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Happy pre-Friday ☀️
In Q1 2024, investment in African startups took a nosedive, plunging by approximately 45.6% compared to Q1 2023.
On the flip side, our growing ecosystem witnessed a flurry of expansion and acquisition activities. Dive deeper into the latest happenings with our freshly unveiled quarterly report.
Crypto
Kenya denies reports of Binance executive, Nadeem Anjarwalla’s arrest
It seems both Nigerian and Kenyan authorities are providing us with a daily dose of uncertainty regarding the situation of Nadeem Anjarwalla, the Binance executive who escaped custody in Nigeria and fled to Kenya using a smuggled passport.
On Monday, it was reported that the Kenyan police, in collaboration with Nigerian authorities and Interpol, reportedly arrested Anjarwalla with plans to expedite his extradition back to Nigeria within the week.
Kenya seems to disagree with the news, as someofficials have called the reports “rumours”, maintaining that no such arrest has taken place despite several reports from Nigerian publications suggesting Anjarwalla’s imminent extradition. Per Coindesk, Anjarwalla’s wife has also denied news of the extradition.
One week ago, Nigerian authorities requested the Kenyan government arrest and extradite Anjarwalla. However, as of now, Kenya has only acknowledged his presence in the country, which has stalled Nigeria’s pursuit of the crypto giant, Binance.
What’s the issue with Binance? Binance and its two executives face charges in Nigeria for tax evasion, currency speculation, and money laundering of an alleged $35.4 million. Yesterday, one of the executives, Tigran Gambaryan, who pleaded not guilty had his bail hearing rescheduled to May 17, 2023, after the Judge, Justice Emeka Nwite heard arguments—on whether Gambaryan should remain in custody at the correctional centre—from Gambaryan’s legal team and the Nigerian government’s lawyers.
As the case continues to unfold, these legal issues are just the latest in a string of challenges Binance is facing globally.
What more? In the United States, the Department of Justice is recommending a 3-year prison sentence for Binance founder Changpeng Zhao after he reportedly failed to comply with federal sanctions and anti-money laundering regulations. Adding to the pressure, the Philippines Securities and Exchange Commission has ordered Apple and Google to remove the Binance app from its app stores
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Banking
Stanbic IBTC to raise $401 million to meet CBN’s capital requirements
Nigeria’s apex bank has put the squeeze on banks, prompting them to scramble for additional capital. Following similar moves by Access Bank and First Bank, Stanbic IBTC Holdings Plc is the latest entrant in the capital race.
The bank is seeking shareholder approval to raise ₦550 billion ($401 million) at a meeting scheduled for May 16. Seeing that it’s a Tier 2 bank, its capital requirement is set at ₦200 billion ($145.9 million).
To address the capital increase, Stanbic IBTC will implement a two-part strategy. First, the bank will issue ₦400 billion ($291.8 million) in bonds, effectively borrowing from investors and repaying them with interest over time. Additionally, a rights issue of ₦150 billion ($109.4 million) will grant existing shareholders the chance to purchase new shares at a discount. This approach allows Stanbic IBTC to raise capital while minimising dilution for current investors.
Stanbic IBTC will also prioritise existing shareholders when offering new shares. Only if these shares aren’t fully purchased by existing investors will the bank look for entirely new investors.
The bank also has flexibility in how it borrows money. These bonds can be traditional bonds, convertible bonds or other variations and can also choose to sell them publicly or privately.
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Cybercrime
Staff member at the centre of Equity Bank’s $2.1 million cyber heist
Last week, Equity Bank, Kenya’s leading lender, suffered a cyber heist of KES 282 million ($2.1 million). Word on the street now is that theft was orchestrated by a bank employee working with other accomplices.
A source said that the unidentified bank worker at the heart of the fraud installed malware within the bank’s core system to siphon funds undetected. The fraudulent transaction ran from April 9 to 15. By the time unusual activity was noticed, the money had already been dispersed across over 500 bank accounts and mobile wallets
“It’s an Equity Bank staff transferring money from accounts to several bank accounts and M-Pesa lines. Some have refunded the money, and investigations are ongoing,” a detective with knowledge of the matter told TechCabal.
How the heist was done: Last week, TechCabal reported that three sources with knowledge of the investigation said the perpetrators pulled off a “card-not-present” scam, where hackers don’t need the physical card to steal money. This type of fraud usually involves using stolen card details to make online purchases. However, in this case, the perpetrators created fake websites to trick victims into making payments. The monies from these payments was then moved into other accounts controlled by the scammers.
Authorities have arrested 59 individuals, with some unknown number of persons already released on bail. Kenya’s Directorate of Criminal Investigations is tracking down additional suspects and “recovering the stolen funds” the detective said.
While such staff-involved thefts occur occasionally in Kenya, many cases go unreported due to reputational concerns. Equity Bank and the Central Bank of Kenya haven’t yet commented on the matter. This lack of public response adds to the concerns surrounding the incident’s impact on Kenya’s financial sector.
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AI
US, Nigeria to discuss AI development
The United States and Nigeria are set to discuss the future of the digital economy, emerging technology and the development and implementation of artificial intelligence (AI). This collaboration was announced by the US Deputy Chief of Mission in Abuja, Mr. Arthur Brown, at the closing ceremony of the national AI strategy workshop in Nigeria.
What’s all the fuss about AI in Nigeria? Just in case you’ve been hiding under a rock, Nigeria’s minister of communications, innovation and digital technology, this month, announced plans for a national AI strategy which was met with public disdain. Across social media, several critics questioned Minister Tijani’s resolution towards AI with many tagging AI plans premature for a country that still lacks basic infrastructure.
But the comments aren’t deterring Nigeria’s tech minister: Just this week, the ministry announced Nigeria’s first Large Language Model (LLM) which it launched at the same AI strategy workshop. MinisterTijani, at the workshop, stressed the need for African nations to take concrete actions to support their digital economies. He advocated for a unified African voice on AI to empower African entrepreneurs and innovators. While acknowledging the potential economic benefits of AI, Minister Tijani prioritised establishing a strong governance structure for this powerful technology. He sees AI as a tool for economic diversification, particularly in agriculture, public health and education.
Following the four-day workshop on National Artificial Intelligence Strategy in Nigeria, US deputy chief Brown expressed a desire to build on this momentum with an AI conference in Lagos. He emphasised the importance of “aligning Al governance to ensure that Al is deployed in a safe, secure, transparent and trustworthy manner.”
Meanwhile, Kenya is also taking a page out of Nigeria’s footsteps. Last week, the Kenyan government also announced plans for its own AI strategy. Not much is known about this yet, but the National Intelligence Agency expects that whatever AI plans developed will bring positive impact on the country’s health, education, finance and security sectors.
What are your expectations about these National AI strategies? Do you think Nigeria and Kenya are getting ahead of themselves? Send me your responses at timi@bigcabal.com. I’d love to hear your thoughts.
Funding
Madica invests $600,000 into three African startups
Madica, an African investment programme for pre-seed startups, has announced its first round of investments in three African companies.
This initiative, spearheaded by Emmanuel Adegboye, head of Madica, originated from a $6 million commitment to invest in 30 African pre-seed startups over three years. Madica aims to support underrepresented founders through funding, technology support, and mentorship.
The selected startups include: Kola Market, a Ghanaian startup that aids SMEs in sales enhancement, inventory optimisation, and financing through a B2B platform. GoBEBA, a Kenyan startup, that provides a direct-to-customer e-commerce platform to streamline the purchase and delivery of bulky essential utilities. NewForm Foods, a South African startup that facilitates the development and scaling of cultivated meat products for food producers and retailers at a cost below industry standards.
Each startup will receive up to $200,000 and 18 months of tailored support, including mentorship and access to a global investor network for follow-on funding.
This year, Madica hopes to invest in up to ten additional startups.
Attend GITEX Africa
GITEX Africa returns a second time on May 29–31, 2024, to Marrakech, Morocco, discussing ways to accelerate the continent’s digital health revolution. GITEX is the continent’s largest all-inclusive tech event renowned for uniting the brightest minds in the technology industry.
Crypto Tracker
The World Wide Web3
Source:
|
Coin Name |
Current Value |
Day |
Month |
|---|---|---|---|
 Bitcoin |
$64,071 |
– 3.25% |
– 3.20% |
| Ether |
$3,129 |
– 2.28% |
– 8.37% |
 Tether |
$0.9993 |
– 0.09% |
– 0.13% |
| BNB |
$609 |
+ 0.23% |
+ 7.34% |
* Data as of 9:56 PM WAT, April 24, 2024.
Opportunities
- The fourth edition of Pitch2Win is open for applications. Pitch2Win aims to connect visionary founders with potential investors, fostering growth, collaboration, and investment opportunities. The 3 Finalists will win from a prize pot of $20,000. They will also receive an all-expense paid trip to the IVS2024 Kyoto Event, Japan’s largest startup conference. Apply by May 5.
- Applications are open for the FC Startup Innovation Challenge. African tech entreprenuers will get a chance to win a $1,000 equity-free cash prize plus up to $300,000 worth of incredible perks from Paystack, Google for Startups, Intercom, AWS, Founders Factory to fuel your startup’s growth. Apply by April 28.
- Applications are open for the 5th edition of Wema Bank’s startup-focused tech competition, Hackaholics, themed “Meta-Idea: DigiTech Solutions for Africa’s Prosperity”. The edition will be executed over six months, touring 10 universities across Africa and challenging the youths to pitch unique, innovative, and practical Digi-Tech solutions to positively impact the acceleration of progress, development, and prosperity in Nigeria and across the African continent. The best innovators in Africa will be awarded ₦70 million. Apply here.
Here’s what you should be looking at
Written by: Mariam Muhammad & Towobola Bamgbose
Edited by: Timi Odueso
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