According to numbers compiled in WeeTracker’s Venture Investments Report 2018, US$726 million was invested across 458 deals in African startups. That is a 300% gigantic leap in the total funding amount and over 127% increase in the number of deals as compared to 2017.
In terms of the number of deals, all inclusive, NIGERIA outperformed all other location with a total of 136 deals. South Africa, which gave it a close competition stood second with 107 deals, followed by Kenya with 73 deals. This trend has a slight deviation from the last year where South Africa had topped the chart. Joining the race this year along with the investor’s preferred destination are countries like Egypt, Uganda, Ghana and Tunisia.
A total of 243 investors participated in the investment landscape in Africa
458 startups raised funding in various rounds throughout the year
80% of the deals were concentrated in South Africa, Nigeria & Kenya.
Fintech retained its top position as the sector with most funding.
30 startups made it to the 5 million club of fund raising across the continent
Startups which received $5m or more. Source: WeeTracker
We have compiled the most impactful articles I authored in 2018: “The Call to Mission” topped the list. The piece had 17 re-print requests from print newspapers, religious organizations, and HR/leadership companies. I had explained how the Messiah had recruited His disciples, trained and prepared them, to execute the mission. If possible, read it again here.
The second most impactful article was the One Oasis Strategy (PDF) where I articulated a management framework on efficient utilization of capital. This brought the highest consulting and advisory opportunities to us. The third most impactful was Aggregation Integration Construct.
We do not track traffic, internally, on Tekedia. Yet, if you check Alexa, these articles were the most searched. My most cited and re-printed leadership article of all time is on ants, published in Harvard Business Review. The Catholic Church has integrated it in a leadership manual. Clayton M. Christensen investment firm has it as a required reading.
If you are looking for business plans (pitch decks) to help you as you work on one, to raise capital, download samples here: Coinbase, YouTube, Uber, WeWork, LinkedIn, etc.
On the piece that Samsung will buy Tecno within 5 years, I have updated it with the core basis of my prediction. Largely, if Samsung cannot grow in U.S. and Europe*, the only remaining place is Africa. Samsung has no serious market share in China. It has struggled in Japan. And in India, Chinese firms are now winning there. So, if you look critically, it is only Africa that it has as a growth market. But since it is losing market share in Africa, it can buy itself out! Why save itself in Africa? It was doing better in the continent before it started fading. In the other markets, it never really did well.
Samsung market share is about 1% and is included in others in China (source: counterpoint)
You can minimally add Apple iPhone in this paralysis of losing market share; Huawei overtook Apple few months ago on smartphone shipment. Despite Apple argument via the Tim Cook letter, the real issue is that many Chinese phone makers are making great phones at 60% of iPhone price. So, in Asia, few people want to spend money on iPhone when they can get really great ones at 60% of iPhone price.
Apple CEO Tim Cook released a statement, warning investors Wednesday that the company is lowering expectations for its first quarter 2019 performance: “While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in Greater China. In fact, most of our revenue shortfall to our guidance, and over 100 percent of our year-over-year worldwide revenue decline, occurred in Greater China across iPhone, Mac and iPad.”
Notice the *: I added it because U.S. and Europe are strategically keeping Chinese brands out of their territories on the basis of national security. So, Huawei and Mi are not officially sold in U.S. through the big channels like telecom operators like AT&T and Verizon. If U.S. has allowed Huawei, Samsung and Apple would struggle at home. Americans like value and when they see how much Apple and Samsung are charging compared to the value on price and quality that Huawei offers, they would go for Huawei. The national security accusation is not strong since most of the phones sold in U.S. are actually made in China including Apple iPhone, and the ones sold by the telcos like Verizon and AT&T.
On the acquisition, how much would it cost? Looking at Tecno Mobile financials, it made (at most) $1 billion on revenue as at 2014, shipping 37 million units of phone in 2013. Samsung revenue in 2016 was $176 billion; the firm shipped 72 million phones in Q3 2018. Simply, Samsung can afford to acquire Tecno and make it Samsung Tecno with focus on Africa and Latin America. Samsung Galaxy is not cutting it here; Samsung Tecno is a better name! Maybe, it may cost it $6 billion to have Tecno in-house.
Smartphone unit shipments of Samsung worldwide by quarter from 2010 to 2018 (in million units)
After I chose the CEO/GMD of Access Bank, Herbert Wigwe, as my Businessperson of the Year, many had written, making a case that CEO/GMD of GTBank, Segun Agbaje, would have been a better choice. Largely, as I noted, all the CEOs won because anyone that saw its institution from Jan to Dec in Nigeria is a winner – our market remains extremely unpredictable that anything can happen.
Yet, despite the strong shareholder value GTBank has created over the years, 2018 was not necessarily superb in that institution. But because it was light years ahead of others, we did not notice. GTbank lost 15% of shareholder value in 2018 even though it accounted for 26% of all banking market value in Nigeria, as at Dec 31 2018. On technology, GTBank has lost grounds to competitors, and Agusto & Co actually ranked it 5th on the Best Digital Bank in Nigeria.
As you can see, I am doing everything to explain why I did not choose GTBank even though it was clearly a category-king in Nigeria. Though it has built the best shareholder value in the last few years, last year was not great. Its technology supremacy is cracking that it came 5th in a ranking. Sure – it remains the best but 2018 was not super-great.
But when compared with Access Bank, it moved from #3 to #1 (post-deal closure) on asset. It added millions of new customers and it got a good deal on Diamond Bank. Less than 5 years ago, Diamond Bank was worth excess of $400 million; Access is paying $200 million (N62 billion). In short, if Access decides to sell all the real estate of Diamond Bank, it would have extra change on that N62 billion it is paying [I get it; many would throw digital bombs on that last line].
In summary, Herbert has to unlock great value in Diamond Bank to justify this deal. My thesis is that he is a visionary leader to have done this deal. That does not mean that he has added value just by doing it. The Nobel Prize committee gave Obama the Nobel Peace Prize hoping that he would make the world a prepaid paradise. That did not happen, as Obama deployed more hellfire grenades and bombs to protect his nation. I do hope that Herbert will execute.
