Zanzibar, famed for its world-class tourism offerings, is getting ready for new tenants as startups seek success in the semi-autonomous island’s nascent tech space.
In August, the archipelago signed up Kenya’s e-commerce firm Wasoko as Silicon Zanzibar’s anchor tenant setting the stage for new entrants into that market.
And just recently, Pando DAO, a community of top tech founders in Africa partnered with Silicon Zanzibar to help turn the island into a hub for tech talent and companies.
Panda DAO’s 70 founders, representing 49 firms from across Africa, could help propel the Indian Ocean archipelago into a vibrant tech melting pot. Firms include mPharma, Pariti, Africa Health Holdings, Stitch, Marketforce, 54Gene, Mara, VertoFX, Turaco, Raise, Carry1st and Jetstream, Wasoko and others.
The founders’ start-ups are currently valued at more than $2 billion and have together raised over $500 million in capital.
Panda DOA will work with the island’s authorities to open operations and create a policy framework to support innovation and the digital economy in Zanzibar.
The entry of Wasoko – ranked in May as Africa’s fastest-growing company by the Financial Times – is a major vote for Zanzibar’s public-private initiative to attract tech firms.
Now valued at $625 million after closing a $125 million Series B round in March, Wasako grew its revenues from $300,000 in 2017 to $27.4 million in 2020, while its staff increased from 57 to 372 over the same period.
Ramani, a Fintech disruptor building infrastructure to enable commerce in Africa has also been listed on Silicon Zanzibar.
It offers mobile and web applications, where Africa’s micro-distributors can gain quick and easy access to SME financing and integrates brands to provide resellers with 30-day terms on inventory.
Tushop, a Nairobi-based social-commerce platform that enables the group buying of fast-moving consumer goods (FMCGs) has also set up camp in Zanzibar.
In March it hauled in $3 million in pre-seed funding, in a round led by 4DX Ventures to expand services in Nairobi.
In its latest analysis, startup tracker, Africa: The Big Deal says that Zanzibar could mint an East African unicorn.
“With Wasoko on board, Silicon Zanzibar will have bragging rights to one of Africa’s non-fintech unicorns; there were expectations that the startup would become Kenya’s first tech unicorn,” it said.
“But, no thanks to Kenya’s disincentivizing high taxes, the country might have to wait a little longer to mint its first billion-dollar startup.”
To lure tech companies, Zanzibar is dishing out work visas for relocating tech workers, something that has been problematic in mature markets like Nigeria, Kenya, Egypt and South Africa.
Other incentives in the Zanzibar Free Economic Zone include exemption from corporate tax for 10 years.
Relocating firms will also find available working space and accommodation at Fumba Town, a new modern eco-town located on 1.5km of sea shore, just 9km away from Abeid Amani Karume International Airport.
“Silicon Zanzibar is reestablishing the island as a gateway to the African continent through the transformative potential of the tech industry. As part of Zanzibar’s Blue Economy masterplan to promote sustainable development, the tech sector will play a critical role in expanding the island’s economy while maintaining a low environmental footprint,” reads the Silicon Zanzibar website in part.
“With direct flights to over 20 major destinations across Africa, Europe, and the Middle East along with fibre-optic internet encircling the island, Zanzibar’s infrastructure for staying connected is firmly in place.”
But even as startup flock to Zanzibar, the island will need to grow its household income and create demand for tech financial services.
For now, however, the island could well become the launchpad and headquarters for some of Africa’s biggest tech firms.
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Britam half-year net profit hits Sh2bn on higher investment income
Insurer and financial services provider Britam posted a 22.5 percent jump in net earnings for the half-year ended June 2024, to Sh2 billion, buoyed by increased investment income.
The rise in half-year net profit from Sh1.64 billion posted in a similar period last year came on the back of net investment income rising 2.5 times to Sh13.27 billion from Sh5.3 billion.
“We are confident in the growth and performance trend that Britam has achieved, supported by its subsidiaries in Kenya and the region. Our business is expanding its revenue base while effectively managing costs,” Britam Chief Executive Officer Tom Gitogo said.
“Our customer-centric approach is fueling growth in our customer base and product uptake, particularly through micro-insurance, partnerships, and digital channels.”
The investment income growth was fueled by interest and dividend income rising 34 percent to Sh9.1 billion, which the insurer attributed to growth in revenue and the gains from the realignment of the group’s investment portfolio.
Britam also booked a Sh3.79 billion gain on financial assets at a fair value, compared with a Sh1.8 billion loss posted in a similar period last year.
The increased investment income helped offset the 12.7 percent decline in net insurance service result to Sh2.13 billion in the wake of claims paid out rising at a faster pace than that of premiums received.
Britam said insurance revenue, which is money from written premiums, increased to Sh17.8 billion from Sh16.6 billion, primarily driven by growth in the Kenya insurance business and regional general insurance businesses, which contributed 30 percent of the revenue.
The group has a presence in seven countries in Africa namely Kenya, Uganda, Tanzania, Rwanda, South Sudan, Mozambique, and Malawi.
Britam’s insurance service expense hit Sh13.6 billion from Sh11.3 billion, while net insurance finance expenses rose 2.6 times to Sh12.3 billion during the same period.
“Net insurance finance expenses increased mainly due to growth in interest cost for the deposit administration business driven by better investment performance. This has also been impacted by a decline in the yield curve, which has led to an increase in the insurance contract liabilities. The increase has been offset by a matching increase in fair value gain on assets,” said Britam.
Britam’s growth in profit is in line with that of other Nairobi Securities Exchange-listed insurers, which have seen a rise in profits.
Jubilee Holdings net profit in the six months increased by 22.7 percent to Sh2.5 billion on increased income from insurance, helping the insurer maintain Sh2 per share interim dividend.
CIC Insurance Group posted a 0.64 percent rise in net profit to Sh709.99 million in the same period as net earnings of Liberty Kenya nearly tripled to Sh632 million from Sh213 million, while Sanlam Kenya emerged from a loss to post a Sh282.2 million net profit.
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