The rise of Sub-Saharan Africa as a fintech hub
Sub-Saharan Africa is one of the fastest-growing investment zones for financial technology companies according to new research says Forbes. The GSM Association says in its Mobile Economy, Sub-Saharan Africa 2019 report that the region will remain the fastest growing worldwide. Predicting a total subscriber base of over 600 million by 2025, which represents approximately half the population, Sub-Saharan Africa will become a flagship for mobile disruption.
One of the driving forces behind this growth, according to Mike Smits, co-founder, uKheshe, a micro transaction platform, is the unbanked: “Mastercard reports that while around 1.2bn adults opened bank accounts for the first time over the past decade, 1.7bn remain outside the formal banking sector worldwide. Our challenge, as a continent, is to reach these “unbanked” individuals and better understand, as financial service providers, why they opt to stay in the informal sector.”
Smits says that since launching uKheshe 10 months ago, the plight for financial inclusion has become glaringly obvious: “While progress has been made in terms of mobile money, it’s become imperative that we move beyond that and look into digital payment solutions. What we have realised is that financial inclusion is not just about technology disruption, but more about solving greater economic problems.”
He says that consumers need simpler, more cost-effective ways to do simple tasks such as sending or receiving money and buying airtime as examples. Of course, financial inclusion goes beyond consumers and plays a far greater role in the lives of small-scale entrepreneurs: “The gains for these informal merchants is significant, bringing income for the community at large. We have seen this as so many of our users have trebled their businesses since using our platform to trade,” says Smits.
It’s ultimately about inclusive economic growth and how digital financial services can play a major role in the increase of financial inclusion in Africa. With an ever-growing mobile base, Sub-Saharan Africa has the potential to lead the way, while also creating widespread economic prosperity.
French and South African partners collaborate to support South African animation industry
South African startup innovation hub, the Tshimologong Digital Innovation Precinct and the National Film and Video Foundation (NFVF) have strengthened their ties with international partners by signing official partnership agreements at the 2019 Annecy International Animated Film Festival. The agreements are with Paris-based animation school, Gobelins, and the French Embassy in South Africa.
The objective of both of the agreements is to grow the animation industry’s skills pipeline by offering training, internships and scholarships to animators in Africa. It also presents the opportunity to enhance the linkages between African animation talent, producers, schools and institutions with their French counterparts.
Earlier this year, the Precinct’s Johannesburg-based Tshimologong Animation Studio opened its doors to 20 interns with hopes to further their understanding of visual development for high-end animation under the direction of recent Gobelins Masters graduate, Lesego Vorster. Co-designed in collaboration with Gobelins, the internship programme is focused on establishing authentic African aesthetics through appropriate referencing and understanding of design and storytelling fundamentals. Furthermore, the internship forms part of an active role in empowering black youth in a field which was previously relatively inaccessible to them.
The Tshimologong Animation Studio is strategically positioned as being between a finishing school and an internship. This gives interns first-hand experience on real-world projects, while still having the comfort of being able to use university methodology to strengthen their references as well as their workflow.
“The partnership with Gobelins offers interns strong support from one of the best schools in the world, not only in raising the standard and quality of the work to come out of the Tshimologong Animation Studio, but also to broaden the horizons of all interns,” says Lesego Vorster, Tshimologong Animation Studio Art Director.
“South Africa is a vibrant soil of young creativity. Talents are numerous, young and passionate, promise of a very bright future and the emergence of a powerful African animation.” says Cécile Blondel, Head of International Relations, Gobelins.
The agreement with the National Film and Video Foundation (NFVF) and the French Embassy in South Africa addresses training needs, scholarships, skills exchange and co-production opportunities. The NFVF will contribute up to EUR16,000 (R268 000) for a scholarship for the Gobelins “Character Animation and animated filmmaking – Master of Arts” qualification. The Animation School (SA) and Campus France will also fund this scholarship. Gobelins, NFVF, the French Institute of South Africa, the Animation School and Campus France have awarded this scholarship to Karien Benz.
By joining forces, the two organisations aim to strengthen their support for the South African film and TV industry and to foster better cooperation between South African and French ecosystems in film, TV and new formats. The animation industry, because of its dynamism, creativity and international appeal both in France and in South Africa, is at the core of this new partnership. Both institutions aim to support and reinforce synergies between the respective markets and to promote consistency in the support of their development.
“South African animators have been creating soundwaves across international borders over the last decade and it’s essential that as the funding body mandated to ensure the development and growth of the film industry in South Africa, that we have partnered to create a scholarship with Gobelins. I look forward to a beneficial partnership that will see a significant step towards the further growth of the animation sector in South Africa” says Joy Mawela Head of Industry Development & Promotions (National Film and Video Foundation)
“As South Africa’s potential in the field of animation is undeniable, especially in the development and production of original content rooted in a strong Africanisation of imagery, we see the enhancement of our cooperation with NFVF as a great opportunity to expand opportunities for creators, to promote prolific cooperation, and to bring our two markets closer together using the complementarity of their assets,” says Erika Denis, Regional Head of Media, Film & Music (French Embassy/French Institute in South Africa)
CDI Growth Fund opens for new round of applications
A new application round has opened for the R12.8million CDI Growth Fund to boost SME growth and job creation.
The CDI Growth Fund is a grant fund specifically for growing South African small businesses who need a cash injection to scale up further and create jobs. Since its launch in 2017, it has already contracted with 38 SMEs, who have collectively created over 160 jobs.
The CDI Growth Fund is managed by CDI Capital, which was incorporated as a subsidiary of the Craft and Design Institute (CDI) in 2016 to catalyse funding for SMEs. The funding has been enabled through contributions by the National Treasury’s Jobs Fund, the Technology Innovation Agency (TIA), and the Western Cape Department of Economic Development and Tourism (DEDAT).
The Fund is in the second year of a five-year disbursement period.
One of the current Fund recipients is Pesto Princess, a Cape Town-based SME that produces locally-made pesto sauces, pastes and soups using only natural ingredients and an environmental consciousness.
CEO Lesley Grimbeek says that the grant funding they received has had a tremendous impact on their growing business.
“We have seen really rapid growth in the past four years, and in the next two years we are determined to have a facility four times the size of what we currently have, creating between 250 and 300 jobs and bringing our amazing product right across South Africa. It’s been a pleasure working with the CDI’s Growth Fund, and it has been very exciting to see the impact it has made in such a short time. We have been able to purchase equipment that we could not have afforded otherwise, and through this we have been able to create more jobs. To date, we have created ten new jobs in the factory, and we have the intention of at least another 12 to 13 new positions by the end of the year,” said Grimbeek.
The CDI Growth Fund is open to South African-owned businesses who operate within South Africa, who are at least one year old with turnover or assets above R1m.
Each applicant must demonstrate their year on year growth and/or the potential for sufficient growth and must be tax compliant. Applicants also need to match 20% of the grant contribution of the Fund through a cash contribution to achieve agreed objectives. Importantly, the business must be able to create new jobs.
SMEs that meet the criteria for funding, can apply online, and are taken through a diligent process of selection and support, whereby successful applicants contract for a three-year intervention and disbursement plan, performance managed by quarterly reporting, oversight and inspection, bespoke mentorship, and business development support.
According to Ryan Rode, project coordinator for CDI Capital, the Fund is ahead of its key deliverable, namely, the creation of permanent jobs through participating SMEs.
“The CDI Growth Fund is very specific in its focus – we are looking for SMEs who are about to employ new staff to meet growing demand and who need the capital to expand their operations. The funding is a grant and it is not paid back to the Fund; and can help to leverage additional funding and de-risk loans. It’s a fantastic opportunity for a growing South African business that is needing to employ new staff.”
The deadline for applications is 12 July 2019.
For more information and to apply, visit www.cdicapital.co.za/GrowthFund
On Ethics and Activism: South Africa’s Nene Moment
Revelations by former Finance Minister Nhlanhla Nene on his meetings with the controversial Gupta family sparked outrage among South Africans and was met with calls for his axing. In his testimony to the Zondo Commission on State Capture, the former Minister was faced with the stark outcome of his ethical decisions. His resignation and replacement as finance minister by former South African Reserve Banko Governor, Tito Mboweni was unavoidable for a country grappling with rebuilding its reputation.
For managing director of Reputation Matters Regine le Roux, the question of ethics in leadership in any organisation boils down to the practice of instilling ethical behaviour into the DNA of an organisation. “The leadership of an organisation (or country) sets the example of how things need to be done. When measuring corporate reputations among South Africa’s private and public organisations, we look at ten core building blocks; corporate management is one of the first elements interrogated when it comes to assessing an organisation’s reputation.”
“To rebuild the reputation of our country we need to laude President Ramaphosa for taking quick action in this matter; continuing to fight against corruption needs to remain top of his priority list as he indicated during his state of the nation address, walking his talk on this issue is crucial,” adds le Roux
The other key element that played a crucial part in this saga is strategic alliances; your reputation is impacted by the company you keep. Even though there is no evidence of any wrongdoing from the meetings conducted at the compound between Nene and the Guptas, but purely by association and lessons that we have learnt from other similar meetings, the worst case scenario is automatically assumed.
Why are reputations so important to treasure? “As a leader your organisation and in this case, country’s positive reputation has a direct impact on the bottom line and a country’s foreign investment opportunities.”
Taking a look purely at a corporate level, if your business has a positive reputation, people will want to work for you and buy your service or product. You will attract top talent, which in turn will impact the level of service or products that people will be willing to pay a premium for, so that they can be associated with your brand.
At Ethics Monitor, Managing Director Cynthia Schoeman believes we all have a built-in radar of right and wrong and has coined the term “Ethics Activism” when referring to the role organisations should play in managing ethics within a company.
Schoeman adds, “Ethics are non-negotiable. It warrants that ethics is included as an important goal that is actively managed, supported and recognised. Expecting on-going ethical conduct without such meaningful engagement with employees is frankly wishful thinking. Given the range of challenges and improper personal agendas that can arise, regular engagement is necessary to ensure employees’ understanding and to maintain their commitment to ethical practices.”
le Roux maintains that an organisation needs to be ruthless about looking after their reputation especially because of the impact it has on the health and bottom line of an organisation (or country). “Simply put, leaders set the example and values need to be non-negotiable”.
Explore Data Science Academy and Rand Merchant Investments launch EXPLORE 10X to find SA’s top 20 future fintech entrepreneurs
Do you have an idea that could make you South Africa’s most successful fintech entrepreneur? Are you looking to acquire the skills to launch a data-driven fintech business? ThenEXPLORE 10X is looking for you.
The Explore Data Science Academy (EDSA) and Rand Merchant Investments (RMI) fintech division,AlphaCode, have announced a 12-month data science and business skills programme for 20 aspirant South African future fintech entrepreneurs.
Successful candidates will go through an intensive six-month data science-training programme, where they will learn how to design a 10X business along with the core digital skills needed to build a fintech organisation. This will be followed by three-months of business skills training, learning how to execute a 10X business strategy and to build a fintech startup.
The course will be sponsored by RMI and is offered at no cost to the candidates selected to take part. Included in the sponsorship is a stipend, to cover major living expenses during the year.
“The EXPLORE 10X programme, developed by the EDSA team, provides AlphaCode access to young, bright, future fintech entrepreneurs with great ideas, which AlphaCode can then help grow their businesses and the economy at the same time,” said Dominique Collett, Head of AlphaCode and Senior Investment Executive at RMI.
Candidates interested in the programme need to submit their CV, as well as write a 750-word essay, motivating their ideas and why the world would be a better place with their business in it. Twenty of the best entries will be selected. Entries close on 30 October 2018.
“Ideal candidates for EXPLORE 10X would be young (in spirit) graduates with tech smarts, bright ideas for fintech innovation and disruption, a passion for data analytics, a desire to acquire new skills as well as the ambition and drive to build and grow a business that could impact South Africa’s fintech industry,” said Shaun Dippnall, co-founder of the Explore Data Science Academy.
Data science core to disruption
Commenting on the decision to partner with the EDSA for EXPLORE 10X, Collett explained: “Data science skills are essential to innovation in the insurance and banking sector. We see increasing opportunities for data science driven fintech solutions to lower barriers to entry, which broadens access to financial services and as a result drives the economy.”
The Explore Data Science Academy team are entrepreneurial by nature with a depth of expertise in data science and a track record of success with their accredited data science skills learnerships. AlphaCode views them as a great fit.
An additional consideration for the program was that it fitted into RMI’s broader transformation strategy. “We were looking for a programme that would both utilise our skills development spend while being strategically aligned to our business,” Collett said.
RMI over the years has invested heavily in technology and innovation both through its shareholding in FirstRand, Discovery, OUTsurance and MMI, as well as its various AlphaCode sponsored fintech development programmes. “EXPLORE 10X will provide a pipeline of talent for our Incubate – and later our Accelerate programmes,” she added.
To apply for the EXPLORE 10X programme go to https://www.alphacode-explore10x.club/
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