Disruptech co-Founder: Dina H. Sherif, Mohamed Okasha and Malek Sultan (Photo By: Matjaz Kacicnik)
The Arab region is a unique region. We could write about its distinctive historical, socio-economic, and political conditions forever, without running out of material. Yet, in the midst of this wealth of information, we want to zoom right in on a very interesting fact. The region has the world’s lowest bank penetration rate in the world – only slightly over 14 percent are in the formal banking system. If you think that’s what makes our region unique, however, you would be wrong.
The uniqueness only appears when you juxtapose that low bank penetration rate with an internet penetration rate that exceeds 100 percent, a mobile penetration rate that exceeds 100 percent and a smart phone penetration rate that was already at 60 percent back in 2017. This uniqueness is what makes our region, and in particular, our country Egypt – home to the region’s largest unbanked population – fertile ground for financial technology, or what has come to be known as “Fintech.”
This uniqueness is what gave birth to Fawry, a company established in 2009 by the Managing Partner of Disruptech, Mohamed Okasha, and his colleague Ashraf Sabry. Back in 2009, nobody in Egypt knew what fintech was, but everyone knew that there was a deep need to solve the problem of digital payments. Fawry not only tackled that problem, but it created a space for others to innovate and design market solutions to the multitude of problems that surround the lack of access to traditional forms of financial services by those considered ‘unbankable’ or simply ‘unreachable.’
In 2019, Fawry became the first fintech company to IPO in the region and since taking that step, the price of its stock has risen by 300 percent. Last week, Fawry became Egypt’s first tech ‘unicorn,’ born in the midst of a global pandemic and what is quickly becoming a global economic meltdown of massive proportions. If this is not testimony to the importance of this sector and the opportunities that lie within it, then we are not sure what is.
If you don’t believe that Fawry’s unicorn status and the birth of numerous rapidly growing startups in the space are proof that fintech is the future or that this sector will be critical to Egypt’s ability to achieve its commitment to inclusive and sustainable economic growth under Vision 2030, forget all of that and focus on one simple reality. In the midst of the global pandemic, Egypt and many similar countries in the region and beyond are finally introducing laws and regulations that will not only allow this sector to thrive, but will allow our economies to thrive by using technology to serve the millions of people who remain economically excluded from the system.
Further to the above, recent studies have demonstrated that providing fintech services to the unbanked and MSMEs alone can generate additional annual revenue in the billions. According to a 2020 CGAP funded report on the landscape of Fintech in the Arab World (https://www.findevgateway.org/sites/default/files/users/user331/CGAP-EY_FintechRegionalReport_ArabWorld_2020.pdf), the region boasts significantly high survival rates, making these companies attractive for investors. For fintech companies launched in 2014, 90% survived. With that in mind, it comes as no surprise that the 2019 MENA Fintech Venture Report (http://mcit.gov.eg/Upcont/Documents/Reports and Documents_4112019000_MAGNiTT_ADGM_2019_MENA_FinTech_Venture_Report_EN.pdf), highlighted a total of USD 237 million that were invested in 181 deals since 2015.
The enormous potential that lies within the fintech space was a part of why Mohamed Okasha stepped down from his leadership role at Fawry to launch Disruptech, Egypt’s first VC Fund to focus on fintech and fintech-enabled startups in Egypt. Stepping down from Fawry at a time where it was clear that the company was heading towards a billion-dollar valuation was built around a desire help entrepreneurs who have entered this space avoid the same sacrifices and hardships experienced during Fawry’s growth journey.
Disruptech’s mission is to provide access to capital, specialized expertise, and the networks required for entrepreneurs in this sector to thrive and have impact on Egypt’s growth journey. This mission is reflected in the expertise and professional history of the partners and advisors brought in to join the team – Malek Sultan, and Dina H. Sherif who joined as partners, in addition to Mohamed Aboulnaga who joined as a Senior Advisor.
For the Disruptech team, establishing this fund – however hard it may be – is built on a solid belief that Egypt, the country that each of us loves deeply, cannot continue as is. We believe in Egypt’s potential, and we know that fintech is not just about financial inclusion, it is about economic inclusion, as a dear friend of Dina’s, Efosa Ojomo, from the Clay Christiansen Institute would say (https://www.christenseninstitute.org/blog/chasing-financial-inclusion-is-a-red-herring-economic-inclusion-should-be-the-goal/). Egypt is at a critical inflection point in its growth journey and many entrepreneurs are rising to the occasion.
Our goal is for Disruptech to be a solid contributor in the story of Egypt’s future growth and its embrace of technology as a critical and essential tool within that inclusive growth journey.
Article By: Dina H. Sherif, Mohamed Okasha and Malek Sultan
Helios Investment Partners Backed Africa Specialty Risk Group Launches
Africa Specialty Risk Group CEO, Mikir Shah
Helios Investment Partners (“Helios” or the “Firm”) is pleased to announce the launch of Africa Specialty Risk Group (“ASR”) in partnership with Mikir Shah, former CEO of AXA Africa Specialty Risks, and Bryan Howett, former CEO of Old Mutual’s pan-African reinsurance operations. ASR is a reinsurance business focused on becoming the partner of choice to corporations through the provision of comprehensive and bespoke risk mitigating insurance solutions.
Helios, through its extensive financial services expertise in Africa, identified an unmet need in the reinsurance space to expand the continent’s long-term domestic capacity beyond its current capabilities. Having previously founded market-leading businesses such as Helios Towers, the Firm
took a similar pioneering approach in partnering with Mikir Shah and Bryan Howett to develop and increase domestic reinsurance capacity.
ASR will create tailored solutions for local and global customers, using Africa-specific pricing models coupled with a deep understanding of African risk and cultural environments. This provides corporates and investors with the confidence to grow their businesses, thereby unlocking investment activity, and the associated developmental benefits.
Mikir Shah, commenting on the partnership noted: “We chose to work with Helios given their extensive reach across Africa, their knowledge and experience in our key markets, as well as their established track record in helping entrepreneurial businesses to scale.”
Souleymane Ba, a Partner at Helios, said: “We have identified a sustained lack of adequate insurance capacity across Africa, which has been exacerbated further by Covid-19 as global reinsurance providers focus on their home markets. ASR has been established to address this gap by providing specialist risk mitigation products which companies and capital providers operating in Africa have found difficult to access to date. As demonstrated in the US and Europe, private equity has a long and successful track record of stepping up to fill unmet insurance capacity to de-risk and support investment activity.”
ASR intends to work proactively with local regulators and clients to develop skills and provide training to local underwriters. Environmental, social and governance considerations are central to ASR’s values, particularly in relation to local capacity building.
The investment in ASR is being made from Helios’ latest fund, Helios Investors IV, L.P., whose investors include CDC Group (the UK’s development finance institution) and the International Finance Corporation (a member of the World Bank Group).
METTĀ And Nairobi Garage Join Forces To Create Kenya’s Biggest Innovation Community
Nairobi, September 15, 2020 – Kenya’s leading co-working space Nairobi Garage and entrepreneurial club METTĀ have announced they are combining their services to create the country’s largest innovation community, offering flexible access to all their workspaces and networks, as well as a new digital event series.
African businesses are facing a disrupted marketplace due to the COVID-19 pandemic, with day-to-day operations and the economic outlook for businesses of all sizes feeling the impact. As a result, there is a renewed demand for flexible work space arrangements, allowing companies to remain responsive to the market and keep their teams productive without tying up much-needed working capital.
As Kenya’s leading co-working space, Nairobi Garage is home to over 150 companies across its four premises, giving members total flexibility when it comes to the office space they need, as well as offering a range of add-on business development, collaboration, and networking opportunities.
METTĀ is a club for the entrepreneurial community to connect, share knowledge and bring ideas to life. With 370 members in Nairobi, and over 15,000 members in its digital community, METTĀ offers a range of events, workshops and corporate innovation programmes.
By joining forces, METTĀ and Nairobi Garage members will have access to both organisations’ workspaces throughout Nairobi – with drop-in and private office options available in Westlands, Riverside Drive, Karen and Kilimani -, as well as to all the complimentary business support services provided across the two communities. All members will benefit from exclusive corporate collaborations and partnerships – such as discounts, programmes, and first dibs on funding and training opportunities.
The organisations have also combined their entrepreneurship events and will launch an online event series offering thought leadership, innovation and practical business advice. The series involves six monthly events, including panel discussions, networking e-meetups, and podcasts.
“We are confident in the resilience and capacity of Kenyan entrepreneurs to come back from this pandemic stronger than ever. We want to support them in doing just that, and this merging of forces is a demonstration of our belief in the strength of both our communities. It’s of utmost importance that innovation in business continues to be a priority, and we’re here to facilitate that process for the country’s top entrepreneurs,” says Hannah Clifford, director of Nairobi Garage.
Esther Mwikali, general manager of METTĀ, says: “We have always believed that “Innovation doesn’t happen in isolation”. Outstanding innovation breakthroughs occur when the right people collaborate, to spark commercialisation and scale. This partnership is a true testament to our
vision, as we are taking our own advice and leading by example – the value we offer our customers and the community at large through this is greatly increasing.”
With the business landscape plagued by so many uncertainties in the COVID-era, Nairobi Garage and METTĀ want to provide a sturdy, strong foundation for businesses in Kenya to thrive. By combining their two trusted names, members can have the most complete support available to weather the current storm.
To become a member, people should write to firstname.lastname@example.org or email@example.com
New members joining in the month of September get 10% off their first month’s membership.
Sahara Energy, Petroci Sign $43 Million Deal To Boost LPG Supply In Cote D’Ivoire
Dr. Ibrahima Diaby, Director General, Nationale d’Opérations Pétrolières de la Cote d’Ivoire (Petroci Holding), and
Olayemi Odutola , Country Manager, Sahara Energy (Cote d’Ivoire) at the execution of the Joint Venture Agreement between both companies for the construction of a 12,000 Metric Tonnes Liquefied Petroleum Gas (LPG) storage facility to guarantee LPG supply security in Cote d’Ivoire. (Source: Sahara Energy).
Sahara Energy Logistics Holding Limited (a Sahara Group company) and Société Nationale d’Opérations Pétrolières de la Cote d’Ivoire (The National Oil Company of Cote d’Ivoire, Petroci Holding), have entered into a Joint Venture Agreement (JVA) to facilitate the construction of a 12,000 Metric Tonnes Liquefied Petroleum Gas (LPG) storage facility to guarantee LPG supply security in the nation.
The cost of the project is estimated at $43million and will be executed in two phases, with commissioning scheduled for November 2021 and October 2022 respectively.
Incorporated as SAPET Energy S.A., the joint venture company will handle the construction, operation, and maintenance of the ultra-modern LPG storage terminal. Upon completion, the facility will become the largest of its kind is Sub-Saharan Africa, and more importantly, support the government’s efforts to meet Cote d’Ivoire’s growing LPG demand.
Speaking at the execution of the agreement, Dr. Ibrahima Diaby, Director General Petroci, said, “this joint venture project is the first of its kind in Cote d’Ivoire and will serve as a model for other projects in the energy sector. It is a historic event that will pave the way for a robust and seamless storage, distribution, and supply of LPG. This translates to more clean energy, growth, and productivity in Cote d’Ivoire. We are delighted and look forward to more collaboration with Sahara Energy.”
Olayemi Odutola, Country Manager, Sahara Energy said the project was in tandem with Sahara Group’s commitment to promoting clean energy in Africa through investments, new technology, and collaboration with regional and global institutions. He stated that the partnership with Petroci further reiterates Sahara Group’s support and commitment to enhancing economic growth in Cote d’Ivoire and contributes to the UN SDG7 goal which aims at ensuring access to affordable and clean energy.
“We are excited about the project and the huge opportunity it will confer on Cote d’ Ivoire as the leading LPG hub in the sub-region. Sahara Energy continues to support the energy value chain in the nation as a foremost partner. Sahara Group remains unwavering in its commitment to enhance capacity, productivity, reliability, safety, profitability, competitiveness, and sustainability in Africa’s energy sector. We will continue to explore other investment and partnership opportunities to replicate similar projects across the continent,” he said.
Industry experts say the development is cheery news for the nation with a population of 25 million people which has recently emerged as one of West Africa’s fastest growing LPG markets. National LPG consumption has grown from 175KT in 2013 to 380KT in 2019, a significant increase that far exceeds the country’s demand for liquid products (excluding gasoline).
The proposed facility will increase the country’s LPG storage capacity by 60% and significantly enhance importation, storage, supply and distribution of LPG and other related activities in Cote d’Ivoire and its neighboring countries such as Mali, Burkina Faso, and Guinea.
The investment will also bridge the current product supply and storage gap in the market and ensure more product availability and security by increasing stockholding from 15 days to 27 days.
Sahara Group is already a leading LPG supplier on the continent via its joint ownership of MT Africa Gas and MT Sahara Gas, both LPG vessels with a combined capacity of 76,000 cubic metres (cbm). The vessels have delivered about 600,000 metric tonnes of LPG, making households, communities and nations cleaner and safer as well as boosting economic growth and development across markets.