Eversend’s African neobank ambition

JULY 19, 2020
This newsletter is a weekly in-depth analysis of tech and innovation in Africa that will serve as a post-pandemic guide. Subscribe here to get it directly in your inbox every Sunday at 3 pm WAT.


Welcome to your favorite weekend digest, today we have an important announcement: The Coronavirus Weekly Update is being reborn, and here’s why.

The virus is still out there, and raging, but what will tech and innovation in Africa look like after this period? Beyond the immediate now, what are the long tail effects of this pandemic on the continent?

Basically, questions along the ‘what next’ lines are what we’ll attempt to answer on a weekly basis. To do that effectively, I give you The Next Wave; a broader analytical outlook on tech and innovation in Africa.

In the coming weeks, there’ll be a few gradual tweaks to content structure, beyond that and the new name, there’s not much else changing. It is still the same insightful, and hopefully useful, analysis of tech, innovation and the business of both, delivered the same time every

You can still catch up with previous editions of The
Coronavirus Weekly Newsletter.

Let’s dive in.


Shiny vs functional edtech.
In Kenya, the academic calendar, that is usually from January to November, has been canceled for the rest of the year. Education Minister George Magoha, says “the 2020 calendar year will be considered lost”, and rightfully so.

Frankly, this is not surprising. Countries that are considering opening schools are doing so purely on a political basis as there is no health or data-backed indicator that this is a good decision.

If formal education as we know it has been disrupted until further notice, what then happens to structured learning, especially for learners already in the system?
A few weeks ago, in an earlier version of the newsletter, I had posited that edtech as we know it is pretty much ineffectual. Internet access and smartphone ownership are still a luxury for a large part of Africa’s population.

I had suggested using one of the most popular mediums in African homes; transistor radios.

“….radio and television are the quickest answers to this problem as they are easier to access. Even in places without electricity, battery-powered transistor radios are a feature of most African homes in rural and peri-urban areas.”

And it seems someone was listening and taking notes.

Last week in Nigeria, the Lagos State government announced that it was distributing 10,000 radio sets to pupils for homeschooling. There were also talks of broadcasting lessons in Kano, and Oyo States.

Kenya was already on the radio wave. Even though it did not distribute physical radio sets, the Kenya
Institute of Curriculum Development (KICD) was the first to begin programming the curriculum through radio stations.

In Lagos, the announcement did not state a detailed plan for making sure these devices get around. In both Nigeria and Kenya, there are also no apparent plans for continuity and sustainability of these projects, but nevertheless, this is a good thing because it signals a shift in focus from the aesthetically pleasing to the functional.

But what does all this mean for Africa’s >$1 billion edtech industry?

The retooling of a monolith

Firstly, I don’t know that
e-learning in Africa truly has a value of over $1 billion. That figure is from a
GlobeNewsWire report that said the industry will reach a $1.8+ billion valuation by 2024, and was the first thing that popped up on my timeline when I googled, so I used it. The report said the market was worth US$ 792 Million in

There is a growing population that needs to be educated, so edtech in Africa truly has the potential to be a $100 billion industry, but with current realities, that 2024 valuation will be a far cry from reality.

According to the United Nations;

“…226 million youth aged 15-24 lived in Africa in 2015 representing nearly 20% of Africa’s population, making up one-fifth of the world’s youth population. If one includes all people aged below 35, this number increases to a staggering three-quarters of Africa’s population.”

There is no physical classroom to hold these people, so yes, endless possibilities. But a revamp has to happen.

Government-led hardware efforts have largely failed, and private companies are building mostly sexy technology with limited access.

The factors that make radio attractive are quite clear; it’s a technology that is popular in underserved
communities. The learning curve is pretty low; lack of electricity and high data costs are also key issues.

In its latest research, released in 2018, AfroBarometer showed that radio is still by far the most frequent information source for Africans despite audience gains for television and digital media. It is unclear what percentage of listeners use their mobile phone radio app.

Radio’s limitations
The simplicity of radio is also its major limitation. How do you keep a child engaged and make the learning interactive?

In Tanzania, an edtech company, Ubongo Kids solved the problem by allowing children to send in answers to questions via SMS. The higher you go, from primary to tertiary education, the more difficult
it gets to use radio effectively.

The economics of using radio as an edtech platform is also tricky as it’s difficult to monetize, and an obvious option is advertising revenue.

Another viable option, as in Ubongo’s case, is to split SMS fees with telcos. Compare this with the straightforward model of selling tablets with learning content or subscription-based edtech businesses.

Nonetheless, from a social perspective figuring out how to make radio work as a learning platform for underserved communities is a noble exercise. As a business, it’s tough but when you consider the massive access it provides, it’s worth investigating perhaps as an additional distribution channel.

Alternatively, low data distribution channels like dongles as in uLesson’s case are another major bet.

Either way, what’s definitely clear is that fancy, shiny tech just won’t scale.

I am going to close this
with words from Kay Ugwuede’s article;
Rethinking learning tablet initiatives and their impact on education in Africa;

“That technology can help improve the literacy of Sub-Saharan Africa’s 97.5 million out-of-school children is a no brainer. But solutions that are not thinking more robustly about accessibility, infrastructural deficits, and measurable impact will not make a dent in this illiteracy behemoth on the continent.”


Inside Eversend’s ambition to build an African neobank.
The Ugandan startup calls itself a “neobank for Africans,” and wants to become a one-stop-shop for financial services.

In this article, Eversend’s founder, Stone Atwine explains the company’s driving force, and why it recently raised $1 million through a crowdfunding equity campaign.

Mapping Nigeria’s technical talent from 1963 to 2018. Nigeria undoubtedly has one of the biggest, and arguably most talented, pool of computer and software craftspeople in Africa. Most of this large skillset seemed to bloom in the last 15 – 20 years, but there is more history behind this conversation.
In a new two-part research, Olanrewaju has outlined a robust timeline and history from over 50 years ago; way before it was cool to write code and do computer things.


Every week, we will ask our readers, stakeholders, and operators in Africa’s tech ecosystem what they think the new normal will look like, and will share their thoughts here. You can share yours with victor@bigcabal.com with ‘The Crystal Ball’ in the subject line.

“When you look at B2C business models you will generally find that there will be more businesses that are resilient than B2B businesses. An example is e-commerce. Corporates across the US are suffering right now but Amazon is hiring 100,000 workers… Generally speaking, corporates will pull back on investment and spend more than consumers will… I think it (coronavirus pandemic) will force more organizations to become much more efficient… Businesses will be forced to diversify geographically earlier than planned…”

Sim Shagaya, CEO, uLesson; Founder, Konga on TechCabal Live

TC Insights

Funding SOS for African Edtech.
Africa’s edtech industry is nascent but growing. In 2017, the continent’s leading edtech accelerator, Injini received 170 applications to its program, in 2018 the number was 805. In part because it doubled down on publicity but also because there was an uptick in activity in the sector.

While the pandemic has put a spotlight on the sector, historically funding for the sector has been relatively low. In 2018, the sector received $32 million in investments, 2.7% of total funding that year, and a 51% increase from 2017. The majority of the 2018 edtech funding, $28 million (88%) went to a European startup, UNICAF, which provides a higher-education platform for Sub-Saharan Africans.

In 2019, the
funding went up, only if you consider Andela an edtech company. The only other edtech company that received funding was
Noon Academy, a Saudi startup. It doesn’t seem like 2020 will be any different in terms of the total amount going to the sector. So far, it is only claiming 0.7% of total funding as of
July 13th, 2020,
according to data from Briter Bridges.

What might however be
different is that there will be more deals (mostly seed stage) and funding from diverse investors going to a diverse set of founders; local founders.

Get TechCabal’s mini-report on edtech in Africa and send us your custom research requests here.

Best wishes for a great week

Stay safe and please observe all guidelines provided by health experts.

You can subscribe to our TC Daily Newsletter; the most comprehensive roundup of technology news on the continent, and have it delivered to your inbox every weekday at 7 am WAT.

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– Victor Ekwealor, Managing Editor, TechCabal

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