Note: This is an edited version of the TechCabal daily digest for September 4, 2017. Subscribe here, to get it in your mailbox every day around 7am (WAT).
Here’s what you should know today.
1 – Senegal’s green Uber ? ??
Techmoran “featured” a Senegal-based company named Ping! that claims to be [one of] the Uber[s] of Africa. They aren’t the first player operating within one country that claims to cover “Africa”, so why are they noteworthy? They also claim to be fixing pollution and doing good for the environment. From the report:
Ping! contributes to the modernization of the old taxi park of the Senegalese capital, to the fight against pollution which asphyxiates and above all, gain market share. These are the reasons that led Adam Martel Brown to create Ping!, an alternative fuel company, a mixture of ethanol and petroleum. The cars of the company will be hybrid, therefore less polluting, and will consume 50% to 75% less fuel than the others.
The air in Dakar, Senegal’s capital, is known to be terribly polluted, so this is a worthy cause and a great project. Is it a great business though? I’m not certain.
First of all, where are they getting the cars from? They claim Senegal has 3 cars per 100 people (this report says it is actually 1 per 100 people) and they will develop the technology and/or import hybrid motor vehicles, and employ drivers to operate them. But the reason why Uber and businesses like it are so economically lucrative is that they do not need to own any infrastructure and that makes them infinitely (in theory) scalable. Owning the vehicles which both cost more to produce and cost more to maintain means you are taking on Uber-type problems without any of the economic upside.
It gets worse. From the original French report Techmoran cloned + translated:
This model of alternative fuel taxi company – a first in Senegal – intends to start with a fleet of 15 to 30 vehicles and about thirty employees. About 15 other employees will be involved on a part-time basis, with the aim of increasing the number of staff over the next three years by 10 to 15%.
The implication of starting at such a small scale (which they must, since they have to own the vehicles) is that most consumers will have to wait longer to get rides, and it will cost Ping! more money to serve each one than literally any alternative. Well, shit then.
Pursuing a fully-integrated business model makes sense for creating high quality differentiated products which you charge a premium for (think: Apple), but not only is Ping! offering a worse experience by most metrics (most people don’t care enough about fixing pollution to endure long waits), but they are also trying to charge less money per ride than both the legacy taxi industry and Uber. That’s not all; the founder, Adam Brown, also thinks bargaining is a “very big waste of time”, so their prices are fixed, thereby removing the opportunity to charge extra money for rides that should cost more.
How does this make any sense?
2 – MTN CEO on high data prices. ? ?
In a podcast with Bruce Whitfield from the Money Show, Rob Shuter, CEO of MTN Group talked about their overarching strategy for providing and pricing data services. According to him, MTN currently has 70 million data subscribers out of a global total of 230 million, and they are closing the gap by first building out “high speed data networks” in high-end areas (where each consumer uses more and more data, presumably) and then use the profits to subsidize the rest of the population.
That bit makes sense, I think. His answer to the question of why data bundles do not roll over, and why out-of-bundle prices are so “infernally expensive” is much less satisfactory:
“This is how the industry has evolved – you can either pay per MB or minute, or you can buy a bundle, and what is not used often does not roll over. […] Some people find it a practice which is not appealing, but it has also emerged over time because there was a demand for these bundled products.”
Basically, “screw you, if you don’t like it – you’ve already bought the bundle and we can do what we want afterwards *sticks tongue out*”
What else is interesting?
+ [It begins.] Alipay enters South Africa. Link.
+ Samsung says its Bixby speaker will be better than Amazon Echo. Well… okay. If you say so. ??♂️
+ New HR-as-a-Service platform in South Africa. Link.
+ SolarCentury and CrossBoundary Energy are funding solar projects in Africa. Check them out if you’re working on something. Link.
+ The worst may be over for Africa’s biggest economies. Link.
+ Diamond Bank is offering Nigerian entrepreneurs $8k in grants. Apply here.
+ Techpoint interviewed the CTO of Comercio, a computer hardware company in Nigeria. Link. // Very interesting/informative, but also a little self-indulgent.
Upcoming events
Cape Town: SA Innovation Summit is taking place from September 6 – 8 at the stadium in Green Point. Link.
Lagos: PyCon, a gathering of Python developers and enthusiasts in Nigeria on 15th and 16th September. Link.
Lagos: Paystack is organizing a Y-Combinator Lagos Meetup on September 23. Meet YC founders and gain insight into the process. Link.
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