FreshRSS

🔒
❌ About FreshRSS
There are new available articles, click to refresh the page.
Today — April 2nd 2020Your RSS feeds

Visa’s Africa strategy banks on startup partnerships

By Jake Bright

Visa has prioritized growth in Africa, and partnering with startups is central to its strategy.

This became obvious in 2019 after the global financial services giant entered a series of collaborations on the continent, but Visa confirmed it in their 2020 Investor Day presentation.

On the company’s annual call, participants mentioned Africa 28 times and featured regional startups prominently in the accompanying deck. Visa’s regional president for Central and Eastern Europe, Middle East and Africa (CEMEA), Andrew Torre, detailed the region’s payments potential and his company’s plans to tap it. “We’re partnering with non-conventional players to realize this potential — fintechs, neobanks and digital wallets — to reach the one billion consumer opportunity,” he said.

Africa strategy and team

TechCrunch has covered a number of Visa’s Africa collaborations and spoke to two execs driving the company’s engagement with startups from Nigeria to South Africa.

Visa’s head of Strategic Partnerships, Fintech and Ventures for Africa, Otto Williams, has been out front, traveling the continent and engaging fintech founders.

Located in Cape Town, Visa’s group general manager for Sub-Saharan Africa, Aida Diarra, oversees the company’s operations in 48 countries. Visa has a long track record working with the region’s large banking entities, but that’s shifted to smaller ventures.

visa africa

Image Credits: Visa

Before yesterdayYour RSS feeds

Airbnb and three other P2P rental platforms agree to share limited pan-EU data

By Natasha Lomas

The European Commission announced yesterday it’s reached a data-sharing agreement with vacation rental platforms Airbnb, Booking.com, Expedia Group and Tripadvisor — trumpeting the arrangement as a “landmark agreement” which will allow the EU’s statistical office to publish data on short-stay accommodations offered via these platforms across the bloc.

It said it wants to encourage “balanced” development of peer-to-peer rentals, noting concerns have been raised across the EU that such platforms are putting unsustainable pressure on local communities.

It expects Eurostat will be able to publish the first statistics in the second half of this year.

“Tourism is a key economic activity in Europe. Short-term accommodation rentals offer convenient solutions for tourists and new sources of revenue for people. At the same time, there are concerns about impact on local communities,” said Thierry Breton, the EU commissioner responsible for the internal market, in a statement.

“For the first time, we are gaining reliable data that will inform our ongoing discussions with cities across Europe on how to address this new reality in a balanced manner. The Commission will continue to support the great opportunities of the collaborative economy, while helping local communities address the challenges posed by these rapid changes.”

Per the Commission’s press release, data that will be shared with Eurostat on an ongoing basis includes number of nights booked and number of guests, which will be aggregated at the level of “municipalities.”

“The data provided by the platforms will undergo statistical validation and be aggregated by Eurostat,” the Commission writes. “Eurostat will publish data for all Member States as well as many individual regions and cities by combining the information obtained from the platforms.”

We asked the Commission if any other data would be shared by the platforms — including aggregated information on the number of properties rented; and whether rentals are whole properties or rooms in a lived in property — but a Commission spokeswoman could not confirm any other data would be provided under the current arrangement. Update: It has now confirmed a second phase will involve more data being published — see below for details.

She also told us that municipalities can be defined differently across the EU, so it may not always be the case that city-level data will be available to be published by Eurostat.

In recent years, multiple cities in the EU — including Amsterdam, Barcelona, Berlin and Paris — have sought to put restrictions on Airbnb and similar platforms in order to limit their impact on residents and local communities, arguing short-term rentals remove housing stock and drive up rental prices, hollowing out local communities and creating other sorts of anti-social disruptions.

However, a ruling in December by Europe’s top court — related to a legal challenge filed against Airbnb by a French tourism association — offered the opposite of relief for such cities, with judges finding Airbnb to be an online intermediation service, rather than an estate agent.

Under current EU law on Internet business, the CJEU ruling makes it harder for cities to apply tighter restrictions as such services remain regulated under existing ecommerce rules. Although the Commission has said it will introduce a Digital Services Act this year that’s slated to upgrade liability rules for platforms (and at least could rework aspects of the ecommerce directive to allow for tighter controls).

Last year, ahead of the CJEU’s ruling, ten EU cities penned an open letter warning that “a carte blanche for holiday rental platforms is not the solution,” calling for the Commission to introduce “strong legal obligations for platforms to cooperate with us in registration-schemes and in supplying rental-data per house that is advertised on their platforms.”

So it’s notable the Commission’s initial data-sharing arrangement with the four platforms does not include any information about the number or properties being rented, nor the proportion which are whole property rentals vs rooms in a lived in property — both of which would be highly relevant metrics for cities concerned about short-term rental platforms’ impact on local housing stock and rents.

When asked about this, the Commission spokeswoman told us it had to “ensure a fair balance between the transparency that will help the cities to develop their policies better and then to protect personal data, because this is about private houses.”

“The decision was taken on this basis to strike a fair balance between the different interests at stake,” she added.

When we pointed out that it would be possible to receive property data in aggregate, in a way that does not disclose any personal data, the spokeswoman had no immediate response.

Without pushing for more granular data from platforms, the Commission initiative looks like it will achieve only a relatively superficial level of transparency in the first instance — and one which might best suit platforms’ interests by spotlighting attention on tourist dollars generated in particular regions rather than offering data to allow for cities to drill down into flip-side impacts on local housing and rent affordability.

Gemma Galdon, director of a Barcelona-based research consultancy, called Eticas, which focuses on the ethics of applying cutting edge technologies, agreed the Commission move appears to fall short — though she welcomed increasing transparency as “a good step.”

“This is indeed disappointing. Cities like Barcelona, NYC, Portland or Amsterdam have agreements with Airbnb to access data (even personal and contact data for hosts!),” she told us.

“Mentioning privacy as a reason not to provide more data shows a serious lack of understanding of data protection regulation in Europe. Aggregate data is not personal data. And still, personal data can be shared as long as there is a legal basis or consent,” she added.

“So while this is a good step, it is unclear why it falls so short as the reason provided (privacy) is clearly not relevant in this case.”

Update: We understand a second phase of the Commission’s data-sharing arrangement will see Eurostat also publish data on the number of properties rented and the proportion which are full property rentals vs rooms in occupied properties. However it intends to wait until it’s confident it can accurately exclude double-counting of the same rental properties advertised on different platforms.

In the first phase Eurostat will publish the following occupancy data: Number of stays (number of rentals of each listing during the reference period); number of nights rented out (number of nights each listing was rented out during the reference period); and number of overnight stays (number of guest nights spent at each listing during the reference period (based on number of guests indicated when booking was made).

In a second phase, which does not yet have a timeline attached to it, the following capacity data will also be published: Number of hosts (number of hosts renting out one or more listings); number of listings; and number of bed places (best possible approximation based on e.g. maximum capacity shown for each listing). This second phase will also include data on the type of accommodation (i.e. individual room in a shared property vs entire property).

Africa Roundup: Trump’s Nigeria ban, Paga’s acquisition and raises, Flutterwave’s $35M and Sendy’s $20M

By Jake Bright

The first month of the new year saw Africa enter the fray of U.S. politics. The Trump administration announced last week it would halt immigration from Nigeria — Africa’s most populous nation with the continent’s largest economy and leading tech sector.

The presidential proclamation stops short of a full travel ban on the country of 200 million, but it suspends immigrant visas for Nigerians seeking citizenship and permanent resident status in the U.S.

The latest regulations are said not to apply to non-immigrant, temporary visas for tourist, business and medical visits.

The new policy follows Trump’s 2017 travel ban on predominantly Muslim countries. The primary reason for the latest restrictions, according to the Department of Homeland Security, was that the countries did not “meet the Department’s stronger security standards.”

Nigeria’s population is roughly 45 percent Muslim and the country has faced problems with terrorism, largely related to Boko Haram in its northeastern territory.

Restricting immigration to the U.S. from Nigeria, in particular, could impact commercial tech relations between the two countries.

Nigeria is the U.S.’s second largest African trading partner and the U.S. is the largest foreign investor in Nigeria.

Increasingly, the nature of the business relationship between the two countries is shifting to tech. Nigeria is steadily becoming Africa’s capital for VC, startups, rising founders and the entry of Silicon Valley companies.

Recent reporting by VC firm Partech shows Nigeria has become the number one country in Africa for venture investment. Much of that funding comes from American sources. The U.S. is arguably Nigeria’s strongest partner on tech and Nigeria, Silicon Valley’s chosen gateway for entering Africa. Examples include Visa’s 2019 investment in Nigerian fintech companies Flutterwave and Interswitch and Facebook and Google’s expansion in Nigeria.

On the ban’s impact, “U.S. companies will suffer and Nigerian companies will suffer,” Bosun Tijani, CEO of Lagos based incubator CcHub, told TechCrunch .

Nigerian entrepreneur Iyinoluwa Aboyeji, who co-founded two tech companies — Flutterwave and Andela — with operations in the U.S. and Lagos, posted his thoughts on the latest restrictions on social media.

“Just had an interesting dinner convo about this visa ban with Nigerian tech professionals in the U.S. Sad… but silver lining is all the amazing and experienced Nigerian talent in U.S. tech companies who will now head on home,” he tweeted.

Notable market moves in African tech last month included an acquisition, global expansion and a couple big raises.

Nigerian digital payments startup Paga acquired Apposit, a software development company based in Ethiopia, for an undisclosed amount.

The Lagos-based venture also announced it would launch its payment products in Mexico this year and in Ethiopia imminently, CEO Tayo Oviosu told TechCrunch

The moves come a little over a year after Paga raised a $10 million Series B round and Oviosu announced the company’s intent to expand globally while speaking at Disrupt San Francisco.

Paga will leverage Apposit — which is U.S. incorporated but operates in Addis Ababa — to support that expansion into East Africa and Latin America.

Paga has created a multi-channel network to transfer money, pay bills, and buy goods digitally. The company has 14 million customers in Nigeria who can transfer funds from one of Paga’s 24,411 agents or through the startup’s mobile apps.

With the acquisition, Paga absorbs Apposit’s tech capabilities and team of 63 engineers. The company will direct its boosted capabilities and total workforce of 530 to support its expansion.

On the raise side, San Francisco and Lagos-based fintech startup Flutterwave (previously mentioned) raised a $35 million Series B round and announced a partnership with Worldpay FIS for payments in Africa.

FIS also joined the round, led by US VC firms Greycroft and eVentures, with the participation of Visa and African fund CRE Venture Capital .

The company will use the funding to expand capabilities to provide more solutions around the broader needs of its clients. Uber, Booking.com and Jumia are among the big names that use Flutterwave to process payments.

Last month, Africa’s logistics startup space gained another multi-million-dollar round with global backing. Kenyan company Sendy, an on-demand platform that connects clients to drivers and vehicles for goods delivery, raised a $20 million Series B led by Atlantica Ventures. Toyota Tsusho Corporation, a trade and investment arm of Japanese automotive company Toyota, also joined the round.

Sendy’s raise came within six months of Nigerian trucking logistics startup Kobo360’s $20 million Series A backed by Goldman Sachs. In November, East African on-demand delivery venture Lori Systems hauled in $30 million supported by Chinese investors.

The company plans to use its raise for new developer hires, to improve the tech of its platform, and toward expansion in West Africa in 2020.

Sendy’s $20 million round also includes an R&D arrangement with Toyota Tsusho Corporation to optimize trucks for the West African market, Sendy CEO Mesh Alloys told TechCrunch.

More Africa-related stories @TechCrunch

African tech around the ‘net

African fintech firm Flutterwave raises $35M, partners with Worldpay

By Jake Bright

San Francisco and Lagos-based fintech startup Flutterwave has raised a $35 million Series B round and announced a partnership with Worldpay FIS for payments in Africa.

With the funding, Flutterwave will invest in technology and business development to grow market share in existing operating countries, CEO Olugbenga Agboola — aka GB — told TechCrunch.

The company will also expand capabilities to offer more services around its payment products.

More than payments

“We don’t just want to be a payment technology company, we have sector expertise around education, travel, gaming, e-commerce, fintech companies. They all use our expertise,” said GB.

That means Flutterwave will provide more solutions around the broader needs of its clients.

The Nigerian-founded startup’s main business is providing B2B payments services for companies operating in Africa to pay other companies on the continent and abroad.

Launched in 2016, Flutterwave allows clients to tap its APIs and work with Flutterwave developers to customize payments applications. Existing customers include Uber, Booking.com and e-commerce company Jumia.

In 2019, Flutterwave processed 107 million transactions worth $5.4 billion, according to company data.

Flutterwave did the payment integration for U.S. pop-star Cardi B’s 2019 performances in Nigeria and Ghana. Those are two of the countries in which the startup operates, in addition to South Africa, Uganda, Kenya, Tanzania, Zambia, the U.K. and Rwanda.

Flutterwave Cardi B Nigeria“We want to scale in all those markets and be the payment processor of choice,” GB said.

The company will hire more business development staff and expand its developer team to create more sector expertise, according to GB.

“Our business goes beyond payments. People don’t want to just make payments, they want to do something,” he said. And Fluterwave aims to offer more capabilities toward what those clients want to do in Africa.

GB Flutterwave disrupt

Olugbenga Agboola, aka GB

“If you are a charity that wants to raise money for cancer research in Ghana, or you want to sell online, or you’re Cardi B…who wants to do concerts in Africa…we want to be able to set up payments, write the code and create the platform for those needs,” GB explained.

That also means Flutterwave, which built its early client base across global companies, aims to serve smaller African businesses, including startups. Current customers include African-founded tech companies, such as moto ride-hail venture Max.ng.

Worldpay partnership

The new round makes Flutterwave the payment provider for Worldpay in Africa.

“With this partnership, any Worldpay merchant in Europe or the U.S. can accept any African payment. If someone goes to pay Netflix with an African card, it just works,” GB said.

In 2019, Worldpay was acquired for a reported $35 billion by FIS, a U.S. financial services provider. At the time of the purchase, it was projected the two companies would generate revenues of $12 billion annually, yet neither has notable presence in Africa.

Therein lies the benefit of collaborating with Flutterwave.

FIS’s Head of Ventures Joon Cho confirmed the partnership with TechCrunch. FIS also backed Flutterwave’s $35 million Series B. US VC firms Greycroft and eVentures led the round, with participation of Visa, Green Visor and African fund CRE Venture Capital.

Flutterwave’s latest funding brings the company’s total investment to $55 million and follows a year in which the fintech venture announced a series of weighty partnerships.

In July 2019, the startup joined forces with Chinese e-commerce company Alibaba’s Alipay to offer digital payments between Africa and China.

The Alipay collaboration followed one between Flutterwave and Visa to launch a consumer payment product for Africa, called GetBarter.

Flutterwave and African fintech

Flutterwave’s $35 million round and latest partnership are among the reasons the startup has become a standout in Africa’s digital-finance landscape.

As a sector, fintech gains the bulk of dealflow and the majority of startup capital flowing to African startups annually. VC to Africa totaled $1.35 billion in 2019, according to WeeTracker’s latest stats.

While a number of payment startups and products have scaled — see Paga in Nigeria and M-Pesa in Kenya — the majority of the continent’s fintech companies are P2P in focus and segregated to one or two markets.

Flutterwave’s platform has served the increased B2B business payment needs spurred by the decade of growth and reform that has occurred in Africa’s core economies.

The value the startup has created is underscored not just by transactional volume the company generates, but the partnerships it has attracted.

A growing list of the masters of the payment universe — Visa, Alipay, Worldpay — have shown they need Flutterwave to do finance in Africa.

❌