On a real estate pre-seed, drop in Jumia stocks, and regulatory competition

Good morning!

Immanuel here,

Africa’s tech space is experiencing massive heights, and the media has been riding the wave. But sometimes we have to ask ourselves, to what extent do the larger narratives of Africa affect our daily lives?

Let’s think about this as we chat:

  • Spleet’s $625,000 raise
  • Jumia’s Troubled Stocks
  • South Africa vs. Meta

Spleet’s $625,000 pre-seed

Nigerian prop-tech startup, Spleet, raised $625,000 pre-seed led by MetaProp VC. Other investors including Future Africa, FEDHA Capital, VFD Group, Moonshot VC, HoaQ, CEO of Squarefoot, Jonathan Wassersturm, CEO of Flutterwave, Gbenga ‘GB’ Agboola also participated in the round.

Spleet plans to create financial services solutions for landlords and tenants in Africa. Planned features include tenant verification and payment automation for landlords and an immediate rent option for tenants.

why it matters: Renting apartments is notoriously tricky in major African cities. Landlords and tenants do not know what they are getting into by signing a rental agreement. Based on my personal bias, I think Lagos takes the cake.

Decent housing in suitable environments is rarely affordable, and affordable houses are rarely decent. By adding a mixture of religious, cultural and tribal prejudices, you find yourself faced with an impossible situation.

Where Spleet Comes In: Spleet’s overall mission is to facilitate housing in Africa, but its current solution, like other proptech companies, is targeted at the high end.

Spleet CEO Tola Adesanmi acknowledged that Spleet’s initial housing market did not solve the affordability problem. He thinks that the “rent now, pay later” financing solution would fill this gap.

The big picture: A financing solution solves only part of the problems mentioned above. Frankly, only people with relatively higher incomes would choose to finance an apartment that costs £2 million a year ($4,000). Given the other solutions available in space, the industry seems wide open to further disruption.

Meanwhile, I leave you with this piece: Why solving Nigeria’s housing problem is beyond proptech startups so far

The collapse of Jumia shares

At the start of the pandemic, I regretted not buying Jumia shares, given its appreciation. Today, the e-commerce company, listed on the New York Stock Exchange (NYSE), hit a one-year low as its shares fell to $6.5.

Still in trouble: In its earnings report, Jumia posted improved results in the fourth quarter of 2021, but the overall outlook for the year remained fragile. Orders and gross merchandise volume (GMV) increased only slightly, but losses quadrupled to $52.5 million.

Recall that for most of 2020, Jumia pushed for profitability and shifted its focus from electronics (which had higher value but less volume) to fast moving consumer goods (FMCG), which meant volume high but less value per order. It also reduced marketing expenses.

The result? Jumia’s losses were reduced, as were its monthly orders and revenue.

Read: 18 months after the start of a new strategy, how close is Jumia to profitability?

A half turn: The company has relaunched aggressive marketing and advertising while continuing to focus on consumer products.

Results? Monthly orders, users, and revenue are growing, but, predictably, its losses are skyrocketing once again.

The big picture: Despite its well-documented struggles, African entrepreneurs and a handful of investors are still betting on e-commerce in Africa. There’s a lot to dig into here.

look at this: Bet $165 million on B2B e-commerce in Africa in 2021

Meta and antitrust in South Africa

picture by Dima Solomine to Unsplash

If you’re a keen observer of global technology or a fan of Wondery’s trade wars, you can probably guess what’s to come. A big tech company facing anti-trust allegations is, pretty much, up to the mark.

Facebook’s parent company Meta could be sued by the South African Competition Commission for imposing restrictions on government platform GovChat. According to the regulator, Meta had blocked the citizen engagement platform from using its WhatsApp business APIs.

What is GovChat? The South African government established GovChat in 2018 as a citizen engagement platform that uses WhatsApp’s business API to facilitate real-time alerts and complaints on civic issues such as bullshit. hen, faulty government facilities, COVID-19 distress and social security apps.

It reportedly has 8.7 million active users and processed over 582 million messages.

The elephant in the building: Regulator alleges WhatApp Business terms are designed to insulate it from any competition the GovChat platform might present, but Meta completely denies this, saying GovChat breached terms by signing up people without going through process WhatsApp integration.

The big picture: As I pointed out earlier, big tech companies could expect antitrust allegations any day of the week. The likes of Google, Facebook, Amazon and Microsoft have been caught in this web.

Read more: Meta faces lawsuit in South Africa for alleged violation of antitrust laws

Interested in digging deeper into this question, especially as it relates to Africans? Then press the answer button.

What else am I reading

  • Cash on delivery: the worst thing that can happen to e-commerce. Read
  • Nigeria has a new data protection agency; here’s why you should care. Read
  • What happened the last time high gas prices dominated US politics? Read

Opportunities

  • Get rewarded for building technical skills in the Microsoft Spring Skills Challenge. Details here
  • Have you heard of the MTN Nigeria Graduate Trainee Program for Marketers? check it out.
  • Identitypass is recruiting. Discover the roles available
  • CarePay is looking for a Customer Success Officer and a Pricing List Coding Intern. Learn more and apply here and here
  • OnePipe is launching a writing challenge for Nigerian journalists. Three writers to earn 1 million naira each. Apply here.
  • UN Women plans to select 60 interns from 10 African countries for coding courses. Find out the requirements and how to apply here
  • Applications are open for the Middle East, Turkey and Africa GNI Innovation Challenge. Learn more about the challenge and how apply here.

Have a stress-free day!

Emanuel Paul

Writer and Narrator. Technology, business and politics fill my head. Looking to chat? Find me (@eruskkii) on Twitter or send an email to [email protected]



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