China's Flag is Planted in African Tech
A balance of power is at stake, but so is a window of opportunity for investors — here's what you need to know about China's influence in Africa.
Stay up to date on emerging market trends, stories, and companies I’m following closely as an emerging VC investing in LatAm, Africa, the Middle East, and South Asia. Publishing twice weekly:
Hello!
Welcome to my first piece on Emerging Market VC, where each week I’ll share technology trends and companies in emerging markets that I’m following closely. I’ll publish primarily in two formats:
Monday: deep dives into market dynamics & trending stories in LatAm, Africa, the Middle East, and South Asia
Friday: features on early-stage companies I’m bullish on in these regions
Why am I starting Emerging Market VC? My goal is to provide well-researched content on undercovered emerging market tech trends and companies for global technology investors (like myself) seeking intel (and alpha) in these regions.
A bit about me, I’m Puerto Rican Chinese-American, and the General Partner of Predictive VC, where we invest into early-stage companies unlocking upward mobility across the US and emerging markets.
As a ‘global citizen’ and product nerd, I am passionate about the evolution of cross-border digital connectivity and the intersectional dynamics between culture, socioeconomics, and innovation in emerging markets. I look forward to keeping you updated on the tech stories and opportunities in these regions that I find interesting and relevant. Let’s get started — just like any MVP, Emerging Market VC is a work in progress… I’d love your feedback!
Cheers,
Kevin
Playing a Long Game ⏰
Over the past three decades, China has strategically embedded itself in Africa, playing a long-term game that has largely flown under the radar.
From forging political ties through aid in the 1990s to expanding investment in telecom and transportation infrastructure in the early 2000s, and spearheading mobile, energy, healthcare, and education development in the 2010s, China has had a far reaching vision for Africa.
With Africa projected to double its population by 2050, becoming home to over a quarter of the world's people, the continent's political and economic influence are set to take a massive leap.
Why does this matter? 🤔
As the world’s second most populous continent (1.7 billion people) with fifty four member states in the United Nations and three seats on the UN Security Council (out of a total of fifteen seats), Africa will be in an enviable position to amplify its global footprint over the next few decades.
Meanwhile, China is pulling strings, playing a substantial role in shaping Africa's trajectory while gaining significant political & technological leverage itself.
The dynamics at play in China’s ‘long game’ in Africa are fascinating and under covered. In this piece, I’ll share a history of China’s involvement in Africa, my perspective on the implications, and areas of investment I’m focused on given the circumstances.
Part 1: China’s Foundations in Africa
Part 2: Establishing Moats
Part 3: Implications of these Moats
Part 4: A Window of Opportunity
As an early-stage investor, I believe we’re entering a ripe window to identify the next series of unicorns in Africa, despite a general pullback in VC interest this year; China’s formative role in Africa’s tech ecosystem is a key catalyst for this thesis.
It may be a revelation to you — it certainly was for me — that many of the fastest growing technology companies in Africa, from OPay in fintech to uLesson in education and mPharma in healthcare, have deep Chinese ties.
Furthermore, China is now rapidly connecting the dots across each of these verticals into a unified digital operating system, or a ‘Digital Silk Road’ as coined by Chinese President Xi Jingping, as part of its master plan.
Remember the movie Eagle Eye, with the all-seeing supercomputer?
At a broader geopolitical level, the realization of China’s ‘Digital Silk Road’ initiative underscores the urgency for Western policymakers to prioritize investment in African technological infrastructure. Failing to do so may result in the surrender of significant global political and technological leverage to China over the next decade or two.
Let’s dive in.
Part 1 — China’s Foundations in Africa 🛠️
China and Africa are no strangers.
In fact, legendary Chinese seafarer Zheng He brought a giraffe back from his expeditions to the continent in the early 15th century, inspiring a wall painting of the animal in the Ming Imperial Tomb in Beijing.
We’ll focus our attention on the 1990’s onwards, however, when the Sino-African relationship begins to heat up.
Early 1990s: Public Sector Aid
During the early 1990s, the relationship between China and Africa was dominated by public sector development aid, which grew from around $110 million per year to $3 billion per year over the course of the decade. Approximately 64% of that aid went to infrastructure development and construction on the continent.
Late 1990s: Telecommunications Revolution
In the mid to late 90s, Chinese telecom companies such as Huawei, ZTE, and China Telecom began to play meaningful roles in establishing and upgrading telecom infrastructure across Africa.
Early telecom infrastructure development in Africa was enhanced by China's "Go Out Policy," launched in 1999, which aimed to promote Chinese investments abroad, internationalization of Chinese companies, and deeper ties with Africa.
This policy was carried out by various Chinese state-owned financial institutions, including the Export-Import Bank of China, the China Development Bank, and the China-Africa Development Fund, which by mandate began accelerating their investment in Africa.
Early 2000s: Corporate Infrastructure Growth
In 2000, China announced a newly formed Forum on China–Africa Cooperation (FOCAC) to accelerate collaboration with Africa, which quickly became more popular for African leaders to attend than the UN General Assembly!
Spurred by the FOCAC, China began facilitating sizable corporate investment in Africa to the tune of approximately $6.6 billion between 2000-2006 and $23 billion between 2007 and 2020.
In 2007, for example, the Industrial and Commercial Bank of China purchased 20% of Standard Bank Group of South Africa, then the largest bank in Africa, for $5.6 billion.
During this period, western countries largely stood by the sidelines. In fact, China’s corporate investment was more than double the amount lent to corporate development in Africa by banks in the United States, Germany, Japan and France combined.
Notably, China also emerged as the undisputed leader in the installation of fiber optic cables across Africa, contributing substantially to digital connectivity. In fact, China claims to have laid over half of the continent’s wireless sites and high-speed mobile broadband networks.
Beyond fiber optics, Chinese companies invested aggressively in pan-African communication and transportation infrastructure, including development of the following:
10,000 kilometers of railway
100,000 kilometers of highway
1,000 bridges
100 ports
66,000 kilometers of power transmission and distribution network
120,000 megawatts of installed power-generating capacity
A 150,000-kilometer communications network
A network service covering nearly 700 million user terminals
Chinese companies claimed 85% of construction contracts in Africa during this period. 🤯
So how did the financing model work behind this explosive period of Chinese corporate investment in Africa?
Let’s unpack two key levers.
Lever 1: Independent Entrepreneurial Activity
Generally, Chinese companies and entrepreneurs independent of the Chinese government spearheaded projects on the continent. However, they were able to then access cheap loans, called ‘Iron Triangle Loans’, which I’ll discuss next.
Lever 2: Iron Triangle Loans
Chinese companies leveraged Iron Triangle Loans from state-owned banks like the China Development Bank and EXIM Bank to substantially underbid competitors in Africa, wrestling market share from non-Chinese firms such as Ericsson, Alcatel, Nokia, and Siemens.
These loan agreements often imposed strict confidentiality on borrowers, with contracts governed by Chinese law — any disputes that arose were required to be settled by arbitration in China.
In essence, Iron Triangle Loans are loans granted at very low interest rates at terms that cannot be matched by commercial banks.
Since the early 2000s, they have been heavily leveraged in Africa, where companies across 24 countries have taken up to an estimated 57 loans, totaling US$4.7 billion, to fund telecom infrastructure projects.
China effectively overwhelmed corporate competitors in Africa with capital infusions, paired with strict obligations.
Late 2010s: Connecting Dots (Mobile, Energy, Healthcare, Education)
In 2013, China announced its Belt and Road Initiative (BRI) with a mission to drive trade connectivity across Africa, the Middle East, Russia, and Asia. This initiative has played a critical role in shaping China-Africa relations ever since.
As part of BRI, China further accelerated its pace of African investment, pledging $60 billion at the Forum on China-Africa Cooperation (FOCAC) in 2018 to enhance infrastructure projects on the continent.
In the late 2010s, however, China began to extend its reach in Africa beyond foundational infrastructure into key verticals such as mobile, energy, healthcare, and education — the next phase of its master plan.
Mobile
China’s influence on consumer mobile adoption in Africa has been substantial, largely driven by Chinese companies such as Huawei and Transsion, the latter which sold nearly half of all smartphones (40%) in Africa in 2020 alone. Chinese companies currently account for over half of Africa’s mobile phone market and 70% of Africa’s mobile networks.
Africa is adopting smartphones at an astonishing rate.
At the end of 2020, there were 495 million mobile subscribers in sub-Saharan Africa, representing 46% of the region’s population, and that number is projected to rise to 615 million subscribers by 2025.
Energy
China has aggressively expanded its renewable energy initiatives in Africa, providing extensive funding and support for development — including a $20 billion credit line announced in 2018. As of 2022, China has contributed to over 22%, or about 5,000 MW, of Africa's total installed renewable energy capacity.
China has also pledged to support Africa’s environmental and biodiversity protection efforts. Coined the “Great Green Wall,” this initiative is expected to have a ripple effect on the African labor economy — it is estimated that the energy transition could accelerate jobs in renewables from around 350,000 in 2020 to 4 million by 2030 and over 8 million by 2050.
Healthcare
As part of its Belt and Road initiative, China has committed significant healthcare personnel, financing, and infrastructural support to Africa.
One example of this is the $80 million African CDC headquarters in Ethiopia, originally planned as a U.S.-China-Africa collaboration. But when relationships soured between Washington and Beijing under the Trump administration, that plan fell apart and the agreement was redesigned as one between China and the African Union.
And in 2021, China pledged to deliver over 1 billion COVID vaccines to Africa.
Education
China’s reach also extends deeply into African technology research and education. In 2009, China launched the China-Africa Science and Technology Partnership Plan (CASTPP), with an objective to fuel technology transfer on the content.
Since then, China has allocated over $60B in technology research initiatives to African institutions, with a particular presence in Africa’s largest countries including Nigeria, Kenya, Ghana, South Africa, and Egypt. The funding has been directed towards training African scientists across a range of futuristic verticals including biotechnology, space technology, and satellite communications.
As of 2014, China emerged as the preferred destination for international students from Africa, surpassing both the United Kingdom and the United States. And in the following year’s FOCAC, China committed to provide 32,000 government scholarships to Africa, double the 18,000 offered in the prior 2012 FOCAC.
China’s diversified involvement in Africa in recent years has been underpinned by what I view as the real golden egg of China’s investment on the continent: China’s ‘Digital Silk Road’ initiative, as introduced by Chinese President Xi Jinping in 2015.
The Digital Silk Road initiative represents a holy grail vision that will deliver a connected digital ecosystem spanning from mobile and energy to healthcare, education, smart cities, and much more.
Whereas China’s Belt and Road initiative lays a physical bridge to the Middle East and Africa, the Digital Silk Road is the interconnected digital equivalent — representing an ‘Operating System’ of sorts that will create a valuable and defensible moat around China’s access to Africa’s tech infrastructure and data.
Part 2 — Establishing Moats 🚧
China’s investment in Africa over the past three decades has yielded technological, financial, and political moats, which will enable Chinese companies — and the Chinese state — to accelerate their influence at a pace that may be difficult to match.
1. Technology Moat 👨💻
For early Chinese corporate technology entrants on the continent such as Huawei and ZTE, the road is now paved for them to win subsequent network upgrade contracts and provide complementary services such as fintech, security, and IoT applications.
Partnerships forged in the early innings of infrastructure development have heavily influenced downstream research and development planning.
In Tanzania, for example, China International Telecommunication Construction Corporation, the Chinese company contracted to deploy the national ICT broadband backbone, constructed it to be “China’s Telecommunication Footprint” in Africa and compatible only with Huawei routers.
What does this mean for Huawei, the world’s second largest smartphone provider (generating approximately $100 billion per year in revenue), and other Chinese multinational companies in Africa?
Technology standards in Africa are now tightly aligned with the R&D roadmaps of these companies. They are well positioned to outcompete upstart players at both the platform layer and vertical application layer:
In my opinion, this is fairly analogous to Apple’s hardware and iOS platforms, which are so deeply ingrained amongst hundreds of millions consumers and businesses worldwide that it would be extremely daunting to compete.
Lack of Participation from the West
Furthermore, I was particularly surprised to find that despite the substantial impact Africa will have on global power dynamics in coming decades, western players and multinational institutions have continued to sit on the sidelines. For example, the World Bank provided just $1.4 billion per year on average for infrastructure projects in sub-Saharan Africa from 2016 to 2020, relative to China’s double-digit billions.
Demand is certainly there for western participation — despite comprising 17% of the global population, Africa currently possesses less than 1% of the world’s global data center capacity.
In fact, African countries have repeatedly sought international funding and expertise to develop their telecom and data infrastructure, but literally only China has repeatedly shown up. Tanzania, for example, has made several proposals to multinational agencies, including the World Bank, for financing for its National ICT broadband backbone (NICTBB) to unlock country-wide internet connectivity, but only China was willing to finance the project despite its criticality towards establishing foundational broadband connectivity that would link Tanzania to East Africa.
Thus, while African countries are wary of Chinese security risks, they consistently lack affordable and accessible alternatives, and ultimately have had to defer to Chinese companies like Huawei. As a Foreign Policy report headline puts it…
‘For Africa, Chinese-Built internet is better than no internet at all’.
Only recently, in 2022, has the United States begun to wake up to the criticality of infrastructural investment into Africa — the Biden Administration recently committed to invest $350 million into Africa’s digital transformation, and over $55 billion over the next few years across healthcare, climate, and trade.
Too little, too late?
2. Financial Moat 💰
Meanwhile, China has laid extensive groundwork for the adoption of its native yuan currency in Africa, positioning itself with a baked-in distribution network for Chinese products & technologies that leverage the yuan.
China was able to achieve substantial African yuan penetration in the 2010s by dangling trade incentives as a carrot for African countries to adopt the yuan as a reserve currency.
In 2014, for example, Zimbabwe added the yuan as a reserve currency in a bid to encourage trade with China — amounting to $600 million in 2014.
Today, dozens of African countries leverage the yuan as part of their settlement and reserve currencies, with institutions such as the Nigerian Central Bank announcing that it planned to shift more of its foreign reserves into yuan from dollars.
Now, China is Africa’s largest trade partner, at approximately $300 billion per year, as well as the continent’s largest creditor.
In addition, China has signed a memorandum of understanding on cooperation in financial supervision with seven African countries, including Egypt, South Africa and Nigeria, cementing long-term cooperation on bilateral development.
All of that to say, China now has a powerful foundation to both accelerate bilateral trade with Africa and promote the distribution of its new digital yuan (the ‘e-yuan’) across the continent.
3. Political Moat 📢
The third prong of China’s strategy for Africa has been the establishment of deep political ties via hands-on collaboration with African government leaders on issues such as corporate strategy, digitization, and social media controls.
Corporate Strategy Partnerships
African countries have, with growing frequency, partnered directly with Chinese companies to design economic strategy. For example, in October 2020, the Ivorian government collaborated with Huawei to formulate its national digital economy strategy, subsequently involving the Chinese company further in designing its broadband development strategy.
Training of African Officials
China has also extensively subsidized the training of African officials on a range of managerial topics, including a focus on media and information management for African media elites and government officials.
China’s hardline approach to internet governance has appealed to African governments that have sought to leverage digital media towards economic growth while maintaining strict controls over internet usage.
In Nigeria for instance, Lai Mohammed, Minister of Information, Culture, and Tourism, called for a strict social media policy and cited China’s censorship and regulation of social media as a model that could be adopted.
Between June 5, 2021 and January 13, 2022, Nigeria in fact outright banned Twitter, and reportedly consulted with China’s Cyberspace Administration (overseeing China’s cybersecurity initiatives) regarding the implementation of a firewall.
Part 3 — Implications of these Moats 🤔
Here’s where things get interesting — how might China benefit from the past 30 years of investment in Africa?
I’ll conjecture on four possible implications below.
1. Pathways to Consumer Data
First, via its hardware and software roots on the continent, China may have unique access to a treasure trove of consumer data, which could enable Chinese companies to outcompete others in tailoring their products and services for African consumers.
Just like TikTok (also owned by Chinese company ByteDance) has shaped internet habits and ways of thinking for Gen Z here in the US, China has the unique opportunity to gain influence and further shape social development — and political ideologies — for younger populations in Africa. This is particularly eye-opening given over 60% of the population in Africa is under the age of 25, and digitally native.
Meanwhile, many African countries may still lack airtight regulatory infrastructure required to protect consumer data. Several countries such as Kenya and Nigeria have made initial strides over the past few years, such as via Kenya's Data Protection Act (DPA) and Nigeria’s Data Protection Regulation 2019 (NDPR), both passed in 2019. Meanwhile in Ghana, regulators are in active discussions around data protection policies.
2. Influence Over Africa’s Data Infrastructure
With China’s datacenter investments now yielding conveniently located and affordable hotspots, African companies and governments are moving their software platforms from foreign servers to local data centers developed by Chinese companies.
For example, the Senegalese government indicated it would move all government data and digital platforms from international servers to the Diamniadio National Datacenter, located 30 KM outside of Dakar.
Constructed at a cost of 6 billion CFA francs (~$18.2 million), this center was funded through a Chinese loan and built by Huawei, which also supplied necessary equipment and technical assistance.
Huawei has also contracted with a range of African countries such as Kenya, South Africa, and Lesotho to develop data centers and provide 5G networks.
With these platform migrations, China may stand to gain further leverage over data connectivity and, more tactically, data pricing.
3. Distribution of Chinese Applications
Chinese companies like Huawei, Xiaomi, Oppo, and Transsion are in favorable positions to launch and distribute new applications natively integrated with their hardware and operating systems.
Over the past decade, there has been a particular explosion of payments platforms on the continent, powered by Chinese companies.
Applications such as Ant’s Alipay, for example, have already become widely adopted. And in 2013, WeChat, the multipurpose superapp owned by Tencent that is ubiquitous in China, began rolling out in Africa.
Opera, another Chinese company owned by Beijing Kunlun Tech, launched African payments startup OPay in 2018. OPay has since raised over $500M from investors like Softbank and Sequoia Capital China to scale across western Africa. And Transsion rolled out PalmPay in 2019 in Ghana as a pre-installed payments app on over 20 million smartphones.
The emergence of these Chinese applications has fueled a prevalence of superapps on the continent, equipping African consumers with a series of pre-built functionalities — within a singular app — for a variety of use cases.
This superapp distribution phenomenon in Africa has followed what’s called a “Push-Pull” strategy.
“Pushing”
On one hand, Chinese companies are “pushing” these applications onto the African consumer as a means to capture new market segments. Unlike in markets like the United States or Europe, where innovation has evolved from PC applications to mobile applications, in Africa, consumers are generally jumping straight to mobile — there is substantially less of a fragmented PC app landscape (and competition) to contend with.
“Pulling”
On the other hand, African consumers are naturally being “pulled” to superapps due to the technological limitations of their smartphones and economic limitations of their incomes.
For example, lower-end African smartphones — which comprise approximately 85% of phones shipped to Africa — generally have less storage capacity, limiting the number of applications that can be carried at once.
Furthermore, data costs are exponentially higher relative to average salaries in Africa than elsewhere in the world. In Africa, 1GB of data costs 7.1% of one’s daily salary on average, vs 1.9% in the Americas.
As a result, it is practically and economically far more efficient for Africans to adopt superapps rather than downloading various disjoint apps.
4. Trade Leverage
Perhaps most notably, China may gain substantial trade leverage in Africa with wide-scale adoption of the yuan.
In 2020, China was the first large economy to trial a digital currency, the e-yuan (e-CNY), with the eventual goal of replacing physical cash. The e-yuan is integrated with the Digital Currency Electronic Payment (DCEP) system and data processing network managed by the People’s Bank of China (PBOC).
Unlike Bitcoin, the e-yuan and the DCEP are under control of China’s monetary policy. And over the past few years, China has been aggressively distributing its e-yuan in Africa via currency swaps, lending agreements, and tech company subsidies.
In 2021, China’s Cross-Border Interbank Payment System (which offers clearing and settlement services for its participants in yuan) boasted 42 organizational participants in Africa across 19 African countries.
Via this medium, China’s central bank has executed over 73 billion yuan (~$11.5 billion USD) in currency swap agreements with central banks of South Africa, Morocco, Egypt and Nigeria.
And later that year, Huawei launched the Mate 40 smartphone, featuring a pre-installed e-yuan wallet harnessing the DCEP network.
Part 4 - A Window of Opportunity 🔎
As we discussed, China has established meaningful moats in Africa, which I believe will continue to accelerate China’s objectives to gain global political and technological leverage.
Is Africa’s tech ecosystem entirely in China’s hands? Not so fast. ✋
Countervailing Force: a Weakening Chinese Economy
China is now facing a raft of growing domestic economic challenges — the value of the yuan is at its lowest level in 16 years and GDP growth has recently shrunk by 1.4 % over the past two years, the largest decline since the 1960s and 70s when Mao Zedong was at China’s helm.
Domestically, local debt is rising and China’s population is aging dramatically; foreign investors are no longer singing the same tune about China that they were in the early 2000s.
What does this mean for China’s influence in Africa in the short term?
I believe the short term implication is that China will be more constrained in its commercial technology investments on the continent. While the Chinese state has solidified its foundational influence in Africa via its infrastructural investments, per its BRI objectives, there is less of an immediate economic pull for China to invest in African technology at the moment.
As a result, I expect China to pull back on capital injections into Africa over the next few years as it refocuses on addressing internal debt and labor issues.
Meanwhile, however, Africa remains in a period of rapid growth and will continue to require sizable foreign investment to subsidize this development.
Who will step in?
The door is open for participation from the west, as long as investors from these regions fundamentally understand local dynamics in Africa, as well as key risks.
Investing in Merchant Digitization & Financial Scalability
I believe there is tremendous window of opportunity over the next few years to invest at the merchant digitization & scalability layer in Africa — this area is ripe for development after the past 30 years of foundational Chinese investment in hardware and data connectivity, along with the past 10 years of Chinese investment in payment rails such as M-Pesa and OPay.
Furthermore, I expect an inflow of entrepreneurial talent (including founders educated abroad and those spinning out of Africa’s first wave of tech unicorns such as Flutterwave, Jumia, Chipper Cash, Andela) that will drive the next wave of highly legitimate technology companies in this area.
Now that African merchants are coming online with point of sale hardware and connected payment rails, there will be a critical need for development in areas such as identify verification, fraud prevention, lending & credit, and embedded finance.
Projecting forward, I believe investing in this segment will unlock much needed operational efficiency, transparency, and scalability for African businesses…subsequently leading to explosive e-commerce and financial growth for hundreds of millions of African consumers over the next decade or two.
I’ve compiled three “waves” of investment opportunity in Africa (and relevant company examples) below:
Wave 1 — Basic Financial Rails
Ripe Early-Stage Investment Timeframe: ~2010-2024 (it’s crowded)
Merchant Payments & API Connectivity
Incumbents: Interswitch, M-Pesa
Startups: Flutterwave ($500M raised), OPay ($600M raised), Tala ($370M raised) TymeBank ($300M raised), Chipper Cash ($330M raised), Onafriq ($220M raised), Stitch ($52M raised), Mono ($17M raised), Nala ($10M raised)
Wave 2 — Merchant Digitization & Scalability
Ripe Early-Stage Investment Timeframe: ~2023-2028 (opportunities now)
AI-Assisted Identity Verification and Fraud Mitigation
Examples: Smile Identity, iidentifii, Prembly, Dojah
Merchant Lending & Credit
Examples: Lulalend, Evolve Credit, Moni, Kashat, Flapkap
Stablecoins, Web3 Connectivity, Crypto Exchanges
Examples: Yellowcard, Jambo, Fonbnk,
Merchant Acquisition
Examples: ThankUCash, Traction, Autogon AI
Embedded Finance
Wave 3 — Consumer Participation & Growth
Ripe Early-Stage Investment Timeframe: ~2025-2035 (we’re still early)
E-commerce & Delivery
Examples: Jumia, Jabu, YallaFelSekka, Rabbit
Consumer Wealth Management (incl BNPL, Investing, Exchanges)
Ironically, thanks to China’s 30 year investment in connecting and digitizing Africa, paired with current economic circumstances that are forcing China to remain conservative in the short term, I believe there is an opportunity now — with relatively reduced Chinese competition — to participate at the “merchant digitization & scalability” layer in Africa, where I envision several new African unicorns to emerge over the next few years.
Key Risks
I will caveat, however, that there are several significant risks in participating at this merchant application layer.
First is the possibility for Chinese companies like Huawei, Xiaomi, Oppo, and Transsion to force bottoms-up adoption of vertical software for merchants above the operating systems baked into their hardware. We see a degree of this already from companies like OPay, however, they are moving relatively slowly at the moment and the app quality is not quite there — creating opportunities for faster moving, higher-quality upstarts.
Second is the potential for regional policymakers to ban applications misaligned with government interests. In recent years, Nigeria, Kenya, and other governments have forcibly shut down lending applications they deemed as predatory.
In order to mitigate these risks, winners in this space must be flexible and compatible with a variety of foundational hardware and software in order to prevent fatal outcomes in a scenario in which they are locked out by a particular operating system.
Furthermore, winners must partner early — and maintain close feedback loops with — the corporate and policy stakeholders that hold the power to wipe them out with a flip of a switch. A general trend I’ve seen amongst the newer wave of fast-growing fintechs in Africa is their prioritization of early partnerships with regional banking stakeholders, which provide licensing and distribution to their merchant-base (within the constraints of their economic and political interests, of course).
That’s all for now, thanks for reading. I appreciate any feedback you have as I dig into next week’s deep dive topic!
Cheers,
Kevin
Disclaimer: All information contained on Emerging Market VC is not intended as, and shall not be understood or construed as, financial advice. All views and ideas expressed are my own.