Afridigest Week in Review: BNPL continues to blossom across Africa

+Deals in Nigeria, Egypt, Ivory Coast & more +On Deck accelerator in Africa +A new neobank in Nigeria +Hierarchy is good for startups +Ecosystem VC growth +News, Podcasts, Interviews, Essays & Video

Emeka Ajene

Jan 18

The Afridigest Week in Review is a must-read weekly recap for Africa-focused founders, executives, and investors, as well as interested observers. Share it liberally. 😊

Welcome back, friends! Welcome to Week 2’s digest & I hope US readers had an enjoyable MLK Jr day. The most clicked link from last week was 'The Quick and Dirty Startup Founder’s Compensation Guide.' Lastly, excuse the tardiness & thanks for your patience with today’s newsletter — I lost someone close to me yesterday & was unable to publish on Monday as planned, but here it is now.

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 2 2022: January 9-15

E-Commerce Buy Now — Credit: *Nido Punto*

📰 Deal of the Week

ACCESS TO CREDIT FOR AFRICAN CONSUMERS

Lipa Later, a Kenyan consumer credit & BNPL platform, raised a $12M (debt & equity) pre-Series A, with Cauris Finance leading the debt portion, Lateral Frontiers VC and GreenHouse Capital leading the equity portion, and participation from SOSV IV LLC, Sayani Investments and Axian Financial Services. (The debt/equity split was not disclosed.)

💡 Why it’s the deal of the week: Afridigest last covered Lipa Later in Week 23 2020’s Week in Review, before the popularization of the term ‘buy now pay later.’ Still, the company is among the pioneers of BNPL across the continent.

Other prominent BNPL players/services across the continent include the Lipa Mdongo Mdongo service (Safaricom), Aspira, Miti, Flexpay Technologies, Julla, and M-KOPA in Kenya; Carbon Zero, CDCare, PayQart, CredPal, M-KOPA, AltMall/AltDrive (Sterling Bank) in Nigeria; Shahry & others in Egypt; and Payflex, PayJustNow, & others in South Africa.

See also: Week 35 2021’s Week in Review on the Zip-Payflex acquisition.

⛏️ Go deeper:

How it works: Lipa Later currently operates in Kenya, Rwanda, and Uganda where it signs partnerships with retailers that allow consumers to pay for products in installments. For more details on the credit model, see this 2019 interview with the CEO.
Use of funds:
- “In the next 12 months, we are looking to grow and double our presence in the existing markets, even as we open in three to five new markets in Africa. [Target markets for expansion include Tanzania, Ghana, and Nigeria.]” — Co-Founder and CEO Eric Muli
- “This latest round of funding leaves them… one step closer to being the dominant Buy-Now-Pay-Later player on the continent.” — Samakab Hashi, partner, Lateral Frontiers VC
A look back: Watch this Oct 2020 interview with Lipa Later Co-Founder & CEO Eric Muli and Metropol TV Kenya on how the company faired during COVID times and Lipa Later’s future plans:

🔦 Other deals

NIGERIA, IVORY COAST, EGYPT, SENEGAL

SeamlessHR, a Nigerian cloud-based human resources, payroll, recruitment, and performance management platform, raised a $10M Series A led by TLcom Capital, with participation from new investor Capria Ventures and existing investors Lateral Frontier Ventures, Enza Capital, and Ingressive Capital — Over 100,000 employees from client firms including PwC, AXA, Sterling Bank, Flutterwave and TGI Group.use SeamlessHR monthly; the startup is also launching embedded finance products like earned wage access
ANKA, an Ivorian e-commerce platform (formerly Afrikrea), raised a $6.2M pre-Series A round led by Investisseurs & Partenaires (I&P), with participation from VestedWorld, Enigmo, Groupe Prunay, Rising Tide Africa, and Saviu Ventures — The company has raised $8.1M to date since its 2016 founding and has facilitated over $35M in transactions to buyers from 174 countries; in 2021 alone, it served over 7,000 merchants from 47 African countries and buyers from 170 countries
ThankUCash, a Nigerian multi-merchant loyalty & rewards platform, raised a $5.3M seed round co-led by 500 Global and Unicorn Growth Capital, with participation from Expert Dojo, Predictive VC, SaaS Growth Ventures, Betatron Venture Group, Accelerex Holdings, and others — ThankUCash has attracted over 600,000 users, onboarded over 1,000 stores, and processed over $80M in transaction volume
Tawfeer Market, an Egyptian grocery quick-commerce platform, raised a $500K seed round from Alexandria Business Angels Network — The app has achieved over 100,000 downloads and offers ~4000 SKUs delivered within 60 minutes in Alexandria, Egypt’s second most populous city
The following African startups announced their participation in OnDeck accelerator programs that offer $125K in exchange for 7%. (There are likely other African startups participating who have not yet announced.)
- ODX:
  - Tanél Health, a Senegalese platform for digitizing pharmacies & digital health infrastructure
  - Fidia, a Nigerian creator economy-focused payments & e-commerce platform
  - Sendchamp, a Nigerian API platform for SMS, voice, Whatsapp, email, and USSD messaging
- ODX Flexport:
  - Sendstack, a Nigerian platform building intra-city next-day delivery & logistics infrastructure across Africa
  - OnePort365, a Nigerian digital freight management platform for African traders
3attar, an Egyptian health-focused B2C e-commerce & information platform, raised an undisclosed seed round from AUC Angels, UI Investment & others — 3attar claims to be Egypt’s biggest healthy-shopping platform and offers 3,000+ SKUs
Pivo, a Nigerian credit & financial services platform for supply chain SMEs micro traction announced an undisclosed investment from Microtraction — At the time of the Microtraction investment, Pivo had 100 active customers and processed more than $100K in loan applications

ADJACENT

Fintech Farm, a British/Ukranian fintech platform that launches digital banks in emerging markets, raised a $7.4M seed round led by Flyer One Ventures and Solid, with participation from TA Ventures, Jiji, u.ventures and AVentures Capital — Fintech Farm launched credit-led neobank in Azerbaijan in November 2021 and is in the process of launching Fibo in Nigeria; in the next two years, Fintech Farm plans to enter eight emerging markets across Africa and Asia
Mr. Green Africa, a Kenyan plastic waste recycling platform, received an undisclosed investment from US multinational Dow Chemical as part of a Series B round — This is the first investment of its kind in Africa for Dow; Since November 2019, Mr. Green Africa has been collecting and reusing at least 30 tons of plastic waste every two months in Kenya

FUNDS

The Energy Entrepreneurs Growth Fund (EEGF) received $13M from FinDev Canada — Founded in 2019 by the Shell Foundation, EEGF is a $120M fund that invests in early and growth-stage energy startups in sub-Saharan Africa; its portfolio includes Baobab+, Yellow, and Redavia

📢 Share this with a colleague

The Afridigest Week in Review is designed to inform Africa-interested founders, executives, investors, and observers. Share it with those interested in innovation across the continent. 🙏

📚 Quick Hits

FOR YOUR READING PLEASURE

Falling flat: why startups need hierarchical structure — “Although many entrepreneurs dislike the notion of hierarchical structure and managers, what many of them realize over time is that no matter how good the business idea is or how brilliant the team is, mismanagement can ultimately kill a business. Unfortunately, there are many cases where startups fail simply due to the lack of management structure.”
The trust paradox — How startups whose business depends on trust acquire early customers when they have no track record
Where the ‘new formal’ is the new normal: lessons on innovation from India’s artisan economy — An interesting analysis of how so-called 'New Formal' approaches bridge the gap between the formal and informal economy
My first impressions of web3 — The founder of Signal App, cryptographer Moxie Marlinspike, shares his skepticism towards web3

Bonus:

Jack Dorsey knows how to tweet — A look at @jack’s tweeting spree since resigning from the CEO role at Twitter

🙈 Visual of the week

GROWTH IN CAPITAL TARGETING AFRICAN STARTUPS: 2019-2021

Source: Maxime Bayen & Max Cuvellier — Africa: The Big Deal

🕵️‍♀️ In case you missed it

NEWS & ANNOUNCEMENTS

VIDEO

Sarah Menker, Founder & CEO of Gro Intelligence spoke with GGV Capital’s Hans Tung as part of Stanford eCorner’s Entrepreneurial Thought Leaders series

PODCASTS & AUDIO

The Afrobility podcast discusses How Gokada is providing delivery & transportation services across Nigeria
Michael Kimani discusses Web3 within the African context on Africa Tech Roundup’s Unajua series
Stephen Ozoigbo, Senior Director of Business Development for Emerging Economies at Arm, discusses Arm’s role and approach in Africa (and South America) and the opportunities and challenges the markets present on The Arm Viewpoints podcast
Victor Asemota, Michael Kimani, and Harry Obi spoke with Cointelegraph’s Elisha Owusu Akyaw about the past & future of crypto in the African context on the Crypto Talk Africa series

ESSAYS

Investor Matt Brown writes ‘8 crucial tips for investing in tech startups’
Investor Eric Osiakwan writes ‘Africa’s Digital Economy Welcomes Web3’
Nicole Dunn of Founders Factory Africa writes ‘What's behind Africa's fundraising growth?’
Sam Alhadeff, Celine Duros Acheampong, and the BFA Global/Catalyst Fund team write ‘Why we invested: Shopa is delivering wholesale prices to informal retailers’
Scott Onder and the Mercy Corps venture team write ‘The Responsible DeFi Lending Protocol: Why we invested in Goldfinch’

INTERVIEWS

Leon Kiptum on Chipper Cash and their operations in Africa (Hapa Kenya)
Tarneem Saeed: The entrepreneur at the forefront of Sudan’s economic renaissance (Techcabal)

🗣️ Community Corner

I see you, friends!

Congrats to Biola Alabi on the launch of Atika Ventures 💪🏽
Congrats to Eunice Ajim on the launch of Ajim Capital 🤸🏽

Afridigest