Earlier today, Disrupt Africa reported Kenyan fintech startup Weza Tele has been acquired by financial services group AFB for US$1.7 million, the largest acquisition of a tech startup in the country thus far.
Weza Tele provides a number of value added mobility solutions in commerce, supply chain, distribution and mobile payment integration, with these solutions in use not just in Kenya but also the likes of Tanzania, Zimbabwe and Nigeria.
AFB provides credit access to customers in Africa through a range of financial products, including mobile loans and retail credit cards. It launched in Ghana in 2010 and now has customers in Kenya and Tanzania also, with more than 400 retail partners.
Disrupt Africa caught up with some of the movers and shakers of the Kenyan tech startup ecosystem to get their thoughts on what is the landmark day in the development of the sector.
Sam Gichuru, CEO, Nailab
“In essence this should encourage three groups of people – 1. the startups, to apply for incubation and be ready to learn, 2. the investors to come via the incubation and work together to vet deals and ensure greater success, 3. to tech writers in Africa, to ensure more inspiring stories like this are on the lips of every young entrepreneur in Africa.”
Jessica Colaco, director of partnerships and community, iHub
“Weza Tele’s acquisition by AFB is history in the making as it opens doors for growing startups in this ecosystem. The Weza Tele team are a lighthouse for others in the Kenyan startup ecosystem that if team and talent are nurtured in the right direction it has fruition.
“Local angel investors like Joe Mucheru had the confidence in investing in young talent at Weza Tele, this is a step in the right direction to boost the support needed by local investors in this country. It is amazing to see that global companies such as AFB are searching for local talent and making major investments to make an impact in fintech across Africa.”
Harry Hare, executive producer, DEMO Africa
“It is big news because you don’t hear of such exits for tech startups often in Africa, let alone in Kenya. We need more such exits in the region to show that there is value in this ecosystem and that local investors need to start taking the opportunities more seriously”
Erik Hersman, co-founder, BRCK
“I think Weza Tele tells a great short history of the Kenyan tech ecosystem and how it has progressed. There have been just a couple small exits like this, but there were none at all back in 2010 and this brings hope to those who are trying to build tech businesses.”
Hannah Clifford, general manager, Nairobi Garage
“The Weza Tele acquisition is very important for the tech scene in Kenya. It shows investors as well as entrepreneurs here that there is a path that can end in a sale, which at the end of the day is what a lot of investors and angels are looking for.
“I think we can expect to see an increase in private equity, including more local money, coming in to the tech scene as a result of this deal. And for those who have been plugging away in the tech startup scene for the last few years, this is definitely some kind of affirmation of their belief in the market.”
Judith Owigar, co-founder, AkiraChix
“The acquisition of Weza Tele shows that the Kenyan tech startup ecosystem is full of opportunity and ripe for investment. It shows what happens when local and international investors come together to fuel the dreams of Kenyan entrepreneurs. It shows the ecosystem is growing and the only way is up from here. We now look forward to seeing more investors supporting tech enterprises and even more startups having easier access to finance. They are the shoulders on which other startups can stand on.”
Arielle Sandor, co-founder, Duma Works
“I think any acquisition of a startup in the Kenyan space is a win for many reasons. It indicates a potential for an exit for investors and VCs – though they will also be looking at exit values. It shows a shift of thinking amongst large corporates from “screw the small guys, I’ll build it myself” to a collaborative and more efficient approach.
“It can also indicate that the market is maturing overall in the tech startup space. That being said, this is one event. Definitely not a big enough sample size to indicate any kind of trend. And I’m not sure if they were acquired by a Kenyan company so there is that.”
Samuel Njuguna, business strategist, Chura
“It’s a great move for the Kenyan startup ecosystem. It gives confidence to Kenyans looking to venture onto the entrepreneurial path, and also to the investors eyeing Kenya as a potential investment location. We as players in the Kenyan startup ecosystem are happy for Weza Tele for restoring faith in our endeavours by proving that it is possible – it can be done.”
Jason Eisen, CEO, Maramoja
“It excites me to see an exit like this for the possibilities it can help talented young coders imagine. Startups here have had a tremendousły difficult time competing for top talent with corporates paying huge salaries due to perceived lack of value of startup equity. I don’t think this will flip that script alone but it’s a big step in the right direction. Congrats to Weza Tele!”
Caesar Tuva, CEO, Create
“The Weza Tele acquisition is a positive reaffirmation to the gradual maturity of Kenyan – and to a greater part East African – startups from early stage to momentum and expansion stage, where structures are more defined and success more repeatable.
“As any startup founder will testify, there is no way of knowing everything from the start. The ability of the core team to gain as much knowledge as they can and plan ahead allows for pivoting and scaling of growth that is inherent in most successful startups. Very few companies reach acquisition readiness like Weza Tele did; this is proof of the pool of tenacious techpreneurs that are becoming synonymous with the African Silicon Savannah.”