BD Insider 221: EFCC drops charges against Nigerian fintech Leatherback

The Disha link in your bio won't work anymore. Also inside, we cover Africa’s biggest streaming platform and the latest on EFCC charges against Nigerian fintech Leatherback.
8 minute read
BD Insider 221: EFCC drops charges against Nigerian fintech Leatherback
Photo: Leatherback team

More than a year after X (formerly Twitter) dismissed its Ghana-based Africa team, the company has finally fulfilled its obligation to pay severance to the laid-off employees, following advocacy and legal pressure.

“They [referring to the ex-Twitter employees] are very pleased to finally be able to get their due, put this behind them and look to the future,” says Carla Olympio from Agency Seven Seven, the company providing legal representation to the staff


Now, let’s go into today’s letter, where we explore:

  • the temporary shutdown of Disha by Flutterwave
  • Showmax, Africa’s biggest streaming platform
  • the latest on EFCC charges against Nigerian fintech Leatherback

and other noteworthy information like:

  • the latest African Tech Startup Deals
  • opportunities, interesting reads and more

The big three!

#1. Flutterwave shuts down Disha temporarily

Heads up! The Disha link in your bio won’t work anymore starting next month.

The news: Disha, the no-code platform for creatives acquired by Flutterwave in 2021, is temporarily halting its operations. The company cited a need to “reassess its goals and realign its mission to better serve the creative community” as the reason for the pause.

Although Disha insists that the closure is temporal, it said, “There is currently no specific…date in sight” for the reopening. “We find joy in providing you with tools that move your craft forward, and this pause is critical in helping us rethink our focus,” the company said in a statement.

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Why it matters: Over 100,000 creators—including content creators, influencers, artists, writers, and designers—leverage Disha’s tools to manage their online presence.

This shutdown will temporarily limit user access to accounts and stored data. Until the March 31 closure, users have the opportunity to migrate their files and data to alternative platforms. Additionally, existing subscription fees will be refunded.

This marks the second occasion that Disha has sought to halt its operations.

Zoom out: For creators seeking new hosting solutions, alternative platforms like Mainstack, Milkshake, and Linktree offer viable options.


#2. Showmax overtakes Netflix as Africa’s top streaming platform

Start here: After years of dominance by Netflix in the African streaming market, the tables have turned. As of November 2023, the South African-born platform Showmax has dethroned the global giant to claim the top spot, as reported by market research firm Omdia.

Showmax currently commands a 38.7% share of the streaming market in Africa, boasting 2.1 million subscribers. In contrast, Netflix sits at 35% with 1.8 million subscribers. Amazon Prime lags with only a 5.6% market share, accounting for 300,000 subscribers.

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Know more: Industry analysts attribute Showmax’s success to its strategic focus on locally curated content resonating with African audiences. “In the last few years, Showmax has over-indexed on local content and they are clearly seeing the long-term impact of that strategy. It is a volume game, which the global streaming companies don’t fully seem to comprehend. I guess they will understand that now. The mass market prefers [its] own content,” Jason Njoku, co-founder and CEO of iROKOtv told Rest of World.

In 2023, Multichoice, Showmax’s parent company spent half its entertainment budget on local content and exceeded its goal. The company’s library now exceeds 76,000 hours, with production up 9% year-over-year.

Apart from its array of local content, Showmax also has streaming rights to the English Premier League and exclusive licensing rights to HBO’s content. It also shows popular reality shows like The Real Housewives and Big Brother Naija.

Zoom out: Earlier this year, Multichoice said it will invest $89 million into Showmax in the next five years. The platform intends to acquire 50 million subscribers and a revenue of $1 billion during this period.


#3. EFCC drops charges against Nigerian fintech Leatherback

The news: Leatherback, a Nigerian fintech startup says the Economic and Financial Crimes Commission (EFCC) has dropped all allegations of fraud and misconduct against it.

“I am relieved to see the end of this arduous episode, but I am even more delighted to see that myself and Leatherback, as an organisation, have been completely cleared of all wrongdoing,” says Toyeeb Ibrahim Ibitade, CEO of Leatherback.

Rewind: In a now-removed Instagram post, EFCC declared Ibitade wanted on charges of conspiracy and obtaining money by pretences. Responding to the allegations, the CEO stated that he was innocent and Leatherback fully cooperated with the EFCC, providing over 5,000 documents of relevant information. Additionally, Leatherback filed Suspicious Activity Reports (SARs) with authorities in both the UK and Nigeria.

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Toyeeb Ibrahim Ibitade, CEO of Leatherback

At the time, reports emerged suggesting the EFCC’s investigation into Leatherback and its CEO was connected to the operations of SDQ Financials, a merchant on Leatherback’s platform. SDQ had allegedly lured individuals and companies with promises of favourable foreign exchange rates but ultimately failed to fulfil these commitments.

“If a commercial bank in Nigeria issues an account to an individual or a business and that business goes to defraud other people, will you declare the CEO of the commercial bank wanted?” Ibitade questioned and clarified that Leatherback has no direct affiliation with SDQ.

At the moment: Following the dismissal of charges, the cross-border payment company Leatherback, operating in seven countries, announced plans to resume growth acceleration.

Additionally, Leatherback has filed a defamation lawsuit against the EFCC. “There have to be consequences because it almost put a dent in what we are building at Leatherback over the last five years,” Ibitade said.


State of Funding in Africa

In January 2024, African tech startups secured $74 million in funding across 24 deals, with equity accounting for $45.5 million (61.49%) and debt financing contributing $28.5 million (38.51%), according to BD Funding Tracker. Equity funding declined 20% year-over-year.

Except for Sun King and Hatch Africa, whose primary markets within Africa are unclear, Egypt, Kenya, South Africa, and Nigeria remained the continent’s top recipients of VC funding in the tech sector in the month under review.

Meanwhile, here is a breakdown of startups that raised funding last week:

  • Roam, a Kenya-based electric vehicle company secured $24 million in equity and debt. The equity round was led by Equator Africa, and the International Development Finance Corporation provided the debt facility.
  • Nigerian mobility fintech startup, Moove raised $10 million in debt funding from Stride Ventures.
  • Ilara Health, a Kenya-based healthtech startup secured $4.2 million in debt-equity funding: DOB Equity led the $2.5 million equity round, and the debt was provided by Alphamundi, Kiva Capital, and Boehringer Ingelheim.
  • Moroccan logistics startup Logidoo snagged $1.5 million in seed funding, backed by investors like Maroc Numeric Fund II, 216 Capital, Gullit VC, Founders Factory Africa, Sunny Side Venture Partners, and Kalys Ventures.

Noteworthy

Here are other important stories in the media:

  • From eye strain to back pain: Globally, including in Africa, tech workers grapple with health issues stemming from extended periods of sitting. Experts advocate for ergonomic improvements and regular breaks to address these concerns effectively.
  • OpenAI’s new model: OpenAI has launched a new video-generation model called Sora. It can “generate complex scenes with multiple characters, specific types of motion, and accurate details of the subject and background”.
  • Mira by Ted: Ex-Flutterwave design VP, Ted Oladele launched Mira, a company building order management and payment systems for hospitality businesses.

Recommended: A deep dive into Ted’s background and work philosophy

  • A new lead at MasterCard Nigeria/West Africa: Mastercard has appointed Folasade Femi-Lawal as the new Country Manager and Area Business Head for West Africa.
  • Wigwe’s acting successor at Access: Bolaji Agbede, the highest-ranking executive at Access Holdings, was named the acting group CEO of Nigeria’s largest bank on Tuesday following the passing of Herbert Wigwe, its former chief executive, who died in a helicopter crash.
  • Moove-ing in India: Barely a year after expanding into India, Moove, a Nigerian mobility startup has secured $10 million to expand its vehicle financing offering to more cities.

Opportunities

Jobs

We carefully curate open opportunities in Product & Design, Data & Engineering, and Admin & Growth every week.

Product & Design

Data & Engineering

Admin & Growth

Other opportunities

  • For African entreprenuers: Applications for the Tony Elumelu Entrepreneurship Foundation Program are open until March 1, 2024. Learn how to apply for your startup today.
  • Get backed by Y Combinator: Applications for the YC Summer 2024 batch are open now and the early deadline to apply for the batch is February 21. Apply here.

Have a great week!

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