Safaricom-backed ride-hailing company gets $3 million for Africa expansion
Audiomack launches in Nigeria
in partnership with FLUTTERWAVE 24.07.2020
Hello there, Welcome to TC Daily! In today's digest: Safaricom-backed ride-hailing company is looking to expand in West Africa; Audiomack launches in Nigeria and Airtel Africa seals remittance service partnership. Please take a moment to subscribe to our newsletter if this email was forwarded to you.
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RIDE HAILING

Kenyan ride-hailing company, Little has received a $3 million investment from its parent company, Craft Silicon to expand across Africa. The ride-hailing service which launched in 2016 in partnership with the country's leading telco, Safaricom is currently piloting in Accra and will use the investment to launch there and across West Africa. Due to the pandemic, it plans to conduct launch operations including driver recruitment and training virtually. Little is present in Kenya, Uganda, Tanzania and Zambia. In 2018, in a bid to raise capital for expansion, it sold a 10% stake in the business to an Indian investor for $3 million. Afterwards, last year it announced that it was seeking to raise $50 million for expansion. Little faces stiff competition especially outside Kenya where players like Uber and Bolt have gained a foothold. In Kenya, it is facing some opposition from Egypt's Swvl which launched there last year and is also planning to expand to West Africa. Before Swvl, Little leveraged the robust Safaricom mobile ecosystem which includes MPesa to succeed. It will be tough to replicate the model in cities where Safaricom isn't already present.

THE BACKEND
Nigerian digital bank, Kuda casts itself as the "bank of the free" that understands consumer needs for convenience. It has no branches anywhere: you sign up, get your account number and do your banking from your smartphone. With an operating license from the Central Bank of Nigeria, Kuda appears on the same lists with older institutions like Zenith, UBA and First Bank. But instead of attempting to replicate these incumbents’ growth strategy, Kuda is taking inspiration from the online hangout platforms that define today’s digital age. Kuda’s approach to offering banking services comes from the playbook of social media giants which are free but make money by extracting value from the data the frequent presence of users provide. Given the digital literacy required to use the product, is Kuda in danger of limiting itself to a small pool of potential customers? In this week's dispatch of the Backend, Alex takes a deep dive into the thinking behind the product, how the company makes money and its plans for the future.
TELECOMS

The Nigerian Communications Commission has mandated six telcos to submit their annual financial reports within seven months after the financial year ends. The agency said it is doing this to improve competitiveness and transparency in the sector. The six affected telcos include Airtel Africa, MTN Nigeria, Emerging Markets Telecommunications Services Limited (9mobile), Globacom Nigeria, Main One Cable Company Limited, and IHS Nigeria. The directive is based on a new policy document named Determination on the Implementation of an Accounting Separation Framework for the Nigerian Telecoms Industry. The telco regulator says it was developed with input from operators. In simple terms, it looks as an avenue for the regulator to monitor the activities of telcos in the country and to consequently avoid breeding a dominant player. In Ghana, the government recently declared MTN a dominant player and is now in a legal tussle with the telco. The new policy requires the telcos to prepare individual reports for the different units and revenue centres within the company as against lumping them. For now, it only seems to apply to companies with an annual turnover of at least ₦5 billion ($12.9 million).

MUSIC STREAMING
Music streaming and audio distribution platform, Audiomack has expanded to Nigeria. The eight-year-old, US-based company has opened a Lagos office and hired a three-man team to lead operations across West Africa. The streaming platform offers artists an opportunity to distribute their music for free and monetize their sounds through the Audiomack Monetization Program. "Nigeria is home to so many influential artists and a distinct sound that other African countries, US music fans, and our whole audience want to listen to," David Ponte, co-founder and CMO told TechCabal. "Our team on the ground shows that we are serious about dedicating resources to Nigeria ," Ponte added. Audiomack is, however, entering a market that is somewhat saturated with players like Boomplay which comes preloaded on millions of phone brands. Although music streaming revenue is expected to rise to $18 million by 2023 from $3.3 million in 2018, illegal music download is still quite prevalent. Navigating these issues will be crucial to Audiomack's success. Abubakar explores the company's plans for the Nigerian market in this piece.
CYBERCRIME

Cameroon's anti-graft agency has warned its citizens of online fraudsters on WhatsApp and Facebook. The Cameroon National Anti-Corruption Commission (CONAC) announced that using these social media platforms, fraudsters posed as government officials and promised exam candidates fake question scripts. "These cybercriminals request victims to download exam scripts upon payment (of money) through their Orange or MTN mobile money accounts," CONAC said in a statement. Last month, the Cameroonian election body, ELECAM also had to deal with the activities of cybercriminals. Its Facebook page was reportedly hacked and false information was published. These events have raised concerns about the rise of cybercrime in the country.

REMITTANCES
Airtel Africa has partnered with remittance company, Mukuru. The partnership will allow Mukuru's customers, mostly in South Africa, to be able to send cross border transfers to Airtel Money customers wallets in 12 African countries. The deal allows Airtel Africa to expand its mobile payment offering, particularly in Southern Africa, Mukuru's primary market. Remittances are a big deal for Africans. The amount of money remitted by migrants has grown tenfold in two decades, from $4.8 billion in 2000 to $48 billion in 2018. Telcos and other financial players are looking to get a chunk of the pie as well as to keep users within their product ecosystem.
WHAT ELSE IS HAPPENING?
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