must relook at their business plans

“This is the time businesses should be really listening to customers, relooking their cost structures and engaging meaningfully with their stakeholders. Chaos creates opportunities.”

“Coronavirus is pressing a reset button in many industries thereby creating a blank canvas for businesses that are agile, able to act fast, and technology-enabled. These businesses without large costs and fixed overhead structures are best placed to take advantage of opportunities to get products and services out to market quickly. We saw it during the global financial crisis where these types of businesses arose: Instagram, Airbnb, Pinterest, and Uber. These fintech entrepreneurs found new problems to solve and new opportunities by adding real value to the world,” he concludes

Featured image: Andile Maseko, head of ecosystem development at AlphaCode (Supplied)

The post Tech startups share their lockdown experiences appeared first on Ventureburn.

ProfitShare Partners secures R100-million for SA SME’s

The FinTech SME capital provider, ProfitShare Partners has secured a whopping R100-million from the SA SME Fund. With this funding, ProfitShare Partners will be able to partner with small and medium businesses to help accelerate growth for SME’s.

ProfitShare Partners provides disruptive alternative funding to SME’s which have a contract with a reputable company or government department. This funding allows SME’s to deliver successfully on their orders and contracts which in turn allows them to access a bigger pool of business resulting in exponential growth.

Characterised as a fintech disruptor, ProfitShare Partners has assisted more than a hundred SME’s since conception providing them with the tools to grow their turnover tenfold in less than two years.

ProfitShare Partners has secured R100-million in funding for the local SME sector

In recognising the ProfitShare Partners business model and its positive impact on SME growth, the SA SME Fund provided the R100-million in funding to assist in accelerating the growth of the SME market in South Africa.

Ketso Gordhan, Chief Executive Office (CEO) of the SA SME fund explains that their investment into ProfitShare Partners comes at a time where it is dire to the survival of the SME market.

“The availability of funding and access to working capital has always been a challenge for SMEs. This has been exacerbated by the country’s economic crisis which has been deepened by the pandemic. PSP will provide SMEs with an alternative funding model to act as a catalyst for their survival and growth. The SA SME Fund is extremely pleased to be announcing this investment; it could not be more timeous,” he said.

Data gathered from an academic conference held by the National Planning Commission on small business as the spine of economic recovery and stimulation indicates that 92% of small businesses are struggling to operate. In addition, researched have estimated than over 50 000 SMME’s will shut down due to the impacts of the pandemic.

Covid-19 has had far-reaching effects on the SME market and the funding secured by ProfitShare Partners is a step towards revitalising this sector.

Andrew Maren, CEO and founder of Profitshare Partners comments on the impact of the R100-million in funding.

“This deal is a great win for SMEs who can’t access traditional funding. This capital helps ProfitShare Partners financially partner with hundreds of SMEs to catalyse their businesses to becoming bigger and more sustainable, enabling them to attract traditional funding in the future.”

ProfitShare Partners business model

The ProfitShare Partners business model is best described as a hybrid between venture capital and private equity. However, it does not involve taking up shares in its clients’ businesses but rather, partners with them principally on the specific transaction. The FinTech business provides the capital and business support needed for the SME to deliver on their contract.

“Our model is designed to give SMEs a boost. As opposed to providing capital as a form of a loan, we share in the profit and assist our clients in achieving financial sustainability to the point where they are either in a position to qualify for traditional finance or they no longer require finance,” Maren continues.

SMEs in supply and delivery who have an order but cannot access the capital needed to deliver, either because they do not qualify or because they do not have the necessary track record, financial history or paperwork, now have improved chances of gaining access to business and delivering more efficiently on their contracts.

Read more: Kudoti crowned SA’s startup champion for 2020
Read more: SA Fintech Mama Money expands globally
Read more: Graduates of Africa’s first drone accelerator programme announced

Featured image: Stevepb via Pixabay 

The post ProfitShare Partners secures R100-million for SA SME’s appeared first on Ventureburn.

MainOne’s story building West Africa’s Internet infrastructure

Techpoint Africa

This article is brought to you as part of a new partnership between two of Africa’s foremost news and information platforms for African tech startups, Ventureburn and Techpoint Africa.

On Wednesday, July 1, 2020, MainOne celebrated its 10th anniversary. The occasion was a notable one for MainOne, and for several tech companies that have benefited from the Internet capacity it has helped build.

We headed for the MainOne office in Victoria Island, Lagos, Nigeria, to have a chat with its CEO, Funke Opeke. Though the office typified the new normal during the pandemic — serene and quiet — I caught a glimpse of the company’s culture amongst the few staff present.

MainOne celebrates its 10th anniversary

The gentle but structured way they received visitors, the firm but polite manner with which they aired their opinions were remarkable. It was only a glimpse, but it was remarkable nonetheless.

As we began the interview, Opeke sat in a chair directly in front of a beautiful map showing cable connections around the world.

The journey so far

It was exactly ten years since the Funke Opeke-led team laid the first private submarine cable in West Africa, the first of its kind at the time.

The launch heralded a massive boost to Internet speeds in the country. With a large presence in Lagos, one could draw links between the rise in Internet speeds and the proliferation of startups in the city.

“First, I’m grateful for having had the journey. I thank God and everyone who has made it possible. There have been high moments and low moments along the way but we’re still here, and the journey is still meaningful and adding value,” Funke recounted.

On those high moments, Funke points to the first day the submarine cable began operations over ten years ago.

“We were on time and budget. It was a big bet at that time considering we were a small startup, but we succeeded,” she said.

This particular feat seems to have been a launching pad for the company and every other milestone it has achieved.

Notable among them were the winds along the way, the impact MainOne’s services have had on startups

“You look back and see what has been happening with startups in Yaba, and the entire tech space in Lagos. Each time any of the founders reaches out and I see the awe, the appreciation, and recognition for what we’ve done, it really touches me,” Opeke stated with some emotion

For Opeke, the levels of Internet penetration in Nigeria, being invited to chair the Nigerian National Broadband Plan 2020 – 2025, and the White House invitation to discuss Internet connectivity for the globe and to unserved populations in Africa, shows some level of recognition for the company’s work.

MainOne has also entered some important partnerships such as with the Orange Group in its entry into Ivory Coast and Senegal, and Vertiv for expansion of its data centre facilities.

But the journey has not been rosy

According to Opeke, one of the biggest challenges has been raising capital and closing in on them. This is to be expected considering how capital intensive telecom infrastructure projects are.

“Also, the environment in which we operate has been tough.”

According to Funke, MainOne has invested a lot in power. With privatisation, they were able to make a private connection to the national grid. This meant they’ve had better power than most.

Despite this, the company’s distributed operations still face the same power challenges as others. Apparently, they still have to invest in backup power, collocation facilities, and other power solutions.

“Truly, I wonder. For all we collectively invest in power in this country, we really could have better grid power solutions for everybody,” she commented, her eyes lighting up in thought.

“The question is how do we align or aggregate all we spend individually on generators and batteries to provide a better collective solution?”

Besides the working environment’s challenges, Opeke still looks back on the company’s impact with some longing.

“I look back, and I never imagined that ten years after we launched, every school in Nigeria will not have access to the Internet, but that is the sad case today,” she lamented.

She referenced the COVID-19 pandemic and the effect it has had on school children, most of whom have been told to go virtual.

“It is safe to say that only the privileged have access to the Internet today. This leaves a large portion of our student population without access to learning,” she explained.

Opeke’s statement is close to the truth. As we have stated in previous reports, Nigeria’s Internet market is not as big as official data suggests and the cost of accessing the Internet is still rising.

“What does that say about us as a society, about how much value we place on the education of our young people?” Opeke asked.

She explained that there is a need to be globally competitive and education is the foundational element to achieving that.

“Such things are still low moments for me. To see how far we’ve come and how much there is still to do.”

The vision

As of 2008, Internet penetration in Nigeria was relatively low. Internet cafes were popular and very few smartphones were available.

Opeke says her vision is to bridge the digital divide in West Africa with the provision of enabling infrastructure.

“I came back from the US and the Internet had been exploding over there, but in Nigeria there was no Internet and no infrastructure. So we decided to put the pieces together and make this happen.

“If we’re going to transform our society, our society needs to be developed. It’s a youth population, it’s education, access to information, it’s the ability to innovate. It’s giving young people access that is going to bring about the full benefits of this.”

Opeke believes that with focused efforts, the Internet can get to school children in Nigeria. Though it might not be the same quality of instruction as they will get in schools, they can get access to world class educational materials on the Internet.

“Your own company (Techpoint Africa) was founded by a self-taught entrepreneur who had access to the Internet,” Funke remarked. “Whenever I hear such stories, it really warms my heart,” she added with a smile.

Staying motivated

Opeke claimed that MainOne has been more successful when it comes to impact than it has been commercially. The company was capitalised with $240 million for starters.

“It takes significant amounts to run this infrastructure and keep it performing at a world-class standard and continue to invest in local distribution, infrastructure, and data centres,” she explained.

“We can’t be complacent because we still have obligations to our shareholders and to our lenders. We need to continue to top up on our debts to invest in expanding our infrastructure.”

Opeke pointed out that having a good governance structure in a company prevents its members from being complacent. When that is in place, the company becomes more than any individual.

“When you look at the original vision and the potential and where we are, you will know that there is so much to do. If I get complacent I may have to step aside so that the vision can move forward,” she adds.

Strategic partnerships

In November 2019, MainOne expanded its submarine cable to Cote d’Ivoire and Senegal in partnership with french telecom company Orange Group. A move Opeke says was in line with the company’s vision for the west coast of Africa.

She states that when the cable was first laid in 2010, the concept of private submarine cables was very new to a lot of regulators. Though they were in a hurry to bring Internet access, they could not secure the permits to connect the countries along the way, between Nigeria and Europe.

“To solve this, we put up branching units which are just connectors so the cable can extend to those markets.

“As we continued exploring opportunities, a fabulous one came up with Orange. They were already present in two markets, and it made sense, commercially, to partner with them considering their status as a major provider and the compelling technical solution we provided for them.”

Apparently, it was a win-win for both sides. One provided access to its underutilised cables and the other gave access to new markets.

MainOne is looking at more expansions in Africa and has recently signed an agreement to extend services to Burkina Faso.

Also, MainOne has struck a partnership with Vertiv for the expansion of its data centre services.

What the future holds
“We’ll continue to expand our data centre footprint. Within Nigeria, we’ll expand to places like Lekki, Sagamu, and several others. Across the region, we are also looking to enter other West African states,” Opeke concluded.

The same applies to connectivity which, as she pointed out earlier, remains congested within the country.

She, however, explained that the company currently has no immediate plans to go public.

The original version of this article appeared on Techpoint Africa on 3 July. See it here.

Featured image: Funke Opeke, CEO of  MainOne (Supplied)

The post MainOne’s story building West Africa’s Internet infrastructure appeared first on Ventureburn.

Four key metrics from Carbon’s financials in the past three years

Techpoint Africa

This article is brought to you as part of a new partnership between two of Africa’s foremost news and information platforms for African tech startups, Ventureburn and Techpoint Africa.

Nigerian fintech startup, Carbon, on Tuesday, released a report detailing its key activities and metrics for 2019.

Last year when the startup, Carbon, formerly Paylater, first published its financial results, it received rapturous applause. Although startups in other parts of the world release financials from time to time, it was quite unheard of in Africa, most notably, Nigeria.

Carbon offers a range of fintech services including business banking, payments and more

The few times the ecosystem had witnessed a similar occurrence was with eCommerce juggernauts, Jumia and Konga. However, they did not share their financials on their own. In Jumia’s case, it happened when one of its shareholders, Rocket Internet went public in 2014 and had to include Jumia’s data in its annual report.

In July 2019 when Carbon first shared, Chijioke Dozie, CEO of Carbon, said the eight-year-old startup would continue to share its financials and it has rightfully done so for the second year running.

Since 2012, Carbon has metamorphosed from its main offering of being a digital lender. Now, the platform offers an array of fintech services including business banking services, payments, credit reports, investment products.

Audited by consulting giant, KPMG, Carbon’s report shows continuous growth in operations and finances. Also, it features progress from existing offerings as well as plans for new product offerings and expansion.

The year is 2019: life’s good, & COVID sounds like the name of a video game.

It was also the best year yet for Carbon. We launched in Kenya, enhanced our product and grew revenue by 70% 📈

Today, we’re sharing our 2019 financial results.

Download here: https://t.co/Qe5HCCDwTa

— Carbon (@get_carbon) June 30, 2020

From its financials, we take a look at four key metrics from 2017 to 2019 and gauge the startup’s progress since sharing its first financials in 2018.

Gross earnings and total revenue

In 2017, Carbon recorded a revenue of $4.4-million, equivalent to 1.57-billion Nigerian Naira. It ended with 3.73-billion Nigerian Naira ($10.4m) in 2018, representing a 136% increase.

https://techpoint.africa/2020/07/03/carbons-financials-since-2017/

Last year, Carbon’s total revenue nearly doubled to 6.3-billion Nigerian Naira ($17.5-million), 70% up from 2018 and 298% from 2017.

Disbursement volume

According to Carbon’s 2018 report, it disbursed 3-billion Nigerian Naira ($8.3-million) worth of loans in 2017. That increased by 333% to 13-billion Nigerian Naira ($36.1-million) in 2018.

https://techpoint.africa/2020/07/03/carbons-financials-since-2017/

n 2019, loan disbursement reached an all-time high of 23-billion Nigerian Naira ($63.9-million), representing a 77% increase from the previous year and 666% the year prior.

Profit before tax

The report from 2018 shows that Carbon made a loss of 111.2-million Nigerian Naira ($309k) in 2017. However, that changed when the company made its first profit by raking in 149.14-million Nigerian Naira($414k) in 2018. A staggering 234% increase.

https://techpoint.africa/2020/07/03/carbons-financials-since-2017/

In 2019, the company’s profit before tax increased by 50% to 223.2-millon Nigerian Naira ($620k).

Profit after tax

When Carbon reported a loss of 111.2-million Nigerian Naira ($309k) in 2017, the company didn’t share its income tax expense, and profit after tax stayed the same.

For 2018, however, income tax expense stood at 1.93-millon Nigerian Naira, which means Carbon’s profit after tax for that year was 147.21-million Nigerian Naira ($409k).

https://techpoint.africa/2020/07/03/carbons-financials-since-2017/

Profit after tax for the year 2019 reduced by 23% to 112.6-millon Nigerian Naira($312.8k) after incurring an income tax expense of 110.5-millon Nigerian Naira ($307.2k).

Asides these metrics, Chijioke Dozie points to impairment figures to understand how customers defaulted on loans.

When a loan is impaired, it means the company, in this case, Carbon, was unable to collect the money borrowed to the user, including interest.

From the financial results, net impairment loss on financial assets in 2019 stood at 3.14-billion Nigerian Naira($8.72-million). This is 42% up from 2.2-billion Nigerian Naira ($6.1-million), the loss it incurred in 2018.

Some other highlights from the 2019 report include bill payments value and volume of 51-billion Nigerian Naira and 5.5-million Nigerian Naira; investments made on the platform at 2.8-billion Nigerian Naira; more than 93k Nigerian Naira cashback beneficiaries; and 975k Nigerian Naira-plus loans disbursed.

The original version of this article appeared on Techpoint Africa on 3 July. See it here.

Featured image: Supplied 

The post Four key metrics from Carbon’s financials in the past three years appeared first on Ventureburn.

Top startup web events in South Africa this week [06/07/2020]

Tomorrow  (7 July) Lifecheq will be hosting a career startergy workshop, assisting attendees to navigate their career chosices during a time of uncertainty.

On 8 July, as part of Absa’s WorkInProgress webinar series will continue to highlight the challenges and sucesses which startups have faced during the global pandemic.

Ventureburn has updated its existing weekly series that highlights all the top startup events in Africa, by shifting to focus only on web events broadcast from Africa. This includes webinars as well.

If you have any event recommendations for us to add to the list, or next week’s, please let us know in the comments below or  send us an email. Please notify us by the Friday of the week before the event.

Not all the events are free and some will require booking in advance. Please click on the event names to find out more information.

All times below are set in South African time, unless indicated. These events are free of charge unless otherwise indicated.

Career Startergy during a pandemic

Covid-19 has changed our live, in a time where most people are dealing with economic instability and job insecurity, deciding what your next career move during a pandemic is possibly the most important decision you will make in your career.

Lifecheq CEO Abu Addae and Senior Consultant, Lilian Dombo will provide the the tools to develop a practical career stratergy during trying times. These sessions will be a combination of interviews with experienced executives, MBA alumni, entrepreneurs, research, and expertise from some leading South African companies.

Date: 7 July, 6pm to 8pm
Location: Live stream 

Lessons from small and medium enterprises

Absa has launched an innovation lab, titled WorkInProgress (Wip) is hosting a webinar series titled Wise-Up Wednesdays. These sesssions will feature real-life sucesses and lockdown challenges faced by small and medium South African enterprises.

This week, Pragmattica founder, Amanda Louw Bester shares her lockdown tales, views on office sharing and coming runner-up in the Accenture Rising Star awards 2020.

Date: 8 July, 1pm
Location: WorkInProgress Facebook live 

 Tips from an expert  

Caleb Annobil, a young Ghanaian born entrepreneur who has made a name for himself in the startup industry will be offering words of wisdom on how he was able to raise his startup from the ground up during a webinar hosted by Entrepreneurship To The Point.

As one of the top 20 Entrepreneurs in Africa as elected by the Anzisha Prize South Africa, Annobil will share increidble insight on how to maintain and grow a startup in even trying times.

Date: 6 July, 2.30pm
Location: Zoom 

Featured image: Caleb Annobil, Co-Founder of IYC Life Company Limited as well as the Executive Director for Auto-Hydro Company Limited and Orbit Oil and Gas Company Limited (pictured on the left), Azola Mzekanab, host and Property Point programme manger (pictured on the right), via Facebook Entrepreneurship To The Point

 

 

The post Top startup web events in South Africa this week [06/07/2020] appeared first on Ventureburn.

Six ocean-minded startups in SA

Ocean Voyages Institute’s marine plastic recovery vessel broke a world record on 2 July of the most waste collected out of our oceans, measuring at 103 tons in fishing nets and consumer plastics.

Over 48 days, the vessel travelled through the North Pacific Subtropical Convergence Zone, commonly known as the Great Pacific Garbage Patch or Gyre. It has been recorded as the largest at sea clean up in the Gyre to date.

Plastic Free July has kicked off at the start of the month and highlights the importance of reducing single-use plastic and its overall impact on the environment and our oceans.

These six startups aim to make a positive impact on the restoration and preservation of our oceans

Reports indicate that nearly eight-million pieces of plastic make it into our oceans each day, causing irreparable damage to the marine ecosystem. With more than 100 000 marine animals dying from plastic pollution each year, it requires efforts of those both in the private and public sectors to make a concerted difference in reducing plastic waste.

Oceanhub Africa, a Cape Town-based impact accelerator (see this story) that aims to support ocean-minded start-ups through its programme has selected six startups that are working diligently to a sustainable and eco-conscious future for our oceans.

The selected projects were chosen by the esteemed committee at Oceanhub and will be accelerated over the next six months. These startups will be provided tailored mentorship, scientific expertise, and access to market leads.

In bringing attention to the current plastic pandemic, we have decided to highlight six ocean-minded startups in South Africa who have employed the use of technology to protect our marine environment.

Ocean-minded startups

SharkSafe Barrier

SharkSafe Barrier has developed an ecofriendly alternative to shark nets and baited drum lines. The current shark nets used along are detrimental to the environment.

Developed to mimic the visual effects of a kelp forest along used in hand with magnetic shark deterrents, the technology both ensure the safety of beachgoers while protecting the ocean’s biodiversity. The barrier affects only large sharks while other marine life including seals and various fish can swim through it similarly that they utilize the natural kelp forest for refuge.

Inseco

Aimed at creating a lasting and positive impact on the global food system, Inseco utilises advanced engineering technology, entomology, and biomimicry to provide effective solutions to reduce the use of fish-based meals used in livestock farming and aquaculture.

Utilizing onsite waste management technology converts organic waste into cost-effective protein an alternative to what is currently used. This innovative technology can help reduce over-fishing and greenhouse gas emissions.

Captain Fanplastic

Through the use of edtech which has been implemented in gaming, Captain Fanplastic hopes to educate users with a #NoTrashButTreasure minds. The gamified environmental literacy program has been designed using behavioral science, e-learning, and one-on-one modules. This startup is tackling a global issue of education around plastic waste by providing a long-lasting solution that is bound to yield long term positive results

Children aged between 10 to 12 years of age can become environmentally literate and adopt a lifestyle that aims to protect the environment through the reduced use of plastic.

MeanSea level

MeanSea level has developed and is currently constructing an operational 1,000 kW Wave Energy Converter which will supply electricity to shore-based industries and municipalities. This renewable source of energy is created through a process that does not contribute to greenhouse gas emissions as it harnesses wave power as the main resource.

Impact-Free Water

Through the use of pump harvesting wave’s potential energy ImpactFree Water can convert it into pressurized seawater for use in the aquaculture industry and for shore-based industries along with municipalities to produce fresh water. The use of wave power as a renewable source means that the overall production reduced greenhouse gas emissions.

Symbytech

Symbytech’s multi-purpose drone has an extraction and filtration system which can inspect and clean boat hulls. Not only does it clean boat hulls but it is able to filter the water and neutralise biofouling allowing clean water to be returned.

Overall the technology employed at this startup will reduce the fuel consumption of boats.

Read more: OceanHub Africa opens accelerator call to startups looking to protect ocean
Read more: Kudoti crowned SA’s startup champion for 2020
Read more: LifeQ announces it’s working with B-Secur to develop tech solution

Featured image: Free-Photos via Pixabay 

The post Six ocean-minded startups in SA appeared first on Ventureburn.