These Ten Ugandan Startups Have Been Selected To Pitch At This Year’s Seedstars Kampala

Using Psychometry In Its Loan Disbursement Process, Nigeria’s P2P Lender KiaKia Is Bringing Down The Loan Default Rate

Joshua Moses April 20

Between banks and their customers is a tale of unfulfillment. The gap is because, banks are the natural place for people, mainly medium and small-scale businesses to seek credit or loans, and many have had their fingers burnt. 

Either due to unfavorable interest rates and other loan conditions or other policies that reflect poor credit ratings, prospective loan applicants are disqualified. In essence, banks may now be playing second fiddle to fintech startups like KIAKIA that are offering loans to customers who need personal and small business loans without all the burden of collateral.

Although news reports from the Q4 2017 show that banks are increasingly becoming open to lending more money even as lenders are expected to loosen credit scoring criteria in Q1 2018, they recorded an 8 percent increase in bad loans recorded in 2017 

As Nigerians are increasingly becoming reliant on online loan platforms, players in the loan subsector of Fintech, are hard-pressed to find ways to ensure minimal default on loans with many checks on creditworthiness. 

But the Nigerian market by sheer size is enormous and remains an attractive proposition for businesses and many of these need loans to thrive and both the banks and Fintechs cannot afford to ignore them.

 There is a belief at Kiakia that it can provide 24/7 real-time loan services to individuals and businesses within the banking umbrella who otherwise may not have access loans from their bank, with very minimal default on its part.

Indeed the market is vast for Kiakia and other competing online loan services. Statistics from Nigeria interbank settlement system shows that there are over 31 million verified bank accounts in Nigerian banks.

For Kiakia about 75% of this number has never accessed any form of consumer or business credit from any financial institutions. With Artificial Intelligence, A.I online lender Kiakia believes to have sorted the issue of creditworthiness that was a spanner in the wheel of loan and claims to have reduced loan defaults in the process.

Olajide Abiola

Founder Olajide Abiola, a computer science graduate and an Ex-soldier with the Nigerian Army, explains that this system is one that relies on non-traditional data to analyze, determine and predict the creditworthiness and credibility of borrowers.

In order to do so, this Fintech startup utilizes psychometry, behavioral biometrics and digital forensics to determine this predictively. Described as a self-learning risk assessment and a scoring algorithm, it only requires about 75 data points to determine if an individual has the ability and the willingness to repay.  This is a noticeable improvement from “alternative credit scoring providers who rely on as much as 2,000 to even 20,000 data points for a single individual to determine ability to repay a loan,” said Olajide.

“At KiaKia, we believe such volume of data isn’t required to determine both the ability and the willingness of an individual to repay a loan.”   

Kiakia, essentially delivers its services via a virtual assistant, which engages customers and also performs transactions like account creation, loan applications, credit scoring, responses to queries, repayments, account history and several more. 

At the core of this scoring engine is Machine Learning. This enables the system better understand the dynamics of the customer changing behaviors in ways that allow it to personalize services to the customers and also accurately profile them.

This method has been successful as the startup which has disbursed over 3,500 loans and with more than 17,000 borrowers listed puts its loan default percentage at 2.3%, a very low threshold as per the team. It reckons this as good news since funds are mostly coming from lenders and not just from their loan books. 

The startup says it has individual lenders from over four countries and three continents listed as active lenders on the KiaKia platform and have funded multiple rounds of loan funding, which they have repeatedly earned interests. 

USA, UK and China dominate the global P2P scene. Globally, China has the most massive market size of P2P lending which started in 2006. As of January 2017, there were total 2388 P2P platforms in China with trading volume in 2015 touching USD 67 Bn which is ten times that of UK and four times bigger than the USA figures. However, unlike USA and UK, the China P2P market is dominated by a large number of small and medium-sized firms. 

In India, there are about 50 players in the space operating at present.Prominent players are I-Lend, Lendbox, Faircent, LendenClub, Rupaiya Exchange, Monexo, and CapZest.

Reports from Transparency Market Research suggests that the opportunity in the global P2P market will be worth USD 897.85 Bn by the year 2024, from USD 26.16 Bn in 2015. The market is anticipated to rise at a CAGR of 48.2% between 2016 and 2024.

A report on transaction volume by Cambridge in collaboration with KPMG points out that P2P consumer lending at USD 450 Mn volume in 2015 is the largest market segment of alternate finance while P2P business lending at USD 266 Mn ranks second in the segment.

Borrowers need not worry much about the interest rates for the loan they take, as interest rates are dependent on credit scores and risk level. This can range from 0.4 percent to 0.8 percent per day for personal loans which has a minimum tenure of seven days and a maximum of sixty days. 

Interest for peer to peer loan which is available for a tenure of 90 days can go for 5.5 percent, also dependent on credit score, trust point, and risk level.

At Kiakia, to apply for loans, prospective borrowers need to create an account which allows them to apply for loans. Mr. ‘K’ the AI system guides applicants on the processes and enquiries required to get loans. Individuals can sign up to Kiakia to get listed as a lender, fund loans and earn reasonable interest rates.

The startup which was launched to the public on December 1, 2016, started its funding cycle by bootstrapping with its founders’ savings up until its launch. Two Angel investors joined in with Equity funding totaling USD 40 K to significantly expand their loan book. 

At 15 months old at its current pace, and based on 2018 Q1 performance, the team says it can achieve about 40% revenue growth over last year.

The team says it’s facing what it calls “lack of quality local investors with medium and long-term vision.” This a situation where investors are focused on immediate gains. Olajide explains that most of their prospective investors seek very short-term deals and in the process disregard the bigger picture. 

“They have commodity trader’s mindset. They hardly see the bigger picture and so the focus is usually on immediate gains, which makes the critical buy-in into a vision impossible. The least an investor can do is to bring money to the table,” he said. 

For a startup that has disbursed loans to people in 27 states in Nigeria, it is relying on an orthodox strategy that will organically grow its users. They say, “It is simple, people need money and will come looking for it.” 

It will continue to originate quality loans and borrowers that give comfort, good returns and safety to lenders, and the platform will continue to be sought after. There are plans to include strategic marketing and promotion campaigns to achieve more visibility though.

So what’s next?

The banked population comes as the next vista for the startup to explore and provide loans to. It will implement a mixture of technology fused with brick and mortar to drive penetration in this sector. The only puzzle might be if the company can meet the massive demand for money that the sector promises.

South African Supply-Chain App Khula! Wins Grand Prize Worth USD 14 K As MTN Business App Of The Year

Nzekwe Henry October 16

Khula!; a South African app that serves to link up farmers in emerging markets with the formal marketplace, has clinched top honors at this year’s edition of the MTN Business App Of The Year Awards.

In addition to being named the Business App of the Year, the platform has also received recognition in a special category dubbed; Best Agricultural Solution, as it has also emerged the winner in that category. As part of the perks that come with clinching the award, the developers of the app are now entitled to a trip to Silicon Valley in the U.S., worth up to USD 14 K in cash.

The app, Khula!, is known to facilitate delivery on bulk orders from supermarkets, restaurant chains, and even homes. This it does by effectively creating “one big virtual farm” which is basically comprised of multiple emerging farms for the purpose of crowd-sourcing produce to meet demands.

The platform’s complete software suite also incorporates an eCommerce web platform which makes it possible for clients to place orders from farmers. It also comes with an on-demand logistics solution which allows for the completion of deliveries by independent contractors.

According to Wanda Matandela, CEO of MTN Business, the awards afforded the telecommunications company the chance to place innovative solutions on the front burner and render support to these innovations with a view to helping them scale and go fully commercial, as well as help foster job creation in South Africa.

Industry experts, app developers, and past recipients of the award were amongst the panel of judges who selected and scrutinized the offerings of the shortlisted candidates of this year’s MTN Business App of the Year Awards.

Amongst other winners in the latest edition of the award were Pineapple (Best Consumer Solution),  Cowa Bunga (Best Enterprise Solution), Digemy Knowledge Partner and Besmarter (Best Incubated Solution), and Bestee App (Most Innovative Solution/Best Breakthrough Developer).

Other award recipients included such names as Stokfella (Best South African Solution), Difela Hymns (Women in STEM Solution), The African Cyber Gaming League App (Best Gaming Solution), dbTrack (Best Health Solution), Ctrl (Best Financial Solution), and Xander English 1-20 which took home the award in the Best Education Solution category.

 

 

Image via LinkedIn

South African Tech Teams Scoop Cash Rewards In The SAB Foundation Awards

Nzekwe Henry October 16

Around a total of USD 875 K in cash rewards have been doled out by the SAB Foundation to a number of South African startups and tech teams who have distinguished themselves to merit recognition in this year’s edition of the Social Innovation and Disability Empowerment Awards.

Hustlenomics; an affordable housing provider, as well as Clothes to Good clinched cash prizes worth USD 90 K and USD 84 K respectively for their offerings. While the former was recognized in the Social Innovation Award category, the former took home the accolades in Disability Empowerment Award category.

The SAB Foundation Awards are targeted at innovators, entrepreneurs, and institutions that have developed prototypes of products that are designed to tackle social problems or early-stage businesses that have set their sights on addressing social concerns.

The organization is known to offer assistance in the form of financing and mentorship to social innovations that are identified as possessing a recognizably viable business model while serving up veritable solutions to critical social problems. The SAB Foundation also claims to have disbursed more than USD 5.2 Mn since its inception in an effort to promote social innovation. More so, a total of 163 social enterprises are believed to have benefitted from the offerings of the Foundation.

The winners in the Social Innovation category, Hustlenomics, is a platform which makes it possible for underprivileged families who are holed up in the squalid conditions of informal backyard shacks to build lasting structures in their place. The startup does this by employing alternative building technology which incorporates the use of interlocking bricks made out of recycled materials. The new structures cost the homeowners virtually nothing as the housing projects are financed by means of a shared-home financing model. This model allows for the rental home income raked in by the completed structures to be used in offsetting development costs before full ownership of the property is ultimately transferred to the landowner.

Following Hustlenomics closely as second and third-place winners in the Social Innovation category are smart farming tech solution, Famru, and a microfinance solution created by InvoiceWorx for retailers in the informal sector; Spaza Credit. Both teams took home USD 63 K and USD 49 K respectively.

It appears there was enough to go around for everyone as shortlisted finalists in the Developmental Award category also got in on the act with such names as Fix Forward, Solar Lab in a Bag and ejoobi, taking home between USD 28 K to USD 34 K in cash rewards respectively. Bursary Network and Impulse Biomed were also rewarded with seed grants worth USD 14 K each.

Clothes to Good; the winner of the Disability Empowerment Award, was rewarded for helping to provide sustainable jobs and micro-business opportunities for people with disabilities by means of its clothing recycling program. Steps Clubfoot Care and Coral Tech’s VoQal took home USD 56 K and USD 42 K respectively for finishing in second and third place respectively. In what could be described as a good day at the office for Steps Clubfoot Care, the first runner-up in the Disability Empowerment Award category also scooped the Audience Award which came with a cash reward of USD 10 K. Three other shortlisted finalists in the said category also went home with USD 21 K as recipients of a special Developmental Award.

 

 

Image SourceSAGoodNews

Meet Silas Adekunle: The Nigerian Prodigy Who Is Fast-Becoming The King Of Robotics

Nzekwe Henry October 16

Africans are known to be making waves and holding their own amongst their peers on the global tech scene, and one Nigerian robotics engineer cum gaming guru is taking this to a whole new level. 26-year-old Silas Adekunle is a Nigerian robotics engineer who is considered one of the highest paid and smartest in the field. And as you will soon find out, these are anything but purported or bogus claims.

At a time when the Nigerian tech scene appears to be playing catch up with their counterparts in the developed world, the young robotics engineer seems to be pulling off remarkable feats in the world of robotics and giving ingenuity and innovation a whole new meaning,

Silas Adekunle, Nigerian robotics engineer

Adekunle, who recently got snapped up by global technology and software giants, Apple Inc., to become one of the world ’s highest paid engineers on the robotics scene, was born and raised to his teens in Nigeria. Having had some of his education in Nigeria, he relocated to the United Kingdom where he completed his secondary school education before enrolling into the University of the West of England to pursue a career in robotics. This was going to pay off as the Nigerian engineer graduated Summa Cum Laude having bagged first class honors from the institution.

Silas Adekunle created Reach Robotics in 2013. The company is known to channel efforts towards incorporating Augmented Reality (AR) into gaming for the purpose of performing functions. Fast forward four years down the line and the youngster already carries invaluable robotics experience under his belt. This feat is believed to have earned him the position of team leader in the Robotics In Schools program.

The Robotics In Schools program is targeted at honing the skills of students in the Science, Technology, Engineering, and Mathematics (STEM) disciplines. His role in the program is believed to have triggered his ingenuity and inspired the idea which led him to another project which involved developing robotics to make education more engaging and entertaining for students in the STEM disciplines.

Silas Adekunle, Nigerian robotics engineer

But the young Nigerian genius was far from done as he again caused ripples on the tech scene when he got robotics circles buzzing after the launch of Mekamon in 2017. In Mekamon, Adekunle is said to have built what is believed to be the world’s first gaming robot. The robot is considered unique in that it possesses the inherent ability to customize its features for the purpose of performing personalized functions. Mekamon may have become an instant hit post-launch but putting the gaming bot together was anything but a cake walk. The young Nigerian’s chances of success were hampered initially when he encountered difficulties in securing funds for the project. But sheer persistence, resourcefulness, and resilience got him over the line, and Mekamon reportedly generated USD 7.5 Mn after its initial launch, having had 500 units sold.

The remarkable success enjoyed by Mekamon can be considered to have opened the floodgates as support began to stream in aplenty soon after the initial sell-out of the bot. London Venture Partners weighed in with USD 10 Mn and Adekunle’s company, Reach Robotics, wrapped up a deal with Apple in the same year — a deal which means the company now has exclusive sales in Apple stores.

The quality and design of Adekunle’s creations are deemed impressive owing to their ability to show emotion with movements that are subtly-calibrated. His four-legged “battle bots” are priced at around USD 300 by Apple, and they are featured in almost all Apple stores in the US and UK. As he told Forbes in an interview earlier this year, while techies and geeks may have accounted for most of the initial scramble for the product, the robot is now beginning to draw patronage from a growing number of parents presumably due to their STEM application which can serve to get children interested in those lines of study.

Image result for Meet Silas Adekunle: The Nigerian Robotics Genius images

“Balance, shared ideas, time management, and being oneself”, are the words and phrases fondly associated with the young robotics engineer as the tonic for the successes he has so far enjoyed. As his works have gained traction, so too has he gained recognition. Adekunle was listed in this year’s Forbes 30 Under 30 Europe: Technology. According to TheBossNewspapers, he was also named “Someone to Watch in 2018” by the Black Hedge Fund Group.

Having taken the world by storm with his genius, Adekunle can be thought to be gearing up for even more feats. He currently puts in work at the Bristol Robotics Lab, which can be considered the cream of the crop of research centers in the U.K. Now, here’s to Africans all over the world who are doing the continent proud!

 

 

Image Credits: QED, Face2AFaceAfrica, JejeGuysEmpire, Naij.NG

Internet Ventures: 5 Africans Founders Who Have Railed In Massive Online Cash

Andrew Christian October 16

In the course of the past two decades, a significant number of digital ventures have been springing up from different parts of the world, due to the increasing embrace of knowledge technologies, information and social media. Several African entrepreneurs have also carved out online niches to birth economic benefits, employment and in the same way, enable globalization. Pivotal people such as Mark Zuckerberg, Sergey Brin, Steve Chen, Chad Hurley and Jawed Karim (YouTube partners), as well as Lawrence Page have been scintillating the internet scene and cashing in big on the international front. So what about Africa? The continent is definitely not missing out, as innovative minds in the motherland are citing and exploiting internet opportunities, making them worthy of celebration and emulation. Here are five of them who have built successful online ventures.

Elon Musk – Co-founder PayPal, South Africa

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The legendary Elon Musk from South Africa is the co-founder PayPal. The entrepreneur, who has an African father and a Canadian mother, is one of the brains behind what has to be the most internationally recognized and used payments system. But that isn’t the only of his accomplishment, as he also co-founded X.com in March 2002 – a financial service and email payment company. In a matter of one year, the venture acquired Confinity – a company originally formed to beam money between Palm Pilots. The combined entity then capitalized on email payment through the PayPal domain. In February of 2001, X.com was officially renamed to PayPal, which was later acquired by eBay for USD 1.5 Bn in 2002 via a stock deal. Before its sale, PayPal’s 11.7 percent shares formed the coffers of Elon Musk, making him the largest shareholder in the company.

Kamal Budhabatti – Founder Craft Silicon, Kenya

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Kamal, who is nicknamed Kenya’s Bill Gate, is the fuel to the engine and the man behind the wheels of Craft Silicon. He founded it to be a Kenyan software company that provides core banking, Microsoft, mobile, switch solutions software and electronic payments services for more than 200 institutional clients in over 40 countries spread throughout Africa, Asia, Europe, and the Americas. Craft Silicon boasts of an office in the all-time Silicon Valley in San Francisco, which makes it one of the quite few Kenyan companies ever to bask in such affiliation. With its more than USD 50 Mn market value, the company is causing ripples in the African business ecosystem, driving tech in the East African region and putting Kenya on the world map of entrepreneurship. Kamal Budhabatti’s idea of a venture now rakes in annual revenue of USD 6 Mn.

Jason Njoku – Founder Iroko TV, Nigeria

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Jason, who happens to be one of the few Nigerian entrepreneurs that beat the odds of raising capital even in impossible situations, is the founder and CEO of Iroko TV in Nigeria. The internet company is now reported to be the largest distributor of African movies in the world. While that may come as a shock to you, this may be an absorber – Iroko TV is labeled as the Netflix of Africa according to a Forbes publication. In 2013, Jason’s business was able to raise USD 8 Mn in venture capital from Tiger Global Management, which is a New York-based private equity and hedge fund being managed by billionaire Chase Coleman. Iroko TV is an online streaming website that makes enormous profits from lucrative content distribution deals with companies such as Daily Motion, iTunes, Amazon, and Vimeo. According to analysts, Iroko TV could be worth an estimated amount of USD 30 Mn, with Jason Njoku being the company’s largest individual shareholder.

Njeri Rionge – Co-founder Wananchi Online, Kenya

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Rionge is the co-founder of Wananchi Online, one of the leading internet services providers in East Africa’s cable, broadband, and Internet-based IP phone companies. This woman is regarded as one of the most successful entrepreneurs in Kenya, and her turning point was when she succeeded in turning a USD 500 K startup into the echelon internet form in the whole East African region. Wananchi Online now has a net valuation of no less than USD 175 Mn. She was one of the few people who went tooth and nail to put it out there that internet is not cut out alone for the elite, as just about anybody can found, build and make a fortune out of it. Her ISP company became massively successful so much that it rose to nearly USD 60 Mn in growth capital from a consortium private equity firm.

Mark Shuttleworth – Founder Knife Capital, South Africa

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Mark Shuttleworth is the founder of Thawte and Ubuntu/Knife Capital, South Africa. He founded Thawte when he was 22 to be a digital certificate and internet security company, which he later sold to VeriSign for USD 575 Mn in an all-stock deal. The company today is the second in the world when it comes to the provision of digital certification. When Shuttleworth was 26, he used a fraction of the proceeds from the Thawte sale to start a venture capital firm HBD Capital, which is today popularly known as Knife Capital, based on Cape Town. The firm invests in innovation-driven fintechs with proof of traction. Knife Capital was one of the participating investors in the Weetracker UberPitch series. Another of Shuttleworth’s founding was that of Ubuntu, a computer operation system that is distributed as free open-source software. The entrepreneur’s net worth is reported to be USD 500 Mn.

NEIP Disburses USD 10 Mn To Ghanaian SMEs

Andrew Christian October 16

The government of Ghana, through its flagship National Entrepreneurship and Innovation Plan Initiative (NEIP) has successfully funded 1,350 owners of Small and Medium Enterprises, with a total of USD 10 Mn in seed capital.

The disbursement is meant to aid these SMEs successfully set up their own business or vamp up the existing ones to gain some traction.
Each beneficiary of the scheme received an amount ranging between USD 2 K to GHC 20 K as financial support.

Owusu Karikari, the Director of Business Support at NEIP, told the press that the support is a loan expected to be refunded with a 10 percent interest, repayable within three years to enable more SMEs to expand and create more jobs.

According to him, NEIP identified the lack of knowledge about product development, limited market, insufficient management skills, lack of funding and little or no technical support a few of the many challenges facing SMEs in the region. He said that the support would shore up indigenous enterprises, so they have a competing chance with their international counterparts.

As part of the government’s support for small businesses, 7,000 more entrepreneurs have been taken through intensive training to build and handle their enterprises. This is quickly followed by the announcement of tax holidays for young entrepreneurs under 35 years of age, as is a respite for their businesses.

NEIP Business Support Program essentially concentrates on the provision of business development services, startup incubators and funding for early-stage businesses, seeking to enable them to grow and become successful.

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