Afridigest Week in Review: After rain comes sunshine 🌞

+MTN's mobile money menace +Social media in China +Good retention +Mental models +Foreign investors in local tech +Steve Jobs' lost interview

The Afridigest Week in Review is a must-read weekly business & innovation recap for founders, operators, and investors in African markets, as well as interested observers.

Welcome back! Since Week 23’s digest, I published this piece exploring Nigerian video-on-demand company Iroko’s evolution from 2010-2016; it adds some details to a piece previously published in 2017 — sorry if you’ve read the original.

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Week 24 2020

Happy Sun Sticker by Kye Cheng for iOS & Android | GIPHY

📰 Deal of the week

South Africa-based Sun Exchange raised $3M from the Africa Renewable Power Fund of the UK’s ARCH Emerging Markets Partners. Notably, ARCH is an investment vehicle partly owned by billionaire Patrice Motsepe's African Rainbow Capital. 

The startup, founded by Abe Cambridge in 2015, offers a crowdfunding platform that enables anyone to invest in solar cell projects that generate power in South Africa; it uses cryptocurrency to disburse returns to investors. Sun Exchange will use the funds to expand into new markets across sub-Saharan Africa.

🔆 Sunshine at last for Sun Exchange: The company had experienced challenges raising alternative funds over the last 18 months.

🤝 Other deals

✂💪 MTN, market power, & mobile money

Two weeks ago, I published this essay on Africa’s most popular apps in which one of the key takeaways was that:

“MTN is dominant in Ghana. Two of Ghana’s top 15 apps are from MTN (MyMTN and Ayoba) while no other country has two telco apps among the twenty most popular.”

Last week, the Ghanaian government took action “to reduce MTN’s dominance.” It announced that the telco regulator would institute policies that would “ensure a level-playing field for all network operators… [including] setting of floor and ceiling pricing on all minutes, data, text messages, and mobile money.”

While the government’s statement explicitly mentioned MTN’s near 70% market share in mobile data subscriptions, some believe that the real driver behind the move is mobile money, not mobile data.

  • Recently, mobile money in Ghana has enjoyed rapid growth that has largely benefitted MTN.

  • So perhaps regulators are seeking to prevent what happened in Kenya where now up to 50% of the country’s annual GDP passes through Safaricom due to M-PESA’s mobile money monopoly. 🤔

🌏 Asia Read of the Week

Big idea: An easy to read 156-page report that purports to be the ultimate introduction to China’s online landscape. (Entrepreneurs & investors in Africa should look to the East, not the West, for inspiration.)

“Originally playing catch up, China is now in many ways indisputably ahead… [But] although China has grown a lot over the past decade, ... huge potential still lies ahead. 64% of the population live outside of the top tier cities, only 31% are middle class and there are still 600 million people living on less than 1,090 RMB (US$154) per month.”

👉Social Media in China” by Alex Duncan’s KAWO

👔 Management Read of the Week

Big idea: Retention is important but not well understood. This remedies that by offering benchmarks across multiple startup sectors.

“Although retention is widely considered to be the most important metric to get right when building (and investing in) a business, it’s also one of the least understood. Why? Because unless you’re a growth expert or an experienced investor, you’re often relying on anecdotes, dated blog posts, and misguided benchmarks…we reached out to twenty of the most experienced growth practitioners we knew and asked them.”

👉What is Good Retention” by Lenny Rachitsky

📚 Author’s Recommended Read

Big idea: A narrative case study on the early strategic and product choices Iroko (sometimes called the ‘Netflix of Africa’) made in its early history.

“IROKO continues to show that pioneers can become powerhouses in sub-Saharan Africa by understanding and embracing the realities of the market, staying close to the customer, and, where necessary, ‘distorting’ an entire organization to meet customer needs & use cases. ” 

👉 How Iroko went from pioneer to powerhouse | Part 1 (2010-2016) by Emeka Ajene, your humble author

🎙️ Podcast of the Week

Strongly recommended. George Mack hops on Chris Williamson’s podcast for a 3rd time.

  • Mack studies mental models & uses them to make better decisions and clarify his thinking.

  • Here, he shares practical wisdom learned from Nassim Taleb, Naval Ravikant, Warren Buffett, Winston Churchill, and more.

  • Can’t listen but want highlights? ➠ Read this thread.

👉 George Mack - Mental Models 103. Mental Wisdom Podcast.

Honorably mentioned. The well-respected think-tank, The Center for Strategic & International Studies discussed topics relevant to this newsletter last week on its Into Africa podcast.

  • Host: CSIS Africa Director Judd Devermont

  • Guests: Ilana Cohen (GSMA), Greg Cohen (Co-Founder, Asoko Insight) and Dr. Amani Abou-Zeid (African Union Commissioner for Infrastructure and Energy)

  • Topics: the GSMA’s report “Digital Solutions for the Urban Poor”(PDF), Uganda’s President, Madagascar’s sanitation system, a smart, tech-enabled COVID-19 recovery, and more.

👉 There’s an app for that. Into Africa Podcast.

🖼️ Visual of the Week

  • This graph plots Brazil and Mexico’s internet penetration from 2000-2018 and uses startup and VC firm logos to show activity in and the evolution of their ecosystems. Note, for one, the uptick in activity around 2011.

💡 It’d be interesting to recreate this for Nigeria, Kenya, and other SSA markets. 🤔

💼 Job Opportunity of the Week

Nigeria’s Co-creation Hub seeks a Lagos-based Director of Innovation Consulting.

  • CcHub is a tech hub & ecosystem builder supported by Omidyar Networks, the Ford Foundation, and others.

  • It acquired Kenya’s iHub last year and has incubated & supported over 120 early-stage ventures since its 2011 debut, including Lifebank, Riby, BudgIT, and WeCyclers.

To submit a job opportunity, email:

⚡ Learning Opportunity of the Week

The Venture Deals Summer 2020 free online course starts on June 28th.

  • It’s for anyone who wants to learn more about venture capital, particularly entrepreneurs looking to raise venture capital and professionals aspiring to become VCs.

🕵️‍♀️ In case you missed it

  • Sriram Krishnan, former product lead at Twitter/FB/Snap interviewed Marc Andreesen, co-founder of Netscape and co-founder of Silicon Valley VC firm Andreessen Horowitz.

    • “Venture capital is too elongated an activity. We don't really know whether something is going to work or not work in the first five years of its life after we passed. And so it’s - okay, what do I learn? Like, what, what do I learn in the first three years when it's not working? Because sometimes these companies really struggle for a while and then they really succeed. Sometimes it’s the opposite - they really succeed fast and then they have serious issues later.”

  • Chris Folayan, Link Commerce & MallforAfrica CEO, did a press run after selling a stake of Link Commerce to DHL two weeks ago.

    • “At the end of the day, Link Commerce is the platform that developed MallforAfrica and DHL’s Africa eShop. So it’s a white-label turnkey SaaS platform we made for businesses that want to get into eCommerce in emerging markets. So if you’re a bank, a shipping company, a mobile operator, or telco and you want to get into eCommerce in Africa, you look to Link Commerce and we will deploy our solution for you to get into eCommerce in your country. That’s what we do, white-label. We started with MallforAfrica but now, we do other brands. ”

  • Mastercard’s Division President for sub-Saharan Africa did an interview.

    • “Let me put it very simply: in Africa, our biggest competitor is cash. Around 95% of all transactions in Africa are in cash. I could spend all my time thinking about Visa or American Express or I could try to reduce that 95% – come with new ways to expand and digitalize cash. By the way, cash is very expensive. You have to print, store, transport, secure it. We estimate that the cost of cash is around 1.5% of the GDP of an economy. That is where we can make a difference.”

  • Also this week, Nigerian early-stage investment firm Microtraction published a note announcing & explaining their investment in Chaka, a trading and investment platform.

  • In 1995, Robert Cringely interviewed Steve Jobs for PBS's Triumph of the Nerds. The full interview was 70 minutes, but only ~10 minutes were used. Soon afterward the original videotape of the interview was lost, until years later after Jobs’ death.

    • This is the interview George Mack refers to in the Mental Wisdom podcast above.

    • Here, Jobs speaks candidly about the difficulties in the early days, the pain of his departure from Apple, and his vision for the future.

🕵️‍♂️🐤 In case you missed it - Twitter edition

If you liked this show your appreciation by liking / sharing / commenting. To contact me, send me a DM on Twitter @eajene. Thanks for reading & have a great Week 25 🙌