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TGIF ☀️
To close out the week, we’re once again asking you to move this newsletter to your Main/Primary folder so that we can be smack dab in your faces. A small glitch means our newsletter is landing more in the Promotions folder, so a qquicck drag-and-drop will help solve this.
Don’t make us ask again 👀. Thank you.
Regulation
WhatsApp threatens to exit Nigeria
Nigerians may have to imagine life without WhatsApp. Meta says the Federal Competition and Consumer Protection Commission’s (FCCPC) demands would make it “impossible to provide WhatsApp in Nigeria or globally”.
On July 19, 2024, FCCPC handed WhatsApp a $220 million fine over claims that the social media company breached user data policy on Nigerian users and forced them to accept dubious data requests.
In addition to the fine, the FCCPC is also asking WhatsApp to stop sharing user data with its other Facebook companies and third parties.
This situation puts Nigeria in a pickle. On one hand, the government’s flex shows it’s not afraid to take on tech giants. On the flip side, it risks pushing away a company that millions of Nigerians rely on daily for income and entertainment.
Meta’s data use allows it to continue to float its other money-spinning business—advertising. More than 10 million digital advertisers use Meta Ads daily to reach their target audience, thanks to the data Meta collects. Last year, 98% of Meta’s $134.9 billion revenue came from advertising. However, this scrappy data collection practice has put it in trouble in many parts of the world.
Currently, Meta is facing regulatory complaints in 11 countries and recently agreed to pay a $1.4 billion Texas fine for a biometric data breach. It seems shady that the non-data compliance in Nigeria is given a different treatment. Meta’s bluster is a tactic to strong-arm the country, according to FCCPC chairman Babatunde Irukera. In his X post, he says, “if [Meta] didn’t violate the law, it should appeal and let the legal process run its course.”
Read Moniepoint’s 2024 Informal Economy Report
89% of businesses in the informal economy pay levies and market fees. The informal economy is typically described as untaxed, but is that true? Click here to find out more.
Startups
Is Chowdeck ads a profitable side hustle for the company?
Growth-stage startups often have to think outside the box to create new pathways to profit. Sometimes these revenue opportunities are low-hanging fruits already layered on top of a product they deliver for free.
Chowdeck is delivering a complementary ad product to make more money. Its value proposition for third-party businesses goes like this: for ₦250,000 ($150.5) per week, place ads on Chowdeck and reach 600,000 users.
Much like food delivery companies in the US, Chowdeck is profiting off its free app to create an additional income source for its business. Already, it has attracted the likes of Guaranty Trust Bank which advertised its share offering on the platform this week.
Other food delivery companies have tried a version of this ad product to generate income before. For example, Heyfood, another food delivery startup,, offers banner advertising spaces for aggregator restaurant companies on its roster. Businesses on the platform that want more visibility can advertise to users in order to increase orders.
Chowdeck also has one thing going for it. Its large user base and the age demographic that uses its app make it a valuable destination for businesses to place ads. And as its users increase, it further strengthens Chowdeck’s position.
As a growth-stage startup, staying in business long enough likely creates an opportunity to win. And how do you stay in business long enough? By figuring out ways to bring in more cash and burn less money.
Chowdeck has just figured it out with an ad product.
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Crypto
Kenya removes Digital Asset Tax (DAT)
Like opening this newsletter daily, death and tax are a given. However, crypto exchanges in Kenya will be avoiding taxes for now.
In 2023, Kenya introduced a Finance Bill that mandated crypto exchanges to pay 3% of their revenue from trading cryptocurrency and other digital assets as part of a Digital Asset Tax (DAT). While some critics argued that the government should have aligned the DAT with the 1.5% Digital Service Tax (DST) which caters to taxes on digital services including crypto transactions, others were against the entire Finance Bill.
Senator Okiya Omutatah, who is thought to be the defender of most public interest cases in Kenya and some activists—Eliud Matindi, Benson Otieno and Blair Oigoro—took the National Treasury to court to defend the bill. Okiya argued that additional taxes could affect the quality of Kenyan lives.
Yesterday, Kenya’s Court of Appeal ruled against Okiya case, ruling the 2023 Finance Act unconstitutional, null, and void.
The ruling means that crypto exchanges in the country will no longer be required to pay Digital Asset Tax (DAT) which was included in the Finance Act. The National Treasury will appeal the decision at the country’s Supreme Court.
The ruling comes after Kenyan authorities bowed to public protests, reversing some of its newly proposed tax. President Ruto introduced new taxes in the 2024 Kenya Finance bill—that sought to place a tax on everything from the price of bread, motor vehicles, mobile money transfers, and banking services—in hopes of increasing government earnings to help pay back its debts.
Banking
Shago sues Fidelity Bank over $488,000 chargeback
A Nigerian fintech dragging a commercial bank to court wasn’t my bingo card for the month. While both institutions have shared a complicated history over the years, we hardly see legal showdowns. But here we go.
Shago Payments, a four-year-old payments and agent banking startup, is suing 36-year-old Fidelity Bank over chargeback claims of ₦811 million ($488,000). A chargeback is basically a refund for a card transaction disputed by a customer through their bank. The acquiring bank (Fidelity Bank, in this case) debits the merchant (Shago Payments) to settle the claims.
Alerzo-owned Shago claimed Fidelity Bank made chargeback deductions from its accounts between June and August 2023 without notice. Both parties held talks between July 2023 and early 2024 to resolve the issue but it led nowhere.
The matter ended as a suit before a Federal High Court in Lagos, with Shago asking for ₦10 billion ($6 million) in damages, among other demands. On July 17, the court ordered Fidelity Bank to remit the ₦811 million to a designated account until the case is resolved.
TC Insights
Funding tracker
This week, the Egyptian B2B e-commerce platform Cartona raised $8.1 million in a Series A extension ($5.6 million in equity and $2.5 million in debt) from new and existing investors. Egyptian VC firm Algebra Ventures led the round, while Silicon Badia and SANAD Fund for MSME also participated. Camel Ventures and GlobalCorp provided the debt component. (July 30)
Here are other deals for the week:
- South Africa-headquartered logistics startup Shiprazor secured undisclosed funding from Launch Africa Ventures. (July 30)
- Egypt-based AI startup Synapse Analytics raised $2 million in a round led by Silicon Badia and Hub 71, Abu Dhabi. (July 31)
- Egyptian edtech Educatly raised $2.5 million in a funding round led by TLcom Capital and Plus VC, with participation from Egypt Venture and Ireland’s HBAN syndicate. (July 30)
- Nigerian startup Intron Health raised $1.6 million in a pre-seed funding round. The round was led by Microtraction, with participation from Plug and Play Ventures, Jaza Rift Ventures, and other angel investors. (July 29)
Follow us on Twitter, Instagram, and LinkedIn for more funding announcements. Before you go, our State of Tech in Africa H1 2024 Report is out. Click this link to download it.
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Crypto Tracker
The World Wide Web3
Source:
|
Coin Name |
Current Value |
Day |
Month |
|---|---|---|---|
 Bitcoin |
$64,350 |
+ 1.20% |
+ 5.85% |
| Ether |
$3,159 |
+ 0.56% |
– 8.57% |
 Layer 3 |
$0.077 |
– 17.55% |
– 17.55% |
| Solana |
$165.00 |
– 0.87% |
+ 11.47% |
* Data as of 06:05 AM WAT, August 2, 2024.
Events
- You can still get an early bird ticket to the second edition of TechCabal’sMoonshot Conference! From October 9–11, 2024, at the Eko Convention Centre, Lagos, Nigeria, you can join Africa’s biggest thinkers and players like Iyin Aboyeji, Wiza Jalakasi, June Angelides, Kola Aina on a global launchpad for change. If you want to join these stakeholders in Africa’s tech ecosystem for three days of insightful conversations, then get an early-bird ticket to Moonshot 2024 at 20% off.
- Join the 24 Fintech Africa Roadshow Webinar! We’re excited to invite you to our upcoming webinar on Monday, July 29th at 3:00 PM WAT. Discover opportunities for African technology companies at the 24 Fintech Summit, happening from September 3 – 5, 2024, in Saudi Arabia. Speakers include leaders from the fintech industry, providing insights on global fintech trends and opportunities. Don’t miss out on this chance to connect and learn. Register Now.
- Join Career Brunch 2024 on August 17, 2024, in CcHUB with successful professionals from diverse fields and beyond for an exclusive (physical) career hangout for all professionals. Whether you’re a 9-5er, entrepreneur, founder, or young and upcoming professional looking to climb the career ladder, scale your business or transition, Career Brunch has something for you. This is your golden ticket to connect with industry leaders and professionals from MTN, CcHUB, McKinsey, Spotify etc., gain invaluable insights, and supercharge your career trajectory. Get your ticket at www.tix.africa/thebrunch.
You should definitely read these 👇🏾
Written by: Emmanuel Nwosu, Ganiu Oloruntade, Stephen Agwaibor & Faith Omoniyi
Edited by: Muyiwa Olowogboyega & Timi Odueso
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