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Good morning ☀️
This morning, the team at TechCabal would like to ask you to take a few seconds out of your day to speak out for press freedom.
One of our colleagues, Daniel Ojukwu who works for the Foundation for Investigative Journalism (FIJ) has been wrongfully detained by the Nigerian Police Force for nine days. Daniel’s detainment is due to his investigative report involving mismanagement of funds by Nigerian officials.
Daniel is yet to be charged to court as required by Nigerian law, and has been transferred to the Federal Capital Territory without due process. Please lend your voice to #FreeDanielOjukwu across social media, and help us ensure that all journalists can uncover the truth and hold leaders accountable.
Economy
NIBSS in ₦1.4 billion lawsuit
What do you call an unexpected event? A black swan.
The biggest black swan in Nigeria’s waters right now might be the fraud and financial impropriety allegations against the country’s financial infrastructure backbone, the Nigeria Interbank Settlement System (NIBSS).
How? Last year, Temidayo Adekanye, a former chief risk officer of NIBSS, flagged fraudulent activity across different arms of the company, including AfriGo, a domestic card scheme launched in 2023, and NQR, a platform for QR-code payments. He also raised similar concerns about a cloud migration project, according to court filings.
Adekanye then requested details of the company’s financial records and third-party contracts but was denied access.
Shortly after, Adekanye was asked to resign and was offered ₦160 million ($112,700) in severance or risk immediate termination of his employment in a meeting with the company’s Head HR, HOD Legal/Company Secretary, Executive Director, Business Development, and CFO.
His request to review the offer was refused, and eventually, he was fired.
What’s next? The former NIBSS executive has sued, and is now asking the National Industrial Court to award damages of ₦1.4 billion ($986 million) for wrongful termination and breach of contract.
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E-commerce
Takealot and Amazon in early competition
Days after the launch of Amazon in South Africa, the e-commerce company is being welcomed with stiff competition.
What’s happening? Naspers-owned Takealot, South Africa’s top online retailer, is offering South Africans a subscription service similar to Amazon Prime.
You see, Amazon Prime is a paid subscription service offered by Amazon that provides a variety of benefits to its members including free and faster shipping, streaming services and exclusive discounts. This feature, however, isn’t yet available to South Africans.
Yesterday, Takealot announced a similar feature called “TakealotMore” which is scheduled for a May 13 launch. This feature offers free deliveries for subscribers which matches one of the major selling points of Amazon Prime.
It will be offering the new subscription with a tiered approach to cater to different budgets. This means there will be two plans to choose from, the TakealotMore Standard plan costs R39 ($2.11) per month, while the Premium plan is priced at R99 ($5.36) per month.
Competition is the fuel that ignites innovation: It’s taken over a decade–operating in South Africa since 2011—and the threat of a multinational behemoth for Takealot to offer its prime service. The company, however, has had years to observe customer preferences and develop its own offering.
Presently, Takealot looks like it’s staying ahead in South Africa by offering high-quality products at friendly prices. Amazon is touting the same root, focusing on matching those same good prices for local customers. It’s still the early days but only time will which platform will be primed for the market leader status.
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Companies
Safaricom becomes East Africa’s most profitable company
Kenya’s Safaricom is winning big with M-Pesa but it’s taking a hit on profits due to its Ethiopian expansion.
A financial rollercoaster: On one hand, Safaricom’s net profits grew by a small 1.2% from $474 million in its 2022 financial year to $480 million for its 2023 financial year. On the other hand, a different metric—its operating profits—shows a 20% jump to $1 billion, which makes Safaricom East Africa’s first billion-dollar profit boss.
M-Pesa magic: The push behind Safaricom’s growth is M-Pesa, Safaricom’s mobile money platform. It grew revenue by 20% (thanks to a surge in both business and personal payments). Data usage is also booming, with revenue up by 18%; this alone brought in about $1.4 billion.
What this means is that Safaricom’s core business of providing mobile phone services and M-Pesa transactions is highly profitable. Even though the company’s overall net income was impacted by the Ethiopian expansion, Safaricom’s day-to-day operations in Kenya are generating significant earnings.
Its Ethiopian expansion is a hungry venture: Safaricom’s big move into Ethiopia is exciting for the future, but it’s hurting profits now due to startup costs. The company spent about $700 million over the course of two years as it expanded into another East African country. Currently, it’s facing an uphill battle against the state-owned Ethio Telecom, which boasts 72 million mobile subscribers compared to Safaricom’s 9 million. Similarly, Safaricom’s M-Pesa service—with 3.1 million users in February 2024—needs significant growth to catch up to Ethio Telecom’s dominant mobile money platform with 41 million users.
The good news? Kenyan unit profits are still up 13.7%.
The bottom line: Safaricom’s core business in Kenya is on fire, but the Ethiopian expansion is a gamble. Investors will be watching closely to see how they manage the costs and integrate the new market.
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Innovation
Elon Musk’s Neuralink malfunctions in test patient
When Elon Musk launched Neuralink, the brain technology company, it was unthinkable. The device, which would allow disabled people to communicate with computers via their thoughts, was just shy of a miracle.
In the weeks that followed the first implant on its first human patient, Noland Arbaugh, who became paralysed eight years ago after a diving accident, could use the link to control his laptop from various positions, including while lying down in bed. Nolad was able to play computer games with friends, surf the internet, and watch live streams, all by controlling a cursor with his mind! 🤯
Everything went well until the brain technology company wrote, in a blog post posted two days ago, that some threads on the device began retracting in the patient’s brain tissue, resulting in the malfunction of the device. The company made quick software fixes, which it said have “produced rapid and sustained improvement that has now superseded Noland’s initial performance.”
Experts who work in the brain implant field say the complication may have stemmed from the placement of threads within the brain. Typically, brain implants sit on the surface of the brain tissue, however, neural link threads sit within the skull bone.
It’s not all gloom for Neuralink, however. While Neuralink’s current product might not be perfect, keep in mind that this is the earliest—and most basic—version of the product. The company is actively working on improvements, like making it easier to type and control the cursor.
Neuralink also plans to make ten new implants for new patients this year.
TC Insights
Funding tracker
This week, Seamfix, a Nigerian digital identity solutions provider, secured $4.5 million from Alitheia IDF in private equity funding. (May 7)
Here’s the other deal for the week:
- Egypt-based fintech Swypex announced its launch following a $4 million seed investment round led by Accel, with participation from Foundation Ventures, The Raba Partnership, and angel investors. (May 7)
Follow us on Twitter and LinkedIn for more funding announcements. Before you go, our State Of Tech In Africa Report for Q1 2024 is out. Click thislink to download it.
Follow us on Twitter, Instagram, and LinkedIn for more funding announcements. You can also visit DealFlow, our real-time funding tracker.
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Crypto Tracker
The World Wide Web3
Source:
|
Coin Name |
Current Value |
Day |
Month |
|---|---|---|---|
 Bitcoin |
$62,581 |
+ 2.20% |
– 9.51% |
| Ether |
$3,024 |
+ 1.81% |
– 13.89% |
 Jupiter |
$1.10 |
+ 5.76% |
– 18.38% |
| Solana |
$151.47 |
+ 6.80% |
– 12.89% |
* Data as of 23:35 PM WAT, May 9, 2024.
Events
- The second edition of TechCabal’sMoonshot Conference is set for October 9–11, 2024, at the Eko Convention Centre, Lagos, Nigeria. Moonshot will assemble Africa’s biggest thinkers, players and problem solvers on a global launchpad for change. If you want to join the stakeholders in Africa’s tech ecosystem for three days of insightful conversations, then get an early-bird ticket at 20% off.
- Attention all music lovers! On Saturday, May 11, 2024, Zikoko wants you outside for a day of link-ups, games, drinks and live performances at Muri Okunola Park, Lagos. Strings Attached is an opportunity for friends to reconnect, lovers to bond and individuals to make friends and build community. To get a free ticket, download the Onebank by Sterling App and sign up using ZIKOKO as the referral code. You’ll get your ticket in your email once tickets are available. Click here to get the app.
Here’s what you should be looking at
Written by: Faith Omoniyi, Stephen Agwaibor & Towobola Bamgbose
Edited by: Timi Odueso
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