🚗💨 Bolt's €500 million Africa ride
When the gig economy meets mass unemployment
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- Bolt's €500 million swing in Africa
- Deal Roundup
- Events and Opportunities
- Tech Twitter
Lets get this tour started 🦍
This week Bolt pledged to invest €500 million into Africa - taking a big swing in Africa’s mobility space.
For those who aren’t acquainted, Bolt is one of the world’s biggest ride-sharing companies.
We’ve talked about Bolt on Tech Safari before - specifically their launch of a Ride Now Pay Later service with CredPal (which we were skeptical about).
Starting in Estonia as Taxify, Bolt is now in 45 countries.
But instead of starting in Europe and expanding to the US, Bolt skipped a US expansion all together - launching in Africa instead.
CEO Markus Villig commented:
‘The growth opportunity for us as a company is much bigger in Africa, than what it would be in a developed country where everybody has cars and public transport is available.'
Bolt has been honing in on Africa - building a company tailored to the continent - with cheaper rides and easier driver onboarding.
And while Bolt sees the growth opportunity in Africa, Africa has a growth opportunity in Bolt.
The gig economy meets mass unemployment
Africa has a population of 420 million people between 18-35 - and the highest rate of unemployment globally.
Stats from African Development Bank show us that from these 420 million young people:
- 15% of Africa’s young population are in waged employment.
- 31% work informally. This could look like running a market stall, or working in ‘gig work’ - like driving a Bolt. These workers are seen to be ‘economically vulnerable,’ and may live day to day.
- 19% are inactive - meaning they are not seeking work or are unable to work.
- The remaining 35% are unemployed.
The same research shows that while 10-12 million youth enter Africa’s workforce each year, only 3 million jobs are created annually.
On a continent with little to no social protection, Africa’s youth have no choice but to find work.
And unemployment in Africa doesn’t just hurt job seekers, it hurts stability.
Historically, we see how low employment rates next to higher prices of living can be the catalyst for large-scale political instability and conflict.
That’s where the ‘gig economy’ comes in.
Platforms like Uber, Bolt and Glovo let you start working easily - all you need to get started is a car.
And while gig work is another form of informal work, for many gig workers it’s a means to an end.
Only 40% of delivery workers and drivers across Africa see themselves staying in their jobs for the next year. Most want to move onto their next career or business.
The gig economy can have a significant role in addressing large-scale unemployment in Africa.
And that’s why Bolt’s commitment to Africa is exciting.
Since Bolt launched in Africa, they have grown to become one of Africa’s most important ride-hailing companies.
By 2022, they reported over 700,000 drivers in 90 cities across Africa - and they aim to onboard another 300,000 drivers this year.
But Bolt hit a roadbump..
This week Bolt also laid off 17 of 70 employees in Nigeria.
In a confusing, seemingly contradictory move, the company claimed that it was necessary to restructure Nigerian operations.
Damilare at Tech Cabal reports that these cuts were a surprise to the team.
The news makes it a bit unclear about what Bolt actually has in the pipeline.
And while Bolt has committed to investing in Africa, market realities might mean otherwise.
It has been a hard time for African growth stage companies - as we saw this week with Jumia and Chipper Cash announcing layoffs.
But I'm hoping that Bolt can stay firm with its commitment to the continent.
What do you think? Let me know here.
- Workpay, a Kenyan HR payroll startup that offers time tracking, payroll management and remote teams payroll solutions has raised $2.7 million in a Pre-Series A round from Launch Africa, Saviu Ventures and many others.
- Qotto, the cleantech Franco/West African startup that provides solar home systems has raised $8 million in a Series A round led by IBL Group, Off-Grid Energy Access Fund and others.
- Clinify, the Nigerian/ Canadian healthtech startup that digitises and centralises medical records has raised $1.5 million in a seed round from Thin Air Labs, Halo Health and Calgary doctors.
- Treepz, a Nigerian ride-hailing startup that allows users to rent buses, SUVs and trucks have raised $1.2 million in an undisclosed round from GIIG Africa Fund, Mo Angels and many more.
- Right Now Response(RNR), a South African startup that mobilised a network of nationwide suppliers to service truck fleets has raised $555K in an undisclosed round led by HAVAIC.
- Jumba, a Kenyan marketplace for construction materials has raised $4.5 million in a seed round led by LocalGlobe.
Events + Opportunities
- Applications are open for the Included VC 2023 Global Fellowship. Aspiring venture capitalists from diverse, overlooked communities get to gain exclusive access, education and mentorship from the best VCs across the globe.
- Africa to the World! We will be discussing opportunities for Africans globally through technology, featuring Olusola Amusan (Co-Founder of Vesti) on Friday 3 March. Sign up here
- Applications are open for the Mastercard Foundation Edtech Fellowship Program in Nigeria. Empowering edtech startups who are building tools that enhance learning outcomes. Application deadline on 17th March 2023.
The Silicon Valley approach to VC funding ("growth at all costs") isn't always feasible for Africa-based startups.
Prioritizing profitability/revenue to fund future growth is often required.
Let's briefly explore why:
— Marge Ntambi (@margentambi)
Feb 24, 2023
Great thread by a great writer, Marge Ntambi!
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