Sometimes I wonder to what degree us tech folk overstate the impact tech is having in our respective markets. To what degree are we living in a mental future that far outpaces the physical present?

This week, analyst Benedict Evans published a tweet -

Ecommerce is (still) only less than 20% of total retail sales in the US.

In South Africa, 76% of consumers visit a mall at least once a week, and across the continent, between 80 and 90% of retail transactions take place in the informal retail market.

Perhaps the question to ask is not if a product in question is ahead of the market, but how far ahead is it?

(As an aside, I also read this week that China's ecommerce sales are predicted to overcome the percentage of sales at physical stores for the first time this year, reaching 52% of overall retail sales! But that's another story altogether...)

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Gift Card Remittances

Speaking of crypto, this week's obsession has been the peer-to-peer exchange Paxful. (And, in fact, I am interviewing Paxful's CEO this week for a future podcast - please email or tweet at me with any questions or topics you'd like to hear us talk about 🙏).

I stumbled upon an article entitled Paxful is the Most Important Bitcoin Company You Aren't Paying Attention to, which quantitatively explains and explores the trading of gift card for bitcoin on Paxful's platform. The author coins the practice "gift card remittances".

Much like airtime is a stable store of value that was informally traded between individuals (and the formalization of this practice became M-Pesa and mobile money), immigrants are purchasing and trading gift cards to "on ramp" into the crypto ecosystem, and using the method outlined above as (in some instances) a more affordable and often quicker way to make international money transfers to African countries like Nigeria.

This also just underscores the absolutely vital importance of supporting and backing a diversity of founders with relevant, lived experience. One cannot fully appreciate the opportunities in remittances, for example, without having dealt with the laborious, expensive, and slow pain points of sending money back to Africa.

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TymeBank and Hybrid Models

This week, South African "digital bank" TymeBank announced their recent $109 million funding round, along with their plans to expand to the Philippines.

I put "digital bank" in quotes, because that's not an entirely accurate categorization. The bank does have a quite significant physical footprint in the form of their network of 700+ kiosks in Pick n Pay and Boxer stores across the country. It's undoubtedly a substantially more affordable way to acquire and service consumers than with hundreds of physical branches.

I am excited to see how the TymeBank story unfolds - first, in terms of a case study on what it means to apply a digital-first strategy to banking, while not eschewing the critical need for a physical presence. And second, in terms of their expansion to the Philippines.

Last year, we published an episode on the topic of African countries expanding to Latin America or Southeast Asia, and vice versa. In this case, Tyme is making a bet that their product has more transmutable properties with a country halfway around the world, and/or that their expansion efforts will be more rewarding by entering a market with twice the population size as South Africa.

Time will tell!

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Thanks for reading,

Justin

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