Afridigest Week in Review: A dynamite deal for digital infrastructure
+A torrent of transactions +Interesting bolt-on acquisitions +Startup spotlight: Transfy +Demographics are destiny +Co-Founder opportunity +More
The Afridigest Week in Review is a must-read weekly recap for Africa-focused founders, executives, and investors, as well as interested observers.
Welcome back, friends! The most clicked link from last week was this guide to structuring a fundraising pitch deck by thinking in acts, not slides. This week, a shedload of deals were announced & one gets the sense that there is/was some end of the year pressure before the holidays arrive 🎅
If you’re new, welcome 🙌 — you’ll receive a weekly digest like this one every Monday and, generally (but not always), an original essay/article on Saturdays. For past essays and digests, visit the archive.
Week 49 2021: December 5-11
📰 Deal of the Week
DOLLARS FOR DIGITAL INFRASTRUCTURE
MainOne, a Nigerian data center and colocation/connectivity solutions provider, is being acquired for $320M by Equinix, the publicly traded American multinational data center specialist with a ~$73B market cap.
Globally, Equinix has 237 data centers across 27 countries and it provides data center services to more than 50% of all Fortune 500 companies. MainOne has: three data centers in Nigeria, Ivory Coast, and Ghana, with a fourth under construction; an open access 7,000km sub-sea cable stretching from Portugal to West Africa; a 1,200km terrestrial fiber network; and 570,000 sq. feet of land — “enough to build another 10 data centers,” according to Equinix’s Vice President for Emerging Markets.
💡 Why it’s the deal of the week: The transaction is one of the largest across Africa this year (second only to OPay’s $400M Series C), it’s the largest acquisition of a tech company in Nigeria, and it’s (arguably?) the most notable deal made by an African woman tech Founder/CEO to date. It’s also the first deal in Africa for Equinix, which generated $6B in revenue in 2020.
⛏️ Go deeper:
Deal valuation: Comparing a reported ~$200-$400M raised in outside capital over the years to the acquisition price, some pundits voiced opinions across social media channels that the deal undervalued MainOne
Techcrunch’s Tage Kene Okafor spoke to MainOne’s CEO who clarified that 1) the outside capital raised includes significant debt, 2) shareholder dividends paid over the year shouldn’t be overlooked, and 3) that the acquisition, which involved a competitive, informed process by leading investment banks, was done at the right price
MainOne’s facilities generate ~$60M and ~$23M in annualized revenue and EBITDA respectively, suggesting ~5.3x revenue and ~14x EBITDA multiples
What happens next: Acquiring MainOne is the first step in Equinix’s long-term Africa strategy and its expressed aspiration is to be Africa’s leading neutral/open provider of digital infrastructure; Founder/CEO Funke Opeke and the MainOne management team will stay on through the finalization of the acquisition to continue bringing this vision to life
🔦 Other deals
A TORRENT OF TRANSACTIONS AS THE YEAR COMES TO A CLOSE 🌧️
TymeBank, a South African digital bank, announced that it raised an additional $70M from Tencent and CDC, completing a $180M Series B; the first part of the round (~$110M) was announced earlier in February — The company has acquired ~4M customers in 32 months and currently has ~$173M in retail deposits from customers in its bank accounts; it will use the fundraise to grow TymeBank in South Africa and GOTyme in the Philippines
TradeDepot, a Nigerian B2B e-commerce and logistics platform, raised a $110M Series B (including both equity and debt); The IFC led the equity portion, with participation from new investors Novastar, Sahel Capital, CDC Group, Endeavor Catalyst, and existing investors Partech and MSA Capital also participating; while the debt portion was led by Arcadia Funds — TradeDepot now has over 100,000 merchants on its platform; Techcrunch estimates the equity share of the round at ~$42M based on SEC filings
uLesson, a Nigerian e-learning platform, raised a $15M Series B from new investors Tencent & Nielsen Ventures, and existing investors Owl Ventures, TLcom Capital, and Founder Collective — Founded in 2019, uLesson has garnered 2Mapp downloads, 12.3M watched videos, and 25.6M questions answered on the platform; it’s available in Nigeria, Uganda, Kenya, Ghana, South Africa, Sierra Leone, the UK, Liberia, Gambia and the US, but 85% of paying users are Nigerian
The African Blockchain Lab, a Nigerian company building blockchain-based solutions for Africa, raised a $6M Pre-Series A round from Lateral Frontiers VC, CRE Venture Capital, Musha Ventures, Dragonfly Capital, Hashkey Capital, SNZ Capital, Fenbushi, Cadenza Capital, Head & Shoulder X, LeadBlock, Hash Global, Bonfire, Krypital, Despace, and others — ABL will use the proceeds to grow its VIBRA crypto wallet and aims to drive mass adoption of digital assets across Africa
Sympl, an Egyptian buy-now-pay-later checkout platform, raised a $6M seed round led by Beco Capital with participation from A15 and Global Ventures — Sympl is currently accepted at over 240 retail and online stores across Egypt; it initially announced an undisclosed investment from A15 in Week 44
Kwara, a Kenyan neobank for credit unions across emerging markets, raised a $4M seed round led by Breega, with participation from SoftBank Vision Fund Emerge, Finca Ventures, New General Market Partners, Globivest, Do Good Invest, Rabacap, Launch Africa, Norrsken Impact Accelerator, Future Africa, Samurai Incubate, DOB Equity and others — Kwara operates in Kenya, South Africa, and the Phillipines, and serves ~60,000 SACCO members
Pariti, a Kenyan platform that connects founders in emerging markets to various resources, talent, and capital raised a $2.85M seed round led by Harlem Capital with participation from Better Ventures, Accelerated Ventures, Diverse Angels, AVG Basecamp, and New General Market Partners — The company has over 880 companies across 42 countries on its platform
CinetPay, an Ivorian payment processing platform focused on Francophone Africa, raised a $2.4M seed round from 4DX Ventures & Flutterwave — Since its 2016 launch, it has processed over 30M transactions for ~400 active merchants and now processes ~$12.5M in transactions monthly; it currently operates in Ivory Coast, Senegal, Cameroon, Mali, Burkina Faso, Togo, Congo, Guinea, and Benin
Jamborow, a Nigerian blockchain- and AI-enabled platform providing white label solutions for savings and credit cooperatives societies, announced that it raised an additional $450K from undisclosed investors — this comes after the company’s $400K raise in June 2020
Kamioun, a Tunisian B2B e-commerce & logistic platform connecting FMCG manufacturers to retailers, raised $400K led by Janngo Capital, with participation from Anava Seed Fund (Flat6Labs), Dakar Network Angels, and others — Launched in 2020, Kamioun now has over 1000 B2B customers; it has also partnered with Jumia as a delivery solution provider for its retailers in the greater Tunis region
Sendchamp, a Nigerian customer engagement & unified communications platform, raised a $100K angel round from DFS Lab, Hustler Capital, Hoaq Club, Velocity Digital, and others— After 8 months in stealth mode, SendChamp has powered over 3 million messages to 300,000+ customers and built a 500-string developer community
Entersekt, a South African device identity and customer authentication solutions provider, announced an undisclosed investment from private equity firm Accel-KKR — Entersekt secures over 1 billion transactions every month
WaffarX, an Egyptian cashback rewards platform, raised an undislosed amount led by Lobby Capital — Founded in 2018, WaffarX has over 260 merchant partners and over 450,000 members
Roque Online, an Angolan platform that helps large distributors, informal market vendors, farmers, and others sell & deliver goods and produce, raised an undisclosed amount from TurningIdeas Ventures — Roque Online has delivered 1.2M Angolan products locally and globally
Transtura, a Nigerian intracity fixed-route mobility platform, raised an undisclosed funding round from Tekedia Capital — Transtura launched in Lagos in October
Healthtracka, a Nigerian digital health platform offering at-home lab testing, raised an undisclosed amount from Akazi Capital
FilKhedma, an Egyptian home services platform that links customers with plumbers, carpenters, electricians, & other providers, raised an undisclosed funding round led by the Cairo Angels
Plstka, an Egyptian on-demand doorstep waste collection platform, raised an undisclosed seed round from Alexandria Angels Network, along with a matching grant from Hivos
Opontia, a UAE-based e-commerce brand aggregator, raised a $42M Series A (debt & equity) with STV leading the equity portion and participation from Raed Ventures, Global Founders Capital, Upper90, VentureSouq, and others; Partners for Growth provided the debt financing — In Week 42, Afridigest highlighted the global brand aggregator trend and Opontia’s stated Africa focus, asking “Is Africa ripe for this right now?” Well, with this round comes the news that Opontia has switched its target market from “Africa & the Middle East” to primarily the UAE, Saudi Arabia, and Central, and Eastern Europe, and (perhaps) Egypt and Nigeria in the future
Impact Rooms, a blockchain-based platform connecting African startups with knowledge and access to capital, raised a ‘seven-figure’ pre-seed from Global Blockchain Ventures
OTHER ACQUISITIONS, BESIDES MAINONE
Minly, an Egyptian celebrity shoutout & online events platform, acquired Oulo, an Emirati celebrity shoutout platform for an undisclosed amount — Minly has over 130,000 users and 1,000 celebrities, while Oulo has 300 celebrities across Lebanon, Jordan, Iraq, and Saudi Arabia
Lamma, a Tunisian quick-commerce & last-mile delivery platform, acquired Farm Trust, a Tunisian e-commerce platform for fruits and vegetables for an undisclosed amount — Lamma works with 150+ merchants, offers 1,000+ SKUs, and operates 2 dark stores in Tunis; it raised an undisclosed amount from Orange Ventures earlier in Week 40
GRANTS & AWARDS
The Norrsken Foundation and Novartis Foundation selected the five HealthTech Hub Africa Challenge winners:
Insightiv Technologies, a Rwandan teleradiology platform, was awarded $30K; Medtech Africa, a Nigerian remote monitoring cardiology platform, was awarded $20K; Klarah, a Cameroonian telemedicine platform, was awarded $20K; Afia Group, a Rwandan online pharmacy, was awarded $10K; Lifesten Health, a Rwandan platform promoting healthy lifestyles, was awarded $5K
The DFS Labs announced the awards received by the nine companies that participated in its Blockchain Bootcamp in partnership with the Stellar Development Foundation:
Honeycoin $15K; Stax (from Hover) $15K; Bonafide (from Moneymie) $15K; Windpay $5K; Pesapeer $5K; Gravity $5K; Fonbnk $5K; Quidroo $5K; and DyaPay $5K
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📚 Quick Hits
FOR YOUR READING PLEASURE
Three steps to the future — Benedict Evans’ future-forward presentation on the most exciting themes in technology
What I learned about people that scale — Brex’s Founder and co-CEO on what it takes for people to scale at fast-growing companies
What is a COO? — OpenView Partners explores the Chief Operating Officer role and the 3 COO types: Support, Chief of Staff, Everything-but-product
A founder’s guide to community — A comprehensive plug-and-play comprehensive guide to building community
Top product management hacks — A product manager who work on Gmail and Facebook’s News Feed on new products, motivating teams, and what makes a great PM
Metaverse: web 3.0 virtual cloud economies (PDF) — Cryptocurrency asset manager Grayscale’s bullish report on the evolution of the internet
🚀 Startup Spotlight
CROSS-BORDER INTRA-AFRICA FINANCIAL INFRASTRUCTURE
Transfy is building financial infrastructure that enables users to seamlessly and securely send money across and out of Africa at industry-best rates
What problem does this solve?
Existing payments players mainly concentrate on transactions originating from abroad, whereas relatively little emphasis has been placed on intra-Africa transfers, and these intra-Africa transfers are characterized by especially high costs
There are many players in Africa's cross-border payments space? How is Transfy differentiated and what competitive advantage does it have?
Transfy focuses on intra-Africa cross-border transfers and offers a multi-currency wallet, secured with bank-level encryption and multi-factor authentication, that allows users to send, receive, and hold money in the African currency of their choice
Transfy also helps fintech platforms & businesses accept and make payments across borders with solutions that include APIs, bulk payments services, and more; Developers can also take advantage of Transfy’s API to automate payments in digital products
When was Transfy founded? Who are the co-founders? What traction metrics can you disclose and how has Transfy been able to achieve that traction?
Transfy was founded in April 2020, by two young Africans: Nigeria’s Emmanuel Tochi and Kenya’s Vincent Ochieng
What's next for Transfy?
Transfy has built a solid presence in Kenya, Nigeria, Uganda, Ghana, South Africa, and Rwanda, and will soon expand further. It will also continue to improve its suite of products to satisfy the various financial needs of individuals, businesses, fintech platforms, and developers across the continent
Thanks, Beauty, and best of luck to the Transfy team 🙏 Try Transfy today for your cross-border intra-Africa payments needs 😊
🙈 Visual of the week
DEMOGRAPHICS = DESTINY
“If the [continent]’s leaders invest in… human capital endowment, Africa could significantly benefit from the steady increase in the portion of working-age persons to dependents. Reaping Africa’s demographic dividend presents many challenges, but perhaps most fundamental is the need for a revolution in the provision of education.”
Source: Foresight Africa 2021, Brookings Africa Growth Initiative (PDF)
🕵️♀️ In case you missed it
The ins and outs of launching a digital savings product in Kenya: regulatory guidance for fintech startups (Next Billion)
Blockchain technology could solve many challenges in Africa’s payments space (Pymnts)
Could Africa ditch cash? (Techcabal)
Meet the investor: Ian Lessem of HAVAÍC (Techpoint)
Meet the investor: Jack Knellinger of Capria Ventures (Techcabal)
🗣️ Community Corner
I see you, friends!
Join Maya Horgan Famodu, Ayobamigbe Teriba, and others on the Ingressive Capital team at the Early Stage Startup teleconference event on Thursday, December 16th
Work with the Founders Factory Africa team — they’re looking for a Lagos-based Co-Founder to lead Project Apollo & help further access to high-quality medical devices across the continent
Thanks for reading 🙌 And thanks in advance for sharing this Week in Review across your social networks.