Afridigest Week in Review: A word on Worldcoin
Sam Altman's identity and financial network officially launched this week & amassed a ton of users in Kenya; but is that good or bad?
Afridigest is your intelligent guide to Africa’s tech ecosystem. This Afridigest Week in Review helps you stay in the know about what happened in Africa Tech last week.
Welcome back, old & new friends 👋🏽!
📌 In case you missed it, we sent out a startup spotlight on Smile ID (formerly Smile Identity) on Thursday. I had a great conversation with Mark Straub, the company’s co-founder & CEO, and you can hear from him in his own voice directly in the piece. (Isn’t modern media great?) A number of you asked about the full-length conversation in podcast form and we’re looking into this now.
If you’re new here: welcome — this Week in Review is sent on Mondays, the Fintech Review goes out on Sundays, the Content Corner or Intelligence Brief goes out on Wednesdays, and an original essay occasionally goes out on Saturdays. (But please note: Wednesday & Saturday content is very much in flux.) For past essays and digests, visit the archive & Afridigest.com.
And with that said, let’s get into it!
Week 30 2023: July 23-29
NEW ON AFRIDIGEST.COM
The business of black soldier flies. The website version of a popular Afridigest Intelligence Brief is now live. If you weren’t aware, insects might just be the future of food, and Africa has a chance to lead the way.
Lessons I’ve learned about identity verification in Africa. Mark Straub, CEO of Africa’s leading digital KYC and identity verification platform Smile ID, shares lessons learned after conducting 75 million ID checks across the continent.
📢 We accept & are actively calling for op-eds/essays from industry leaders for publication on Afridigest.com. Our focus is on ideas, analysis, and insights that help readers succeed in building the continent's future. Get in touch: firstname.lastname@example.org.
🔦 Equity & Debt Fundraises
Have a fundraise to share? Submit the announcement via the form below:
💰 Investor Activity
The European Investment Bank is considering a $10M investment in Seedstars Africa Ventures Fund 1. The Fund is targeting an $80M close; portfolio companies include Franco-Ivorian payments aggregator Bizao, Kenyan job recruiting portal Fuzu, and Nigerian electricity grid management platform Beacon Power Services.
Dutch Development bank FMO is considering a $7.7M (€7M) investment in Breega Africa Seed I, an Africa-focused fund from French VC firm Breega Group. Breega’s Africa portfolio includes Ugandan SME lending platform Numida, Kenyan credit-union-focused neobank & software provider Kwara, and Franco-Guinean digital payments platform YMO.
EdVentures, an Egyptian edtech-focused corporate venture capital firm from Nahdet Misr, announced a strategic partnership with Saudi Arabian venture studio VMS. The parties will collaborate to grow the edtech sector in Egypt, Saudi Arabia, and the broader MENA region.
Safaricom shareholders approved the Kenyan telco’s proposal to invest in African tech startups through two new VC fund subsidiaries.
🕵️♀️ In case you missed it
Madagascar-headquartered conglomerate Axian is buying a controlling stake in Senegalese telco Free Senegal for an undisclosed amount. Axian Telecom, which owns 40% of Free Senegal, signed a deal to buy an additional 40% stake, taking its ownership to 80%. Previously branded as Tigo, Free Senegal is the second largest telco in the country with ~5M users and ~25% market share, at least according to some statistics. Leading Senegalese telco Sonatel has ~11.7M users.
Kenyan e-commerce platform Copia laid off ~25% of its 1,800-strong workforce in Kenya. The company cited the “economic downturn” and “operating profitability” as key drivers. This is the third round of layoffs from Copia this year; the company previously laid off ~50 staff in Kenya at the start of the year and exited Uganda in April, laying off ~300 staff in the country. A sign of the times.
Safaricom’s payments platform M-Pesa & various other digital services in Kenya were offline on Thursday, thanks apparently to cyber attackers.
How Lagos’ bubbly internet cafe culture went flat (Rest of World)
Public transit is driving EV sector growth in Kenya (TechCrunch)
Bridging the AI language gap in Africa and beyond (DW)
The story behind the Nigerian SEC’s recent circular on Binance (Mariblock)
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👀 Visual of the Week
Startups in Africa & elsewhere have to do more with less these days.
The median number of employees at startups worldwide continues to drop as efficiency — ‘growth plus profitability’ — replaces growth at all costs.
The Economist writes:
“Firms accustomed to spending with abandon to win market share find themselves in the unfamiliar position of having to trim fat. And there is plenty of fat to trim… In 2018, the typical firm that raised a round of $10M-25M had some 50 employees. In 2023, a similar one employs 41.”
🐤 Tweets of the Week
Eversend CEO Stone Atwine shared how his team was able to acquire 500K customers with just ~$1.2M in funding since 2017.
(I encourage you to click the image below to read the tweet in its entirety.)
🗣️ Community Corner and Opportunities (Send to email@example.com)
Early-stage African fintech, mobility, e-commerce, and talent tech founders are invited to apply before August 9th to the 2023 ARM Labs Lagos Techstars Accelerator program. The program offers $20K in exchange for 6% equity and an optional $100K convertible note.
Early-stage women founders from across the continent are invited to apply for an all-expenses paid trip to Nairobi to pitch at the Women Who Build Africa (WWBA) assembly from Sept 12th through the 14th. WWBA is a hub & community for women working in tech across African markets, and the WWBA Assembly is its first major event. Potential partners and sponsors are encouraged to get in touch via the form as well.
African entrepreneurs building solutions including but not limited to fintech, insurtech, agtech, climate-tech, ecommerce, healthtech, and mobility are invited to apply before September 8th to the Startupbootcamp AfriTech ASIP accelerator program.
The last word
💭 Just my thoughts
Worldcoin, the brainchild of OpenAI CEO Sam Altman that issues crypto tokens to people in exchange for biometric data, officially launched this week.
And it quickly amassed tons of users in Kenya.
The startup, which aims to “creat[e] a new identity and financial network owned by everyone,” is controversial for a number of reasons.
It uses iris scans to verify identities, which are then stored on a decentralized blockchain — invoking a number of privacy issues, both technical & non-technical.
It “wants to provide a universal basic income (UBI) to every human being in response to the expected labor upheaval caused by artificial intelligence.” (Australian Computer Society).
But it’s backed by one of the men leading that AI-driven labor upheaval.
Its agents perhaps use unscrupulous marketing methods.
Despite the talk of decentralization, if it succeeds, it’ll be one central institution controlling user identities and (potential) income.
And there are probably a bunch of other points of controversy not listed here.
Not only does Worldcoin & its methods “just feel wrong” to some, but there are real concerns that many users in Africa (& elsewhere across the Global South in particular) don’t/won’t consider trade-offs involved given the incentive of cold hard tokenized cash — what is privacy intrusion, after all, when there’s no food to eat?
To add to that, is it sustainable?
If you ask for my opinion, I don’t yet have one really.
You’ll note that this is the first time Worldcoin appears in Afridigest’s digital pages, and I haven’t yet done the work required to form an opinion (as EchoVC’s Eghosa Omoigui might invoke Charlie Munger to say).
Nonetheless, here are some articles that caught my eye:
And what about you, dear reader, do you have an opinion?
Tell me what you thought of today’s newsletter:
✨ The rest of this newsletter contains details on the companies & founders that announced fundraises this week; it’s available to premium subscribers whose support makes this work possible.
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