Due to the impacts of the economic crisis, 2022 was a different year for the African tech sector. The year was rife with tales of success, setbacks, and advancement. Here is a list of 22 firsts that occurred this year in the African tech industry.
Kenya was the first nation in Africa to introduce computer science as a topic in the classroom.
Former Kenyan president Uhuru Kenyatta said in August that computer programming would henceforth be taught in the country’s primary and secondary schools.
Because it encourages experimentation and provides kids the self-assurance to be creative, this announcement was highly received. It’s also considered as a step toward ensuring that Kenya maintains its status as one of the continent’s epicenters for digital innovation.
An announcement concerning teaching robots and coding in schools was made earlier this year by the South African Department of Education.
1. Nigeria and DRC Congo Now Have Startup Acts
Regulation is viewed as a crucial instrument in Africa for fostering innovation. This has sparked a need for supporting startup acts that would regulate the tech economy. A startup act provides a nation with the legal and institutional foundation needed to advance startups. It aids in fostering a climate in a nation that promotes the emergence, expansion, and operation of startups.
Following Tunisia’s historic law that was approved in April 2018, Senegal became the second African country to establish a national startup act in December 2019. Nigeria and the DRC joined the list of African nations with startup acts this year.
Over 10 African countries, including Kenya, Rwanda, Ghana, and Ethiopia, are still in the process of drafting their startup bills.
2. Massive Wave of Layoffs
Employees of African startups were not immune from layoffs this year, which are a regular occurrence during an economic slump.
Data from layoffs.fyi, a crowdsourced database of tech layoffs, reveals that since the start of COVID-19, 1,495 tech companies have fired 246,267 employees. Over 50,000 of these layoffs occurred in 2022, and at least 1,000 of them affected tech professionals in Africa.
Swvl, an Egyptian mobility startup, fired roughly 400 workers in May to kick off the layoffs. Many other startups, including Twiga Foods, Quidax, Vendease, 54 Gene, and Sendy, also undertook a similar practice and attributed it to the recession.
3.Nigerian Fintech Companies Battled With Fraud Allegations in Kenya
In particular, the Central Bank of Kenya and its Asset Recovery Agency (ARA) were looking into charges of card fraud and international money laundering against Nigerian businesses.
The following companies and individuals were charged with money laundering: Flutterwave Payment Technology Limited, Boxtrip Travel and Tours Limited, Bagtrip Travel Limited, Elivalat Fintech Limited, Adguru Technology Limited, Hupesi Solutions, Cruz Ride Auto Limited, Korapay, and a certain Simon Ngige.
Many of these fintech firms, including Flutterwave, Kora Pay, and Kandon, have been exonerated of these claims of fraud.
4.Over $4 Billion Raised in Venture Capital Funding
The actual amount that African entrepreneurs raised in 2022 is still up for debate, but all signs point to it being close to what they raised the previous year. According to the Big Deal, about $4 billion has been raised so far in 2022.
There were a few noteworthy investment deals done this year even though no unicorns were minted. Wasoko (formerly Sokowatch) closed a $125 million Series B at a $625 million valuation; Algerian Yassir raised $150 million Series B; Nigerian Fintech TeamApt raised $50 million; and Congo-based crypto startup Jambo raised a total of $37.5 million this year. Ramani, a Tanzanian startup, raised $32 million in Series A funding, the largest Series A ever from the country.
5.African Companies Embraced the Metaverse
The Metaverse has gained enormous popularity over the past year, and numerous businesses have entered the market by filing patents or conducting tests.
Africa’s largest telco, MTN, made history by being the first African firm to purchase 144 parcels of virtual land in the Africarare metaverse Ubuntuland in February following its relaunch. Later on in the year, South African retailers Game and Nedbank did the same.
6.Global Tech Companies Setup African Offices
Physical presence is a powerful indicator of a company’s dedication to a nation. Several multinational tech businesses opened their first headquarters in Africa this year.
Microsoft inaugurated a brand-new African Development Center in Ikoyi, Lagos, in March. The multi-billion dollar company invested $100 million in the center, where it expects to offer software engineering solutions to Africa.
Google announced the opening of its first development center in Africa in Nairobi in April. The center is anticipated to assist in developing products and services that would alter lives in Africa.
7.Techstars Accelerator Programme Returned to Africa After Five Years
The ARM Labs Lagos Techstars Accelerator Programme was introduced by Techstars in April with the goal of assisting fintech and proptech businesses with products that cater to African consumers.
The announcement marked the end of a five-year absence from Africa for the accelerator with more than $500 million in assets under management (AUM). In the past, from 2016 to 2017, Techstars sponsored an accelerator program in South Africa in collaboration with Barclays Bank. During that time, they invested in 21 firms, of which three were bought, five failed, and 13 are still operating today.
8.Swvl Became the First African Company to Get Listed via SPAC
The mobility business Swvl, which was founded in Egypt and has its headquarters in Dubai, merged with Queen’s Gambit Growth Capital in April at a valuation of $1.5 billion, making it the first startup in Africa to go public through a special purpose acquisition company (SPAC).
However, after being listed, Swvl’s valuation has plummeted, and the business is currently only worth around $40 million.
9.The Race for African Data Centres and Cloud Continues
The largest database management firm in the world, Oracle, launched its first cloud region (a collection of data centres) in Africa at the beginning of the year. Later in the year, other international cloud and database service providers followed suit.
Google announced in October that South Africa would become the first African Google Cloud region. Five years after opening its first office in Johannesburg in 2017, Amazon Web Services (AWS) inaugurated its first location in Lagos, Nigeria, in November. Liquid Intelligent Technologies expanded to Zambia in August before beginning operations there formally in December.
10.Amazon Prime Video Became More Pronounced in Nigeria
In the previous several years, Amazon’s Prime Video strategically increased the selection of Nigerian content it offered; however, this year, the company pushed its marketing efforts even harder and gave Nigerians the option of paying for the service with their own currency, the naira. Prior to now, Nigerians were unable to watch Prime Video because many of them used VPNs.
The business signed a multi-year exclusive licensing agreement in January with Anthill Studios, the Lagos-based production house behind a few well-liked films, including Elevator Baby and Day of Destiny. It completed a comparable agreement with Inkblot Studios, the company behind the commercially successful The Wedding Party movies, a year ago.
11.Vodacom Pulled the Plug on its Video Streaming Service
There were some exits as a result of new players joining the African VOD scene. Vodacom’s August 2015 introduction of the video streaming service Video Play ended in July 2022.
The services, which were just made free, have had over 1 million downloads from the Google Play Store alone. In addition to gaining the license to broadcast Metro-Goldwyn-Mayer (MGM) material in 2020, the firm had already obtained the right to live stream the English FA Cup in 2019.
12.Google’s Africa Internet Cable Arrives in Africa
In 2022, Equiano, a subsea internet cable connecting South Africa to Portugal, reached Africa. The cable passes across South Africa, Namibia, Togo, and Nigeria. It is anticipated to start operating this month.
A major step has been taken with this project toward Google’s goal of lowering connectivity costs and bringing faster internet to more people in Africa by constructing global infrastructure.
The project, which bears the name of the abolitionist and writer Olaudah Equiano, who was born in Nigeria, is anticipated to support further digital transformation on the continent and speed up economic growth, with GDP increases of $10.1 billion in Nigeria, $7 billion in South Africa, and $260 million in Namibia anticipated.
13.Meta-backed 2Africa Subsea Cable Internet Lands in Africa
2Africa Pearls, the largest underwater internet cable in the world at 45,000 km, will connect 33 places at 46 locations in Africa, Europe, and Asia once it is finished. The cable arrived in Cape Town in December. The 2Africa project seeks to improve internet accessibility for Africans.
The 2Africa initiative, developed in partnership with MTN, Orange, Vodafone, and China Mobile, will be introduced by Meta in May 2020. In contrast to Equiano, the 2Africa cable will eventually encircle the whole continent of Africa, with the launch of the system’s initial component planned for 2019.
14.Meta Quietly Shuts Down its Low-Cost Internet Programme Across Africa
Express Wi-Fi, a program created to offer inexpensive internet in developing nations through collaborations with local communities, mobile operators, and companies, was shut down by Meta after more than five years of operation. In nations like Nigeria, the Democratic Republic of the Congo, Kenya, Côte d’Ivoire, Zambia, Cameroon, Ghana, Zimbabwe, Madagascar, South Africa, and Uganda, the Express Wi-Fi service was in use.
15.Workplace Culture Issues and Scandals
A thriving African tech economy was rocked by scandals in 2022 in addition to layoffs and the economic slump. Several CEOs of Internet startups were accused of misbehavior this year.
The alleged toxic behavior of Ebunoluwa Okunbanjo, CEO of Bento Africa, was made public in March 2022 as a result of numerous interviews with previous and present workers. The board of directors requested that Okunbanjo leave the company for a few months in light of these revelations. Later, he took over again as CEO of the business.
16.A Wave of Acquisitions
This year, there have been more acquisition transactions across the continent. TechCabal monitored 26 acquisitions in the first half of 2022; in contrast, in Q3 2022, we monitored 17. Some of these purchases include:
Accra-based GreenLion was acquired by B2B marketplace TradeDepot; South African meal kit delivery business Ucook was purchased by Silvertree for $12.3 million; Global Technology Partners was purchased by MFS Africa for $34 million; Israeli Telrad was acquired by Liquid Intelligent Technologies; Egyptian Tactful AI was purchased by Belgian Dstyn’s; Kenyan Lynk was acquired by Nigerian home concierge startup Eden Life; West African solar energy provider Peg was acquired by UK-based power company Bboxx; Moroccan B2B e-commerce startup Chari was acquired by Ivorian B2B e-commerce startup Diago; and mPharma.
17.Zanzibar Launched Silicon Zanzibar
Through the Silicon Zanzibar project, the East African semi-autonomous island of Zanzibar set out to become Africa’s premier digital centre.
Silicon Zanzibar, an initiative led by the Zanzibar Ministry of Investment and Economic Development in collaboration with a number of African digital companies, intends to draw tech companies and employees from all across Africa and beyond. Zanzibar is offering work visas for moving tech professionals to entice tech businesses, a practice that has been troublesome in developed markets like Nigeria, Kenya, Egypt, and South Africa.
Corporate tax is exempt for 10 years in the Zanzibar Free Economic Zone, among other benefits.
18. MTN Exits the Middle East
As it continues to scale back its operations outside of the continent, MTN Group, the largest wireless provider in Africa, revealed in November that it had sold its Afghanistan operations to M1 New Ventures, a company located in Beirut, for $35 million.
This action is consistent with MTN’s strategy goal of concentrating on its own continent beginning 2020. Prior to this, the company sold its Yemeni division to a partner and gave up on its Syrian operation. In Iran, MTN is still present.
19. A South African Was Charged in the Largest Fraud Scheme Involving Bitcoin
In July, 2022, the U.S Commodities Futures Trading Commission (CFTC) charged South African resident Cornelius Johannes Steynberg in a bitcoin fraud scheme case totalling $1.7 billion. Sternberg was recently detained in Brazil on an Interpol arrest warrant.
20. 5G is Here to Stay, With more African Countries Getting Access to This Technology
For long 5G has been touted to revolutionise the connectivity space; some analysts predict that 5G will add an additional $2.2 trillion to Africa’s economy by 2034. This has led many African countries to begin trials with Gabon starting as early as 2019, but few have commercially launched 5G. This can be largely attributed to challenges around spectrum regulation clarity, commercial viability, and deployment deadlines.
