AI & African Enterprises: January 2023 Newsletter

Originally published January 30, 2023

〽️ Growth in the Face of Uncertainty

The part alternation mark (the title emoji), indicates a moment of "beginning" in a song in Japanese music. And so we begin the year as markets weigh the potential for recession; the sense of uncertainty is palpable.

The decade following the 2008 financial crisis saw private market fundraising rise to all time highs. This mirrored increasing dependency of early stage tech on venture capital, intensifying the focus on growing valuations over establishing paths to profitability. Funding models that centred profitability, like US-based indie.vc, struggled when liquidity was cheap and optimism seemingly uncapped. Word on the twitter streets is that Indie VC may make a comeback, in response to a market environment that may favour profitability if funding becomes challenging.

African tech has mirrored broader market trends, with increased focus on fundraising over profitability. 2022 saw African tech raise $4.8b of venture capital, with fintech (largely payments) startups attracting the majority of funding.

Takeaway: 2023 will prove key in testing the reslience of African tech to a potential slowdown in fundraising and the sustainability of underlying business models

In this edition we consider the

• Implications of KaiOS' latest funding round

• BioNTech's acquisition of Tunisia-founded InstaDeep, and

• The latest developments in data privacy and 5G

We look forward to keeping you informed of the products, deals and partnerships shaping the future of AI in Africa on the last Monday of every month.

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—Team ajala

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