We’re starting with a story that’s making waves in the global tech community: TikTok’s move to automatically label AI-generated content on its platform. This step, taken in collaboration with the Coalition for Content Provenance and Authenticity, has significant implications for creators, users and the future of online content.
Learn more about the initiative.
In this letter, we examine:
- The alleged ₦11 billion at Flutterwave
- Nigeria’s play in the Bay Area
- The Accion Digital Transformation Fund
We also curated updates on the state of funding in Africa, other noteworthy information and several opportunities.
The big three!
#1 Flutterwave allegedly loses ₦11 billion to a security breach
The news: Flutterwave suffers a major security breach allegedly allowing unknown persons to divert billions of naira into various bank accounts in April 2024. This comes just one month after the company secured a court order to recover $24 million lost to unauthorised point-of-sale (POS) transactions in October 2023. The exact amount stolen in the latest incident remains unclear, with reports ranging from ₦11 billion ($7 million) to ₦20 billion ($13.5 million).
In a statement made to TechCabal, Flutterwave said no customers’ funds or data were compromised in the breach. As is common in financial services, this is an attempt to compromise the security of its system.
Rewind: This is not Flutterwave’s first brush with security breaches. Over the past year, the company has faced multiple incidents involving unauthorised transfers. In October 2023, $24 million was illegally transferred through unauthorised transactions by POS merchants. In February 2023, ₦2.9 billion was diverted to 107 bank accounts, while another breach worth ₦550 million was reported in March 2023, according to court documents.
Zoom in: Inside sources quoted by TechCabal say the perpetrators used a cunning “closed-loop” system to move stolen funds, transferring the money to random accounts and transferring it to other accounts before sending it back to the first beneficiary account, potentially suggesting a coordinated network. This approach differs from past attempts to hide the trail by transferring money through unconnected accounts.
They also confirmed that all the accounts related to the incident have been temporarily restricted and they have requested KYC details of the accounts involved
#2 Nigeria stakes claim in the Bay Area with Startup House
The news: Nigeria is strategically moving to propel its tech industry onto the global stage. The country has announced the establishment of the Nigeria Startup House in the heart of the San Francisco Bay Area, a world-renowned hub for innovation and entrepreneurship. This initiative aims to attract much-needed foreign direct investment (FDI) and significantly raise the visibility of Nigeria’s startup ecosystem.
Context: The decision to establish a presence in the Bay Area has been described by analysts as “strategic” due to the pre-existing strong ties between the Nigerian tech scene and American investors.
A significant number of Nigerian startups, including household names like Paystack, Flutterwave and ThriveAgric, are already incorporated in the US. Furthermore, about 60% of the total venture funding for Nigerian startups originates from the US, with the San Francisco Bay Area being a major concentration point for this capital. This highlights the immense potential for the Nigeria Startup House to bridge the gap and facilitate a smoother flow of investment towards Nigerian innovation.
Why it matters: The minister of communications, innovation and digital economy, Bosun Tijani said that the proximity to venture capitalists significantly increases the chances of Nigerian startups to secure funding and the hub will showcase Nigerian startups to a wider audience of investors and potential partners in the global tech market.
Zoom in: The Nigeria Startup House will be established on a previously underutilised 4,200-square-foot property owned by the Nigerian government. The minister also added that while the ownership of the Nigeria Startup House will remain with the Federal Government, it will be managed by a consortium of Nigerian digital technology companies to provide non-public funding for the operations of the Startup House.
#3 Accion launches $152.5 million fund to support financial institutions in Africa
The news: Accion, a longstanding non-profit focused on financial inclusion, has launched a new initiative called the Accion Digital Transformation Fund. This $152.5 million fund aims to bridge the gap between traditional financial institutions and digitally underserved populations in emerging markets.
Context: Accion has a rich history of promoting financial inclusion for over six decades. They’ve traditionally supported microfinance institutions and provided them with the tools to reach underserved populations. However, with the rise of digital finance, Accion recognised the need for a new approach. Their previous venture, the Accion Venture Lab, focused on early-stage fintech startups offering innovative financial solutions.
Why it matters: The digital revolution has left many low-income individuals and small businesses behind, particularly in rural areas. This lack of access to digital financial services hinders economic participation and growth. The Accion Digital Transformation Fund seeks to address this challenge by empowering traditional financial institutions to better serve these underserved segments through digital transformation.
Zoom in: The Accion Digital Transformation Fund will target established financial institutions, including microfinance companies transitioning to full-fledged banks, affordable housing providers, and traditional banks. They will not invest in early-stage fintech companies, but rather focus on helping existing institutions develop stronger digital customer engagement strategies. The fund will provide these institutions with growth capital (equity investments ranging from $12 million to $15 million) and strategic support to navigate their digital transformation journey.
State of Funding in Africa
Here’s a roundup of African startups that secured funding last week:
- MNZL, an Egyptian fintech raised $3.5 million in seed funding from P1 Ventures, Localglobe and Ingressive Capital, with additional support from 500 Global, Flat6Labs, First Circle Capital, Enza Capital, Beenok and other angel investors.
- Cleantech startup d.light, has received a $3.4 million grant from Private Sector Foundation Uganda and Energising Development, an international programme by the German, to provide 10,000 solar home systems to refugees in Uganda.
- Maad, a Senegalese B2B e-commerce startup secured $3.2 million in debt-equity funding. The seed round was led by Ventures Platform, with participation from Seedstars International Ventures, Reflect Ventures, Oui Capital, Launch Africa, Voltron Capital and Alumni Ventures. It raised $900,000 in debt financing from French DFI Proparco and local banks.
Noteworthy
Here are other important stories in the media:
- Tough times don’t last—tough startups do: In an interview with thecondia.com, Ameya Upadhyay, Venture Partner at Flourish Ventures, one of Africa’s earliest investment vehicles, talks about the tough situations faced, stressing the need for startups to focus on making profits and managing their costs carefully.
- HerRyde, “hibernates” after a year: After a year of operation in Nigeria’s capital city Abuja, HerRyde, a women-only ride-hailing platform has “hibernated” to re-strategise and source for funding ahead of a near re-launch.
- Nigeria wants to build 90,000km of terrestrial fibre-optic: The Nigerian government has announced plans to expand the terrestrial fibre-optic in the country by 90,000 kilometres.
- Africa’s undersea cable troubles are far from over: As of last week, some East Africans still experienced slow internet speeds; telcos indicated that the issues persist.
Opportunities
Jobs
We carefully curate open opportunities in Product & Design, Data & Engineering, and Admin & Growth every week.
Product & Design
- CcHub — Senior Product Designer, Lagos
- payZeep — Product Manager, Remote
- Remote — Senior Product Manager, Remote
Data & Engineering
- Yassir — Data Engineer, Algiers
- Jobberman – Senior Data Engineer, Nigeria
- Deel — Senior Software Engineer, EMEA (Remote)
Admin & Growth
- FoodCourt — Head of Marketing, Lagos
- Qatar Airways — Marketing Officer, Lagos
- Nomba — Customer Success Intern, Remote
Thanks for reading this edition.
Have a great week!
