Afridigest Week in Review: Effectively $0.00 of every VC dollar invested globally goes to Africa
+Happy New Year — Please share your anonymous feedback +YC W23 is already here +Niche is the next big thing +Doc Neto's 2022 Healthtech Year in Review has arrived +Key global 2022 trends visualized
The Afridigest Week in Review is a must-read weekly recap for Africa-focused founders, executives, and investors.
Welcome back, friends! The most clicked link from last week was Robin Guldener’s 'Finding traction without a product.' And if you missed the Fintech Review that was sent an hour ago, it’s available here.
📌 Happy new year and welcome to 2023 ✨ Help us improve for you this year by sharing your thoughts via this simple anonymous feedback form. And in case you missed it, we closed out 2022 with an End of Year email on Saturday.
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» Today’s WIR is short & sweet — there’s no Deal of the Week. Maybe you prefer that? Let me know via the form.
Week 52 2022: December 25-31
🔦 Other Deals
FUNDRAISES ACROSS THE CONTINENT
The following Africa-focused startups announced their acceptance into Y Combinator’s Winter 23 batch. YC invests $125K in exchange for 7%, plus an additional $375K at the most favorable terms of the next equity round:
Afridigest is a reader-supported guide to Africa’s startup ecosystem. Both free and paid subscriptions are available. If you’re reading this and want to support us, the best way is by taking out a paid subscription.
📚 Quick hits
FOR YOUR READING PLEASURE
Niche is the next big thing: Why VC's obsession with big TAM is a big mistake — Good contrarian read from Rick Zullo: “There is another often overlooked form of monopoly power that we see every day but rarely apply to the tech industry: the structural monopolies of niche markets.”
Creating in the era of creative confidence — Behance founder Scott Belsky on the impact of AI & other tools going forward: “Creativity is not just the output, it is the inputs — the ideas and the ingenuity… As the process part of creativity becomes less of an obstacle, the other parts of creativity — the original idea, the judgment, the story — become more important than ever.”
Thinking about how to think: short-term vs long-term — “(Reasoned) confidence, (deserved/earned) trust and (resultant) patience is what seems to be lacking in so many business ecosystems. The table above contains a list of short-term characteristics and their long-term alternatives.”
The liquidation preference — “The most important term in a term sheet is the valuation. But, the liquidation preference takes the mantle for second-most important.”
👀 Visual of the Week
Early indications suggest that roughly $5B was raised in Africa’s startup ecosystem in 2022, a similar level to 2021.
But despite the attention African startups have received in recent years, it’s worth noting that it's still the earliest days for Africa’s tech ecosystem.
For example, for every $1 invested in a VC deal globally:
half ($0.51) goes to companies in North America
$0.32 to Asia Pacific
$0.14 to Europe
$0.03 to Latin America and the Caribbean
and effectively $0.00 to Africa. (Try to find the thin grey line in the chart below.)
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🕵️♀️ In case you missed it
The Carbon Blockchain, an American carbon capture & carbon credit generation platform, expanded in Africa via the acquisition of a South African agriculture group & a newly announced clean energy biomass and waste conversion joint venture focused first on Ghana.
Dr. Ikpeme Neto writes ‘A tale of 2 cities: Nigerian health tech year in review 2022’ — “The opening to Charles Dicken’s ‘A Tale of Two Cities’ captures what 2022 was like in Nigerian healthtech.”
With jobs at home scarce, young Chinese are heading to Africa (Sixth Tone) — “There has been a noticeable uptick in interest in the topic on Chinese social media.”
Battery swapping spurs Kenya's electric motorbike drive (Reuters) — “It is a sign of an electric motorcyle revolution starting to unfold in Kenya”
Waleed Rashed, Founder & CEO of Egypt’s SideUp
Wyclife Omondi, Cofounder of Kenya’s BuuPass
Latimer Wandera, general manager at Uganda’s Spesho Taxi
🐤 Tweet of the Week
A visual summary of key global trends of 2022:
🗣️ Community Corner and Opportunities (feel free to send yours in)
Many, many thanks to everyone who reached out to me in 2022. One of the most rewarding parts of writing a newsletter like this is exchanging with readers — they’re always at least a small dose of joy in that. ✨ I’m looking forward to more exchanges in 2023 and, as always, you can email me, or send me a message on Whatsapp, Twitter, or LinkedIn. Many thanks! 🙏🏽
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