First published 24 December, 2023

In no order, here are 5 top picks from the 51 Next Wave editions we published this year.

Hey friend!

Thank you for sticking with the Next Wave team throughout the perma-crisis of this year. We published 51 Next Wave editions this year. In the second half of the year Joseph Olaoluwa and Kenn Abuya, both senior reporters at TechCabal, joined me to write these Sunday letters, and we crossed the 50,000 subscribers mark.

Some of you wrote to tell us what you liked about particular Next Wave editions. Some wrote almost full-length replies with suggestions, questions, and additional insight. We enjoyed reading your thoughts. Knowing you read this newsletter makes it worthwhile!

2023 has been a year of maturing for everyone who is part of the progress of Africa’s technology and venture capital industry. And there has been no lack of schadenfreude or “I told you so”. To wrap up this year, we’re bringing back five Next Wave editions that are neither a complaint nor an I told you so.

Happy re-reading! 🤗

One of our long reads this year was this piece about how supermarkets and small malls are springing up across parts of Africa and leading in the formalisation of the retail business on the continent. I wrote: “Small-scale modern retail in Africa will not completely replace open markets in Lagos, souks in Cairo, or storied markets like Karatina in central Kenya. But a subtle shift that can become a major marker of African retail is underway.”

Africa’s Coming Retail Revolution was written in the middle of September. Two months later in November, the Economist published Africa’s Supermarket Revolution. It felt good to be ahead

Early in the year, our friends at DFS Lab contributed this gem on why digitising Africa’s vast retail sector is tougher than most people expect. As we’ve seen from news coverage on the subject, this essay has borne itself out.

“Once you factor in acquisition and distribution costs, these models break and are forced back to serving those living on $10/day or more, which are only 5% of the continent’s population,” Chernay Johnson former director of research, DFS Lab, wrote. “Unless you’re able to fundamentally innovate around your cost structure, B2C marketplace models selling food and necessities potentially break under this logic.”

Entrepreneuring in Africa will take a toll on the health of the people brave enough to attempt it. Physical health problems are bad enough, but the unseen mental scrimmage that early-stage entrepreneurs face daily can be more paralysing.

In a year where well-funded companies have fallen apart due to mismanagement, outright fraud, an inability to raise funding, or even leadership fights, Joseph Olaoluwa reminded us that tech bros and sisters are human beings too.

In the last eight years, African startups have received at least $15 billion in venture capital investments. Briter Intelligence data puts this figure at $20 billion since 2013. When risk money is invested we are supposed to learn what works, what doesn’t work and how to create outsize returns in a market system. Outsize returns do not only have to be capital gains, although that is desirable and the primary motivation in many cases. But the best metric to measure outsize returns is the social impact of a venture, in a market system.

Twenty years ago, we saw the mobile revolution take off and create a sea change by facilitating communications. As we approach the first decade of institutional venture capital in Africa, we need to find the boldness to share data, knowledge and lessons.

In 2021, Wave, a fintech founded in Senegal became the first $1 billion+ company in Senegal, and the first to emerge outside of the Big Four—Nigeria, South Africa, Egypt and Kenya. Three of the Big Four have the English language as one of the languages used in official documents in business, generally. So when Wave raised a $200 million war chest, it was guaranteed to get attention.

If any African company raises $200 million, it’s huge news. But investors, including the IFC, putting $200 million into a company in Senegal has arguably done, for francophone Africa, something akin to what Stripe’s acquisition of Paystack in 2020 did for Nigeria. It put a spotlight on the mostly unheard progress of technology in the region. People sat up and took notice.


You can also browse the full archive of 2023 Next Waves. Do let us know which Next Wave edition was your favourite?

Happy holidays!

Abraham Augustine, for team Next Wave

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