The Flip

There is a $330 billion credit gap, according to the IFC. But why is it so hard to lend in African markets?

We explore that question with Chijioke Dozie, Co-founder and CEO of Carbon, and Mark Straub, CEO of Smile Identity.

This episode was recorded live from the FT Partners Fintech in Africa Summit in New York City. Download their FinTech in Africa research report, published in March 2024.

00:00 - Introduction
01:36 - The credit infrastructure problems in Africa
02:28 - Carbon's approach to lending
03:51 - SmileID's perspective on credit infrastructure
08:10 - Ability to pay vs. willingness to pay
10:06 - Private sector solutions
17:36 - The challenges of scaling lending without infrastructure

Follow Chijioke on Twitter.
Follow Mark on Twitter.

This episode was the third in our series of interviews recorded live from the Fintech in Africa Summit.
Nigerian Neobanks with Moniepoint's Tosin Eniolorunda, Kuda's Babs Ogundeyi & Fairmoney's Laurin Hainy: https://theflip.africa/podcast/nigerian-neobank-roundtable-moniepoint-kuda-fairmoney
Cross-Border Payments with NALA's Benjamin Fernandes & GTXN's Dan Kleinbaum: https://theflip.africa/podcast/why-are-cross-border-payments-so-hard

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The very nature of a high-growth startup means that the company is always growing and hiring at a rapid rate. And for African startups, in particular, the talent question is even more acute, given the general challenges of sourcing for select roles, as well as the difficulty in competing for talent with other startups, multinationals, and companies elsewhere in the world. In this episode, we unpack the talent and recruiting situation for venture-backed startups and growth-stage companies - how do we source for newer types of roles, like product and growth? Do we hire for aptitude and train up? Do we go to where there is more talent? How does remote work - particularly during COVID-19 - play a role here?

2:50 - We discuss the current recruiting landscape with Toun Tunde-Anjous, Founder of The People Practice.
4:38 - Charles Sekwalor, CEO of Movemeback, shares his views on the talent question, and the opportunities with startups and growth-stage companies on the continent.
8:17 - We explore startup recruitment strategy with Ijeoma Oyeyinka, Helium Health's Head of HR.
10:26 - Many startups, including Helium Health, use outside recruiters, as well. Toun's The People Practice is one such firm.
11:20 - We har from Ijeoma & Mansi Babyloni, Flutterwave's Global Head of People Strategy on the hiring competition, and the pitches they make to mission-driven talent.
15:12 - Mansi & Toun on compensation and their experiences with African startups offering equity packages.
17:59 - On remote working dynamics and the opportunity to tap into a wider talent pool, particularly due to COVID-19.
20:46 - A discussion on training & development of talent, and in particular less experienced talent, on the continent.
24:23 - We hear from Aaron Fu, on the Venture for Africa fellowship program, and their endeavor to de-risk an exploration into the African tech and startup ecosystem.
28:13 - As always, a reflective conversation between Justin Norman and Sayo Folawiyo on this episode's topic.

The future of work in the African context is going to be a lot of different things. It mimics the nature of work itself for many individuals on the continent. They're taking this portfolio approach to work. Even in more "developed markets" we're seeing work become less formal and more flexible, as work becomes unbundled from employment. And this evolution of work itself provides a whole set of new challenges and opportunities.

So this episode is a retrospective on the entire season, in which we explore more of these questions about the future of work in this context. And joining The Flip's Justin Norman and Kandua's Sayo Folawiyo for this conversation is friend of The Flip, Chris Maclay, the Program Director for the Jobtech Alliance at Mercy Corps.

00:00 - Intro.
04:30 - Portfolio of work, earnings, stability, growth.
08:40 - Who gets to decide if a job is good or bad?
15:48 - Training, enablement, and platforms.
19:48 - The HustleOS and micro-franchising.
24:28 - The Future of Work is a portfolio of work.
29:54- Digital services for export.
32:57- Market sizing platform-enabled digital work.
41:39 - Should there have been an episode called The Future of Work is Universal Basic Income?

This season of The Flip is sponsored by MFS Africa.

We hear a lot, in the African tech ecosystem, that the competition is with cash. Virtually every country in the world is on some form of a journey to move from cash to cashless. Many African markets, however, are quite far on that journey. And to understand how to accelerate this trend on the continent, we first need to understand how money moves.

[04:55] - For most Africans, the mobile money experience starts with agent networks, like TeamApt's MoniePoint, in Nigeria.
[09:47] - Though increasingly, people are getting paid by employers directly into their mobile wallets. Bulk disbursement startups like Julaya, in Cote d'Ivoire, play a role here.
[13:24] - But how does money actually move, between accounts and banks? The movement of money is powered by national payments switches. In South Africa, its payments switch is BankservAfrica.
[20:06] - So now that we know how money moves, how are fintechs building greater utility into their mobile wallets, to compel users to keep money in them?
[25:56] - How should we think about the design and extensibility of mobile wallets, in the context of physical wallets?

This season is sponsored by MFS Africa.

All this season, we're exploring value chains. And in the payments value chain, no fintech has a wider reach on the continent than MFS Africa. Through their network of over 180 partners - MNOs, banks, NGOs, fintechs, and global enterprises - MFS Africa's API hub makes connects over 320 million mobile wallets across 30+ countries in Africa.

As we continue our season on value chains, in this episode, we explore logistics.
The cost of goods and food is disproportionately higher in Africa than anywhere else in the world, with consumers in some markets, spending 50% or more of their total income on food alone. A major reason for these high prices is logistics.
So how do we fix this? How do we improve the efficiency of logistics on the African continent, and ultimately drive down the cost of goods?

[04:20] - On the role of containerization and efficient ports, with Jetstream Africa's Miishe Addy.
[11:37] - After we get through the ports, our goods are loaded onto a truck. We hear from Omar Hagrass on how Trella is trying to improve long-haul efficiency in North Africa and the Middle East.
[15:26] - From the port, we move on to the wholesale distributor. As we discuss with Daniel Yu, Sokowatch is aggregating small retailers at the fragmented last-mile and offering same-day delivery of fast-moving consumer goods.
[22:37] - As the nature of retail evolves and more small merchants need logistics solutions, logistics-as-a-service providers like Sendbox are playing a role at the last-mile. We hear from its CEO, Emotu Balogun.
[26:41] - But amidst all of this tech and innovation - what about infrastructure? To what extent is the problem just poor ports and roads? The Flip's b-mic, Sayo Folawiyo, and its host, Justin Norman, call up infrastructure investor Dami Agbaje for some insight.
[32:42] - This episode's retrospective with Sayo and Justin.

This season is sponsored by MFS Africa.

All this season, we're exploring value chains. And in the payments value chain, no fintech has a wider reach on the continent than MFS Africa. Through their network of over 180 partners - MNOs, banks, NGOs, fintechs, and global enterprises - MFS Africa's API hub makes connects over 320 million mobile wallets across 30+ countries in Africa.