Recorded live at the 2026 BigFive Summit in Cape Town, this conversation tackles the stark reality that female-led startups in Africa receive just 2% of venture capital funding, despite often outperforming their male peers. 

Jill shares how her debt fund backs high-performing, real-economy female-led SMEs, while Laura discusses her expert-led educational platform and plans for an AI-driven women's ecosystem. The two explore navigating unconscious bias, pitching to male-dominated investors, and the gritty realities of entrepreneurship. 

This episode of the BIG5D Podcast is supported by Telkom. At Telkom, "Possible begins here". Learn more at Telkom.co.za.

This episode is sponsored by Telkom, also the lead sponsor of the 2026 BigFive Summit.

At Telkom, “Possible Begins Here”.

Learn more at Telkom.co.za

Sitting down for a lively fireside chat with Zach has become something of a BigFive Summit tradition. And this year Zach delivered every bit of the candor, insight…and profanity we have come to expect from him.

Launch Africa has invested in roughly 170 companies across two funds, mostly in B2B. The company has three African unicorns in its portfolio. 

Our discussion ranged from surging African M&A to the enduring dominance of fintech to the power of stablecoins to reduce cost and friction in remittances.

The BIG5D Podcast is a production of BigFive Digital. If you would like to book a guest or sponsor an episode, contact us via big5dtv@gmail.com.

This episode is sponsored by Telkom, also the lead sponsor of the recent BigFive Summit in Cape Town. 

At Telkom, “Possible Begins Here”.

Learn more at Telkom.co.za

Peach Payments was launched in South Africa more than a decade ago and now facilitates digital commerce across nine African countries. 

Rahul Jain isn't just looking at where payments are now; he’s looking at where they’re going.

Our conversation with Rahul covers a wide array of topics, including: 

The high-stakes reality of international expansion and the painful struggle of local licensing.

Why the value of tech IP is dropping to zero while "agentic commerce" becomes the next land grab.

The controversial role of Buy Now, Pay Later in driving financial inclusion across the continent.

Rahul offers us a masterclass in scaling on the continent.

The BIG5D Podcast is a production of BigFive Digital. If you would like to book a guest or sponsor an episode, please contact us via big5dtv@gmail.com.

This conversation, recorded at Innovation City Cape Town on 6 May 2025, features a primer on how to choose a digital marketing agency partner led by Summit Co-host Amanda Louw-Bester (Pragmattica Consulting) and featuring Bianca Waterberg, the founder and CEO of the Cape Town digital agency Nspyre, which specializes in paid media and SEO.

Choosing the right agency all comes down to clear and effective communication. As Bianca puts it during this conversation,

"You want your agency to explain things to you clearly," Bianca says during the conversation.

The conversation also gets real about spotting red flags in a potential agency partner. And overpromising, for example, by guaranteeing immediate results that are nearly impossible to deliver, is high on the list of red flags to watch for.

This episode of the BIG5D Podcast is sponsored by Dialog (localdialog.com).

“Answering your 'local' questions with unique data & insights”

The conversation jumps off from a LinkedIn post Keshni wrote about #Statuptruth in which she laments how too many startup founders fail to appreciate the need to carefully manage the funds they raise from investors.

“$1M in funding doesn't make you rich,” Keshni wrote. “It makes you responsible.”

Keshni’s post goes on to recount the story of one founder who spent VC money on a “founder wellness” trip to a tropical island.

The substance of Keshni’s post is that venture funding is runway, not revenue.

We hope you enjoy this episode, sponsored by NSPYRE (nspyre.co.za)

This conversation, recorded at Innovation City Cape Town on 6 May 2025, features a panel on Go to Market Strategies for SMEs led by Summit Co-host Amanda Louw-Bester (Pragmattica Consulting). 

The panel features three entrepreneurs who have seen it all and can at the very least steer small business founders away from obvious mistakes in the early stages of their business journey. 

The panelists offer a wide array of insights for founders on everything from tactics to avoid to tactics not to overlook, especially in a business's early stages. 

The panelists joining Amanda are Bernadene Appalsamy, Ledger Leap; Tim Shoko, Umlilo Energy; and Remi du Preez, Polygon.

This episode of the Big5D Podcast is supported by the 2025 BigFive Summit sponsors.

Absa Group (absa.africa)

Dialog (localdialog.com)

Nspyre (nspyre.co.za)

Networds (networds.co.za)

AfriGIS (afrigis.co.za)

Pragmattica Consulting (pragmattica.co.za)

This episode features a panel discussion of the kinds of support, in addition to capital, that African startups need to be successful -- things like best practice sharing and mentorship, among others. Sharing their views are Lucie Fink, CEO of Thinkroom Consulting; Egla Ntumba of MsFit Ventures, and Thapelo Ntite, Co-founder of Botlhale AI. This discussion originally took place on stage on 8 May at Innovation City Cape Town.

Episode 54 of the BIG5D Podcast is supported by The 2025 BigFive Summit Sponsors.

The Summit's sponsors were led by Premium Sponsor Absa Group and also included Dialog, NSPYRE, Networds, AfriGIS, and Pragmattica Digital Consulting.

Loop is a South African fintech startup that has digitized payments for African minibus taxi drivers using WhatsApp. Loop's broader ambition is to become a payment solution for emerging markets.

Episode 53 of the BIG5D Podcast is supported by The 2025 BigFive Summit Sponsors.

The Summit's sponsors were led by Premium Sponsor Absa Group and also included Dialog, NSPYRE, Networds, AfriGIS, and Pragmattica Digital Consulting.

Zach is Managing Partner of Launch Africa Ventures, the Cape Town venture firm that has invested in African startups including Happy Pay, Peach Payments, Kuda Bank, Moove, Gozem, and many others. Zach has a very clear perspective on Africa Tech.

Zach believes there needs to be more funding for tech startups that come from within Africa, in particular South Africa. And he also thinks founders in Africa need to take a different view on venture capital. Do not chase it before you are ready. Be ready to boostrap until you have a product with a clear path to market and improving unit economics.

Episode 52 is presented by The 2025 BigFive Summit Sponsors.

B5DS25 supporters include Premium Sponsor Absa Group, as well as Dialog, NSPYRE, Networds, AfriGIS, and Pragmattica Digital Consulting. Thanks also to Vendasta and Telkom for their support and to Realm Digital for its ticket giveaway.

Episode 51 of the BIG5D Podcast, features a conversation about using the subscription model to help South Africans gain access to automobiles in a non-traditional manner with Tinashe Ruzane, the co-founder and CEO of FlexClub.

FlexClub helps South Africans access vehicles when they need them on a pay-as-you-go basis (they partner with major car rental platforms in South Africa).

Ruzane, a former Uber executive, explains why car subscriptions make more sense in a market like South Africa where the need for vehicles is high but accessibility is very limited.

Are you claiming and managing your own Google Maps listings?

Meet Local Knowledge, the Leader in “We Do It For You” Digital Location Management and Local SEO Services.

Welcome to Episode 50 of the BIG5D Podcast, a production of BigFive Digital and the Africa B2B Tech Report.

In recent episodes, we have been having in-depth discussions about the latest trends in technology with leaders with deep understandings of how technologies like AI, fintech, blockchain, virtual reality, and so on, are moving the needle for businesses in the region.

We continue in this vein with this episode featuring Dialog Co-founder Neal Polachek. Neal’s new company is conducting some very compelling research on how small businesses are at the leading edge of adopting AI tools to do more with less.

Two quick notes about this episode.

We are breaking an unwritten rule of this podcast to only interview those with feet on the ground in Africa or the Middle East. Neal is based in the U.S. and so far Dialog has only collected data in the States.

Yet the work Dialog is doing to document the evolution of small business AI adoption is important enough to suspend our rule, for one episode at least. Neal makes it clear that Dialog’s ambition is for its research to eventually be globally focused.

Neal also references “The Kelsey Group” early in the conversation. TKG was an advisory services firm focused on SME digital transformation where Neal and I both worked for many years. The Kelsey Group was among the earliest organizations to do research focused on how SMEs are embracing new technologies.

Neal cites a variety of reasons for the apparent anomaly of SMEs leading the way in AI adoption. The usual pattern is for SMEs to lag larger companies in adopting new technologies. But in the end, it all comes down to AI tools being inexpensive and easy to use. And the leverage they produce for SMEs is immediate and material.

As noted, Dialog is currently conducting its research in the U.S. but has plans to begin collecting data about SME AI adoptions around the world. In addition to survey research among SMEs (and digital agencies in a recent wave), Dialog conducts direct video interviews to add color and context to the survey data. These video interviews, in addition to the survey data, are part of the Dialog offering.

In this clip, Neal shares an anecdote from one of the SMEs he interviewed.

What Neal says in this clip gets to the essence of why AI is such a game-changer for small busines ses. “Their [SME’s] most precious thing is time. And this tool is saving them time.”

Five Things We Learned

Here are our five key takeaways from this conversation with Dialog’s Neal Polachek.

* Small businesses are leading the way in AI adoption, bucking the usual pattern of enterprise companies adopting new technologies before SMEs.

* This pattern has flipped because AI tools are inexpensive, easy to use, and produce immediate and tangible time savings for SMEs.

* Therefore, unlike in previous waves of technology innovation, SMEs are eager to adopt AI.

* Neal acknowledges that keeping the human element will remain critical with AI, especially among small businesses.

* Neal expects a wave of vertically focused AI-driven virtual business coaches to emerge as the next wave of AI product innovation for SMEs.

You can also listen to this episode on your favorite podcast apps. Please rate and review the BIG5D Podcast if you do enjoy the show on these apps.

If you prefer to watch the interview with Neal on YouTube, here it is.

Recommended Reading

The following is a curation of content from around Africa, the Middle East, and the world related to big tech, digital marketing, small business, startup life, venture funding, M&A, and more. Please vote with your clicks to tell us what we should curate for you in future editions.

Fintech Theeper Returns Money to Investors

TikTok Launches SSA Safety Council

Mango Expands in Africa

UAE Payments Platform Ziina Raises $22M Series A

Climate Remains a Bright Spot for Africa Startup Funding

Launch Africa Ventures Raises Mezzanine Impact Fund

What Are the 10 African Countries with Lowest Business Bribery Risk?

How to Solve the Late Payments Crisis for SMEs

Mastercard, ChitChat Team Up to Address African Digital Payments

Dentsu Performance Celebrates Third Anniversary in SA

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make businesses more successful in Africa and the Middle East.

The BIG5D Podcast is available on Substack as well as on Apple Podcasts, Spotify, YouTube, or wherever you listen to podcasts. Please follow, comment, rate, and review the BIG5D Podcast. Your engagement helps others discover us so they can learn more from the amazing builders and thought leaders we feature on the show.

To recommend a guest for the podcast or discuss sponsoring an upcoming episode, please write to us at info@bigfivedigital.org.

Please stay tuned for information on future BigFive Digital live and virtual events.

Thank you Local Knowledge for sponsoring this episode of the BIG5D Podcast.

ICYM: Recent Episodes of The BIG5D Podcast

Episode 49: Author, investor, and university professor Steven Boykey Sidley is never at a loss for words, nor does he fear controversy. In this conversation, Sidley shares his deep knowledge and strong opinions on the hottest technology issues, including the implications of AI and blockchain for business and society.

Episode 49 is sponsored by Frational.dev

Episode 48: “Banking as a Service” In this episode Houssam Kayal, the Chief Revenue Officer of FOO shares some deep insights on how trends like embedded finance and banking as a service are transforming businesses from grocers to telecoms into fintechs.

Episode 48 is sponsored by Frational.dev

Episode 47: “Solving the SME Funding Gap” In this episode Vula Co-founder & CEO Nic Rawhani shares how artificial intelligence can help close Africa’s massive SME funding gap by making the process of applying for loans faster and easier for SMEs and de-risking the process for lending institutions.

Episode 47 is sponsored by Realm Digital

Sponsored Message

The Craft of Conferencing is an events consultancy and content agency offering turnkey conference management, public speaking coaching, podcast production, and content creation. Journalist, podcaster, and event producer Charles Laughlin leads The Craft of Conferencing.

Fraktional connects developers and organizations for short to medium-term projects.

Contact Fraktional.dev to learn more.

Welcome to Episode 49 of the BIG5D Podcast, a production of BigFive Digital and the Africa B2B Tech Report.

In this episode, I talk about AI and blockchain with the candid and opinionated Steven Boykey Sidley. Steven is a professor at the Johannesburg Business School (part of the University of Johannesburg).

Steven is the author of multiple books, including non-fiction works on technology as well as novels and plays. His latest book is It’s Mine: How the Crypto Industry is Redefining Ownership. He is also an investor and advisor.

Steven is a regular contributor to The Daily Maverick, where he opines on trends in technology. This latter pursuit brings Steven regularly to my attention and led me to think he would be a great podcast guest. And I was right.

This candid and engaging conversation spans AI safety, the AI opportunity for startups, and AI's geopolitical implications.

A few highlights

In this clip, Steven agrees that AI tools make it at least conceivable for a startup to scale to unicorn status without taking on employees.

I have been obsessed with the AI-enabled one-person unicorn ever since I watched Sam Altman (Open AI) and Alexis Ohanian (Reddit) discuss this in a YouTube video. I also believe this represents a unique opportunity for African founders who struggle to raise seed capital. AI may be making seed capital obsolete.

Here Steven talks about how many AI startups are building on top of existing AI models. We got into whether this approach is truly innovative and sustainable.

And finally, we talked about the long-term implications of AI. Steven is not optimistic that humans will be able to prevent the worst outcomes.

You can also catch this episode on your favorite podcast apps.

If you prefer to watch the full interview with Steven on our YouTube channel, here it is.

Recommended Reading

The following is a curation of content from around Africa, the Middle East, and the world related to big tech, digital marketing, small business, startup life, venture funding, M&A, and more. Please vote with your clicks to tell us what we should curate for you in future editions.

Conduit Raises $6.5M for Cross-Border Payments Expansion

Africa Not Spared from TikTok’s Global Layoffs

Launch Africa Ventures Funds Digital Lending Marketplace Kredete

93% of Saudi Entrepreneurs Comfortable Using AI

Now Money Rolls Out New Strategic Banking Relationships

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make businesses more successful in Africa and the Middle East.

The BIG5D Podcast is available on Substack as well as on Apple Podcasts, Spotify, YouTube, or wherever you listen to podcasts. Please follow, comment, rate, and review the BIG5D Podcast. Your engagement helps others discover us so they can learn more from the amazing builders and thought leaders we feature on the show.

To recommend a guest for the podcast or discuss sponsoring an upcoming episode, please write to us at info@bigfivedigital.org.

Please stay tuned for information on future BigFive Digital live and virtual events.

Thank you Fraktional.dev for sponsoring this episode of the BIG5D Podcast.

“Where innovation meets code, and the possibilities of technology unfold at your fingertips”

ICYM: Recent Episodes of The BIG5D Podcast

Episode 48: “Banking as a Service” In this episode Houssam Kayal, the Chief Revenue Officer of FOO shares some deep insights on how trends like embedded finance and banking as a service are transforming businesses from grocers to telecoms into fintechs.

Episode 48 is sponsored by Frational.dev

Episode 47: “Solving the SME Funding Gap” In this episode Vula Co-founder & CEO Nic Rawhani shares how artificial intelligence can help close Africa’s massive SME funding gap by making the process of applying for loans faster and easier for SMEs and de-risking the process for lending institutions.

Episode 47 is sponsored by Realm Digital

Episode 46: “Mixed Reality is the Future” In this episode Realm Digital’s Imtiyaz Mohamed offers a masterclass on the potential of AR/VR. Tune in to learn how corporations are using this technology today in very practical ways.

Episode 46 is sponsored by Frational.dev

Sponsored Message

The Craft of Conferencing is an events consultancy and content agency offering turnkey conference management, public speaking coaching, podcast production, and content creation. Journalist, podcaster, and event producer Charles Laughlin leads The Craft of Conferencing.

Fraktional connects developers and organizations for short to medium-term projects.

Contact Fraktional.dev to learn more.

Welcome to Episode 48 of the BIG5D Podcast. In this episode, I take a deep dive into embedded finance and banking as a service with Houssam Kayal, the chief revenue officer of FOO, a Dubai-based B2B SaaS company that helps corporates across categories launch financial products.

Kayal, a native of Lebanon, is an electrical engineer who is in charge of driving revenue for FOO. A significant portion of his career was spent in Saudi Arabia, where he led digital transformation projects at The Saudi Investment Bank, Saudi Telecom, and elsewhere.

Kayal is also an entrepreneur whose background includes the digital media startup Cook & Eat, a culinary content platform that merges professional and user-generated content about Lebanon’s famous cuisine.

“Food is an international language,” Kayal told us. “People want to learn about a culture through food.”

Our conversation with Kayal focused mainly on key current trends in fintech, including embedded finance and banking as a service. What are these solutions and how are they being deployed to help banks, telecoms, and other corporates? Not to mention consumers and SMEs.

And of course, we ended on AI, which Kayal says “is becoming a very key enabler of financial services.”

We hope you enjoy this highly informative conversation unpacking some of the key regional trends in fintech.

You can also catch this episode on your favorite podcast apps.

If you prefer to watch the full interview with Houssam on our YouTube channel, here it is.

Interview Excerpts

Here are a few edited excerpts from our in-depth interview with FOO Chief Revenue Officer Houssam Kayal.

What is embedded finance and who is deploying it?

Embedded finance is where entities like retailers. for example [supermarkest group] Carrefour, that are not in the business of financial service. They're not interested in creating a loan. But they want to enable an element of a financial transaction or service within the experience that they deliver. A very good example is Carrefour. They have enabled a closed-loop wallet on their platform. So whenever you buy something from the supermarket, and you want to return it, they'll refund the money back into the wallet in real-time. So in this case, you don't need to worry about the money going back to your credit card or debit card for two weeks, you can use that money instantly. So this is a good example of embedded finance.

Can you define banking-as-a-service and explain who it helps and how?

Banks realize that they have invested a lot in their assets. they have a core banking solution. They have a loan management solution. They have card processing, they can issue credit cards and debit cards. Banking as a service is the banks realizing that they can monetize these assets.

What trends do you see as the most impactful in the near term in the regions you operate in?

Enabling the acceptance of payment with different kinds of technology, whether it's wallets, cards, digital currency, or digital assets. I think the biggest thing we're looking at and we're trying to invest in is how AI is becoming a very key enabler of financial services.

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make businesses more successful in Africa and the Middle East.

The BIG5D Podcast is available on Substack as well as on Apple Podcasts, Spotify, YouTube, or wherever you listen to podcasts. Please follow, comment, rate, and review the BIG5D Podcast. Your engagement helps others discover us so they can learn more from the amazing builders and thought leaders we feature on the show.

To recommend a guest for the podcast or discuss sponsoring an upcoming episode, please write to us at info@bigfivedigital.org.

Please stay tuned for information on future BigFive Digital live and virtual events.

Thank you Fraktional.dev for sponsoring this episode of the BIG5D Podcast.

“Where innovation meets code, and the possibilities of technology unfold at your fingertips”

ICYM: Recent Episodes of The BIG5D Podcast

Episode 47: “Solving the SME Funding Gap” In this episode Vula Co-founder & CEO Nic Rawhani shares how artificial intelligence can help close Africa’s massive SME funding gap by making the process of applying for loans faster and easier for SMEs and de-risking the process for lending institutions.

Episode 47 is sponsored by Realm Digital

Episode 46: “Mixed Reality is the Future” In this episode Realm Digital’s Imtiyaz Mohamed offers a masterclass on the potential of AR/VR. Tune in to learn how corporations are using this technology today in very practical ways.

Episode 46 is sponsored by Frational.dev

Episode 45: “The Massive Healthcare Burden” In this episode, Zane Stenning discusses how he married two passions — health care and entrepreneurship — into a company, Mia Health Technologies, that uses mobility and cutting-edge technology to democratize access to dentistry in Africa.

Episode 45 is sponsored by Realm Digital

“Empowering industry leaders through innovative business solutions”

Contact RealmDigital.com to learn more.

Welcome to Episode 47 of the BIG5D Podcast. In this episode, I chat about using AI to solve the “SME funding gap” with Nic Rawhani, the Co-founder & CEO of Vula, a company that offers “AI SME funding tech”. I struggle to imagine a company description more in the wheelhouse of what BigFive Digital covers.

Rawhani, a South African engineer and McKinsey veteran, founded London-based Vula in 2022 with Alex Goff, who acts as the company’s CTO. The company is at present focused exclusively on the African continent. Though it isn’t difficult to imagine Vula as an emerging markets play.

One of the key things Vula does is uses AI to simplify and streamline the process of applying for funding. This helps SMEs by turning an incredibly frustrating and cumbersome process (that likely ends in rejection anyway) into a fast and simple one. For banks and other lenders (Vula’s real customers), employing this process saves time and labor and leads to a far more accurate assessment of an SME’s credit worthiness.

In this brief clip from our interview, Nic explains the “demographic dividend” that is fueling Africa’s massive, youthful population, which will need a steady infusion of skills training and employment opportunities. As Nic notes, this need will not diminish, it will compound.

Rawhani was a speaker at BigFive Digital’s 2024 Summit in Cape Town, where he explained what the SME funding gap is and how Vula addresses it. You can watch his approx 30 minute talk at the Summit here.

We hope you enjoy this highly informative conversation.

You can also catch this episode on your favorite podcast apps.

And if you prefer to watch the interview on our YouTube channel, here it is.

Interview Excerpts

The following are just a few edited excerpts from our in-depth interview with Vula Co-founder & CEO Nic Rawhani.

You estimate the African SME funding gap (the difference between demand and funding availability) at close to $400 billion. What is behind that number?

In 2018, The World Bank did what is probably one of the most impressive studies we've seen in the space. What they did was that they looked at all developing countries in the world…and they took data from where they could, etc., and compiled it, basically, from a grassroots level and built up this picture of the number of SMEs and MSMEs that operate in these countries. How many of them have access, partial access, or no access to their financing ecosystem?

At that time, in 2018, the total amount of the funding gap, the legitimate demand from SMEs on the continent, was $330 billion. We've seen reports since then, because that's more than five years ago now, that have taken the number all the way up to $410, $450 billion.

What specific challenges in the SME funding process are you using AI to solve?

With some of the major banks on the continent, if an SME even wants to apply for funding, they're still expected to print out a PDF from their website and fill it in by hand and then scan it and send it back to them. And then they take two to four weeks to get back to you. And then it's probably a no. So why would an SME continue to engage with this when they’re just trying to run their business?

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make businesses more successful in Africa and the Middle East.

The BIG5D Podcast is available on Substack as well as on Apple Podcasts, Spotify, YouTube, or wherever you listen to podcasts. Please follow, comment, rate, and review the BIG5D Podcast. Your engagement helps others discover us so they can learn more from the amazing builders and thought leaders we feature on the show.

To recommend a guest for the podcast or discuss sponsoring an upcoming episode, please write to us at info@bigfivedigital.org.

Please stay tuned for information on future BigFive Digital live and virtual events.

Thank you Realm Digital for supporting this episode of the BIG5D Podcast.

“Empowering industry leaders through innovative business solutions”

Contact RealmDigital.com to learn more.

ICYM: Recent Episodes of The BIG5D Podcast

Episode 46: “Mixed Reality is the Future” In this episode Realm Digital’s Imtiyaz Mohamed offers a masterclass on the potential of AR/VR. Tune in to learn how corporations are using this technology today in very practical ways.

This episode sponsored by Frational.dev

Episode 45: “The Massive Healthcare Burden” In this episode, Zane Stenning discusses how he married two passions — health care and entrepreneurship — into a company, Mia Health Technologies, that uses mobility and cutting-edge technology to democratize access to dentistry in Africa.

This episode sponsored by Realm Digital

Fraktional connects developers and organizations for short to medium-term projects.

Contact Fraktional.dev to learn more.

Welcome to Episode 46 of the BIG5D Podcast. In this episode, we receive an informal masterclass on augmented and virtual reality (AR/VR) from Imtiyaz Mohamed, the principal consultant at Realm Digital, a South African technology consulting firm. Mohamed is a great resource for how this technology is being practically applied.

One key area where Mohamed advises Realm’s corporate clients is how to put emerging technologies to work in the real world.

According to stats shared with us by Realm, AR/VR will generate revenues of more than $58 billion by 2028.

To many, AR/VR is Pokemon Go and Apple Vision Pro. But it is so much more, as we learn from Mohamed. For example, healthcare companies use this technology to refine new surgical techniques.

Non-medical safety training, including for catastrophic events, is another current-day use case for AR/VR that Mohamed cites. Here he talks about how VR makes it possible to train realistically for a mine collapse.

We hope you enjoy this highly informative conversation. If you want to geek out on AR/VR directly with Mohamed, write to him here.

Interview Excerpts

The following are just a few edited excerpts from our in-depth interview with Realm Digital Principal Consultant Imtiyaz Mohamed.

What is AR/VR and where do hype and reality part ways?

A lot of people think about [AR/VR] purely as gaming. But there are a lot of practical use cases.

What impact, if any has the Apple Vision Pro Had in Advancing AR/VR

In terms of what Apple has done, I think a lot of people buy Apple because of the brand. And that makes sense. They've built a cool piece of tech [with the Apple Vision Pro]. But I don't think they've found the real-world application yet.

How does AI intersect with AR/VR?

Many people look at emerging technologies as separate things. So you look at virtual reality, or augmented reality, or you look at AI. But they all intersect. For example, using AI to pull data into a virtual environment.

Prefer your podcasts on video? Watch this episode on YouTube here.

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make businesses more successful in Africa and the Middle East.

The BIG5D Podcast is available here on Substack. It can also be found on Apple Podcasts, Spotify, YouTube, or wherever you listen to podcasts. Please follow, comment, rate, and review the BIG5D Podcast. Your engagement helps others discover us so they can learn more from the amazing builders and thought leaders we feature on the show.

To recommend a guest for the podcast or discuss sponsoring an upcoming episode, please write to us at info@bigfivedigital.org.

Also, please stay tuned for information on future BigFive Digital live and virtual events.

Thank you Fraktional.dev for sponsoring this episode of the BIG5D Podcast.

“Where innovation meets code, and the possibilities of technology unfold at your fingertips”

Realm empowers industry leaders through innovative business solutions. Please visit them at realmdigital.com.

Contact Realm Digital to learn more.

Welcome to Episode 45 of the BIG5D Podcast. In this episode, we interview another compelling young South African startup founder. Medical doctor and health-tech entrepreneur Zane Stenning is the co-founder of Mia Health Technologies, a health-tech startup seeking to improve healthcare in Africa by providing access to dental care via mobile clinics.

Mia’s core solution is manufacturing clear aligners using 3D printing. Zane believes this is perhaps the only cost-effective way to solve the continent’s massive malocclusion (skewed teeth) problem. And this isn’t just about improving smiles. Dental issues are closely correlated to a range of broader health concerns from heart disease to diabetes.

Building a health tech has enormous potential for impact. It is also incredibly complex, as Zane explains here.

The company has also built an app to help dentists operate their clinics more effectively. Mia also helps dentists access affordable financing to get clinics off the ground. Zane jokes on the podcast that Mia seems like it is “three startups in one.”

Zane was a guest on a panel on the “fourth industrial revolution” hosted by Savant Venture Fund (a Mia investor) at the recent BigFive Summit in Cape Town. The common thread to 4IR is connected technology. Zane says this is a critical element to achieving his company’s mission.

“It's fundamental to almost every element of this business,” Zane explains in the episode. “Whether you're looking to optimize patient outcomes, whether you're looking to catch disease early, or whether you're looking just to improve communication with your patients.”

Zane also believes strongly that “artificial intelligence is going to revolutionize the healthcare industry.”

He explains further in this clip.

Interview Excerpts

The following are edited excerpts from our interview with Mia Health Technologies Co-founder Zane Stenning.

You started early as an entrepreneur. Tell us about your first company.

My first business at around the age of 16, was the import-exports of bicycle parts. I remember growing up not having a lot of cash, but always wanting the latest stuff. And then locally, there was a such high margins on it. So I just started selling it to friends, family, etc.

So Mia started as a way to scale clear aligners to solve Africa’s malocclusion (skewed teeth) problem. How did you arrive at 3D printing as the solution?

Align Technology is the company that owns Invisalign. When we came across it, we said, this is an incredible product, how has it not penetrated our market? It was for multiple reasons, including a weaker currency, requiring multiple middlemen to get it, and so on. All of it just pushed the price through the roof. When I looked into what it would take for us to manufacture this, we concluded that a 3D printer setup was what we needed.

Can additive manufacturing solve a massive healthcare burden on our continent?

For those of you who don't know, Africa has the highest rates of malocclusion, which has skew teeth in the world at a whopping 89%. And people with poor oral health tend to have a 50% increased risk of cardiovascular disease and metabolic diseases.

Why the mobile clinics?

Distribution was one of the hardest things we ran into in our previous businesses. So it was something I was ready and waiting to try and solve. But we had bootstrapped all of this, so we didn't have massive capital to spend on marketing, marketing teams, and so on. So we needed to keep distribution in-house at the beginning, just to do our product development and all this sort of stuff. So we said if we can't do fixed practices everywhere, let's go mobile. In other words let's do an orthodontic clinic that can go to schools, or wherever it needs to go, and treat all these patients and run our aligners through this clinic.

You launched an app to stitch all of this together, talk about that.

We started having to patch together lots of different software just to run one business. And then eventually we just said, This is crazy. We just need to build our own thing, even if it's just to scale our own business, let alone sell it to other dentists or dental groups. So that's when we started putting together our app and now it's a specialized ERP for the dental industry.

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make micro, small, and medium-sized businesses more successful in Africa and the Middle East.

The BIG5D Podcast is available here on Substack and on Apple Podcasts, Spotify, YouTube, or wherever you listen to podcasts. Please follow, comment, rate, and review the BIG5D Podcast. Your engagement helps others discover us so they can learn more from the amazing builders and thought leaders we feature on the show.

To recommend a guest for the podcast or discuss sponsoring an upcoming episode, please write to us at info@bigfivedigital.org.

Also, please stay tuned for information on future BigFive Digital live and virtual events.

Thank you Realm Digital for sponsoring this episode of the BIG5D Podcast.

This episode is sponsored by the 2024 BigFive Summit, "Africa's leading small business technology event" coming to Cape Town 19-20 March 2024. Learn more at https://qkt.io/laNIFj

This episode is sponsored by the 2024 BigFive Summit, "Africa's leading small business technology event" coming to Cape Town 19-20 March 2024. Learn more at https://qkt.io/laNIFj

This episode is sponsored by the 2024 BigFive Summit, "Africa's leading small business technology event" coming to Cape Town 19-20 March 2024. Learn more at https://qkt.io/laNIFj

The series’ first guest is Aisha Pandor, the CEO of SweepSouth, a two-sided marketplace startup celebrating its 10th anniversary this year. 

This podcast series is sponsored by The 2024 BigFive Summit

The series’ first guest is Aisha Pandor, the CEO of SweepSouth, a two-sided marketplace startup celebrating its 10th anniversary this year. 

This podcast series is sponsored by The 2024 BigFive Summit

The series’ first guest is Aisha Pandor, the CEO of SweepSouth, a two-sided marketplace startup celebrating its 10th anniversary this year. 

This podcast series is sponsored by The 2024 BigFive Summit

Partner with Duda to build high-performing websites at scale while reaching higher productivity with a customizable platform designed for agencies and SaaS companies.

Please write to Mitul Patel (Mitul@duda.co) to begin a conversation with Duda.

The BIG5D Podcast is back and this episode features an engaging and informative conversation with Zach Marks, the Co-founder and CEO of blockchain-based fintech Jia. The company, formed in 2022, provides access to capital for small businesses in emerging markets. Jia currently operates in Kenya and the Philippines.

Jia, which was formed in 2022, recently raised a $4.3 million seed round. But this significant funding event isn't even discussed in the episode. Zach and I did discuss it briefly before we began recording. I told Zach that the amount of money a company has raised "is usually the least interesting thing about it." And he agreed.

Our objective on this podcast is to learn about the problems a company is trying to solve and how it plans to go about doing so. We do not particularly care how much money a company has raised, or from whom.

Ultimately what we do care about is the small business owner who needs capital, technology, or know-how, to take their business to the next level. And I got the sense that Zach cares about this above all as well. We understand this requires funding. We just don’t obsess over it.

As Zach notes early in our conversation, Jia’s aim is to solve what he calls the “$5 trillion credit gap” for small businesses in emerging markets by providing access to capital. And Jia rewards borrowers who repay successfully with digital tokens. Of course, the tokens must build value for this all to work.

What Jia is trying to do goes straight to the heart of what we cover here. And that is using emerging technologies — from AI to blockchain and more — to empower small businesses in Africa and the Middle East.

Please enjoy this episode. And please stay tuned for more great conversations.

Watch Episode 38 on YouTube

Interview Excerpts

The following are just a few edited excerpts from our conversation with Zach Marks. Please listen to the podcast or watch the video to experience the full interview.

How does Jia work?

What Jia does is provide blockchain-based financing for small businesses in emerging markets. And our mission is really to unlock financial freedom and put entrepreneurs in control of their financial destinies around the world.

We provide inventory financing and invoice financing, mostly as working capital for small businesses in emerging markets. Today our two markets are Kenya and the Philippines. And we basically source that capital on chain on the blockchain, which lets anyone provide liquidity, which we then take to use to finance small businesses.

And when they repay they earn token rewards, which gives them an ownership stake in this business.

Why did you select Kenya as Jia’s first market in Africa?

I've worked in Kenya for the past 10 years, and it helps to work in a country that you know. But the macro fundamentals are the reason so many FinTech companies get started in Kenya, of course, because there is broader digital financial services and mobile financial services adoption there than anywhere in the world. {He cites M-Pesa as laying the groundwork for fintechs like Jia.]

Why blockchain?

I think the benefits that blockchain can bring for any business that's serving multiple geographies can be pretty profound in terms of reducing the cost of moving money across borders, not just for us as a lending company, but even for small business borrowers.

What is your most important KPI?

Obviously, the repayment rate is helpful. But even more helpful than that, I think, is repeat retention. So you don't just want to see the borrower repay, you want to see that they came and took another loan from you.

What are your ambitions for elsewhere in Africa?

I'm very excited to explore markets beyond Kenya. The natural thing that I think a lot of foreign venture-backed companies do is they look at like Kenya in the east and Nigeria in the west, and you know, maybe South Africa's too advanced for them, and then it’s like, ‘Prove something in those places, and then see where they can go from here.’ I think that's sometimes just basic Western VC math.

I would be really excited to be in Nigeria, but it's also a very competitive and complicated, expensive market. And sometimes it might be easier to enter somewhere else. We actually have an invoice financing program going on right now with a company in Ghana {Oze}, which is really exciting.

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make micro, small, and medium-sized businesses more successful in Africa and the Middle East.

The BIG5D Podcast is also available on Apple Podcasts, Spotify, YouTube, or wherever you listen to podcasts. Please follow, comment, rate, and review the BIG5D Podcast. Your engagement helps others discover us so they can learn more from the amazing builders and thought leaders we feature on the show.

To recommend a guest for the podcast or to discuss sponsoring an upcoming episode, please contact us at info@bigfivedigital.org.

Also, please stay tuned for announcements regarding dates and locations for future BigFive Digital live events in Africa-Middle East.

Episode 37 of the Big5D Podcast delves into how AI can move the needle for small business digital marketing in Africa. Our guest is Michelle Geere, the founder & CEO of AdBot.

AdBot is a Cape Town-based start-up that uses AI and machine learning to automate the process of advertising on Google and Bing for small businesses.

The conversation moves along briskly while covering a lot of ground, all of it touching on AI, digital marketing, SMEs, or all of the above. For example, Michelle offers her views on:

* The ascendance of Bing vs Google in Africa

* The nuances of acquiring small business customers.

* Why AI broadly is much more about opportunities than threats.

* How AI specifically offers tremendous opportunities for Africans.

The conversation addressed some of the likely impacts AI will have on business more broadly. And also on some of AI’s cultural impact. For example, Michelle offered why she doesn’t think AI can replace talents like “Fleabag” creator Phoebe Waller-Bridge. On the other hand, Michelle offers that the rapper, producer, and all-around cultural icon Will.i.am himself admits that AI could do most if not all of what he does.

Please enjoy this episode.

Interview Excerpts

The following are a few edited excerpts from our conversation with Michelle Geere. These excerpts represent but a fraction of our full conversation. Please listen to the podcast or watch the video to experience the entire interview.

On the evolution of Bing vs Google

The adoption of Chat GPT is actually where Bing comes in. If you have a look at market share in Africa over the last year, starting January 2022, up until January 2023, you'll see that the market share of Google ads, or just Google in general is taking a nosedive. And the opposite of that is that Bing is really picking up market share, which is really interesting.

On the limits of AI

I cannot see the machine writing “Fleabag” like Phoebe Waller-Bridge.

On AI’s impact on Africa

I think that there will be some leveling of playing fields, specifically in Africa.

On what’s next for Adbot

Our absolute passion is to make sure that small businesses in Africa have access to markets. Online advertising is the easiest and fastest way to do this. And channels like search offer the most conversions. So our 100% aim for the next year is to see how we get this into all the markets in Africa, starting with Nigeria.

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make micro, small and medium-sized businesses more successful in Africa and the Middle East.

The BIG5D Podcast is also available on Apple Podcasts, Spotify, YouTube, or wherever else you listen to podcasts. Please follow, comment, rate, and review the BIG5D Podcast. Your engagement helps others discover us so they can learn more from the amazing African thought leaders we feature on the show.

To recommend guests or to discuss sponsoring an upcoming episode, please contact us at info@bigfivedigital.org.

Also, please stay tuned for announcements regarding dates and locations for future BigFive Digital live events in Africa-Middle East.

Our guest, Caitlin Craig, is head of private capital markets for Untapped Global, which she describes as a “Global investment company focused on emerging markets, specifically Africa. We're trying to reshape how profitable investing is done.”

Untapped follows a revenue-based financing model. What does this mean, exactly?

Caitlin says that revenue-based financing “allows us to track the health of the assets and the health of the businesses we finance through data. So a bit of a unique model that's different than traditional venture capital or, or financing in general.”

Craig is a native of Canada who joined Untapped in 2021.

Revenue-based financing involves extending capital to companies that generate revenue through assets like delivery motorbikes or point-of-sale devices.

The common denominator for these kinds of companies is their ability to capture data on the revenue each device generates and share it with Untapped so that it can monitor results and capture its share as repayment. So IoT runs through the heart of Untapped’s model. Untapped has coined the phrase “Smart Asset Financing” to describe its unique spin on revenue-based financing.

In order to qualify for an Untapped investment, a business needs to be asset heavy with productive assets (e.g., motorbikes). And these assets need to be “tech-enabled” which means they can produce data on the revenue each asset generates. This is where IoT becomes central to the Untapped model.

We asked Caitlin to explain the model by describing some of the companies Untapped has invested in.

One of these is I-Drop, a company based in Cape Town, which is also Untapped’s home base in Africa.

“I-Drop is one of our operating partners, which is what we call our portfolio companies. And they operate something called a water pod, which is a pay-per-use water filtration device,” Caitlin explains on the podcast.

“And they take their water pods and put them in mom-and-pop shops around South Africa, and in some larger grocery retail stores. And, they have run a model where they service those machines. And people can come in, and they can buy clean water at a low cost. So it is one rand per liter, which is much less expensive than buying the big three-liter bottles that you often see people have to purchase when they don't have access to fresh and clean water.”

I-Drop checks a lot of boxes for any investor in Africa. First and foremost it is using technology and innovation to address a real problem in Africa (access to clean drinking water). It’s well suited to Untapped because I-Drop’s pods are connected devices that provide the data stream Untapped needs to track its investment. The impact angle does matter to Untapped. But for Untapped, it’s about more than clean water.

“Impact is always part of the conversation when investing in Africa,” Caitlin said on the episode. “One lens we always look through and what we measure around impact is revenue generated in the local economy.”

With I-Drop, Untapped is drawn to the benefits the water pod business delivers to small entrepreneurs.

“The end user of the assets we finance are almost always small entrepreneurs and the assets we finance should help them do their jobs or help them earn revenue,” Caitlin explains.

“In the case of I-Drop, the end user is that mom-and-pop shop that is providing a service for its customers to have access to fresh water. So we're able to measure how much revenue is extra revenue that this mom-and-pop shop is making because they have access to the machine which goes in their store, and the money goes directly into their pockets,” Caitlin explains. “We're looking at how can we enable these small entrepreneurs to do their jobs or provide jobs through access to this asset that they might not have access to without financing.”

Motorbikes are another asset type that is commonly associated with asset-based funding programs like Untapped offers. As Caitlin puts it in our interview, “we've hit the sweet spot in mobility.”

One company that Untapped backs is Afridelivery in Zambia, which Craig featured, along with I-Drop, in her presentation at the BigFive Summit in Cape Town.

After all, motorbikes, like water pods and POS terminals, are well suited to Untapped’s model, as long as they are enabled to track their performance and share the data with Untapped, which many if not most logistics platforms are set up to do.

Another interesting thing about Untapped is the company takes an equity stake in very few of its portfolio companies.

“We don't traditionally take equity in the businesses, because we're doing revenue-based financing, and we're paid back through the revenue they produce,” Caitlin explains. “It's more of a debt model than anything else.”

She did say Untapped takes an equity stake in some of its investments, usually for strategic reasons. For example, if the business is scaling to multiple markets.

The BIG5D Podcast features in-depth conversations with the leaders who are building, investing in, or taking to market the digital products and services designed to make micro, small and medium-sized businesses more successful in Africa and the Middle East.

The BIG5D Podcast is also available on Apple Podcasts, Spotify, YouTube, or wherever else you get your podcasts. Please follow, comment, rate, and review wherever you listen, including here on Substack. Your engagement helps others discover this podcast so they can learn about the amazing African thought leaders we feature on the show.

To recommend guests or to discuss sponsoring an upcoming episode of the BIG5D Podcast, please contact us at info@bigfivedigital.org.

Announcements are coming soon regarding dates and locations for future BigFive Digital events.

Interview Excerpts

The following are a few edited excerpts from our conversation with Caitlin Craig. These excerpts represent but a fraction of our full conversation. Please listen to the podcast or watch the video to experience the entire interview.

Q: What is Untapped Global and how do you invest in African companies?

A: Untapped is a global investment company. We are focused on emerging markets, and really specifically Africa. And what we're trying to do is really reshape how profitable investing is done. Within the markets that we operate in. We really focus on high-growth companies that are asset heavy. And we offer them a revenue-based financing investment model that allows us to track the health of the assets and the health of the businesses we finance through data.

Q: How does Untapped approach equity in your operating partners?

A: We don't traditionally take equity in the businesses, because we're doing this revenue-based financing, and we're paid back through the revenue they produce. It's more of a debt model than anything else. Some of our businesses we have an equity share in. But that's much more strategic on our side because, for example, they might be scaling to multiple markets.

Q: Is there a common hardware component to the assets that you invest in?

A: The categories of assets that we finance are quite broad, but where we've really realized we've hit the sweet spot is actually in mobility. I-Drop doesn't fit into that category, but it's still a great asset class for us in clean water and filtration. But we've financed a lot of motorbikes, so two-wheelers, three-wheelers, or Tuk Tuks in different countries.

And in order for us to monitor the data, each of the businesses we work with operates those assets. So they operate the fleets of motorbikes or in I-Drop’s case, operating the water pods, they all have to be tech-enabled, meaning that they often have their own platform that they use to monitor their assets. So that commonality could be the tech element in the fact that they have their own platform. But most of these devices have IoT devices that track them. So the water pods have an IoT device that measures the usage and how much revenue is produced. The motorbikes often have trackers on them.

Q: What is Untapped doing in other emerging markets?

A: At the moment, we're also in Mexico, we have two partners in Mexico. And that's a market that we think we can grow a lot in, in Latin America, there's a lot of need in mobility. And then looking at Southeast Asia as well. Indonesia would be a great market for us. We think there's a lot of opportunity there. But we aren't specialists in those markets. And so our goal is to find the partners and potentially funds who are specialists in those markets.

Did you miss the recent BigFive Summit in Cape Town? As a premium subscriber you can access all of the presentations here.

We are excited to return this week with the BIG5D Podcast. Our latest guest is Brenton Naicker, who is the Director of Capital Formation and Growth at CV VC, which is a Swiss blockchain-focused venture capital firm that is now actively investing in Africa.

We reached out to Brenton to discuss two broad topics. The first was to understand what the heck is going on in crypto, notably in the wake of the collapse of FTX and an overall very bad past year or so for the industry.

“I think it really is just an isolated few cases of really, really poor risk management, but by human beings to be quite honest,” Naicker said on the podcast.

Brenton believes that thoughtful regulation is a key element to bringing stability to crypto markets. And he expects that process to take at least a couple of years, given regulators around the world are not given to fast action.

Brenton has a background that gives him a unique perch to comment on all things blockchain and crypto. In addition to his current work as a blockchain investor, Brenton spent nearly two years leading business development and partnerships for the cryptocurrency exchange Binance.

We also wanted to better understand why CV VC believes so passionately that blockchain is a uniquely useful solution for solving real-world problems in Africa and other emerging markets.

There are many reasons, Brenton explains. But it begins with demographics.

“The demographic situation in Africa…definitely leads to a better environment to build these new technologies,” Brenton said. “We've got the youngest population, you know, globally, at about 19 years old [on average]. Europe, I think, is about 55.”

We hope you enjoy the interview. You can also view a video version of Episode 34 of the Big5D Podcast on our YouTube Channel.

Interview Excerpts

The following are a few excerpts from our conversation with Brenton. Please listen to the podcast or watch the video to experience the complete interview.

So what happened with the recent crypto meltdown?

I think it was this Black Swan confluence of factors that really led to this contagion, that stemmed from the wider macro environment, plus [the actions of] some of the bad actors in the space. I think it really is just an isolated few cases of really, really poor risk management, but by human beings to be quite honest.

Why is Africa so uniquely suited to blockchain?

Africans are adopting cryptocurrency at a far more rapid rate, and are utilizing it in a very, very different way. They are using it for payments. I always tell us a story because it just blows my mind. There are 40-year-old street merchants in Nigeria, who can tell you what is the best network to send them USDT on to minimize the gas fees, or basically make the transaction as cheap and fast as possible. And that level of adoption and knowledge was just gained out of necessity.

What are some of the top use cases for blockchain in Africa?

Fintech is the lowest-hanging fruit. Sub-Saharan Africa [is among the] worst places to remit money to in the world. The costs are ridiculous. The charges there are sometimes 15% to 25%. If you look at the user base, they're sending the little bit extra that they can home to mom in a village. So that 25% is a significant value to be extracted. In local markets in Nigeria and Kenya and South Africa, it is completely possible right now to buy synthetic dollars as a US citizen, and remit that to Nigeria in 15 minutes for free. In fact, because of local premiums, you'd actually end up sending the person more money. So they get more money in Africa.

One important note. Nothing discussed on this podcast should be construed as financial advice.

Join Us in Cape Town

Brenton will be a speaker at the upcoming BigFive Summit, 15-16 March in Cape Town. Please use the promo code BIG5SUBSTACK at checkout for 25% off of the prevailing ticket price. Early bird prices expire at the end of February.

For those few of you not yet in the know, BNPL lets consumers take immediate possession of goods they will pay for later through installments. SNBL is BNPL’s stern, responsible cousin. SNBL still facilitates buying cool things like furniture and jewelry. But you have to make your last payment before you can take possession of the chair or the necklace.

Vega graduate Katzwinkel got his entrepreneurial start with FOMO, an online travel agency that facilitated installment payments for travel adventures, allowing everyone in a friend group to make that destination wedding after all, as an example. Then came COVID.

FOMO’s payments technology ended up providing the backbone for LayUp Technologies, Katzwinkel’s current company trying to flip BNPL on its head via SNBL.

On the podcast, Andrew argued that SNBL is better suited to the South African economy, where the financial system is sophisticated yet many consumers live on cash. Also, Andrew noted that a large percentage of South African consumers are not fully included in the financial system and are not considered credit-worthy.

“We have taken a bit of longer-term view and identified a much larger market whereby we can serve them through a save now buy later model,” Andrew says on the podcast.

Andrew and others in the SNBL space (for example, U.S.-based Accrue Savings) like to point out that SNBL is savings, not credit. This is an important distinction from BNPL, as Andrew drives home in this episode.

We hope you enjoy the interview. You can view a video version of this episode on our YouTube Channel.

Interview Excerpts

The following are a few excerpts from our conversation with Andrew. Please listen to the podcast or watch the video to fully experience the interview.

Why is Save Now, Buy Later (SNBL) better suited to the South African market than Buy Now, Pay Later (BNPL)?

If we look at the total addressable market [in South Africa], there's actually a majority of our population that actually sits in the non-credit worthy consumer base, and therefore really, when you look at our active credit users, which is really a lot of players all kind of going after the same consumer base, it's very crowded. And it's and it's a diminishing number.

We have taken a longer-term view and identified a much larger market whereby we can serve them through a save now buy later model. This is a low-risk, interest-free savings vehicle where people are deferring the collection of the item but have the flexibility to pay the way that they want and to amend, cancel, or extend those payment plans.

What are some key differences between SNBL and BNPL?

If you're doing a like-for-like correlation between BNPL and SNBL, is that a lot of our customers are saving towards much higher value purchases, where BNPL wouldn't really be in that category of you know, a much more immediate gratification type item.

So when you look at things like engagement rings, to even things like funeral plots here in South Africa, these are very high-value purchases, for which consumers can now set up an interest-free solution whereby they can pay over a much longer term. This also taps into your foreigner market, your Gen Z market that hasn't yet actually got a credit rating…and then your non-creditworthy customers, which is a large number of people in South Africa.

And so it's really focusing on trying to shift the behavior of consumers to say, look, there, there is an alternative to credit. And this is a solution that will allow you to pay really over a period of time in the way that you want to.

As a young African tech founder, what advice do you have for others who are considering entrepreneurship?

First, if you're not willing to get off your chair to try, you're never going to know. If you just talk about your idea and you get this positive feedback, but you have no kind of real willingness to actually make it happen, then it's never going to happen. So how strong is the idea? How strong is the why? If that why is strong enough, then you need to get off your chair to make it happen.

I think the second part would be to realize the importance of creating a strong founding team from the beginning. And everyone has got different skill sets within running a company and you need to identify what are your strong skill sets And then what are the complementary skill sets that you need around you in order to actually put together a strong founding team?

And then the third one would be like, it's a hell of a roller coaster. So enjoy the ride. You're going to go through massive ups and massive downs. And the ups make it worth it. The downs can be some very dark days.

Reach the BigFive Digital Community

Would you like to promote your organization on the BIG5D Podcast? We offer fairly priced podcast, newsletter, and live event sponsorships. We are also happy to explore bespoke content opportunities. For example, white papers, podcasts, webinars, and more. We also offer job postings to help you find the right individual for a role. Reach an audience of nearly 3,000 educated, influential, and engaged tech leaders in Africa and the Middle East, plus Europe and North America, through BigFive Digital. To start a conversation about partnering with us, email us at info@bigfivedigital.org.

Andrew Kastzwinkel will also be a speaker at the upcoming BigFive Summit, 15-16 March, at the Radisson Blu Waterfront Hotel in Cape Town.

We are also well into planning our 2023 BigFive Summit, which returns to Cape Town on 15-16 March at the Radisson Blu Waterfront Hotel. Please add “Africa’s leading small business technology event” to your diary.

Write to us at info@bigfivedigital.org to discuss participating in the Summit.

This week’s guest, Tyler Karahalios, who leads financial services at the B2B marketplace startup MarketForce, will also be a speaker at the BigFive Summit. In fact, this podcast series will lean heavily over the coming months toward featuring some of the most engaging 2023 Summit speakers. Karahalios, a California native and Stanford University graduate who fell in love with Kenya and Africa’s entrepreneurial environment, is among them.

Karahalios’s formal title is Global Head of Special Projects and Merchant Banking at MarketForce. The East African retail distribution platform was founded in Kenya in 2018 by CEO Tesh Mbaabu and CTO Mesongo Sibuti.

MarketForce enables African informal retailers to order inventory — mostly fast-moving consumer goods (FMCG) —- via their smartphones. And take delivery within 24 hours.

This category has become a game changer for informal merchants, who often have to go to warehouses at dawn in search of stock. Or often they are forced to close up shop midday to hunt for fresh inventory. Both are suboptimal processes, for both the health and bottom lines of the retailers.

MsarketForce’s position as a distribution resource for retailers makes it natural to layer on fintech solutions like payments, inventory finance, and more.

Enter Karahalios, who is the fintech person at MarketForce. Here is how she describes her role. “I lead financial services at Market Force, which is all of our inventory finance, digital wallet, payments, any sort of financial service you can think of, we're thinking about extending to our merchant network. So that's my work across all of our operating countries.”

She says MarketForce is building “a super app for retailers to help them operate and grow their businesses.”

Karahalios talks about two key differentiators at MarketForce. One is having an asset-light model (from the Uber playbook) — no warehouses, no trucks, etc.

The second is focusing on finding growth in second-tier cities. MarketForce operates in 20 cities in Kenya for example.

“We typically enter into a capital city where there's a lot of a lot of activity, but then we very quickly branch outside of that,” Karahalios said. “We actually find that the unit economics in the secondary cities can be more profitable than in the primary cities.”

Since its founding, MarketForce has raised $42.9 million (per Crunchbase). The bulk of the funding — $40 million — came in a Series A back in February this year.

MarketForce, based in Nairobi, now operates in five markets — Kenya, Nigeria, Rwanda, Uganda, and Tanzania.

MarketForce has also dealt with challenges common to tech companies in today’s cost-conscious environment. In August, we learned the company reduced its workforce by 9% as part of a restructuring effort.

The company currently has roughly 400 employees across all of its operating markets, according to Karahalios.

MarketForce also faces competition from a wide variety of companies across its operating markets, including TradeDepot, Wasoko, Sabi, and others.

We hope you enjoy the interview. You can also view a video version of this episode on our YouTube Channel.

Interview Excerpts

The following are a few excerpts from our conversation with Tyler. Please listen to the podcast or watch the video to experience the full interview.

Why Africa?

I was very fortunate. I went to Stanford University [located in Palo Alto, California, deep in Silicon Valley] for my undergraduate degree. And that's where I got immersed in the kind of entrepreneurship and startup ecosystem. The energy in Silicon Valley is palpable. And it was impossible not to kind of get drawn into that. And then I, throughout the course of my studies had done some work in South Africa, up into Tanzania. And that's where I first got some exposure to the opportunity across the African continent. So in 2016, I moved to Kenya, I received advice to follow the money and South Africa, Kenya, and Nigeria, basically, are the VC centers so so made moves out here and really fell in love with the startup and venture ecosystems [in Africa]. People are creating incredibly innovative products and solutions that move the needle in people's lives. And it was impossible not to want to be a part of it. So that's what's kept me here.

What is MarketForce today?

We partner with manufacturers and suppliers and make their products available on our platform. And then merchants can order those goods via our app and have reliable next-day delivery. And so we're really solving that core need of reliable convenient delivery of goods. There's a large pain point around merchants waking up at four in the morning to go to a wholesaler that may or may not have what they need. And so this just eases their operations quite a bit. And then on top of that we've layered on access to value added in financial services, to have a digital wallet and digital payments, Bill Pay services where they can sell airtime or electricity to the end consumer and earn extra income, and then inventory financing as well to support their cash flows and help them order more and sell more.

MarketForce aims to be a super app for retailers to help them operate and grow their businesses. What that looks like being a super app is first, meeting their core need of reliably ordering goods. Second has been adding on value-added services, like bill pay, and then financial services. And inventory financing. We're also seeing a ton of startups pop up around business operation tools. So things like bookkeeping, or inventory management, and consumer credit tracking. These are solutions that I can see us building to have it really be a one-stop shop for them to access whatever they need to operate and scale their small businesses.

Does MarketForce help informal retailers formalize their businesses?

We serve formal and informal retailers. And I think that varies pretty significantly by market. So in Rwanda, almost if not all of our customers are formally registered. Part of that has to do with the regulatory environment and the incentives around formalization. That varies largely by market. I can see us getting to the point where we support merchants in their journey to formalize. But right now, yeah, we're all-inclusive, we serve everyone.

What’s on the near-term horizon for MarketForce?

We're really looking at scaling up our inventory financing solution for merchants, which is very exciting to me. We'll also have a digital wallet and Bill Pay services live in all our markets relatively soon. It's active in Kenya, Nigeria, and Uganda at the moment. But there's a 2018 World Bank IFC figure that there's a $330 billion financing gap for formal SMEs across the continent…there's an incredible opportunity to provide MSMEs with financing solutions that meet their needs. And I think one thing that's really unique about market forces, traditional financial institutions tend not to serve this customer segment because they're too costly and too risky.

But that's not true for us. And because of our existing business model, we also have really unique data that no one has access to…their entire transaction history… It really de-risks lending when you're financing inventory, and have a whole new layer of history and data to make those decisions off of. So we're really, really excited to scale that up.

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Jason Sive is lumped in with the buy now, pay later space via his company, Mobicred. But he resists this grouping, noting that what his company really offers is a virtual credit facility. And this bears more similarity to traditional revolving credit than the no interest, no fees “pay in four” structure that most of us associate with buy now, pay later.

Mobicred, which was recently acquired by RCS, offers a virtual credit facility and partners with retailers to offer at the point of sale. The service has been available only online, but Sive noted in the interview that an in-store option is coming. Mobicred has relationships with more than 4,000 retailers.

For all the time we’ve been in touch with Jason, he’s been a pretty sharp BNPL critic. He says the pay-in-four model and its variations are unprofitable, even at scale.

And he says too many players rushing into the space has created a race to the bottom. BNPL platforms are in some instances paying retailers millions to renew deals, Sive said. And even discounting their main revenue stream, which is the lead fees that retailers pay for each BNPL transaction.

BNPL platforms also assume all of the risk. They pay retailers in full for purchases that consumers then pay off over time. So any defaults are borne by the platforms. However, most platforms mitigate the risk by taking one payment upfront, which traditional credit cards don’t do.

It was Jason’s candor about BNPL that led us to invite him to speak on BNPL at the recent BigFive Summit in Cape Town.

We sat down for a 20-minute on-stage interview that offers about as sober a take as you’ll get on the BNPL phenomenon.

You can listen to the interview above, or view the video here.

Here are some highlights from our conversation with Jason.

On the level of competition in BNPL

You can go to pretty much any country right now. And you'll see one or two that got out of the starting gates first, and then five, or six copycats that are trying to play catch up and inevitably will just be consolidated.

On why the ‘pay-in-four’ BNPL model isn’t sustainable

If you look at the products and the way they're designed, they're obviously able to churn their cash really quickly, which is a great benefit. You don't need a ton of money if you're going to grow very quickly because your money comes back quickly.

But the bigger problem is that I think they've created this expectation amongst the retailers that these products are likely here to stay. But they've also created an expectation amongst retailers that they can be served at a rate that's not sustainable. So in the U.S., I know, some of the big guys are actually paying the retailers, like tens and tens of millions of dollars, just to extend the contracts. That's not sustainable.

On why BNPL platforms are in such trouble now

We’ve had a number of these very large BNPL players launch and scale at breakneck speed. And they've also been able to raise a ton of money on the assumption that when they get to real scale, and they've got 10s of millions of customers, it'll be a great model with good returns and shareholder value. And they listed a lot of these businesses.

Twelve months ago, some of these businesses were worth billions of dollars on various stock exchanges. Today, many of them are worth perhaps 10% of what they were.

I think what's happened is that analysts and investors have run out of patience. They're saying, ‘You guys are at scale, and you're still losing money. And two, we kind of don't believe you anymore, because you've been saying this for a long time’. And now, three, interest rates are rising and tech stocks have been hammered. So they have been in a bit of a perfect storm.

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Vinny Lingham is currently CEO of the video conferencing startup Waitroom. But he is best known for his side gig as a Shark on South Africa’s version of the reality show Shark Tank. For the uninitiated, Shark Tank is the show where entrepreneurs try to convince a panel of hard-nosed investors like Vinny to put money into their businesses.

Shark Tank pitches tend to spring from the personal needs or passions of the entrepreneurs. Hence they’re heavy on products involving kids, pets, weight loss, etc.

But once in a while, something different happens on Shark Tank. For example, back in 2016, during Shark Tank’s first season in South Africa, Vinny offered to invest in the developers of the augmented reality game Augmentors. But there was an interesting catch.

This is what Vinny told the Augmentors founders: “The problem you’re trying to solve around creating rarity … can better be solved by using the Bitcoin blockchain. So, my offer will be 500,000 ZAR, or roughly 59 Bitcoins, for 20% of your business.”

By the way, today 59 Bitcoins are worth more than US$2.3 million (or about 35 million ZAR).

Crypto and blockchain have long been passions of Vinny’s, so much so that he helped launch the blockchain-based digital identity company Civic Technologies back in 2015, which Vinny now admits was ahead of its time. Vinny recently stepped aside as Civic’s CEO to focus on his new startup, but he remains Civic’s chairperson.

Vinny’s entrepreneurial journey also includes launching the freemium website builder Yola in 2007 (he exited in 2011). And the digital gift card business Gyft, which he launched in 2012 and sold to First Data Corp. in 2015.

While a native South African who appears on Shark Tank South Africa, Vinny spends most of his time in California, where both Civic and Waitroon are located.

In addition to his work with Shark Tank, Vinny stays connected to his home country via Newtown Partners, a Cape Town-based seed investment fund that focuses on early-stage technology startups in South Africa. Vinny is one of the fund’s co-founders and its general partner.

Vinny joined us last week on the BIG5D Podcast. We talked about his new company Waitroom, why he thinks governmental incompetence stands in the way of South Africa’s technological potential, the true promise of blockchain, and what it takes to be a successful entrepreneur.

Here are some highlights from our conversation with Vinny.

On why he launched Waitroom

Video conferencing and scheduling a video conference are very inefficient. You meet with a whole bunch of people every single day, you have these calls scattered all throughout your calendar, and you don't have enough time to go do what you need to do.

As a Shark on Shark Tank, South Africa, how do I make myself available for pitches if I don't want to listen to pitches for an hour? I'm happy just to do 10 minutes. So how do I get six people to line up and give me 10 pitches in an hour? And I pick the best one and have a follow-up conversation then.

On why he’s pessimistic about South Africa

I think the biggest challenge in South Africa is infrastructure. If you look at the energy grid, the load shedding is just ridiculous.

I mean, I left South Africa because of load-shedding 14 years ago. And it's getting worse. The government is just totally incompetent. I mean, nobody can make a decision, no one can get stuff done. It's just overly politicized.

On why crypto matters

I'm a frontier technologist. So I look at things like web3 and the metaverse. And there are a few people in South Africa building this sort of stuff. And I try to find them and invest in them. I like to be ahead of the next big thing, like Bitcoin and crypto. I've been there for years. And I've been preaching about it in South Africa for nearly a decade as well. I'm trying to get people onto that train.

I have an overarching thesis that the world is going through a massive expansion of wealth and capital right now. U.S. quantitative easing has actually helped expose how much money's in the world and how much value is in the world. I do think that if the monetary expansion happens too fast, we're gonna have major issues. But crypto will probably be the biggest beneficiary because, with crypto, you have a fixed supply. So even if things get crazy, you can't print more Bitcoins, it just doesn't work that way.

On why blockchain-based digital ID is a powerful idea

When you verify someone's identity, you check it against a source, right? And the source is going to be say Home Affairs, or some ID verification company, etc. And they tell you who that person is, and you believe them and you do your thing.

In the decentralized identity world, I give you my credentials, you check the signatures are valid, you don't tell the other guy, you just trust that the signatures they gave are valid, and you can check it using cryptography. And that's private. So instead of three people knowing I did a transaction, now only two know — me and the person receiving the information. That's way more secure and way more private. And it's the future of identity.

And on why it may take years to come to fruition

It’s definitely an idea ahead of its time. We started the company in 2015. And we were the first blockchain-based identity company out there. Where we are right now, I guess, is trying to figure out how to use decentralized identity and things like NFTs.

It's really hard to use fundamentally new technology to disrupt the existing marketplace. Banks want to use what other banks are using. They don't really care about whether it's good or bad. They just don't get into trouble. A banker’s number one job is to make sure he doesn't get fired. Because it’s a cushy job. Why would you want to get fired? So don't make any bold moves.

On what makes a great entrepreneur

I would say, the ability to withstand incredible amounts of pain. Not physical pain, but the emotional pain and trauma and just living in a world of uncertainty for long periods of time.

I'd say the second thing would be being absolutely relentless, and never giving up. So you can withstand the pain, and you just refuse to give up and never say die.

You can watch the full interview with Vinny on YouTube here

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Our latest podcast guest Gideon Greaves is MD, Africa for CV Vc, a Swiss investment firm that is all blockchain, all the time.

Greaves, who joined the firm last year, is charged with finding and investing in blockchain-based startups in Africa. But in order to achieve that objective, his Swiss-based firm CV VC, also sees its role as creating an ecosystem that will help make these startups more successful.

In fact, his firm’s origins are in hosting startup competitions and hackathons designed to foster blockchain innovation. In that vein, CV VC also launched CV Labs, which Greaves describes as an “ecosystem driver.” CV Labs offers workspace and advisory services, startup competitions, and other services to support startups.

“For us, it's very important that we grow an ecosystem, especially in new areas like Africa, and South Africa, where we were trying to get all the key participants that form an ecosystem involved,” Greaves said.

“So that would be academia, education, government, different associations, corporate investors, startups, etc, or to collaborate and, and, you know, continue to meet up and be part of this ecosystem.”

We talked to Greaves about the state of blockchain startups in Africa. What solutions are they building? Do they have adequate funding and support? And how are Africa’s small businesses being helped by blockchain?

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This Episode is sponsored by…

This issue of the Africa SMME Tech Report is supported by Matchcraft, a global martech company powering local search, social, and display campaigns. Matchcraft has introduced “Powered By”, a solution that productizes its suite of APIs, giving third-party platforms access to the technology behind its flagship AdVantage platform. Visit Matchcraft.com for more.

Would you like to sponsor an issue of The Africa SMME Tech Report? Write to us at info@bigfivedigital.org for details.

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Guy Futi is a born entrepreneur. The Congolese founder of food tech SaaS platform Orda was born in Gabon and raised in Canada, and educated at some of the world’s finest schools. He later honed his management chops at Jumia, one of Africa’s tech unicorns.

One of Guy’s many childhood business ventures involved burning CDs off Napster downloads and selling them for walking around money. Fast forward a few years, he and his wife created and produced a reality show focused on dating life in Africa, which they later sold.

In 2020, he left Jumia, where he ran Jumia Food in Nigeria, to launch Orda, a Lagos-based software company that aspires to be the operating system for small (and also large) restaurants across Africa.

Its core offering is a cloud-based POS system. The company recently raised a $1.1 million pre-seed round. The company also just became the first African company named to the Techstars Boulder, Colorado, program. In fact, our conversation with Guy took place while he was in Colorado.

The company offers a platform for omnichannel ordering (e.g., from multiple channels like WhatsApp, Jumia Food, and so on), plus a customizable microsite for its restaurant customers. Orda also gives restaurants their own branded mobile app.

Orda was founded as StarKitchens and later rebranded as Orda. The name change from StarKitchens reflects an early intention to launch a cloud kitchen business.

Futi and his team quickly realized there was a much bigger opportunity. Africa’s very small restaurants need help making the transition from managing their sales and financial operations with pen and paper. And the volume of offline trade still far exceeds the volume coming in via delivery apps.

Futi says Orda’s best customer is a small restaurant that hasn’t yet jumped on the SaaS train.

“We like clients who operate on cash or use pen and paper to run their business,” Futi said. “Because then we can make a difference quickly.”

Restaurants needed tools to help them operate efficiently, collect data and then process it so they know if they made money on any given day. And even better, gather insights to improve operations and profitability, giving restaurants a better foundation to grow from.

So the company changed gears and changed its name. Now Futi and his team are racing to keep building and improving its product, expanding into new markets, and no doubt soon raising more money. As Futi well knows, a million dollars doesn’t last very long when you are chasing a massive opportunity.

Futi met with us recently to talk about his company and its ambitions. He also shared his “brutal” experience fundraising and what he thinks are the keys to building great software for small businesses. Simplicity is a big part of the answer. As Futi puts it, “if you can play Candy Crush, you can use Orda.”

This Episode is sponsored by…

This issue of the Africa SMME Tech Report is supported by Matchcraft, a global martech company powering local search, social, and display campaigns. Matchcraft has introduced “Powered By”, a solution that productizes its suite of APIs, giving third-party platforms access to the technology behind its flagship AdVantage platform. Visit Matchcraft.com for more.

Would you like to sponsor an issue of The Africa SMME Tech Report? Write to us at info@bigfivedigital.org for details.

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Ukheshe was founded in 2018 as a B2C digital banking application with a mission to promote small business financial inclusions in Africa.

But the Johannesburg-based company quickly realized that becoming a platform for other companies to build fintech products was a better path to scale than building a consumer-facing product. The latter would require raising a lot of money and pouring it into customer acquisition.

So in 2019, the company sold its payments product to Telkom (which is now the WhatsApp-based Telkom Pay) and became a platform that now powers fintech solutions from most of South Africa’s banks and telecoms. And its serves as the back end for many fintechs as well. ChipperCash’s recent market entry into South Africa was powered by Ukheshe for example.

Ukheshe also has important commercial relationships with Mastercard and Visa.

In April 2020, Ukheshe joined Mastercard’s Start Path program, “an exclusive startup engagement program for later-stage scaling startups.” The company has since helped Mastercard launch several fintech products into the market. One example is a prepaid payments program with Mastercard and Nedbank.

The decision to pivot to a cloud and API-based platform play has served Ukheshe well. The company hasn’t had to raise any money since raising a US$500,000 seed round in 2019. Until now, that is.

“The business is still majority controlled via the founders, which is great,” Smits said on the podcast. “We are actually on a fundraising drive at the moment. The fundraising drive is to fund expansion into multiple markets. We've got aspirations to be in 40 markets in the next in the next two to three years. And that comes at a cost.”

Had Ukheshe stuck to its original model, its founders would likely be significantly diluted at this stage.

Smits said Ukheshe’s focus is on expanding into emerging markets across the globe — not just in Africa-Middle East. He said the company is already in talk with partners in Southeast Asia. And it has designs on Latin America as well.

Ukheshe ultimate goal is to be the technology platform that companies in emerging markets worldwide use to launch fintech products.

“We want to commoditize fintech so that it makes easy for people to be able to launch fintech propositions, because it's good for the end user,” Smits said.

Episode 25 of the BIG5D Podcast is supported by Matchcraft, a global martech company powering local search, social, and display campaigns. Matchcraft has introduced “Powered By”, a solution that productizes its suite of APIs, giving third-party platforms access to the technology behind its flagship AdVantage platform. Visit Matchcraft.com for more.

Here are some key passages from our Episode 25 interview with Ukheshe’s Mike Smits.

Ukheshe began as a B2C digital bank. Why did you make the pivot into a white-label fintech platform?

“For us it was better to be able to offer it as a service to allow other people to launch digital offerings than for us to raise the funding and digitally onboard people, etc. So in about 2019, we pivoted the business. We sold off our B2C operation [to Telkom].

“We now see ourselves as fintech enablement platform. Fintech-as-a-service, if you like, where, if you want to be able to launch a proposition, we can either help you with a white label solution, or you can build it on top of our APIs.”

Ukheshe encourages companies to “transform your business into a fintech.” Is there any limit to the kind of business can do this?

“Everybody traditionally thinks of the fintechs as being the telcos and the banks. But you you can now go into the FMCG [fast-moving consumer goods] companies, whether you’re Coca Cola or AB InBev, that now needs to do last-mile delivery. And the last-mile delivery traditionally has been based all on cash. So with COVID, and the risks associated with cash, all of them are trying to be able to convert and launch a fintech proposition to take cash out the equation.

“We've got a contract that we've signed with with DHL, for example. Due to last mile delivery, there could be payments that are necessary before the goods can be handed over. Traditionally, they would have to accept cash. There's the cost of cash and everything else that goes with it. If you can convert that very easily across to a digital mechanism, it’s in everybody's interest to be able to do that.

“More and more, every business wants to have a fintech division to be able to assist with receiving money.”

You also work with disruptive fintech brands. How many of these companies are launching on platforms like Ukheshe?

“I think it's it's becoming more and more that way, especially with open banking type of drives across the world. So people always ask us, ‘What is your competition?’ Our competition is build it yourself.

“But for somebody to actually go in and build it themselves, they would generally speaking have to integrate with five, six, seven, different vendors to be able to build a proposition. They would then have to go and sign up banking relationships, which is not easy. And they would then have to go and do compliance and regulatory hurdles that they needed to cover, and so on.

“So this fintech-as-a-service, it just means that you're enabling organizations on a very light capex model to be able to grow. So our business model is we grow with you. We charge transactional fees, etc. And as you grow, we grow.”

How important are APIs as an engine for your business?

“Everything runs on APIs all in the background. So there's very little that actually happens without initiating an API in the payment space. So from a fintech perspective, definitely. And one of the things that we've done very well is that everything that we've built has been, cloud native and API first. So all of our channels are API driven.”

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17 February 2022Media One HotelDubai, United Arab Emirates

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Taskmoby connects consumers with vetted service providers, including domestic workers, plumbers, electricians, with more categories coming.

Taskmoby made news recently when it was named as one of 50 startups receiving investments from the Google for Startups Black Founders Fund in Africa.

This is a meaningful award. Google has invested $3 million in the fund, which translates into non-dilutive cash investments up to $100,000. The award also includes Google Ads and Google Cloud credits worth up to $220,000, plus mentorship and technical support.

“It’s fantastic,” Ezana, an Ethiopian, said of the award. “It’s an award that recognizes African founders and helps us get to the next level.”

The startup investments come amid Google’s announcement that it plans to invest $1 billion in Africa over the next five years.

Google’s focus on African founders comes at a time of increasing scrunity over the racial disparities in venture funding in Africa. Expat founders are widely perceived to be given preferential treatment from investors over native African founders.

Several requirements of the Google Fund are designed to ensure that genuinely African companies get their support. These include requiring at least one black C-suite founder and having both headquarters and legal presence in Africa.

Ezana said that even he was surprised at the extent of the disparity.

“One stat that I didn’t know was, they’re telling me, that in East Africa only 10% of funds are going to black African founders,” Ezana said.

Our conversation with Ezana also focused on Africa’s on-demand home services market, which we wrote about last week.

Specifically, we discussed the challenges in building a two-sided marketplace for home services in Africa. And why, at least thus far, investors have stayed largely on the sidelines, at least when compared with other sectors like fintech and eCommerce.

However, Ezana says development agencies do take an interest in this space, largely because it can play a positive role in job creation.

Some progress was made recently on the venture funding front when Nigerian home services platform Eden Life raised a $1.4 million seed round.

Episode 24 of the BIG5D Podcast is supported by Matchcraft, a global martech company powering local search, social, and display campaigns. Matchcraft has introduced “Powered By”, a solution that productizes its suite of APIs, giving third-party platforms access to the technology behind its flagship AdVantage platform. Visit Matchcraft.com for more.

Here are some key passages from Episode 24.

What will be the impact of Google’s investments in Taskmoby?

“As a start up anything that helps you move forward financially is a great thing. We were on a couple of calls with the other startups, and you also get a network of people that are like minded, facing the same challenges. All that is hugely valuable. And then being able to hop on calls and ask questions. So we are very grateful for all of that. And this is specifically around targeting black African founders and trying to solve a funding gap in that area. So we're lucky to be part of that.”

What is Taskmoby’s mission?

“The backdrop that I think is important within the African context is the massive unemployment rate. In Ethiopia, the unemployment rate among people that graduate from plumbing school is 70%. What's broken is the job market. Essentially, the people don't get placed into position, they're graduating, they're getting certification, but they actually don't get jobs. So I think the way that we look at it is as a placement platform for these people who have certification, but no experience.”

What’s the funding environment like for on-demand home services in Africa?

“Taskmoby is actually quite a mission-driven business. If you look at talk to anybody on the team, the first thing they'll tell you is we're giving jobs to young people. So that the mission side of it actually becomes the main driver…And what we have found is that development partners are easier to talk to around this. And I think that the impact investors probably will be there.”

Upcoming BigFive Digital Events

The BigFive MENA Summit

17 February 2022Media One HotelDubai, United Arab Emirates

The BigFive Summit

11-13 May 2022Workshop 17Cape Town, South Africa

Stay tuned for more information. To enquire about speaking or sponsoring opportunities, write to us at info@bigfivedfigital.org.

Postpay was formed in 2019 by Sheikh, a former management consultant, and his co-founder Dani Molina, who was previously co-founder and CTO of Spanish BNPL Aplazme.

Sheikh and Molina launched their product in 2020. Around the same time, several other companies did the same thing in the Gulf region. These include Shahry, Spotti, Tabby, and Tamara.

“It happened very quickly. And we were all in the know, I guess. I knew that there would be at least two other players coming relatively soon,” Tariq said.

BNPL is now a highly competitive market in MENA. It reflects the global buy now pay later market, which is also hyper-competitive and lately has been attracting big-dollar M&A. The most notable deal to date was Square's acquisition of Australian-American BNPL Afterpay for $29 billion. We also just saw PayPal acquire Paidy in Japan, for about $3 billion. 

In June, Afterpay and its investment arm, AP Ventures invested $10 million in Postpay.

And we've also seen many smaller regional acquisitions, Australia’s ZipCo recently acquired the remaining shares in Payflex, a South African buy now pay later, following a minority investment back in April. Zip has already acquired Spotti, the UAE buy now pay later platform, which continues to operate independently.

So there's a lot going on in this space. And we wanted to get somebody on the podcast to tell us all about it. 

Tariq was kind enough to come on and answer all our questions about how the business works, some of the big challenges it is facing, the competitive environment, and more.

Here is the full interview with Tariq on YouTube.

Episode 23 of the BIG5D Podcast is supported by Matchcraft, a global martech company powering local search, social, and display campaigns. Matchcraft has introduced “Powered By”, a solution that productizes its suite of APIs, giving third-party platforms access to the technology behind its flagship AdVantage platform. Visit Matchcraft.com for more.

Here are some key passages from Episode 23.

What is Postpay’s geographic range?

“Today we are 100% live and operational in the UAE. Saudi Arabia is next, followed by Kuwait, Qatar, and Bahrain. The zone that we consider Postpay territory is anywhere from Turkey to South Africa, and from Morocco to Malaysia and Indonesia. We have a Sharia compliant product, it resonates strongly in the the part of the world.”

Why did so many BNPL platforms emerge in MENA in 2019-20?

“I guess it's driven by the market, right? It's clear that it was a big, big success in the US and in Australia and in Europe. And the Middle East often emulates what happens in the West, and improves it and applies it locally. So this is essentially what happened…We needed it here. There was a strong demand.”

Why has BNPL become so popular?

“When we talk about Gen Z and millennials, this is a population that grew up through financial crisis, in 2007-2008 when there was a lot of uncertainty…in the job market. There was a lot of uncertainty in the banking industry and in the financial service sector. There was a generational shift away from banking, finance and the financial sector. ….

“And so this generation tends to steer away from using credit cards and other traditional financial products. They prefer to use cash. With buy now pay later, when it's very clear — this is what I'm doing and this is how much it's going to cost — there's a lot of transparency. But also important is the instant gratification. This generation wants a couple of things. One, they want things now. And two, they want things that are free.”

How do you respond to BNPL critics who raise concerns that BNPL users may get overextended?

“When we talk about buy now pay later, we're talking about $200, $250, you know, at a cap, maybe $300. If you really go far up, maybe $500. But the limits are a lot a lot lower than what we talk about when you talk about credit limits. So even if we go and dig into a credit bureau and the debt burden ratio, $200, $300 is not going to make a huge difference for the vast majority of the population.

“So when we look at it from a consumer perspective, first of all, we're working with our customers. We're not a debt collection agency. Customers are not able to check out with multiple installment plans ongoing, if if they haven't paid installments off. So they can never get into a situation where they become a revolver. There's nothing like that in buy now pay later.”

What are some of the dangers posed by this incredibly competitive environment?

“There are two major [forms of differntiation]. The first one is constructive differentiation. And the second is destructive differentiation…Destructive differentiation typically comes in two forms and tends to not bode well for any player in the market. First it is lowball pricing, which is unfortunate. It always happens. And it's typically in the unit costs. So it's variable fees, fixed fees that we charge as gateways to the retailers.

“And then the other comes in many different forms, but it could be termed as marketing investments…to boost sales in other ways. I'm not a big believer in those in those two because I believe in sustainability.”

What metrics signal success or failure in the BNPL business?

“You have two major ones. Conversion rates and AOVs [average order values]. Conversion rate come from our market. So our customer base, our returning customer base using the retailer. And also the fact that the same customer that would not have checked out because the price was too high, is now able to check out.

“And the AOV impact, obviously, is that the hypothetical checkout amount is a lot higher, they're able to put a lot more in their basket. And, you know, and check out with more. So those are the two main metrics.

‘In addition to that, we look at items per order. So this is another metric that we look at, which is similar to average order value, but it also looks at, are they just buying more things? Or are they buying more expensive things? So it's a nice way to dive down a little bit more, we also look at return rates. And that's important in a region where logistic costs are enormous.”

This transcript was lightly edited for length and clarity.

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Deepankar founded Lagos-based Omnibiz in 2020 to help small FMCG (fast-moving consumer goods) retailers run their businesses more efficiently.

Omnibiz has a solution for each link in the local FMCG value chain — retailers, field agents, suppliers, and drivers. Omnibiz offers agents, suppliers, and drives revenue opportunities.

The company recently raised a $3 million seed round to build out its product and pursue international expansion. The company has raised $4 million since its inception. And Deepankar believes Omnibiz will need to raise $50 million in order to achieve its vision.

As Deepankar explains, Nigeria has 1 million small retailers. Most of these generate less than $1,000 a month in gross revenue, stocking perhaps 30 to 50 SKUs. And three-quarters are women-led businesses. These businesses need a way to stock their shelves efficiently, so they are no waiting weeks for deliveries or having to close up shop to go out and find stock.

In the near term, Omnibiz hopes to offer a credit product, so the best customers can fulfill orders on credit vs cash on delivery as it is today. The company also wants to expand its software offer to include a simple CRM for its small business customers to better organize their businesses.

Omnibiz faces growing competition in Nigeria. One example is TradeDepot, a B2B eCommerce platform that distributes consumer goods to more than 40,000 Nigerian micro-retailers. The company was founded in 2016. And last year it raised a $10 million pre-Series B round, which brought its cumulative fundraising total to $13 million.

Another competitor, Nairobi-based MarketForce was founded in 2018 and recently raised a $2 million Series A round to focus on building up its RejaReja marketplace and to take its concept to the Nigerian market.

Here is the full interview with Deepankar on YouTube.

Episode 22 of the BIG5D Podcast is supported by Matchcraft, a global martech company powering local search, social, and display campaigns. Matchcraft has introduced “Powered By”, a solution that productizes its suite of APIs, giving third-party platforms access to the technology behind its flagship AdVantage platform. Visit Matchcraft.com for more.

Here are some key passages from Episode 22.

What is a major pain point that you solve for these small retailers?

“We effectively increase their productive hours. They don't have to shut down their stores {to go find stock]. Previously, they used to wait until all the SKUs or all the products on the shelves were finished. There is still a minimum order quantity, but they can now order whatever has finished. So they can order multiple times in a week rather than once in two weeks.”

We’ve seen other startups decide to own their logistics channels. You’ve chosen not to. Why?

“Getting logistics right is challenging. And this is one area where when you scale, you spend more. So someone who has 500 bikers is going to be spending more than someone who has 50. And similarly, more than someone who has five. So we said we're going to aggregate them with technology. So we onboard with these third-party logistics providers, we train their drivers as well as their fleet managers in terms of how to track, how to see the earnings, and how to start and stop the trips.”

How is your company differentiating in what is an increasingly competitive field?

“I think one of the key differences is, we started with the technology first. We are not focused on accruing assets. We are more focused on finding partners who could do it. We don't do any of the logistics or the warehousing. We get it done. So most of the other companies are doing it. Doing the warehousing or the logistics piece, or some of them doing both of them on their own. Our differentiation is that we do not get into doing it on our own. This helps us in scaling efficiently.

“The second key difference is the number of SKUs that we offer. So if you see, the long term problem that we are solving is really the retailer's problem. And we are focused on the retailer. So the number of SKUs that we offer on our platform is aimed to complete the variety that a retailer buys, so they don’t have to go anywhere else to buy.

“And lastly, I think we're going to offer a couple of other tools, other than lending, to the retailers. Like a retailer CRM, so he or she can manage their business.”

How easy was it to raise money for this round? Has the funding environment changed since you became an entrepreneur?

“Lots of capital now is available for African businesses, especially after the pandemic. Globally, there is a lot of capital available. Raising money has become substantially easier. In the African context, there is the challenge of trust. So a lot of investors who are open to investing in your company are looking at someone to make the first move. And once you have that one person who has made the first move…then they bet on the other investors. There are a lot of seed investors available who can cut you a check between $25,000 to $300,000. But there are fewer Series A investors available.”

How are you approaching international expansion?

“We're looking for partners in expanding into other geographies. We believe this business is pretty local. Even though we are technology driven. Africa is not a country, it's a continent. And countries here are pretty diverse. So going into East Africa, or going into Egypt, or South Africa, or even in Ghana and Ivory Coast, we prefer to move in with partners.

“So we are onboarding partners who understand the logistics, who understand the warehousing bit in these countries and will be willing to be our co partner in that country to drive it. So yeah, we are going to expand very soon into other West African markets that are stage one, and would want to be the leaders in the West African space prior to us moving into other markets in Africa.”

Kune Food is an interesting company in many ways. The Kenyan food tech startup’s model sits at the intersection of cloud kitchens, delivery apps, virtual restaurants, home meal kits, and more.

Following a pilot in Nairobi earlier this year, Kune is now gearing up to fully roll out a concept where it prepares either hot, on-demand meals or packaged ready-to-heat-and-eat meals in its own cloud kitchen, which it calls a “factory”.

The company currently is in the process of building a new factory that can produce up to 80,000 meals/day. The full Nairobi rollout is slated for October-November. Initially Kune will deliver only to area hotels.

No Deals with Aggregators

A key Kune selling point is value for money. So the company doesn’t plan to work with aggregators like Glovo or Uber Eats, which add cost for delivery, commission, and so on. This will create added pressure on Kune to spend money on marketing to build the brand and drive order traffic.

The company will also rely heavily on as influencer marketing. To this end, Kune is teaming up with Nelson Aseka’s AIfluence influencer marketing agency.

The on-demand meals will be delivered via Kune’s owned and operated, exclusively female delivery operation. These drivers which Kune calls “captains” will deliver meals (“30 minutes on average”) using a fleet of 60 electric bikes.

The heat-and-eat meals will be sold through supermarket partnerships.

Kune Baby, Kune Pets

Kune is looking at new food concepts that fit with their Kenyan-inspired, wholesome and healthy positioning. Kune Green is likely next. Basically salads. And Kennedy said baby and pet food concepts are also on the roadmap.

Kune also plans to expand internationally. likely beginning next year in Nigeria. In the interview, we expressed some surprise that the company was committing to geographic expansion before it really knows how well the concept will do in Kenya.

Kennedy said the Kune team is confident in how it will perform in Kenya. He also said the company is following in its investors’ footprints by targeting Nigeria and South Africa.

Reflecting on the Controversy

Kune raised an impressive $1 million pre-seed round in June. That event, normally a celebration, turned into a public relations crisis for the company over comments made by its founder, Robin Reecht, a French national.

Reecht’s remarks, published in TechCrunch, landed on many ears as at best tone-deaf and at worst a reflection of the “white savior complex.”

Reecht claimed in the interview that there was no way to get good cheap food delivered in Nairobi. This plus his suggestion that Nairobi street food wasn’t safe seemed particularly triggering for many Kenyans on Twitter. Reecht later apologized for his remarks.

The bigger picture of this controversy was that Kune, just as it was getting on its feet, walked straight into the emotional debate over widely perceived VC favoritism for white, ex-pat founders.

We covered the backlash against Kune in our SMME Tech Report newsletter back in June.

We asked Kennedy about the controversy, mainly to understand if it is having any lingering consequences for Kune as it prepares to launch the business.

In a bit of understatement, he described the incident as “unfortunate.” He also argued that Kune was a convenient target for pent-up anger over larger issues involving equity and inclusion in startup funding.

He also believes the size of the round — $1 million is a pretty big pre-seed round in Kenya — added tinder to the fire.

The controversy mainly played out on social media. And as we monitor the discussion on Twitter, it appears those who were upset back in June have moved on. For now at least.

The discussion of the controversy starts at around the 24.20 mark of the podcast.

Here is the full interview on YouTube.

Episode 21 of the BIG5D Podcast is supported by Matchcraft, a global martech company powering local search, social, and display campaigns. Matchcraft has introduced “Powered By”, a solution that productizes its suite of APIs, giving third-party platforms access to the technology behind its flagship AdVantage platform. Visit Matchcraft.com for more.

Here are some key passages from Episode 21.

Why is it so important for Kune to do everything in-house, from food prep to delivery?

“Because of what we wanted to offer our clients. For us to be able to give them meals that are affordable, we need to own the whole value chain, and try to cut as much costs as possible. One key area that you have mentioned was about the bikes. We are getting 60 electric bikes, which will be ridden by lady drivers. So we've trained 60 lady riders, or captains, as we call them, to do the delivery.

“Customers never get to see the people who are making the food. They only get to see the riders who are doing the delivery. So our app has to be top notch. And our riders needs to feel that they are part of the company. So we are taking them on as full time employees. Because they are the face of the company.”

Are you planning to prove out your model before committing to an international rollout?

“Our eyes are on Nigeria and South Africa. Two reasons. We are very confident that Kenya will be a success. We also want to ride on our VCs’ reach and areas of operation because Launch Africa is in Nigeria, and [unclear] is in South Africa. And they have other existing businesses there that we feel we can partner with to scale. And our investors have been confident in us and they are going to help us do that.”

What has been the fallout from the June controversy over remarks by your founder that some Kenyans found objectionable?

“That incident was very unfortunate. And it comes on the premise of something that had happened before. There was a huge discussion on African startups being not fully African owned. And that has been the discussion that has been going on and we cannot hide our face about that. So we took fire that was not aimed at us directly, but it was part of a bigger discussion.”

Episode 20 of the BIG5D Podcast features an interview with Sky.Garden CEO Martin Majlund. Sky.Garden is a Kenyan mobile-first SaaS company that provides an eCommerce platform for small merchants.

The company sees itself as a Shopify-like solution for merchants in East Africa (and perhaps soon, West Africa) looking for tools to help them sell online. In June the Sky.Garden raised a US$4 million Series A round to fuel the company’s growth, including international expansion.

Sky.Garden takes an asset-light approach. It partners with local boda networks for delivery. It doesn’t touch inventory. It provides software and a wallet to make the entire process much easier for merchants to sell online and get paid immediately. Majlund believes this asset-light approach will make it much easier for Sky.Garden to expand internationally.

Majlund is a former management consultant who later led tech efforts for the Danish brewery Carlsburg. He says the idea for Sky.Garden emerged from conversations with Christian Gruback, then a vendor of his, about creating a set of simplified eCommerce tools for businesses in Sub-Saharan Africa.

The company was formed in 2015 by the two Danes, Majlund and Gruback, and two Kenyans, Isaac Hunja and James Mwai.

Majlund told us it was critical to launch the business with local partners. And today, he and Gruback remain the only non-Kenyan employees out of 37 on the Sky.Garden payroll.

“From day one, we knew that if we were ever going to solve a local problem, we couldn't be arrogant enough to think we could actually solve it from the north,” Majlund said.

“The mindset we had from day one was that we should bring in some experience from European eCommerce. And then find some really, really talented local partners where we could build the company with them from the ground up.”

Sky.Garden tested a prototype in 2016, and the platform formally launched in 2017. In 2018, the company raised a $1.8 million seed round.

Our conversation with Martin focuses on the opportunities and challenges associated with eCommerce for Africa’s small merchants. We also get into the hard lessons learned in the course of building an African eCommerce business.

Here is the full interview on YouTube.

Here are a few key passages from this episode.

What problem is Sky.Garden trying to solve?

“In Kenya, I think 80% of the economy is being driven by the informal sector. So we always say that we've built Sky.Garden for the guys with a side hustle. Today, we're much more than just the side hustle. The pain points we identified were cash flow and access to stock. So making sure that merchants would get paid the second they sold something, I think that's the problem Sky.Garden was out to solve from day one.”

Does a company like Sky.Garden today need an ‘impact’ story in order to raise money?

“I think especially in Sub Saharan Africa it's almost impossible these days to raise early-stage money without having a powerful impact story. But then when you get to the post-seed round, and before Series A, you'll see a pretty massive vacuum. Because then, while the impact story still has to be there, it becomes a pure numbers game. You're not going to raise a dime if you can't show scale.”

How is the intense competition for engineering talent impacting your business?

“There is quite a lot of talent, but in just the couple of years we've been around, it's gotten so much harder to access it. And as far as the pricing, there is not a big discrepancy between hiring a European engineer and a Kenyan engineer now.”

SmartWage was founded in 2019 as an earned wage access platform for South African employers and workers. Essentially it allows workers to tap into wages they have already earned for a small fee, which is either paid by them or their employer.

Why is this important? Far too many South African workers run out of money before their next payday. This is most acute for those on a 30-day pay cycle.

This state of affairs impacts employers by contributing to absenteeism. Money for transport is a leading reason workers need early access to wages.

And this harms workers for many obvious reasons, not least of which is they are often forced to resort to usurious payday lending to get by, absent a more benign alternative like EWA.

“We estimate we're saving employees about 300 Rand per month that they would have alternatively spent on payday lenders,” Simon told us.

One of many challenges Ellis faces is convincing employers to pay for the service, rather than allowing employees to bear the full cost, which, while much lower than payday lending, is a cost all the same.

Probably the biggest competitive threats SmartWage and other earned wage access players face is from the big third-party payroll providers like Sage, ADP, and others.

Ellis acknowledged this but is confident that it does not fit into their business model. He believes that if a payroll player were to enter the space, it would likely be through acquiring a company like SmartWage, or a competitor like Floatpays.

Ellis said SmartWage needs more capital to scale and is in the process of raising a debt fund so it can handle a growing volume of wage advances as it grows.

The company’s future involves penetrating deeper into the market and expanding its set of solutions by adding on features like insurance, savings products, and the like. International expansion is likely farther down the road.

Watch the full episode on YouTube

Here are some key passages from this episode.

Why is this such an important service in South Africa?

“Financial Inclusion is something governments talk about. It's something a lot of fintechs are trying to solve. There is a booming payday lending industry [in South Africa] and we've all heard the horror stories about what people get charged. And the reason why that industry exists is because the 30 day pay cycle hasn't been challenged for 100 years.

“There's a large part of the market which is underserved. So halfway through the month, they need money. Most people go to payday lenders or loan sharks and it puts them in a cycle that is very difficult to escape.”

Who pays for the earned wage access service?

“It's either the employer or the employee. If it's an employee that pays typically, and it's across the board, all of the wage access providers are about five to 10 times cheaper than a regulated, payday loan alternative. And a whole lot cheaper than unregulated alternatives. And typically, the progressive innovative employers who understand the benefits that this gives an employee end up paying for the solution themselves.

“We offer two models. A subscription model is 30 Rand per registered employee per month, with unlimited transactions and a minimum amount of 100 Rand. And we cap the amount that you can access at 25% of what you've actually earned. So if you work for five days, you've only earned five days of earnings. And the other model is a 3% transaction fee.”

What are the benefits to the employer?

“Stressed employees, financially or otherwise, are not productive. So if we can reduce that stress, obviously, there's a benefit for the employer…But the big one in South Africa for the target market we're going after [hospitality, retail, mining] is absenteeism. The number one cause of absenteeism in South Africa is no money for transport. And this solves that problem. And so we've started to see a significant increase in the reduction in absenteeism at the employers we’re working with.”

Why don’t the big payroll platforms take this on?

“I think it's a fundamental pivot to their business model. They typically have these consultants who go and find business and work with businesses too. And now they've got to go a whole further layer deeper to get to the employee. It's a completely different model that would require either that they acquire someone and plug it in, or build their own system.

“And it is nuanced. There are a lot of small things, especially in a South African context that I think the big players are too slow to move to. If you look at someone in the States, like Gusto. This is probably the best example of a payroll provider that has now moved into the space. But they are one of the most innovative companies in America. And it's taken them a couple of years to get to this point. Whereas it's been around for eight or nine years. So I don't foresee the biggest payroll providers making a big change to this.”

What are the biggest challenges facing startups in South Africa today?

“Having lived in London for for a couple of years, the difference in access to capital is significant. For most entrepreneurs finding the right investors is probably the biggest hurdle. Investors want to take a big chunk early on at very low valuations, which then disincentivizes the founders. So that’s the first one.

The second one is talent. With the advent of with with COVID, a lot of talent is now being poached by international companies, especially in the development teams. They can pay double what we can, so we lose out on a lot of significant talent.”

Dubai-based grubtech (founded in 2019) doesn’t operate virtual restaurants. The company has built an operating system to address the friction points arising from running a high-volume food delivery business. Its software provides the efficiency needed to serve multiple delivery-only brands from a single location.

“Our key takeaway from studying the space was that there was no out of the box or native built technology to power these operations,” Mohamed said.

While MENA-based, grubtech has global ambitions. Mohamed tells us the company currently has active customers in more than seven counties. Outside of MENA, grubtech has customers in Singapore and Pakistan, with plans to add Malaysia and the Philippines soon. He says the company is in talks to expand into Europe and North America as well.

In March, grubtech announced a $3.4 million pre-Series A funding round to fuel its product development and expansion. This followed a $2 million seed round in mid-2020.

Our conversation goes pretty deep into the mechanics of ghost kitchens. And we learned about some interesting new trends along the way. One is micro-cloud kitchens. That’s when a local restaurant uses its excess capacity to fulfill delivery orders for another dining brand. So the space operates along both distributed and concentrated models.

We also learned that many originally virtual dining brands are now branching out and launching brick and mortar locations. What’s old is new again.

And we spoke at length with Mohamed about the tehnological future of ghost kitchens. Things like AI-driven personalization and integrtations with wearables. Not to mention ultiizaiton optimization aided by machine learning. All of these and more are on the horizon.

You can watch the full interview on YouTube.

Here are some key passages from this episode.

Why are cloud kitchens/virtual restaurants so popular in MENA?

“When it comes down to online food, we have some of the world's highest order per capita rates. Take a country like Kuwait, I think the order per capita there is almost five per person. So that's five orders a day per human living in Kuwait. So we've always been on the forefront of online food, primarily because of convenience. And obviously, optionality. And we drive a lot of technological innovation from that perspective in that sector.

“So cloud kitchens have almost been seeded here, or at least fortified here, in this part of the world. And they continue to grow very rapidly. So that's contributed to…the proliferation of cloud kitchens in our part of the world.”

Why do cloud kitchens need unique software?

“Our key takeaway from studying the space was that there was no out of the box or native built technology to power these operations. Single brand, single location works fine. Single brand, multiple locations works fine. But when you jam in one location, multiple brands, the existing technology providers really have a hard time with that.

“So a lot of these cloud kitchens built their own technology or kind of customize what was already out there. But to be quite honest with you, it was rickety. It was not very efficient. And it was largely built on a lot of legacy technology. So we saw that as an opportunity, as whitespace.

“We started the company in 2019. so the pandemic was obviously not with us. And we had made a big bet that cloud kitchens are going to be a driving force for how we consume food. And as these operators continue to expand geographically and their business models, they would need a tech enabler.”

What does it take to succeed in the virtual restaurant space?

“The ones we saw succeed were the ones who stuck to the DNA of what good food is. So quality for money, speed of delivery, and consistency. Those are the ones who have managed to survive the shakeout of the virtual brands.

“Another key success factor that we saw with virtual brands that those who went in with a view that they'll just put them into one or two stores that just serves like 10 or 15 kilometers, didn't do so well. Those who had big physical fleets like 50-plus stores, and were able to deploy that virtual brand over a wider area of coverage were able to justify the effort and the investment that went into creating a virtual brand.”

What will happen to ghost kitchens post-Covid?

“This quesiton was debated effusively by our investors. And my response was always the same. Look at online food penetration as a sector. And if you take a global outlook on it, it's still single digits, and some would put it as low as four to five, some will put it as high as seven to eight. But it's still single digits.

“Now, look at how we consume everything else in our life, right? Whether it's media through Netflix, or Apple TV, even down to our groceries or our office needs. You have Amazon. So you've got high double-digit penetrations, in the 30s and 40s, on how we consume our clothes, our commodities, etc. But something as reoccurring as food is still at single digits. What do you think is going to happen? It's going to catch up, right? I mean, we live in our phones and when we press a button, things just appear. So that is not going anywhere. And that consumer behavior obviously was catalyzed by the pandemic, and it will just continue to move forward.

“And as the cost structure of online food becomes cheaper and cheaper, you're already starting to see the impact. New apartment buildings are being built with much smaller kitchens. Because cooking is now a hobby, not a necessity. I can consume food at a cheaper price than having to go to the grocery store, buy all its components, spend an hour or two putting it together. I'll get the same output and a cheaper price, right? So that's here to stay. We've got a lot of headroom to go. The pandemic just helped us accelerate, but it definitely is not going to flatten out or plateau.”

What innovations are you working on at grubtech?

“I think there was a study that said most restaurants run at around 34% capacity. So how do we marry brands that want expansion without capex with this dormant capacity? And do so with science, rather than just arbitrarily…We're spending a lot of time on breaking that problem down. And we're quite confident that we've found a solution.”

The company is based in Kigali and operates in Kenya, Rwanda, and Uganda. 

We got right into it with Tori on some of the tougher questions that come up when you’re talking to the founder of an impact-driven business. 

For example, Can you scale a business that is built on a mission to help people rather than a mission to make money? And are investors energized by the idea, or do they scoff at the idealism? Her view is it’s not an either/or, but an and. You can do well by doing good. But she also acknowledged some perception battles, particularly in securing investor capital.

“Refugees are a very, very diverse group. And there's a spectrum of people included under that broad label. There are about 80 million forcibly displaced people in the world today. It's about 1% of the world's population. And as you can imagine, if you took a random sampling of people across the world and pulled 1%, you'd have all sorts of people in there.”

As notable as Leaf’s impact-driven focus is its foundation in the blockchain. We get into the role blockchain plays in Leaf’s success to date. And we talk about how it will impact the African fintech space in the near term. 

Tori is a US native living in Kigali who has a lifelong passion for helping refugee communities. Her personal interest in the issue intersected with her entrepreneurial ambitions when she and her current business partner Nat Robinson worked on the idea for a grad school competition at Vanderbilt University. 

Please note, the interview with Tori begins at the 6:45 mark of the podcast.

You can also watch the full interview on YouTube.

Here are some key quotes from this episode.

Why focus on the migrant and refugee market?

“We estimate the banks are missing out on about 40% of the bankable markets in the countries that we operate in. And so a lot of those people are refugees or migrants or cross-border traders, people that fall into our target customer segments. We've done a lot of work in finding out what the financial needs of refugees actually are. And we are not just relying on academic and NGO research that sometimes doesn't apply the commercial sector lens. We really dug into it on our own. And then we built a product around this idea of offering affordable, accessible, convenient cross-border financial services to people who may or may not be device enabled with a smartphone.”

What impact can blockchain have on African SMME fintech?

“So you hear a lot of people talk about how blockchain is going to change the world. And how it will change Africa in particular. And all of that has the potential to be true. Yet none of that matters day to day if you're not out there doing it. I am so proud that we are one of the few that is out there doing it every day. We're live in three countries in East Africa and adding more within the coming months. And so, I think that blockchain, when applied correctly, has significant potential to impact lives all over the continent. But the most important thing is that it be regulatory compliant…and then also that it be accessible. So there needs to be on and off ramps. In order for this thing to work, you can't just hold an asset in theory and have it mean something to your daily life. Especially if you sacrificed to get the asset there.”

What challenges do cross-border traders face in a cash economy?

“Estimates are that about 40% of people on the continent rely on cross-border trade for income in some way. So that's about 500 million people. Most of that is in the informal sector. So these are people that are buying goods in one country, traveling across the border on foot, selling them in another country, getting cash and then traveling back with cash. And that proves to be very dangerous. Because not only are they carrying large amounts of cash, but they're crossing a few times a week. And so they're known…and easily taken advantage of on the road and at the border points and anywhere in between. And there aren't digital solutions for these people.”

Firas is a deep thinker about fintech in Africa and our conversation centered around his views on mobile money. 

Firas argues that the success of mobile money on the continent is also in some respects a curse because there isn’t sufficient incentive to innovate. And the lack of continuous innovation threatens to hold back on the development of fintech in Africa.

You can watch the interview in its original form here.

Here are some key quotes from this episode.

Why mobile money lacks the incentive to innovate

“When you have large businesses that make a lot of money and are generating a lot of profits, they tend not to innovate. In fact, they're disincentivized from innovating. Because ultimately you want to make your quarterly sales goals. You want to get your bonuses. You want to get your stock price up. So as a result, looking at other opportunities becomes less of a priority. So my argument would be that the overwhelming success of mobile money is now creating a bit of an impediment for it to start to innovate beyond some of the initial use cases that made it so successful.”

The role of cryptocurrency in Africa

“As a hedge against inflation, it might make sense. And I can see cross-border [transactions] making a lot of sense, particularly when you don't need to convert from currency to currency. But for in-country [transactions], I want someone to explain to me what exactly the use cases are.”

The need for more African VCs

“I really hope to see some exits for African founders such that they can build their own VCs. Because the best VC is the one that has lived the product that you're trying to build.”

Kat, a former data analyst and banking executive, launched NOW Money in 2016 with her former university classmate Ian Dillon, who was working as an investment banker in Dubai.

Kat and Ian saw a huge opportunity in helping the overwhelming number of migrant workers in the Gulf region gain access to banking services. And in the process of giving migrant workers access to financial services, NOW Money gains the ability to earn fees off of the Gulf region’s enormous outbound remittances market.

Earlier this year, NOW Money raised a $7 million funding round led by Anthemis Exponential Ventures to fuel its expansion throughout the Gulf region.

Now money works with organizations employing larger numbers of lower-wage workers to provide financial services to their employees, including a bank account, early access to wages, a debit card, and remittances, all accessed through a mobile app.

Here are some key excerpts from the episode.

On the migrant worker opportunity

“There are actually a relatively low number of banked customers in the UAE. When we dug into that more, it turns out, there's really quite a high minimum salary requirement to have an account at all in the Gulf.

“In 2015, we started scoping it out and realizing there was a real opportunity around creating something that was uniquely designed for the needs of lower-income people. We'd seen digital-only banks in the US and in Europe really started to take off. And we thought, why is nobody doing that here?”

On the remittances opportunity

“The outbound remittance market from the Gulf is 100 billion US dollars a year. That's massive. And the only place that's only slightly bigger is the US who do $140 billion. So we really are in prime position for outbound remittance, and that's what attracted us.

“This is something that banks are not doing very well. It tends to be priced badly when people remit out of banks. This is something again that migrant workers need that's different from what banks have on offer at the moment. That always has been the anchor product in our app.”

On why NOW Money’s model is sticky

“One thing that's notably different about NOW Money customers vs. challenger banking products in the US and Europe is that those banks are often not customers’ primary bank accounts. So they have to spend a lot of money on marketing to those customers to try and get them to switch to having their salary deposited into the new account versus their old traditional bank. And a lot of those customers just tend to use those accounts as pocket money accounts.

“That's something that's different about NOW Money customers. We are our customers’ number one bank account. And because we work with their employer, we know that every single account is going to get funded every single month with all their salary. And then from that, we know that we're going to capture all their transactions. So that's an extremely sticky model to have.”

We engage Zapper CEO Brett White on the state of small business in South Africa one year into the pandemic. We also discuss innovation, fintechs vs banks, and the technologies that will drive the payments space in the years to come.

Here are some excerpts from the episode.

On banks v fintechs

“There are regulations and there are limitation in terms of what the systems allow for. And the fintechs are always going to push those limits to do exactly those things that are limited…And the reality is a lot of the bigger entities move slower. So they're going to struggle in that space.”

“And I think that they will be a lot of opportunity for fintechs to supplement and work with those bigger entities to provide the capability that they so desire. So I think there will always be a symbiotic sort of relationship there.”

On emerging technologies

“I think long term biometric technologies are going to take over in terms of how people transact and purchase things. In the interim, however, I mean for the next five years, we're in a space where mobile payments are predominant. There's gonna be a lot of innovation around payments instruments themselves in terms of the rails over which people make payments. Things like blockchain, open banking, instant EFT, all those types of solutions are being introduced.”

On cryptocurrency

“What we've seen over the last few months are some schemes starting to produce the ability to at least flirt with the idea of supporting crypto. And some of the banks are talking about it as well. And I think a couple of months ago, that would have been very frowned upon. I don't think that would have been well supported. I think what Elon Musk has done recently with buying a lot of Bitcoin has certainly lit a fire under that.”