Top of mind: Happy Sunday!
Africa’s football superstars earn millions of $ and need help spending it. Luckily, African startups are helping solve that good problem by granting our favourite athletes investment options.
Plus, Safaricom breaks records in Ethiopia, and Kenya’s Court takes on the Avenger role.
Let’s get to it.
3 big things
- Footballers and startups
- M-pesa crashes Ethiopia’s Telco party
- Kenya’s Court earns a Superman cape
African startups are getting backed by football superstars.
The short: With millions of dollars in endorsement deals and high weekly salaries, global football superstars are backing tech startups.
Africa’s play: Footballers have historically invested in real estate and retail businesses – but with larger earnings and no clue what to do with it, these elite athletes are backing African startups driven by ecosystem validation from significant milestones like Paystack’s $200M+ exit and regional M&A’s.
The newly-minted footballers turned tech investors:
- Nigeria’s superstar national player and Leicester midfielder Wilfred Ndidi invested in the fantasy football platform, Fanbants – which became the first African startup accepted into the coveted tech accelerator, Techstars. Ndidi’s investment will ramp up excitement for African fantasy gamers across the EPL, AFCON and the World Cup.
- Chelsea’s goalkeeper and Senegalese national team footballer Édouard Mendy invested in Ivorian fintech startup Julaya’s $2 million pre-series A funding to digitise payments for businesses in Francophone Africa. Julaya processes more than $7.5 million in monthly transactions.
- Former French footballer Blaise Matuidi invested in the pre-seed round of Sudan-based fintech Bloom – recording a feat as the country’s first YC-backed startup.
- For South Africa’s retired football player Rudzani Ramudzuli, his participation goes beyond funding – he founded RRR Rams Holdings, a waste management company in South Africa.
- Honourable mention of England footballer Raheem Sterling’s investment and ambassadorship of Oja – an online grocery store catering to African and Caribbean communities, founded by Nigerian-born Mariam Jimoh.
Across the Atlantic: The GOATs and global footballers are partnering with tech veterans to launch venture capital firms or invest at scale as angel investors.
- World Cup winner Lionel Messi launched his venture capital firm, Playtime, to back startups in media, sports, and technology. With its HQ in Silicon Valley, Playtime will support entrepreneurs worldwide.
- Cristiano Ronaldo is a serial angel investor with stakes in companies like Mobitto, Thing Pink, and Insparya.
- Raphaël Varane recently announced his venture into entrepreneurship and investing with a LinkedIn post highlighting his investments in several companies.
- Zlatan Ibrahimovic, Iker Casillas, and Ivan Rakitić are well-known serial angel investors.
Long-games: Footballers turned investors are playing long games on and off the field – Arsenal’s historic attacking trio of Cesc Fàbregas, Robin Van Persie, and Thierry Henry invested in Grabyo in 2013. Last year, the company hit $4.3 million in revenue.
Final thoughts: Exits and M&As are essential in validating an ecosystem’s profitability, and Africa has recorded impressive numbers. With BioNTech’s recent acquisition of Tunisa-founded InstaDeep for $680 million and Smile Identity’s Appruve acquisition, Africa’s tech ecosystem is springing up lucrative activities. It’s no wonder everyone wants a piece.
M-pesa breaks records in Ethiopia
The short: Safaricom is bringing its star student M-Pesa to Ethiopia.
Safaricom’s Ethiopia play: Safaricom just obtained a payment instrument issuer license, bagging another win in its Ethiopia expansion plan. This license allows the telecommunications company to introduce its fintech arm, M-Pesa, into the country and compete with the state-owned mobile money operator, Telebirr.
Breaking records: In 2022, Safaricom launched in Ethiopia as the first private telecom operator. Within its first seven months of operation, Safaricom gained 3 million subscribers in 25 cities. Although it’s a good start, Safaricom still has a long way to go to catch up with the 54 million subscribers of the state-owned telecom, Ethio Telecom.
A costly bet: Safaricom’s desire for Ethiopia is costing them. The company spent $150 million to obtain the license for M-Pesa, which mirrors the $154 million in losses from operating as a telecom in the country over the past year.
Safaricom invested about $1.2 billion and plans to invest $300 million more over the next ten years. Ethiopia’s massive population of over 120 million people was the main attraction for Safaricom, but dominating the market wouldn’t be a walk in the park.
MTN declined the invite: Safaricom will go head-to-head with Ethiopia’s state-owned companies in telecom and financial services. Additionally, Safaricom’s biggest competitor, MTN, chose the road much travelled and pulled out of the bid, citing possible difficulty in repatriation as one of the challenges.
Final thoughts: Safaricom took a bold move to pursue growth when companies globally are choosing to focus on profitability. If they can adapt while leveraging their experience from Kenya, they stand a good chance of taking over the Ethiopian market.
Kenya’s Court is a content superhero
The short: Kenyan court stands up for laid-off content moderators.
The story thus far: Meta and Sama have experienced a roller coaster ride in and out of court in Kenya. In March, the Kenyan court blocked Meta from switching its content moderator from Sama to Majorel and stopped Sama from executing large-scale layoffs.
Backtracking: The content moderators accused Sama of unlawful termination and Meta of instructing Majorel to blacklist them from employment opportunities. Stranded with no content moderator, Meta attempted to get itself out of the lawsuit by arguing that, as foreign companies, they could not get sued in Kenya.
Kenya’s Court said aht aht: Kenyan court found the argument uncompelling and proceeded with the case. This month, Sama decided to exclude the laid-off content moderators from the payroll, but the court stepped in again and forced Sama to pay up.
A likely verdict: The court has sent strong messages to Sama and Meta about its stance on the case and refuses to budge. The experience is frustrating for Meta, which wants to move on with its new content moderator, and for Sama, whose plans to ditch content moderation to focus on AI-inclined solutions.
If Meta and Sama are found guilty, the court could give a verdict that clears the moderators from Majorel’s blacklist and forces Meta and Sama to settle them for their actions.
Final thoughts: It’s been a tedious journey for all parties. An expedited ruling will take Sama and Meta out of Limbo. The pushback from the Kenyan court sets a precedent for international companies providing adequate pay and more mental health benefits to the moderators who are forced to do one of the hardest jobs in the world.
Thanks for reading! We’d love to hear your thoughts about this week’s issue.