For the first time, Safaricom's M-Pesa revenue surpassed voice revenue, for their past fiscal year ending March 31st.

Meanwhile, Airtel Africa released their annual earnings for the fiscal year ending March 31st, and MTN Group shared their quarterly earnings, as well. (Vodacom's are next week.) For Airtel, mobile money revenue was up 35.5%, and while not entirely apples to apples, MTN's group fintech was up 31.3% last quarter.

But this past year, pandemic-induced regulations compelled telcos to waive transaction fees in certain instances, so it's also useful to look at transaction volumes. For M-Pesa, they're up 29.8% to $11.68 billion (remember, this is just Kenya); Airtel's are up 31% to $32 billion across their 14 markets, and MTN's are up a staggering 86.6% to $53.2 billion.

If anything, I think this demonstrates just how much growth is ahead of us, particularly in select markets like Nigeria, where MTN reported adding 54,000 agents just last quarter, bringing their total registered agents to 449,146.

I am sure this goes without saying by now, but it's nonetheless a useful reminder of the outsize impact telcos still have on the markets that venture-backed fintechs are also so heavily focused on.

Investing to Learn

This week, the Cameroon-based fintech Maviance announced a $3 million seed round, funded solely by MFS Africa.

We’re beginning to see a larger trend of growth-stage tech companies investing in early-stage startups - and not only investing for a return, but also investing to learn.

It will be interesting to see the second-order effects. As the ecosystem continues to grow, how much more investment activity will we see from later-stage companies, like MFS Africa, in earlier ones?

Whereas most VCs are focused on a select few markets, what happens when these companies invest in Francophone Africa and other markets with less investment activity? How might that strategy not only kickstart local ecosystems, and also provide the companies investing with asymmetric advantages? And how many (more) of these investments will turn into acquisitions?

Sales-Led Organizations

I was intrigued by the recent survey results published from a product management community called Practical Product.

After surveying product managers across the continent - though the overwhelming majority were in Nigeria - the plurality of respondents categorized their employer as a sales-led organization.

While the survey may not contain an entirely representative sample, I think it’s nonetheless worth interrogating further. If the plurality of startups in Nigeria are sales-led startups, why is that?

Is it talent? We hear often of talent and hiring challenges in the ecosystem - particularly for product and engineering roles. Perhaps the scarcity of product talent is a factor here.

What about the market itself? If a larger percentage of startups are B2B or enterprise companies, that may lead to more sales centric organizations.

And beyond the reasoning why, is it something we ought to consider concerning? Traditional startup logic says that product matters the most, and therefore many (if not the majority of) startups are product- (or engineering-)led. But I also recall Peter Thiel, in his book Zero to One, questioning the Silicon Valley dogma, writing that the opposite principle is probably more correct: “sales matters just as much as product”.

He goes on to write,

Superior sales and distribution by itself can create a monopoly, even with no product differentiation. The converse is not true.

And in African markets, where distribution is especially important - and can be difficult and/or expensive and/or necessarily analog - perhaps it is a good thing we see so many sales-led organizations.

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Thanks, as always, for reading!

Justin

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