Investing in African Talent with YC's Michael Seibel & Microtraction's Kwamena Afful

Michael Seibel: My biggest fear of funding companies from Africa was whether the investment community here would fund them.

Justin Norman: That's Michael Seibel, the Managing Director of Y Combinator. 

What has the shift in perception been amongst the investment ecosystem here then versus now? 

Michael Seibel: People are trying to invest in Africa based on the conditions today, at a minimum we're betting on what it's going to look like 10 years from now, but the smartest technical people in Africa are going to shape its future. 

Justin Norman: You've taken a keen interest in supporting the development of the African tech ecosystem. 

Michael Seibel: Well, what's interesting is often I find myself telling the Nigerian founders like... 

Justin Norman: Back in September, I hosted an investor event in San Francisco with the early stage fund Microtraction. At that event, I was joined in conversation with Michael Seibel, the managing director of Y Combinator, and Kwamena Afful, a founding partner of Microtraction. 

Michael has been an avid supporter of the African tech ecosystem since his first trip to Lagos in 2016. And since Paystack joined YC’s Winter Batch earlier that year, the number of African startups that have participated in the global accelerator has grown to 89. 

And for Microtraction, the early stage fund was founded in 2017. In part in relation to this increased global interest in the African tech ecosystem were Microtraction's early financial support and local know-how could help fill the gap. 

This conversation with Michael and Kwamena was a fun deep dive into their shared perspectives on the opportunities they see and their bets on African talent. 

Justin Norman: This episode of The Flip is sponsored by MFS Africa. MFS Africa is the leading digital payments gateway, which connects over 500 million mobile wallets across over 1000 cross-border corridors and in over 40 countries across the African continent. Throughout this season, we'll hear from the MFS Africa team about their work to create a borderless world. In this episode, we're joined by Rashi Gupta, MFS Africa's Group Chief Operating Officer for our conversation on MFS Africa's payments hub.

Rashi Gupta: At MFS Africa, we strive for true interoperability across the various stores or channels of payments. We started a journey with the mobile money and banks. We have now added cash pickups in countries where mobile money is not very prevalent or the number of unbanked remains high. We are able to connect mobile money and banks to cards, which allows the international reach of consumers. What we want to be is we want to be Africa's omnichannel payments partner for the world. 

So we have not used the same brush to paint all the 54 countries, rather we understand each country, the specificities of it, and then cater a solution for it. So just looking at the different problems that we are trying to solve or different stores of value that we are trying to connect to and seeing what are the specificities of each one of them and designing a product according to that rather than a generic product that may or may not work for the different countries or different technologies. If in a country mobile money is more prevalent, we focus on mobile money. If it's banks, we focus on banks. If it's cash pickups, agents, we focus on that. For us, that understanding of on the ground realities has been very important to making our technology and network successful.

Kwamena Afful: Before you start, can I do one thing and, publicly give Michael his flowers? I always try, he hates it when I do this, but I'm going to do it anyway. When Michael came to Nigeria for the first time, and I said this to you again, maybe around seven years ago, I think there had been no Nigerian company, Y Combinator, only one. And Michael came and spent a lot of time with the ecosystem, with people like us in spite us to start Microtraction. I was actually whinging and bitching about what YC does the valuations, and he was like, "Just shut up and start off the game."

Kwamena Afful: Basically and...

Michael Seibel: I invested. I invested.

Kwamena Afful: Yeah, yeah, yeah. He also invested, which is really cool. So he's been a huge supporter of the ecosystem. I can say definitively after Michael Strip, maybe 10 Nigerian companies went to Y Combinator that year, and there's been many, many, many more since then and many more African companies have gone to Y Combinator since then. 

And at least in my timeline of African tech history, there's before Michael Seibel and there's after Michael Seibel. He's played a huge role in transforming African tech. And I just want to like just take a moment and give him his flowers and tell them it's a chance...

Justin Norman: I saw somebody tweeted that you deserve a honorary chieftaincy in Nigeria.

Kwamena Afful: Yes, yes, yes, yes. And Ghana too.

Michael Seibel: We just fund companies. That's all.

Justin Norman: But I actually want to start there and Kwamena has stole my thunder a little bit, but maybe we can just start Michael, with why, from a personal perspective and also Y Combinator perspective, you've taken a keen interest in supporting the development of the African tech ecosystem and building the bridges in the way that you have.

Michael Seibel: I'll say the general theory behind YC is that smart people are everywhere and the best people aren't the best credentialed when they start. They can't be. And so, Bill Gates didn't spend 10 years working at Microsoft, he made Microsoft. And so you have to be willing to give people, smart people money early in their careers and take a bet on them. And that thesis is not limited by borders. There's smart people everywhere. 

My biggest fear of funding companies from Africa was whether the investment community here would fund them. And I remember Shola with Paystack coming to do YC and it taught me a couple things. One, the Nigerian ecosystem will fund Nigerian companies, especially if they suspect Americans are going to move in and...

Kwamena Afful: Little bit of FOMO.

Michael Seibel: Yeah, a little FOMO never hurt anything. And then on the flip side, the American ecosystem at the early stages feels comfortable as well funding founders. And so, I thought it was my job to help, yeah. YC helped me.

Justin Norman: And so we went from 2016 you guys admitted Paystack. You weren't sure if Silicon Valley would be interested to now 89 African companies have come through Y Combinator. And what has the sort of, as you've seen it, the shift in perception been amongst the investment ecosystem here then versus now?

Michael Seibel: I think that it's much more common that someone's invested in globally now than it was back then. I think it's much more common that an investor will have markups from their global investments, which is really nice. Those are two positives. 

I would say the negative is like, we're out of this zero interest rate bullshit. And so across the board globally and domestically, people have to figure out what the real businesses are and what fake businesses are. And I think that that's tricky.

Justin Norman: Certainly the argument that we would make is there's a lot of real businesses in the African context because there's so much to be built. Kwamena, you just talked about financial services and Michael, I've heard you talk a lot about core infrastructure Kwams Maybe do you want to talk a little bit more about first level maybe with Haystack payments has been solved, you talked about credit...

Michael Seibel: Solved?

Justin Norman: Maybe not solved. Okay.

Kwamena Afful: But in the works.

Justin Norman: But being addressed. Being addressed to a greater capacity or maybe as the first level that needs to be addressed before other stuff can be built on top. How do you think about this core infrastructure question as it relates to payments not being solved, but then you talked about credit and other things that can be built on top?

Kwamena Afful: Yeah, maybe seven, eight years ago, if you couldn't even take a payment online easily, you couldn't start any type of online commerce based business with reach. So that had to come first. You had to first basically fix that. But remember what we said about the five regions. So it's complex. So it hasn't been that easy for Paystack or Flutterwave to scale that quickly. You would expect them to just be in 54 countries. No, I think Paystack today is in three or four and Flutterwave is in 11 on paper, but maybe really active in a major way in five. So payments is on its way, but it's definitely not solved. 

Then when you have payments, you then want people to be able to easily pay from different countries with different types of wallets. So it then became interesting to then look at businesses that were setting up wallets and making it easy for distribution of anything consumers had on the continent. So the telcos have taken the charge on the wallet side, and then I think the finctehs have to then add extra value add beyond what the telcos are providing for their wallets to make sense.

And now, okay, now people have wallets they can pay, then it becomes interesting. Okay. How do they move money around? Like I was giving an example, if I go and visit my friend in the neighborhood country, like different currency and I can't pay with my card. So how do I fix that? So that's where it becomes interesting to then have different ways of actually interchanging money and making peer-to-peer remittance and moving money cross border much easier. 

And I think self custody wallets are going to do a lot of work there. And then really you would think the telcos would've fixed it, 'cause MTN is in like 11 African countries, but each mobile money entity's completely separate and it's not interchangeable. So I can't take my Ghana Cedis on an MTN mobile money wallet and go to Côte d'Ivoire and just change it to Franc, which is crazy. You think that would be the case, but because the regulatory framework and the separate entities and the shareholders are different and all those types of things, it then gets a bit difficult. So that's why I think self custody then becomes the solution because it made you overcome some of that.

Justin Norman: Yeah. You raise an interesting point about the expectation of big incumbents to solve these problems and they don't really, and I think we're seeing, and Michael I've heard you talk about verticalization as well. You talked about it in your presentation of taking this vertical focus. So maybe how should we think about focusing on verticals? Michael, you could talk about the focus on verticals on top of the first layer of infrastructure that's being built.

Michael Seibel: So I want to preface what I'm saying with everything is like a 5% chance of success. So I don't like the different regions. It hurts software companies to be limited by borders.

Michael Seibel: And so I think I kind of think about this problem two different ways. One way is like, okay, I'm going to fund companies that are regulated by governments because they're insulated from global competition. Banking is a big example. But we're going to have the Paystack Flutterwave problem. 

On the other side, I'm thinking how do I fund software companies that are immune to that? I most recently funded an enterprise software company that sells to banks and these guys are in Central Africa. All the banking software from the local bank comes from France. It's like nothing... Basic banking stuff, but none of the relevant features for the region. And it's crazy to sell a big bank software when you're a two person startup. But the 5% bet is that like we can cross the borders.

And so a lot of what I'm trying to figure out is how to cross borders. And the second thing I'm figuring out that's like really tricky is that we funded so much crypto remittance and so much crypto crap and it is obviously the way you get low cost remit, like stablecoins, I completely agree with your point. I think the funny, interesting kind of crazy thing is that what we're really talking about here is how governments control their currency. And the thing that no one's comfortable saying is that everything would work better if the government just didn't control the currency. That's what stablecoin really means, right?

And that is tricky. When I talk to these founders, I'm like, "You can't live in the country that you are trying to make this work in," which is a different challenge. But I do believe like one day stablecoins have the best shot at solving this problem. And then I would say maybe the last thing I think about a lot is other areas where you can go across border where being on the ground matters. So like we funded a company that does auto parts distribution. And it's just like, you can't do that from the cloud. Some motherfucker has to hand people parts.

And so I'm just looking at all of these areas where it's insulated from global competition. It's solving a real world problem, not inventing a problem and it can move cross border. But man, that president, I mean, like that map, that's my problem.

Kwamena Afful: Yeah. Yeah, I'd love to pretend like that map doesn't matter.

Michael Seibel: Right. I get to do that.

Kwamena Afful: You know what I mean? But it does. What it just means is that maybe it's... So for example, in 10 years, I see much bigger consolidation place.

Because if somebody has worked really hard to get Francophone right, and somebody has worked really hard to get East Africa right or something, you can then just come in as a consolidator and take stake and then get creative. But the reality is also, it's also sometimes a competitive advantage for founders who work out how to navigate that map. And there are ways, but it just means it's a bit slower.

Michael Seibel: Well, what's interesting is often I find myself telling the Nigerian founders, you can't copy the US. In the US if you're doing something that has on the ground physical element, it probably makes sense to take over the top 10-25 markets in the US before you get one international market.

Does it make sense to take the top 25 cities in Nigeria before you move to your first non Nigerian city? Probably not.

Kwamena Afful: Yeah.

Michael Seibel: And so there's a lot of areas where people want to copy the thing that worked here, and I'm like... They look at me like, "You're saying some really crazy shit." And I'm just like, "Yeah, I'm saying the thing that works in America won't work in West Africa." And oftentimes I ask folks, what are the 10 cities that matter to you? What are your first 10 cities and how many of them are going to be in country? And that's a very different conversation.

Justin Norman: And I think an added layer of complexity that I want to address in the context of this conversation also is the nature of African markets. Many of them being analog. So we talk about mobile money, but mobile money is built on top of a physical infrastructure of agent networks and physical cash-in, cash-out human ATMs, and you talked about auto parts. This idea also as venture investors traditionally investing in zero marginal cost software businesses versus the very offline nature of African markets. And how do you guys think about investing in companies that have to solve problems that are physical in nature versus the, I guess, the ideal investment case in software businesses.

Kwamena Afful: I think there's a reality. The truth is like, for me, I think of, if you look at the themes you talked about and how we think about it, founders should solve problems and use technology to reduce their cost or increase their revenues quicker. And they should be solving real problems. It doesn't matter that that auto parts business, I have no doubt they have people on the ground. They go to the markets and go and collect things from the ports, so on, so forth. So the technology should just make it more efficient. 

That's why you don't see AI as a theme for us, even though AI is blowing everywhere. Because for me, it's a capability that is embedded into whatever problem you're solving. So very much, I think founders will solve the problems they need to solve. They must be big enough problems for them to profitable businesses. And it doesn't matter if there's a manual element to it, it's just software or technology helps you do it faster, cheaper, and maybe get customers quicker. And really, I keep it at that fundamental simple level.

Michael Seibel: Yeah. I would say the way that I'm trying to attempt to solve that problem is pivoting my Fintechs from consumer to enterprise. I think the thing that I wanted to believe was that the banks will be disrupted. And that was the very naive American thing. But it was weird 'cause it's what all the founders wanted to believe too.

Kwamena Afful: The banks play a different role.

Michael Seibel: I just think the banks aren't going anywhere.

Kwamena Afful: Yes. They are not going anywhere and their role is different.

Michael Seibel: Well, yeah. And so I've been... For example, we have a card issuing company with a deal with MasterCard. And they were originally trying to serve a bunch of fintech, and eventually I said to them, "Why don't you just try to sell this to a bank?" And they're like, "Oh, enterprise sales, blah, blah, blah." And I'm like, "Yeah, but Nigerian banks bank the whole fucking country." They actually have the problem and they actually have a hard time building good technology. You don't have to serve a customer who themselves doesn't have product market fit. You can serve a customer who has customers who want this thing and they just can't provide it. And I've been surprised at how my mind has changed on that because it just seems like the banks aren't going away. I mean, we just had crypto, infinite investment in consumer fintech and mobile phones and the banks are still there.

And so it's like, okay. I'm like, process elimination, maybe we have to work with them.

Kwamena Afful: Yeah, definitely. I mean, at a macro level, simplistically, just so you understand, African banks for everybody here, African banks mobilize deposits from big enterprises, governments and high net worth individuals and deploy those deposits in treasury bills and federal debt. That's their business model. They're not interested in lending to consumer, they're not interested in building it. They mobilize deposits and buy government paper. That's their core business in a nutshell. So they won't go anywhere because the space you are disrupting as a fintech, they're frankly not interested.

Michael Seibel: But everyone has a bank account.

Kwamena Afful: Yes.

Michael Seibel: So what do you deal with... And that's where they get paid.

Kwamena Afful: They're just using it to mobilize deposits.

Michael Seibel: Yes, yes, yes. Exactly.

Kwamena Afful: And buy t-bills. So, they're frankly... So when you are trying to create a credit card for the customer and bank them and cool tools, they are not interested. They want you to do it. So you work with them, you do it. And then when it's big enough, they're like, "Huh, okay, this is big enough. Maybe now let’s acquire it."

Michael Seibel: Well, what's interesting is, like the dirty little secret of both of the companies I'm pushing towards banks is that the use cases are business use cases, non-consumer. One is a payroll use case where like, how do you process payroll in regions of the country where there aren't bank branches? And it's a big problem, it's pretty problem for government. How do you pay the army? 

And then the other one was, card issuing for employees, for workers. And so it's been interesting to navigate that because you have a bunch of founders who to your point, who are like, "Oh, consumers are getting screwed." And you've got banks being like, "I literally don't care."

Kwamena Afful: Yeah.

Michael Seibel: And you've got companies, and what do you tell them to do? And you're like, well if the bank is your customer, maybe you should figure out what the bank wants and do that. And I think it's gonna be interesting 'cause I think it's counterintuitive to think that you could compete in enterprise software against the Western companies. But those large institutions in Africa have different problems. And the Western software companies are not addressing them.

Kwamena Afful: Yeah, Oracle's system doesn't deal with last mile for 800 million people type of thing or mobile money via USSD code.

Michael Seibel: No.

Kwamena Afful: So, I think it's... So, we'll see. We'll see. But it's been tricky, man.

Justin: This season of The Flip is all about sharing lessons and insights from some of the most experienced and esteemed founders from across the African tech ecosystem. And it's a mission for which we're proud to partner with Norrsken22 to share wisdom and insights from the fund's unicorn board as well. We know that advisors and mentorship are an important part of the venture funding process. And throughout this season, we are speaking to and learning from the successful founders, operators, and investors from Norrsken22’s unicorn board. 

In this episode, we're joined by Willard Ahdritz, the founder and chairman of Kobalt Music Group, the music publishing company which, on average, represents over 40% of the top 100 songs and albums in the US and the UK.

Willard Ahdritz: When the digital transformation happened, I saw that there was a huge opportunity to go back and actually change and transform the industry to a fair and transparent system using technology. So, with that, we created the most trusted music company in the world. And today, Kobalt represents 50% of the top 100 from The Weeknd to Paul McCartney. 

We wanted to change the music industry to fairness and transparency. And that purpose-driven and the big challenges we see, both on the African continent and in the climate, may be very excited. Combined with the people, the talent is enormous. The opportunities to transform and take fundamental shifts in what kind of services, if it is health, finance, or climate, is enormous. Using technology to scale is extremely powerful. And obviously, as a startup, you have not legacy cultures, legacy systems. You have nothing to lose. Because if you're a big company, a lot of companies doesn't like to cannibalize their own business. And that is your opportunity to deliver a transformative service to your clients or customers. And technology gives us that opportunity.

Justin Norman: And thinking about from a macro perspective, every African startup's presentation talks about population size. If there ought to be more of an enterprise focus, particularly from a fintech perspective, are there different heuristics that we should be thinking about as it relates to the scope of the opportunity in the context of the population size picture that everyone likes to talk about when we talk about Africa?

Michael Seibel: My only answer to that is I think that our thesis is really simple. The smartest technical people in Africa are gonna shape its future. And sometimes when I look at the founders we fund in their 20s, I think to myself, these people are gonna run major parts of the economy in their countries or in the region. These are the smart people who now have great network and resources. And they care greatly to make the place better than they found it.

And I kind of feel like I don't need much more of a thesis than that. It's like support those folks and they're gonna solve the problems. And like if I'm thinking too much about how to solve the problems from here, that's not...

Kwamena Afful: Yeah. Specifically on the market size thing you say, it has to be really looked at more specifically based on what is the problem that's being solved. So, for example, if you're talking about Africa has, I don't know, one billion people. So it's a huge addressable market, but what you're selling, you're looking for average revenue per user of $10. I can tell you that's all the one billion people. You're now down to like a few hundreds of thousands. 

So then in that case, then it becomes important to do what we talked about before, which is focus on the African diaspora, get legitimacy from the African base and bring in the African diaspora, for example. If you're talking about something that's more mass market, then it really matters that there's one billion people. So it gets overused, that total population. It has to be looked at in the context of the service you have provided and the income bracket you're targeting.

Michael Seibel: The only thing I'll add to that is I think sometimes I make the mistake of thinking things work quickly and made that mistake both in the US and internationally. And we just did this analysis of YC companies. I'm embarrassed I'm saying this. This is the first time we actually figured out the revenue of every single company that we've invested in. And we did a comparison to the valuation and there is so much work left to do. 

And so sometimes I think that people are trying to invest in Africa based on the conditions today, whereas I think at a minimum, we're betting on what it's gonna look like 10 years from now at a minimum. At a minimum. And so I think that's what's tricky. That's hard. This is hard for people to understand. Even in the US it's very hard. So that's why I don't try to... That's why the thesis above anything else is invest in smart people because...

Kwamena Afful: They'll figure it out.

Michael Seibel: They'll figure it out. 

Justin Norman: I think we talk a lot about this TAM today versus TAM tomorrow question in the African context. I think maybe in some instances, we talk about fintech and fragmentation. The market size question might be a little bit of a misnomer because there's some regulatory hurdles. I think where population size absolutely does matter, which you talked about, is in the context of labor. 

So the stat that I always like to talk about is the African population is going to add more people to the workforce in the next 10 years than the rest of the world combined. You talked a lot about connecting African talent to global opportunities, which I do think is a big opportunity. But I'm wondering if you think about this talent question as it relates to local opportunities, as it relates to education upskilling, your example that you gave was a Nigerian teacher who is now doing customer support, but then there's a question of who are the teachers. 

So how else do you think about this talent question? Because I think it's, in my opinion, a very important question, almost from a geopolitical perspective in light of how fast the population is gonna grow and how many people are entering the workforce.

Kwamena Afful: Do you want to go first?

Justin Norman: You go first.

Kwamena Afful: For me, talent will find maximum value for itself globally.

Michael Seibel: Yes.

Kwamena Afful: In the last 12 months to 18 months, we've lost so many people across our companies to Canada and to the US. So talent will find maximum value for itself. That's the reality. So in my view, we like companies that help them find that maximum value, make it possible to see their work, pay them, interact with them. We like businesses like that. I do think there's also room for companies that then train up new crops of talent. So we like companies that help talent and connect people in talent, and we like companies that are constantly training to your point of the teacher becoming a customer service people, new teachers need to be trained, and so on and so forth. So we like companies that do that too. 

But it's undeniable that talent being on export is gonna be a big theme. I think, the more bigger geopolitical issues, maybe avoiding more of a brain drain of people fleeing and maybe people being able to interact, not maybe flee, but interact. That would be my wish and ideal, but talent will find this place always. So we need to facilitate that.

Michael Seibel: Yeah. This one has been hard for me because, everyone I talk to sees fleeing as the goal.

Kwamena Afful: From the perspective of the people.

Michael Seibel: From the perspective of the...

Kwamena Afful: That individual.

Michael Seibel: Yeah. Exactly. Yeah. But I also think that that teacher who now makes 5K think about all of the way... Like that money is spent in Nigeria, and...

Kwamena Afful: It makes much better.

Michael Seibel: Way better. And so we've funded companies desperately trying to give foreign workers US bank accounts so that they can get jobs and get paid and hold USD so that it can retain value and then be spent in country. And I do think that can be a main driver, and I don't know what's better. Like classically it'd be setting up a factory. Is that better than setting up a call center? I don't think so. 

And so, I think what's important is that those workers are getting paid and spending that money in country. And right now it's been interesting, we've funded a number of companies who are trying to get US banks to give foreign businesses bank accounts and foreign individuals bank accounts. And if they can crack that, I just think it's way easier to get hired. So we'll see.

Justin Norman: YC also has their requests for startups. And one theme is one million jobs. I think that's maybe more in the US context, but I'm curious to know if there's any thoughts or lessons as it relates to this idea of one million jobs that might be relevant for the African context. And maybe as a part B to that question, how you reconcile that in this age of AI that we're in today.

Michael Seibel: I think that the biggest driver of jobs from the technology startup world in the last decade has been the gig economy. And I assume that as African economies grow, the gig economy is gonna become more and more and more viable. And so it's really interesting, the gig economy is this tricky thing that I never know how to talk about. 'Cause on one hand it's mildly exploitative. The workers don't really have union style rights and representation. On the other hand, it puts a lot more food on kids' tables to eat every night than like the dev tool does. And so... But if you were to ask me that's already happening and I assume it's gonna expand. But this AI stuff, AI can't drive someone somewhere. Can't deliver anything. Can't, like...

Justin Norman: Well, we did see some of the self-driving cars here.

Michael Seibel: It can't take that food and walk it into your house. Yeah, I don't think the AI stuff is...

Kwamena Afful: The self-driving car doesn't work in Nigeria.

Michael Seibel: No, no, no.

Kwamena Afful: In Nigeria it would be upside down.

Michael Seibel: So yeah, I don't think any of the AI stuff is gonna really hurt the Africans.

Justin Norman: I think in the context of this talent question one thing that Sayo and I like to talk about is what Africa's comparative advantage is, and you talked about culture, youth population, I'm hoping Kwamena you can expand a little bit on how to capture that opportunity. What sorts of infrastructure needs to be built to not only capture the opportunity that exists in terms of the rise of prominence of Afrobeats and Nollywood, et cetera, but also how to further stimulate the development? They talk in the creator economy a lot about needing a middle class. So what needs to happen in order to allow African creators to make a living from what they're doing?

Kwamena Afful: So a lot of the things Michael alluded to already, so it's basic stuff, like bank accounts being easy, being able to receive payment, make payment, participate on global platforms, being able to use global tools, whether it's global music tools. It'll shock you how many artists in Africa too recently have a problem with how to publish all their songs of the big global platforms that pay. It sounds like such a simple thing, but you need a US bank account, you need this, you need that. So they'll end up paying a middle distribution company that does that for them.

Whereas in other parts of the world, you just go online and you do that stuff yourself because you have a US Bank account, a US address, and so on and so forth. Or even 'till recently, I mean, it was quite recent, first pay for Google ads. This is a basic thing. Paying for Google ads and Facebook ads, you needed a foreign bank account or a foreign card, and then they turned on Nigerian cards and then they would charge it in dollars and then your Nigerian bank accounts would be confused and turn it off and all sorts of things. So some of the basic infrastructural things are important. 

Then beyond that, I think it's actually better tools or better things that allow them to participate and plug in. And then it's... I think but in the creator economy specifically, I think there's a way to monetize volume. If I'm an African creative, which I'm not at all, I wish I was. But if I was an African creative, I would want a huge audience or base, and then I would want to work with brands to be able to monetize that audience or base. So even if I'm not making money from that audience or base, I would then want a platform that allows me to share that base with the brand. And I think those types of tools then start opening things up. But we're very early.

Michael Seibel: Yeah. One of the companies we funded, they started as a LLC creator. And they thought it would be valuable, they were like, "Oh, we're gonna compete with LegalZoom, make it easy to trade LLCs." And what they're starting to realize is this exact point where it's like, if you want to participate on a global marketplace, and I'm including Spotify, YouTube, dah dah dah dah, and get paid, you need a US incorporation, you need a US bank account, you need an US address. 

And we started talking, we started asking how many SMBs in the next 10 years are just gonna be US and... Or how many international SMBs are just gonna be US incorporated? 'Cause it makes it easier and like, Hey, instead of getting Airbnb to figure out payouts in some country... Hey, I look like a US host don't I?

And then also how many of those participants in those international marketplaces want to hold their money in USD and not in their local currency? And so it's funny, these folks have literally shifted from working for US based small businesses to international based small businesses. And it kind of goes with this larger theme I've realized, which is that, many fewer platforms and incumbents are being disrupted than it looks. And a lot of international investment is, How do you allow people to consume the benefits of the big incumbents versus how do you destroy and rebuild them in a more friendly way?

Kwamena Afful: 100%.

Michael Seibel: YouTube wants to pay out more creators. They want a bigger audience. But building out payments in a bunch of different countries is hard. So, we'll see. It's weird if the whole crypto revolution is gonna result in everyone has US bank accounts. But it very well might.

Justin Norman: But I think we've learned that these big companies aren't going to solve these problems in these markets and whether they care or not, I mean, it's a such a low down area of focus to focus on Nigeria, even if Nigeria is a big country. So, yeah.

Michael Seibel: I completely... That's why startups have to not assume that at all.

Kwamena Afful: 100% I'll take a good example. One of our companies, Bumpa, they basically just allow you to get all these orders on Instagram, on WhatsApp, on Twitter and all these things, but the social parts of those platforms even including TikTok, haven't been turned on the African continent. So they've turned on a layer for you that allows you to be like a mini shop, but then connects to all these platforms. You use one communication platform to communicate and get all these orders. They process all your payments 'cause they're using local rails. And they connect you to third party delivery platforms. That's a huge opportunity simply because those platforms aren't doing that. And they're not trying to replace those platforms. They just supported it to your point.

Michael Seibel: Yeah.

Justin Norman: So did they talk about the... What's it called? The AI wrapper on top of whatever, OpenAI. So I think that's what's happening a lot, is this thin layer on top of... Localization on top of a global platform that enables them to actually access the global marketplace.

Michael Seibel: Yep.

Justin Norman: Alright. Cool. Thanks so much.

Kwamena Afful: Thanks guys.

Michael Seibel: Thank you everybody.