The five boldest African tech business moves of 2023

Slow and steady has its place. It’s hard to argue against consistent, continuous, incremental improvements — in our personal lives at least.

But in the business world, to make major leaps forward, companies generally have to make big, bold moves: actions that are daring, unconventional, and often hard to reverse.

Here are five of the boldest business moves of 2023 in Africa Tech.

1. Jumia exits the food business

In November 2022, after half a decade of successive losses, the board of pan-African e-commerce player Jumia Technologies (NYSE:JMIA) decided enough was enough — co-founders & co-CEOs Jeremy Hodara and Sacha Poignonnec were out.

Francis Dufay, former EVP and former CEO of Jumia Ivory Coast, was appointed CEO with a mandate to strengthen Jumia’s core e-commerce business, reduce its operating losses, and set the business on a clear path to profitability.

With this carte blanche, he laid off 900 employees (20% of staff), shut down offices in Dubai, slashed marketing spend, discontinued Jumia Prime, and scaled down Jumia’s logistics-as-a-service offerings.

And perhaps most surprisingly, a month ago he announced the shutdown of Jumia Food in all seven countries in which the food delivery business still operated.

While the unit had never been profitable, it contributed ~11% of GMV and was viewed by his predecessors as an important driver of transaction volume that was key to “meet[ing] the everyday needs” of Jumia’s customers. No sacred cows.

2. MultiChoice gets into the payments business

In May 2023, South African video entertainment platform Multichoice (JSE:MCG), one of Africa’s top fifty companies by market cap, announced plans to launch a payment platform called Moment.

According to MultiChoice Group CEO Calvo Mawela, “Investing in this venture is a logical progression for us, as we already process payments every month from 22 million households across 50 countries in Africa.”

While MultiChoice indeed processes roughly $3.5 billion annually via payment partners, fintech nonetheless lies beyond its core competencies.

So to derisk the move, Moment is structured as a joint venture with Israeli fintech-as-a-service unicorn Rapyd and American VC firm General Catalyst (an investor in Rapyd, American fintech unicorn Stripe, Mexican fintech unicorn Stori, European fintech unicorn Monzo, and others).

MultiChoice has invested $3 million in Moment so far and this payments play is part of Mawela’s push for sizeable new revenue streams amidst significant weakness in the company’s core video entertainment business.

3. Wasoko & MaxAB plan to merge

In December 2023, Kenyan B2B e-commerce platform Wasoko and Egyptian B2B e-commerce platform MaxAB announced that they signed preliminary terms for what would be “the largest tech merger Africa has ever seen,” according to Wasoko CEO Daniel Yu.

A combined company would have a customer base of ~450,000 merchants across North Africa and sub-Saharan Africa and, according to media reports, a valuation north of $1 billion.

B2B e-commerce companies across Africa have faced significant pressures recently and this is an enterprising response by two of the leading players in the space.

The parties expect the deal to be finalized sometime in Q1 2024. (Read more here.)

4. Moniepoint gets into retail banking and goes to Kenya

In August 2023, Nigerian business banking platform Moniepoint formally entered Nigeria’s consumer banking space with the launch of a consumer app and debit card.

The move puts Moniepoint into increased competition with OPay, PalmPay, Kuda Bank, and other leading digital banks across Nigeria. But that’s not all.

In the same month, news broke of Moniepoint’s acquisition of Kenyan payments & digital financial services provider Kopo Kopo.

While Moniepoint hasn’t said much about the deal yet, the pending acquisition paves the way for its strategic expansion into East Africa — its first market outside of Nigeria.

These expansions — across product lines and geographies — harken back to my conversation with Moniepoint’s CEO Tosin Eniolorunda, where he mentioned his ambition for the company to become the Square of Africa & beyond.

5. Chipper Cash gets into identity verification

In August 2023, (former) unicorn Chipper Cash launched Chipper ID, a suite of B2B onboarding & identity verification solutions for businesses.

The move, which transformed a significant cost center for the company into a new revenue stream, is part of CEO Ham Serunjogi’s push to maximize resource utilization on the one hand and to diversify the company’s offerings on the other.

As Serunjogi told me, “We’ve come a long way from being just a cross-border payments platform to being almost your one-stop shop for financial needs across Africa for consumers. And also for businesses as we keep scaling the business suite.”

While the launch of a new line of business alone doesn’t warrant mention in a list like this, the fact that Chipper Cash is increasingly becoming a platform for other businesses to plug into is quite significant. In addition to that, given the impact the downturn has had on the company, one gets the sense that there’s a significant amount of urgency around the Chipper ID product specifically and the Chipper for Business suite more generally.

Making bold moves in business is often like replacing the engine of a plane while it’s flying. There’s undeniable risk and uncertainty involved.

But in certain scenarios (e.g., contending with structural headwinds like Wasoko & MaxAB or facing a real risk of running out of cash like Jumia), the riskiest strategy of all might be to avoid bold moves as that almost guarantees a gradual decline.

Moreover, as with some of the examples above, bold business moves often have an interesting and underappreciated characteristic: they’re asymmetric with the upside opportunity far outweighing the downside risk.