TECH | STARTUPS
I’d start this second article by appreciating everyone that provided feedback on the first article. Feedbacks are a critical aspect of any system and yours is not without relevance. Do leave feedback when you’re done reading this one. If you didn’t read the first article, you should check it out before diving into this. It provides a good background and you get to know who really owns Abeg Technologies 😉 Read it here.
❗ ❗ WARNING: This is a long read. I’d recommend you get yourself in a comfortable position, it’s time to engage your mind.
REENTER THE CASH APP FOR AFRICA
I always found the Abeg logo interesting and creative. You don’t need too much thought to know the company is doing something money-related. I did get to hear the name “Cash App for Africa” and tried to find out who the Cash app is. Well, some similarities in their logos and features paint it as a cash app clone or better put; the cash App for Africa. But, the two products are hugely differentiated.
The Xyz for Africa has remained the name tag for several Nigerian companies. For example;
- Termii; the Twilio for Africa
- Chaka; the Robinhood for Africa
- Jumia; the Amazon for Africa
- Paystack; the Stripe for Africa
Calling these companies, the Xyz of Nigeria or Africa is mostly by media and rarely by the company themself although the idea for Abeg came from a tweet by Osaretin Asemota on a company building a cash app-like app in Nigeria.
Jonathan Klein of Jumia made an important statement at Future Africa’s event; “A 10-year view of Entrepreneurship in Africa” which I attended. TechCabal wrote on all that Jonathan shared at the event which you can find here. In his words:
“We never called ourselves the Amazon of Africa. We call ourselves Jumia”
This is relevant because these tags place many unrealistic expectations on these companies. The markets they operate are different regardless of the similarities in the products they offer. While many have used it as a selling point to pitch their startups, I don’t think it’s a good idea. We can do better than just localizing services offered elsewhere. It flops many times. QR codes are a testament to that.
We obviously can’t wait until these companies come to Nigeria before our people can access these products and services nor can we sit back and wait until these platforms are developed outside and then clone them. Local problems require local innovators with local solutions.
Now, is Abeg solving any of our problems?
It is not a Yes-No question. In fact, it is one of those questions that just require broad explanations than direct answers. Abeg like many Fintechs is expanding the number of options for Nigerians. As we have multiple detergents in the market, giving you varieties to choose from, these apps provide a diverse range of options for us to choose from regarding financial services. In the same way, a detergent is a product, an app is a product. In this case, a digital product. So next time you hear “Product Designer/Manager” and you’re wondering what they’re doing in Tech, you should have an idea of what they do.
Variety is the spice of life and it forces existing companies to innovate. Traditional banks are beginning to explore new products and services.
Habari, GTPay and NdaniTv from GTB, Ecobank’s Ecopay, Unity Bank’s Unifi, Wema’s Alat, Imperium and Specta from Sterling are some of their attempts
Some banks have restructured into holding companies to offer services that banks are not permitted to offer. This is proof that they’re not willing to be left out in the race for leveraging Technology to power financial services. A winner will emerge in the coming years 🥇🏆
Also important to mention is the ambiguity of the word problem with regard to startups. I didn’t think I had a problem receiving payments online across the world until I was asked for a PayPal or Stripe account by BuyMeACoffee. I have neither and I now have a question which I’m hoping someone reading will have an answer to;
Shouldn’t the Paystack acquisition by Stripe make a Paystack account the sorta default Stripe account for those of us in countries where Paystack already exists?
Is it already in the works?
Any leads will be appreciated 🙏🏾
In the end, I’ve moved from questioning whether or not a Startup is solving a problem to looking at the relevance of their product or service i.e., the value offered. Honestly, many startups aren’t solving our “problems”. They’re taking tiny pain points and building products around them. Public transportation had always been available, along with discomforts. Many didn’t see the “problems” until Bolt and Uber came around. I would argue that we don’t usually realize there’s a problem until a startup does something about it. No thanks to our ability as humans to adapt 🙄
Now, next time someone asks questions about whether or not Abeg, Eden, GetEquity, Sturrd, Selar or any startup is solving a problem, you should know how to frame your answer. I’ve cut soap for you 😉
ASSESSING THE ABEG APP
Play store. That’s the name of the largest App store. Just like you walk into the Balogun market and see several physical products, app stores are the marketplace we walk into and see digital products. Specifically, mobile apps. Playstore is the leading app marketplace by the number of available apps and it is strictly for Android apps. If you didn’t know, Android is the world’s leading Smartphone OS by the number of installed devices, controlling over 80% of the global market share according to Statista. However, the percentage skews on a per-country basis.
Nigeria is clearly an Android market and as Abeg is a Nigeria-only app currently, the first and best place to source for app reviews is the Playstore.
App Downloads
The number of Downloads stands at 500k+. As someone that has downloaded and uninstalled plenty of apps in a bid to try them out, it is not a great metric. The number of active devices which would be available to the company via the developer console is a much more relevant metric. Comparing the number of downloads with the number of devices where the app is active (installed) might point to user retention. As I don’t have the latter, it would be unfair to say most users uninstall after trying it out like myself and hilarious to say 500k+ is their number of users.
Rate this App
Nigerians don’t rate or review apps. I’m not sure of how global this problem is but looking at Nigeria-only apps is an easy way to make this assertion. It’s a habit that I also engage in but I’m trying my best to change 😌 As of 2:30 pm on 27th August 2021, only 2,213 users rated the app. Assuming that exactly 500,000 persons have downloaded the app, this means that only 0.44% of persons rated the app. Not even near 1%! This is disastrous for many reasons.
For starters, it means drawing conclusions based on the current rating which stands at 3.1 out of 5 (as of 27th August 2021) will be statistically incorrect. In fact, the number is annoyingly insignificant. As a data advocate, I can’t make any deductions from the play store rating.
In God we trust, all others must bring data.
This is not data! 😭😭
Technically, it is. But for any proper analysis, it’s too small 😪 Imagine an additional 100k persons give the app a 1-star or 5-star rating, it will tilt that 3.1 significantly towards either extreme.
It also means we cannot for sure ascertain what the market sentiment towards the app is. Are people using the app and living with the bugs like Nigerians “adapt to problems”? Are they telling themselves, “They just started and it’s okay for the app to have problems” and similar things? Do people see the app as a reasonable alternative to existing apps? It’s rated as #1 top free in Finance in the store but is that how users feel about the app?
App store ratings come in two ways; giving the app a star between 1 and 5 and the option to “write a review”. I decided to read every written review as well as the responses by Abeg Technologies (Don’t try it, it’s not a good idea 🤕). I must commend their responses though, different responses for different complaints. To say it was hard to do will be to lie, I almost gave up.
The most prominent issues based on the reviews are BVN, OTP, deposits and withdrawals related. Other repeatedly mentioned issues are the minimum withdrawal limit of ₦2000, push notifications turning off automatically, profile/avatar issues, the app saying there is no network/internet connection (I still find this one strange), and a funny one; a limited number of giveaway participants.
A Peek into the Apple Store
Checking the Apple store, only 215 ratings were submitted but the Apple store doesn’t show the total number of downloads🤦🏾♂️ We’d revisit this behaviour of not rating apps another day. But there’s something striking about the rating score there; 3.4. The iOS users clearly share the same sentiments as their Android brethren. There are waaaay fewer reviews there and the complaints are the same as those on the PlayStore.
The data, though small still reflects some level of market sentiment when both app stores are considered. Didn’t see that coming eh 😏 There’s clearly prominence at the two extremes; 1-star and 5-star ratings. It’s still not good enough to make conclusions. I read good reviews from people that gave the app a 1-star rating and vice versa. These things make the use of ratings as a metric to assess apps somewhat inaccurate. But how many of us have the time to use apps for ourselves? It’s easier to just read reviews and make a decision.
From the challenges mentioned by those who left reviews, you can ascertain the problems you’d likely face if you do encounter any problems. Again, all figures referenced here are from August 27, 2021.
We’re not done 😁 If you’ve read this far, don’t give up now, the end is so close.
GIVEAWAY-AS-A-SERVICE (GaaS)
As I mentioned in the first article, most users first heard of the app on Twitter and it quickly became the preferred platform for giveaways. Adekoya, the company’s CEO called Giveaways its “beachhead market” in an interview with TechPoint.
“We believe it’s the right hook to get the first set of users and early adopters onto the platform”
I stumbled on Taslim Okunola’s Angle by Taslim newsletter via LinkedIn and saw he had written on the Abeg app. He mentioned something that I found very interesting; GaaS. You can read his two-part submission on the Abeg app here and here.
Most users got on the platform because of giveaways and it has done a better job at user acquisition than the “fun”, “free”, and “easy” mantras that have been used over and over by Fintechs including Abeg. The potential that giveaways have as a business is yet to be explored. Although it wasn’t the reason the platform was built in the first place, Abeg holds the power to be the market leader as the first entrant. The company has leveraged it and is angling at expanding and growing other in-app offerings.
In the second submission, Taslim tries to make a case for giveaways as a business model that can be explored. Recall that I mentioned that financial services can be drilled into further in the first article.
However, he moves away from the common idea of giveaways and gravitates towards “giving”. You should give it a read.
“In this sense, let’s think about a giveaway engine — a product that provides the ability for other businesses to integrate it and execute their “giveaway” needs”
Businesses pay salaries, NGOs receive donations, and many persons give cash gifts; this is the giving Taslim tries to make a case for and I don’t disagree. If Abeg decides to become the quick, easy place to give, it has no business joining other Fintechs to haggle for users by providing airtime purchases and cable tv subscriptions or crypto.
Most of us are tired of these repeated features. Buy airtime, pay for Dstv and electricity, transfer money and stuff. Guy, bank apps do all these too so how is that a selling point?! Fintechs need to up their game, they’re becoming less and less attractive. Most people just open accounts to get the 1k, or 2k they’re giving for free to the first set of users and it’s bye-bye afterwards.
Investors need to stop funding companies repeating these already existing services. YES! It’s that serious 😂😂😂 Discourage this pay bills, transfer money without charges, buy airtime craze! Playstore is littered with these apps. If it’s possible to count unique BVNs across these platforms, it’s mostly the same set of people that have accounts with these apps. This clearly questions the existence of Fintech as a financial inclusion engine. It becomes very difficult to manage your finances when money is scattered across multiple apps.
And no, building an app that manages all your many accounts in one place isn’t so fantastic. I’ve personally started emptying these accounts and moving my money back to one(maybe two) place(s). Once I empty it, I remove the app. I’m too young for headaches. Besides, how much do I have gan that I’ll be scattering it upandawn 😅
Back to Abeg app. Pardon the mini-rant, it’s what many of us are tired of dealing with. I’d give a single case for GaaS and its potential. I hope I haven’t lost you 🥺
THE CASE: Most churches have multiple accounts for various activities they engage in. Building funds, Seed offering, Thanksgiving, Missions ati bee bee lo. This means that for each of these, there’s a separate bank account and you need the account number. For every new activity, there’s a new bank account created. You might be familiar with churches reading account numbers at gatherings or displaying them on screens for people to note down.
ENTER Abeg-GaaS: A church has an Abeg account and the Abeg tag is the church name. Such accounts should be verified to avoid stories that touch (Some Abeg users already have verified accounts like Twitter). I intend to give towards missions at ABChurch. I search them on the app in the explore tab using their tag and a list of options to give to is available on their page. I select what I intend to give to and enter the amount; in this case, missions. And I’m done. The church only needs to share its tag for people to give towards all their activities. If ABChurch needs funds for a new project, say a community hospital, GaaS steps in. Instead of creating a new account with a bank named special projects or something of the sort, an additional option is listed on the app. Imagine the ease that will bring!
This must not be confused with fundraising that is already available on the app. It does fall within the “giving” basket but it is not the same thing.
Businesses have headaches with processing salaries payment and this giving can be simplified by the app. Fintechs have long avoided the original owners of the money in the traditional banks; corporate clients. Businesses, organizations and corporations. The Fintech company that will absorb a fraction of corporate clients will have no business spending big on marketing, advertising or even social media. Your clients just need a rep they can speak to at any time.
Add a sprinkle of charges here and there and revenue flows steadily.
Possibly someone else will do it. Maybe you will😉 but really, it’s worth exploring. And no, you’re not “stealing my idea” 😂😂😂 it’s Taslim’s. But I don’t think he’ll mind 👀 Don’t build nonsense sha, I’d yabb it with joy.
IS BBNAIJA WORTH IT?
You’ve possibly been wondering when we’d get to this considering the previous article ended with questions about Abeg’s BBNaija sponsorship. If you’re active on Twitter, you possibly got to see tons of “takes” on the smartness or craziness of the move by the startup. It’s always interesting to watch these things from the sidelines as I do. No comments, no tweets, just a sprinkle of likes here and there 😅
It’s been over a month since the current season of BBNaija started. All the noise on Twitter around Abeg’s sponsorship has vanished. What better time to write about it 😋 I’ve always believed that the best time to form accurate views and accept opposing views on a subject isn’t the moment it’s trending or popular. There are more emotions than logic at play even from the most logical. Now, you’re less likely to insult me if you disagree with my stance today than when the sponsorship was trending. Leggo!
A BIG RISKY BUSINESS
Big Brother is a Dutch tv franchise that first aired in 1999 and is currently held in over 60 countries and regions. Big Brother Naija (BBNaija) first hit the Nigerian airwaves in 2006 as Big Brother Nigeria but the show went off for eleven years, returning in 2017.
So far, there have been four headline sponsors for the show since 2017 with Payporte being the only company holding the spot twice in the first two editions, Bet9ja and Betway holding the spot in 2019 and 2020 respectively. Abeg takes the spot in 2021 with Patricia as an associate sponsor.
I call the show a risky business because viewership is largely reliant on the housemates. If they are unable to gather sufficient attention from viewers then the sponsor doesn’t get enough value from the sponsorship. Tons of companies and brands have sponsored alongside the headline sponsors including Oppo, Pepsi, Nokia, Flutterwave, Heritage Bank, Airtel, Johnnie Walker, Minimie, Kuda, and Dano Milk.
USER ACQUISITION vs USER RETENTION
Marketing of all kinds is to get the word out about your product or service and chances are, one or two persons would try out what you offer. User acquisition is just a fancy way to talk about marketing. Ads in apps or websites, tv commercials, billboards, and roadshows are all attempts by businesses to gain new customers, users or clients (depending on the industry usage).
User acquisition is the act of gaining new users for an app, platform, or other services -adjust.com
BBNaija is clearly a user acquisition (UA) move by Abeg Technologies. The show boasts around 400 million viewers. That is no small feat! However, Abeg is only operational in Nigeria with an estimated population of 200 million people. Only a fraction of that number has a cable tv subscription or a smartphone. Only a fraction has a BVN which is the only means of creating an account on the platform. Besides, no company can boast of servicing all Nigerians.
Why attempt UA via BBNaija when the app doesn’t work outside Nigeria yet knowing it’s not only Nigerians that watch the show? One way to look at it is to consider Clubhouse. Clubhouse started out as an iOS-only platform creating an air of exclusivity. But Clubhouse flopped. It rode on its exclusivity and the pandemic to rise to fame. But for how long? It took too long to roll out on Android. I’m sure some Android users didn’t realize the app is now available. Twitter’s spaces have become a preferred alternative.
This concerns Abeg because they have gained popularity across their primary market, i.e. Nigeria. Some reviews on the play store were complaints from people who said they were in other countries and wanted to use the app but couldn’t. This means that entry into other markets where BBNaija airs and is popular shouldn’t be difficult. This is one way to look at it.
Or, we could have another clubhouse story where they enter a market where there were demands for their app during BBNaija and there’s no interest since the show that made them popular is passed. Then we’d be left with the question, is BBNaija headline sponsorship worth it to just acquire Nigerian users?
While UA is great, the real deal is User Retention(UR). Now I’ve installed your app, then what? Why should I stay? Since many have flocked to the Abeg app owing to its evidently powerful UA strategy with BBNaija, retention becomes a matter for discussion.
Playstore reviews made one thing clear, Abeg wasn’t ready for the huge influx of users. This would’ve been excusable when they first “blew” in 2020. The numbers were clearly unexpected. But now, after they spent hundreds of millions in naira to win the spot as headline sponsor of the BBNaija show? It can’t be excused. It questions their product strategy and the competence of the Abeg team and their parent company; Piggyvest.
When you’re a sponsor for BBNaija, the plan clearly is to grow your user base, no doubt. Being the headline sponsor is a move to solidify your chances. Even if the app is one that only creates picture filters, there would have been a huge number of downloads once they’re unveiled as the headline sponsor and the show starts. So, what exactly is going on? Here’s a tweet less than a week into the show that first made me raise an eyebrow:
LinkedIn currently lists less than ten employees at Abeg. The amount of complaints and issues to address is too much for a team that small in my opinion. If they could afford to spend so much on UA, why not spend on growing the team to better the product? BBNaija can only get users, it can’t keep them. If an app that is supposed to be for payments, has payments (deposits and withdrawals) as one of the most mentioned complaints on the play store; it clearly hasn’t lived up to expectations.
Headline sponsorship was a bad move for the company. Not because the money is huge but because their product clearly isn’t ready for that amount of publicity and the accompanying demand. I’m sure their DMs and mailbox must be full. Funny enough, other companies are still getting to sponsor the show without being the headline sponsor. Abeg should’ve done that instead.
Product over everything!
If the marketing and publicity are good, it’ll bring users for sure. Will it keep them? No. Fix the product first. That’s the only thing that keeps people. The value offered by the app is yet to be seen by most so a functional app wasn’t to be compromised.
In the end….
Abeg can still redeem itself. The BBNaija show is yet to end. They can still make the most of their sponsorship. But they must improve the app and address challenges that do not emanate from them but from payment processors, network providers and other platforms they’re leveraging or working with that are hampering user experience.
The company ought to clearly address the BVN isshh via any of its communication media. It’s the most common problem in Playstore reviews. Many Nigerians have misplaced the phone numbers linked to their BVN. I didn’t think it was very common until I read the reviews. Since you can’t use the app without a BVN, it bars users that don’t have one. Taking selfies with a means of identification sent via email is a process I won’t embark on if I were in those shoes. Looks too stressful just to use an app.
I certainly don’t want the company to go down. It’ll hit a heavy blow to young people trying to build companies of their own. I just hope others learn the lesson Abeg has taught; marketing will bring people, and the value offered/product will keep them.
You read till the end and I must say, you’ve done well 👏🏾
Do clap and share your thoughts, I’d like to know what you think.
Wear a mask 😷
Get vaccinated! 💉
