Finance (93)
Digital health systems are expanding rapidly in Sub-Sahran Africa, democratizing access to healthcare for millions of people. However, as it is not sufficiently financed, the sector is still growing to its full potential.
The Global Fund to Fight AIDS, Tuberculosis and Malaria and its private sector partners recently set up a US$50 million catalytic fund to support the digital health sector in Sub-Saharn Africa.
The fund, called Digital Health Impact Accelerator (DHIA), was announced during the Africa HealthTech Summit held in Kigali, Rwanda, on the sidelines of the Second International Conference on Public Health in Africa (December 13-15, 2022).
The fund “will help further strengthen regional and global data systems and surveillance capacity for data-driven decision-making, enable better patient care, and transform millions of lives,” said Country Technology Services Manager at the Global Fund and Lead for the DHIA.
“The Global Fund has played a key role in strengthening digital health systems and health data in low- and middle-income countries since its inception. These tools are critical to defeat infectious diseases and prevent future health threats,” he added.
Indeed, digital health is not yet fully developed and exploited in Sub-Saharan Africa. The coronavirus pandemic helped stimulate the segment and, since then, innovative e-health initiatives have multiplied. Same for the number of cell phone users. The GSM Association estimates that by 2025, there will be at least 634 million mobile users in Sub-Saharan Africa. The figures prove that digital technologies have already taken an important place in residents’ lives. Those technologies will also change habits in how they access healthcare in the near future.
Through the DHIA Catalytic Fund, the Global Fund and its private partners aim to “support countries to accelerate and scale up digital health solutions through more widespread internet access, strengthened information systems for data sharing, extensive use of mobile technologies, patient-centric digital tools, and unique patient IDs, among others.”
Samira Njoya
In Africa, the ecommerce industry is booming. According to the IFC, the number of online shoppers on the continent has risen by 18 percent since 2014. This growth, fueled notably by the coronavirus pandemic, could continue over the next decade.
Last Wednesday, Gabonese ecommerce platform Olatono Market, announced it raised €45,000 to accelerate its expansion in Central Africa, strengthen partnerships and create a platform that revolutionizes ecommerce in Gabon.
"Our innovative platform differs from the existing offers. It is launched to meet the expectations of customers who are increasingly searching for solutions that give them command over their choices, enable them to compare prices and access products wherever they are in Gabon,” said Thierry Dzime, founder of Olatano Market.
The platform created in March 2021 wants to transform the ecommerce industry in Central Africa. It developed a service called Achat Flex, allowing individuals to purchase products online and pay on delivery, by installments, by mobile money, or by bank cards. It was a first in Gabon where ecommerce was gradually gaining ground.
Thanks to the funds secured, Olatano Market's managers want to develop even more services, accelerate the start-up's growth, strengthen its workforce and sign new agreements. "We are delighted to support the expansion of the company and the launch of the new product Achat Flex. The ambition is to help the future champions of Gabon’s economy emerge. We are pleased to have made these investments in a start-up with great potential. We will support its progress," said Fabrice Nze-Bekale, President of Gabon Angel Investor Network (GAIN).
According to a report by the GSMA and the Economic Commission for Africa (ECA), Gabon became the e-commerce leader in the ECCAS (Economic Community of Central African States) zone in 2021, overtaking Cameroon.
Samira Njoya
The Dubai-based company can now offer its services in Ghana since it is now complying with the local law, which requires service providers to have a presence in the country.
Tech-enabled payment solutions provider Network International Holdings will open a new office and data center in Ghana. This was announced in a release, dated December 5, issued by the holdings.
“Ghana is an exciting market for digital payments and innovation, and we are delighted to launch our office and data center to offer customers, banks, and entrepreneurs smooth and secure payment services. We look forward to supporting businesses as they grow and reach new customers,” said Addo-Quaye (photo, left), Managing Director of Network International Ghana.
With that office, the holding is establishing a local presence to provide innovative solutions that drive customer and profitability and help businesses and economies thrive by simplifying commerce and payments in the Ghanaian market.
Network International's launch in Ghana comes against a backdrop of accelerated digital transformation and increased consumer preferences for convenient, frictionless payment options. In June, Ernest Addison, the governor of the Bank of Ghana, noted that the volume of instant payment transactions has grown from 420,000 cedis (about US$52,800) in 2016 to 31.4 billion cedis in 2021. In addition, cash in circulation in the country as a proportion of gross domestic product (GDP) has dropped from 6.8 percent in 2016 to 4.7 percent in 2021, while the number of checks used per capita has dropped from 25.67 in 2016 to 18.9 in 2021.
Network International wants to take advantage of these shifts and create more partnerships with companies in the digital payments space in Ghana to offer customers more payment options and boost financial inclusion.
The company has a presence in Africa’s largest markets, including Nigeria, South Africa, Kenya, Egypt, and Ghana. It also operates in almost all of the other African countries.
Samira Njoya
The startup has developed a fintech app that allows the secured purchase, and transfer of digital assets and also enables users to save in cryptocurrencies. Its goal is to promote financial inclusion and democratize the use of digital financial assets.
Cameroonian crypto fintech Ejara announced, Monday (Nov 28), it has secured US$8 million in Series A funding.
The round, led by London-based venture capital firm Anthemis and Dragonfly Capital, had the likes of Mercy Corps Ventures, Coinshares Ventures and Lateral Capital, Circle Ventures Moonstake and Emurgo Ventures as participants.
The additional funds will be used to further democratize access to investment and savings products in Francophone Africa and the diaspora, using blockchain technology. "Financial inclusion is my utmost concern and my role is to ensure that the financial products that Africans deserve are accessible to them with just a few clicks and the lowest entry barrier,” said Nelly Chatue-Diop, CEO of Ejara.
The fundraising comes exactly one year after the company raised US$2 million in seed funding, bringing its valuation to US$10 million. According to the startup, the financial resources were used to boost the use of cryptocurrency and investment services in Francophone Africa.
Despite the recent collapse of cryptocurrencies, Ejara has seen a 10-fold increase in revenue and a 15% monthly growth in transaction volume since last October. The startup expects to grow its user base to 100,000 by the end of 2022. Currently, it boasts users from Côte d'Ivoire, Burkina Faso, Mali, Guinea, Gabon, and Senegal, as well as French-speaking Africans in the diaspora (Europe, Asia, and the United States).
Samira Njoya
According to the WHO, counterfeit medicines cause nearly 100,000 deaths in Africa each year. Grinta wants to remove this scourge by offering medicine traceability and authentication solution.
Egyptian digital pharmacy platform Grinta, announced Monday (Nov. 21), a US$8 million raise to develop its tech platform and accelerate its growth in the local market. The funds, raised during a seed round, were secured from Raed Ventures (Saudi Arabia) and NClude, an Egyptian FinTech fund managed by Global Ventures (Dubai).
"As we plan to expand our footprint in the main pharma hubs on the continent, we will also enable Egyptian and regional pharma manufacturers to further penetrate the US$50 billion African market," said Grinta co-founder and CEO Mohamed Azab.
According to the company's statement, Egypt’s US$6.3 billion pharmaceutical market (Softgroup) is the largest and fastest-growing in Africa. It has three major distributors and more than 3,000 wholesalers targeting 60,000 fragmented retail pharmacies. Nevertheless, the market is also affected by the shortage of pharmaceutical products that usually hit African countries (nearly half of Africa's population (1.1 billion people) lacks regular access to the most essential medicines).
Since its inception in 2021, Grinta has been working to reduce the drug shortage in Egypt by modernizing the pharmaceutical supply chain and empowering independent pharmacies. Its end-to-end platform provides access to the full range of traceable pharmaceutical and medical products from multiple suppliers, in addition to order fulfillment, demand planning, and inventory financing.
Thanks to the funds secured, it wants to scale its full-stack technology platform, expand its team and accelerate its growth in the Egyptian market. Within a year and a half of operation, the company has aggressively expanded across seven governorates in Egypt, with over 14,000 pharmacies registered on its platform, more than 100,000 orders delivered, and more than 14,000 stock management units.
Samira Njoya
In Africa, most countries are betting on digital technologies to boost their socio-economic development. In that context, in its Agenda 2063, the African Union has outlined a set of key programs and initiatives to accelerate economic development on the continent.
Last Thursday, the African Union Commission (AUC) and the African Development Bank (AfDB) signed a grant agreement for the implementation of the first phase of "Upstream", a project aimed at developing the African digital market.
The US$9.73 million grant from AfDB aims to support AUC in the implementation of digital projects that are expected to develop a single continental digital market. It also aims to support the implementation of the African Continental Free Trade Area and the Digital Transformation Strategy for Africa.
"The Covid-19 pandemic underscored the importance of digital technologies and the digital economy as a whole, and in that regard, Africa should think big when it comes to digital development, digital economy, and the grand opportunities for integration and economic growth," said Albert M. Muchanga (photo, right), AUC commissioner for economic development, trade, tourism, industry, and minerals.
Upstream is designed to address gaps identified in the African digital economy during the Covid-19 pandemic. The first phase, which will run from 2023 to 2026, has three main components namely digital enablers, digital trade, and e-commerce adoption as well as supporting actions. It will help strengthen the frameworks (strategic, policy, regulatory, and conceptual) and cross-cutting dimensions (gender, climate change, and resilience) that are essential for the establishment of a single continental digital market by 2030.
Ultimately, the project will contribute to the implementation of digital enablers (universal access to broadband infrastructure, sovereign African cloud, African digital marketplace, etc.), e-business, and digital promotion programs for medium, small and micro enterprises, and start-ups. It will also help create an ecosystem facilitating digital trust, skill development, and networking with African experts.
According to Abul B. Kamara (photo, left), the AfDB's deputy director general for the East African region, the project will also create employment opportunities for millions of young Africans, which is critical to the continent's stability and prosperity. It will also ensure the digital transformation of economies and provide new opportunities to increase intra-African trade and stimulate economic growth.
Samira Njoya
Developing innovative solutions to boost the SME world is a major concern for African economies. Yet, accessing financing remains a headache for sector players.
On Tuesday, November 15, the International Finance Corporation (IFC) announced the launch of a new vehicle dedicated to supporting venture capital systems in Africa, the Middle East, Central Asia, and Pakistan. This $225 million fund will provide seed funding for startups that address development issues in areas such as climate, health, education, agriculture, e-commerce, etc. through technological innovations.
“Support for entrepreneurship and digital transformation is essential to economic growth, job creation, and resilience. It will help innovative tech companies in Africa, the Middle East, Central Asia, and Pakistan expand during a time of capital shortage and create scalable investment opportunities. We want to help develop homegrown innovative solutions that are not only relevant to emerging countries but to the rest of the world,” said Makhtar Diop, IFC's Managing Director.
The already difficult access to funding for startups in low-income countries has worsened with the global slowdown in venture capital investment, the Covid-19 pandemic, rising food and supply chain costs, rising interest rates, and currency devaluations. However, countries still have a huge potential for development. In Africa, for example, the digital economy could contribute up to $712 billion to the continent’s GDP by 2050, according to a report published on June 9 by the international network of high-impact entrepreneurs Endeavor.
The IFC sees in its new platform a way to boost nascent venture capital markets in regions that have shown early growth potential but face challenging global economic conditions. The international organization says it will make equity and quasi-equity investments in tech startups and help them grow into scalable companies capable of attracting traditional equity and debt financing. It will also use the platform to collaborate with other World Bank Group teams to build and support venture capital ecosystems through regulatory reforms, sector analysis, and other tools.
An additional $50 million will be provided by the International Development Association's Private Sector Window Blended Finance Facility, which helps reduce the risk of investments in low-income countries.
Samira Njoya
Digital tools are currently considered essential technologies for Africa's post-Covid-19 recovery and even its future growth. However, unequal access to the internet may become a challenge to countries’ efforts.
Last Thursday, the European Investment Bank (EIB) announced US$10 million in support as part of its cooperation with telecom infrastructure company the Bandwidth & Cloud Services Group (BCS Group).
The investment aims to bring transformed digital connectivity to more than 2.5 million people living in remote areas of the eastern Democratic Republic of Congo through a fiber optic network built by BCS.
"The European Investment Bank is committed to accelerating digitalization across Africa and is pleased to strengthen our partnership with BCS to transform high-speed fibre optic networks in the DRC. Expansion of the fibre optic backbone will enable local communities to benefit from mobile broadband and hospitals and schools to be connected to the rest of the world,” said EIB Vice-president Thomas Östros.
According to the Global System Operators' Association (GSMA) report "The State of Mobile Internet Connectivity 2020, "DRC is one of the African countries that have the largest connectivity gap between urban and rural areas. Its demand for connectivity has grown significantly after the coronavirus pandemic, encouraging international companies to invest in the country. Liquid Technologies, Facebook, and CSquared have committed to building fiber optic networks in the country to improve access to affordable broadband internet.
The new BCS investment, supported by the EIB, will connect areas currently underserved by broadband telecommunications. The support will fund the construction of 1,200 kilometers of fiber out of the 20,000 kilometers planned by BCS in Southern, Central, and Eastern Africa over the next 3 years.
Several outcomes are expected at the end of the project. According to the EIB release, "better digitalization will unlock new opportunities for local entrepreneurs and support job creation, and direct telecom connections to 319 schools and 70 hospitals and health centers to improve education and public health."
Samira Njoya
In September 2022, in line with its ambition to conquer Africa, Cellulant signed a partnership with Orange Money, to implement card-to-wallet transfers for eight banks in Botswana.
Pan-African fintech Cellulant Corporation announced, last Tuesday, it had secured a payment systems operator license from the National Bank of Uganda, per the 2020 Act that governs the national payment system.
According to Frances Diribe, Cellulant’s Chief Risk & Compliance Officer, the license marks another evolutionary step for the company founded in 2003. "Uganda currently has over 800,000 registered businesses and a fast-growing digital youthful population. We’re on course to double down our work in offering these businesses and their clients’ dependable payment options. By streamlining the business payment process, they can concentrate on growing themselves," he said.
Mobile and digital payments are gaining momentum across Africa. In its "State of the Industry Report on Mobile Money 2022," the Global System Operators' Association (GSMA) estimates that the continent was home to more than half of the world's active mobile money accounts in 2021. It had 184 million subscribers compared to 161 million the year before. This leads to a fairly high transaction volume (36.7 billion transactions and US$701.4 billion in value), up by 39% year-on-year.
The license allows Cellulant to expand its operations locally and regionally while assuring its business partners of its compliance with local and international security regulations. By partnering with six financial institutions and over 50 merchants in Uganda, Cellulant offers mobile banking and cashiering solutions throughout the country. It claims payment collection and payouts powered to thousands of businesses in 35 African countries.
“Cellulant launched operations in Uganda in 2009 and through its single API payments gateway – Tingg – it enables global, regional and local businesses to collect payments online and offline serving its customers with locally relevant payment methods, including mobile money, cards & banks,” it indicates.
Samira Njoya
For the past 18 months, Nigerian healthcare provider Mobihealth has been working with the Bill and Melinda Gates Foundation in select states in Nigeria. The additional capital will allow the startup to expand outside Nigeria.
The U.S. Trade and Development Agency (USTDA) announced Monday, Oct. 17, a grant to Nigeria's Mobihealthcare Limited (Mobihealth) for a feasibility study to support the development of its telehealth services in Côte d'Ivoire, Ghana, Kenya, and Egypt.
According to USTDA’s director Enoh T. Ebong, the partnership aims to “transform the delivery of healthcare to underserved communities across Africa using the best technology that the U.S. industry has to offer.”
It is “gratifying to see women-led businesses such as Mobihealth leading the development of critical infrastructure on the continent,” he added.
While the amount of the grant was not disclosed, the statement said the study would include a detailed market assessment, financial analysis, and legal and regulatory review for each of the four countries. The Africa Investment Forum (AIF), an initiative by the African Development Bank, will work with USTDA to facilitate the development and financing of the Mobihealth project.
A year ago, USTDA signed a memorandum of understanding with AIF to support high-quality infrastructure solutions for sub-Saharan Africa. The MoU defined cooperation areas in vital sectors such as clean energy, transportation, information and communication technology, health infrastructure, and agribusiness.
According to the USTDA release, the “project also advances the U.S. government’s Prosper Africa initiative to substantially increase two-way trade and investment between the United States and Africa.” It will help expand access to health care for 100,000 people per year in Africa.
For Mobihealth CEO, Funmi Adewara, “the USTDA grant comes at an opportune time and will enable us to expand the scope of our integrated telehealth, electronic medical records, and digitalization services to several other African markets over the next few years.”
Samira Njoya
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The news comes a month after the startup was selected to participate in the Google for Startups Black Founders Fund 2022.
Pan-African data intelligence company Stears announced Tuesday (October 11), the raise of US$3.3 million in its seed funding round. The round was led by MaC Venture Capital with participation from Serena Ventures, Serena Williams' investment company, and other investors.
“We know global professionals need our data and insight because banks, research firms, development organizations, and investors are already using our early products. Our customers tell us we are building a ‘systemically important’ company to address Africa’s data problem,” explains Stears’ CEO, Preston Ideh.
Stears was launched, in 2017, by three students who realized, by experience, that data and information about Nigeria, their country and Africa’s largest economy, were hard to come by. Combining their skills, they set up Stears to address this lack of information.
According to the CEO, the Stears website is the African version of Bloomberg and Thomson Reuters, two of the world's most trusted information providers. Stears identifies, combines, and markets the often missing, outdated, or poorly digitized data needed by traders, financial professionals, politicians, researchers, and even regulators.
In 2019, the team created Nigeria's first real-time election database, which was used by more than two million Nigerians to monitor the general election. After that experience, they raised US$650,000 in pre-seed funding.
With the resources raised during the seed round, Stears plans to collect data, perform in-depth analysis, and offer the analysis to their commercial customers in several ways beyond simply reported news. The company also plans to hire data scientists and analysts as well as industry analysts and expand in East and Southern Africa.
Samira Njoya
The new funding secured six months after the agritech startup's last financing round brings the total funds it raised to US$14.4 million, including US$6.5 million in debt financing.
Ghanaian agritech startup Farmerline announced, Tuesday (September 27), the second close of its Pre-Series A investment raise. During that round, it raised US$1.5 million from social impact investor Oikocredit.
According to Farmerline co-founder and CEO, Alloysius Attah, the round will help support farmers and agribusinesses across Africa in a context marked by the war in Ukraine. “With the support of Oikocredit alongside our first-round funders, our distribution, logistics, and financing services will continue not only in Ghana but also in Côte d’Ivoire where we’ve recently begun the process of expanding our team,” he said.
West Africa was recovering from the coronavirus pandemic when the Ukraine war began. Record inflationary pressures ensued, sending the cost of living flying in most African countries. According to Issoufou Baoua, an expert food security analyst with the Inter-State Committee for Drought Control in the Sahel (CILSS), the number of people threatened by food insecurity in the Sahel and West Africa is rising. “We have gone from 10.7 million people threatened by food insecurity in 2019 to 40.7 million in 2022,” he says.
By expanding its African footprint, Farmerline will strengthen its agribusiness supply chain, cut costs for farmers and boost yield with the deployment of AI solutions and local infrastructure.
The startup, founded in 2013, currently claims about US$18 million worth of inputs and crops financed so far by franchising with agribusinesses and input resellers. The startup now aims to reach 300,000 farmers by 2022, a nearly 400% growth from last year, when it doubled its direct reach to 79,000 farmers (from 36,000 in 2020 and 8,000 in 2019).
Samira Njoya
With the emergence of digital technologies in Africa, governments are increasingly realizing the importance of the creative economy, which can generate more business opportunities, have a positive impact on livelihoods, and boost the overall economy.
The African Development Bank (AfDB), the Islamic Development Bank (IsDB), and the French Development Agency (AFD) have invested US$618 million in Nigeria's Investment in the Digital and Creative Enterprises (i-DICE) program.
Speaking at the Nigeria International Economic Partnership Forum in New York on Thursday, September 22, AfDB President Akinwumi Adesina (photo) said the funding will support the creation of 225 creative start-ups and 451 small and medium enterprises (SMEs) in the technology sector.
“The future is not just digital, the future will be driven by digital revolution. Today, Nigeria has five of the seven unicorns in Africa and raised almost $1.4 billion of the total of $4 billion raised by fintech companies across Africa in 2021,” Akinwumi Adesina said.
The program's funding is aimed at offsetting the economic downturn caused by the Covid-19 pandemic by expanding the financial and technology sectors in Nigeria. According to the AfDB, in the fourth quarter of 2020, ICT contributed 15.06% of gross domestic product (GDP), compared to 13% during the same period a year earlier. Similarly, the vibrant creative industries generated US$14.4 million in revenue between 2015 and 2018.
Despite such performance, several systemic issues including lack of funding, insufficient infrastructure, skills gap, and limited access to the internet hinder the development of the concerned sectors. The i-DICE launched by the Federal Government of Nigeria, last January, aims to tackle those systemic issues. It targets more than 68 million Nigerians aged 15-35 who are recognized as leaders of innovative, early-stage technology start-ups, as well as leaders of micro, small and medium-sized enterprises in the creative sector. For AfDB president Akiwumi, these businesses could create 6.1 million jobs and contribute US$6.4 billion to the Nigerian economy by 2027.
According to Premium Times Nigeria, the AfDB financing “will help the Government initiative further consolidate Nigeria’s position as Africa’s leading start-up investment destination and as a youth entrepreneurship hub.”
Samira Njoya
Mergers and acquisitions reached a record high in Africa in 2021. The performance nevertheless hides weaknesses, including low investment in small businesses.
Egypt-based fintech investment banking marketplace Exits.me announced, Tuesday (September 20), it raised US$1 million in a pre-seed round. The funds were raised from a “UK-Based Exits.me, a group of notable Egyptian angel investors, Baseeta Investments Holding & Mawelni Holding for Financial Investments, and the founders.”
For Omar Wagdy, one of the angel investors, this round is a much-needed one and aims to bring investment opportunities to all classes of businesses in the MENA region. "We want startups & SMEs who are off the radar of conventional investment banks to have a user-friendly and automated means of engaging in M&A and investment opportunities," he said.
Exits.me was founded in 2022. It facilitates merger acquisitions and investment in companies by offering a seamless, fully integrated online platform and a full-fledged financial advisory service. To date, the fintech has completed more than 25 transactions on its platform, with another 30 ongoings, totaling US$150-200 million.
According to a recent report by financial audit and advisory firm E&Y, the MENA region has recorded 359 merger-acquisition deals worth US$42.6 billion in the first half of 2022. This represents a 12% year-on-year increase. The United Arab Emirates, Egypt, Saudi Arabia, Morocco, and Oman are driving those deals.
Thanks to the funds raised, it intends to facilitate even more deals. It indicates that it “is also in the current procurement of its crowdfunding license from the Financial Regulatory Authority to manage and arrange crowdfunding campaigns; which will open the door to a new investment product for the MENA market, allowing anyone in any capacity to invest.”
Samira Njoya