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Setting Africa up for a Post-Mao China Type Economic Revolution, the Zedcrest Perspective

Apr 28, 2021   •   by   •   Source: Proshare   •   eye-icon 1325 views

Wednesday, April 28, 2021  / 03:00PM/ By Adedayo Amzat, GMD, Zedcrest Group /Header Image Credit: Zedcrest Group

 

 

The People's Republic of China was officiallyfounded in 1949, but the economy didn't really find its feet until the start ofeconomic reforms in 1978, after the topsy turvy turbulence of the two periodsof "The Great Leap Forward" 1958-1960 and the "Cultural Revolution 1966-1976."

 

What changed in China? Emerging from decades of warbefore the founding of the People's Republic of China in 1949, Soviet stylesocialism became a focal point of governance, largely due to the expectednationalistic tendencies arising from periodic civil wars and at least two mainwar programs against regional arch nemesis, the Empire of Japan. Socialism ledto mixed results with massive state-controlled investments in Industry.

 

However, the lack of private incentives and publicdisillusion with Marxist-Leninism led to misallocation of resources, and aneventual collapse of the system. Sustainable growth didn't really start untilthe advent of Deng Xiaoping as the Supreme leader of the Peoples Republic ofChina from 1978. Despite being a socialist republic, Deng unleashed a cultureof innovation and market-economy reforms, the eventual bedrock of the tremendouseconomic development of China till today, taking GDP size from 50billiondollars in 1960 to 14.3 trillion dollars in 2020, an economic miracle by allstandards.

 

When we started Zedcrest in 2013, our convictionwas that Africa was exactly where China was in the early 80s and despitecontinuing struggles, has the opportunity to develop continent-wide growth in asimilar fashion as China. All it would take is focused leadership, a MORE connectedcontinent and an explosion of Innovation across the continent. We then set ourvision along those tenets, with the dream to build a core of African-widefinancial services businesses and a satellite of Investment portfolios. Seven yearslater and achieving domain leadership in the financial markets, consumerlending and now Investment management, we have now turbocharged both our continentalambition in our core businesses and in our early stage investing initiatives tosupport Innovation across the continent.

 

Officially starting in 2019, we have investedrapidly to test our hypothesis and make up for lost grounds. Investing directlyand in partnerships with co-investors and syndicates, we have backed 30+ earlystage businesses with cheque sizes ranging from $25,000 to $250,000 (US Dollars).With the potential of the continent becoming more established with the surginginterests from larger and seasoned global investors, we have joined the likesof Idris Bello at Afropreneur, and Kola Aina at Ventures Partners as "discoveryinvestors", investing early enough and helping founders through the roughperiods of market and business validation.

 


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A Stoplight On Some Key Investments

Koniku - 'Intelligence is Natural' led by Osh Agabi, is building sensing and thinkingmachines, with synthetic neurobiology at its core. Koniku's flagship device,the "Koniku Kore" is a wetwaredevice that can detect and interpret smells and process that data for use inaviation security, policing and medical research. A future where diseases andthreats can be detected by the power of "smell" is one envisaged by Koniku.

 

The company recently announced its partnership withglobal aircraft manufacturer, Airbus.

 

Koniku's work for Airbus is in aircraft and airportsecurity. Both companies are co-developing solutions for detecting biologicalhazards, and spotting chemical and explosive threats. Airbus will installKoniku's Konikore; a small device that looks like a jellyfish. The device canperform the bomb-sniffing roles that have come to be associated with policedogs. In the best conditions, Konikores are expected to detect substanceswithin 10 seconds.

 

Bankly - Banking the Unbanked

We met Tomi and Fred in 2019, and immediatelyconnected with the glint in their eyes. Despite the explosion of Fintechservices, most digital banking products are built almost exclusively for theabout 30million already banked people. Who is working on bringing the remaining50million adults into the digital world? This is where Bankly's work becomesvery important. We led the pre-seed round of Bankly in 2019 and it has beenbeautiful to see their work blossom.

 

Working with agents, Bankly has built customsolutions to onboard unbanked users onto its digital platforms, leading withsavings as product.

 

Bankly recently concluded a seed raise of $2million,led by new investors Flutterwave and Vault.

 

BentoAfrica - The Operating System for Salaries and Lives

Formerly known asVerifi, the leading payroll software solution firm has made a lot ofprogress in the last two years while also rebranding its name to Bento Africa. Bentobelieves that Salaries are the operating system that life is built upon and has partnered with other startups like Nigerian edtech startup,Schoolable; property rental platform, Kwaba; consumer lending[D1] [LO2]  firm, Zedvance among others to enable its users do more.

 

TalentQL:Boosting the Competitiveness of African Talents

Understanding theimportance and value of tech talent in Nigeria and the diaspora, TalentQL, oneof Zedcrest's portfolio companies is creating a diverse and sustainablepipeline for tech talent for companies anywhere in the world.

 

TalentQL recently gotaccepted into Techstars Toronto. The African-focused talent recruitment andoutsourcing company joined nine other startups in the accelerator's class of2021.

 

Other portfoliocompanies are:

 

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...Drivingthe Next Generation of Fintech Solutions 

Onepipe

Working with openbanking frameworks, Onepipe is an aggregator of Application SoftwareIntegrations (APIs) into a standardized gateway, offering businesses theopportunity to be a one-stop shop for digital financial services with oneintegration.

 

Spektra

Prince BoakyeBoampong is building a unified alternative payment network that does notrequire a bank account for over 1billion Africans with Spektra. Essentially, heis building Alipay, but for Africa.

 

Tanda

In funding Kenyastartup, Tanda, Zedcrest is supporting the founder, Geoffrey in promoting financialinclusion by converting neighbourhood dukas (micro-retailers) who account forover 70% of consumer purchases across Africa into a one-stop shop for basicfinancial services.

 

Lenco is building a better banking and expense management experiencefor businesses across Africa

 

Indicinais building the Africa's credit infrastructure by enablingthe much needed risk innovation

 

Kaoshi is leveraging Open Banking APItechnology to unlock cross border finance, specifically the finances of thediaspora to their home countries. 

 

Julaya:Starting out of Francophone Ivory Coast, Julaya is building the digitalaccount for African small and medium-sized businesses.

 

Fintor: The Los-Angeles based company turns real estateinvestment opportunities into micro-equity shares starting at around $5 to makeinvesting in real estate available to everyone.

 

Thundr: A mobile-firstequities trading platform that is designed to make investing easy for bothgreen and expert investors alike. TheYC-backed startup is pioneering commission free investing in Egypt.

 

Yoello is a paymentsplatform building infrastructure that connects banks and payment networks tomerchants' consumers.

 

SUDO: An API platformthat enables you instantly issue physical and virtual cards with more control& flexibility at scale

 

....RevolutionisingHealthcare

Helium Health is a startup leadingthe digitization of Africa's medical industry by providing a suite ofcutting-edge technology solutions for all healthcare stakeholders in emergingmarkets. The startup raised $8million in 2020 to fund its African wideexpansion.

 

Amara Medicare aims torevolutionize the 3-in-1 services of Ophthalmology, Dental and ENT practice.

 

LoraDiCarlo is changing the world by empoweringindividuals to embrace their sexuality with positivity and confidence, withtechnology that solves our most important sexual health and wellness issues.The company announced the coming on-board of Cara Delevingne as co-owner andcreative advisor.

 

Contraline is a medical device company developing a long-lasting,non-hormonal, and reversible male contraceptive using advancements in hydrogeltechnology.

 

Bypa-ss is digitizing healthcare informationexchange between healthcare providers to deliver best quality of care to theirpatients.

 

....Building the Future of Education

Abwaab: Founded in 2019 byformer Uber, Careem, and Mawdoo executives, Abwaab's online platform enablessecondary school students in the Middle East & North Africa to learndifferent subjects at their own pace with the help of engaging video lessonsand interacting with tutors, test themselves using tests and quizzes, and tracktheir performance using different tools. The company just completed a$5.1million seed round and is now live in Jordan, Egypt, Saudi, and Palestine.

 

Utiva: Utiva is building talents for the future of work. WithAfrica needing to retrain a generation of workers to adopt the required skillsset for the digital economy, Utiva is leading this mission by combining remotelearning models with instructor-led approaches to help people acquire theskills they need to make a transition into new tech roles.

 

....Building Logistics Infrastructure

Freterium: Moroccan startup,Freterium is giving superpowers to logistics team with its AI-driven platform.Freterium's cloud-based transport management platform offers the easiest andmost automated way for manufacturers, retailers and logistics firms, to managetheir daily road freight shipments.

 

SOTE: Based in Kenya, Sote is building the digital logistics infrastructurefor Africa. SOTE's mission is to grow the GDP of the continent by facilitatinggrowth of trade. The company provides a combination of ERP solutions,underwriting models, and software driven supply chain services across thecontinent.

 

FLYR Labs FLYR's cirrusplatform is a modern and cutting edge Revenue Operating System (ROS) for theairline industry.

 

XTI Aircraft Company is acleantech aviation company developing the world's first hybrid-electriclong-range vertical takeoff airplane.

 

 

....Providing Basic Human Needs & ImprovingSustainability

Zenfix is providing savoury and nutrient dense foods in Nigeria.

 

Zumi Africa: Zumi is revolutionizing the apparel supply chain in Africaby connecting apparel wholesalers and retailers in a transparent, affordablemarketplace.

 

Tagaddod is a renewable Energy and Waste Management company,started in February 2013 and operating in Egypt. Currently focusing on cleanfuels, Tagaddod isworking on Biodiesel production from Vegetable Oils.

 

 

....Providing Enterprise Services

Simpu helps businesses start and nurture quality relationships withtheir customers. With a one-tap experience platform, businesses can interactwith customers across multiple channels in real-time. 

 

Appruve builds identity and financialsolutions for firms to verify datathey collect from their customers across their lifecycle. Appruve providesverification services around identity and financial profiles, fraud detectionand management.

 

Youverify is building trust in Africa byhelping businesses and individuals confirm identity and physical addresses.Using artificial intelligence, Youverify confirms a user's identity documentand compares it with their facial biometrics. This information can be cross-checkedagainst more than 300 databases locally and globally.

 

 Proshare Nigeria Pvt. Ltd.



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