Opay's dilemma of defining success & Carbon's Transparency.

Good morning, 

After last week’s newsletter went out, I looked back at all the editions of this mid-week newsletter and I noticed they’ve all (except the first) been centred on Payments, eCommerce and a bit of Teleco. Clearly, this mid-week newsletter is more focused on businesses and sometimes how government policies affect them. Is this a tech newsletter? I’m not sure, however, I know it’s difficult to talk about businesses without talking about how they’re being enhanced or affected by technology in this era. 

Follow up on last week

I’d start with Jeff Bezos’ famous talk on betting on things that don’t change: 

I very frequently get the question: “What’s going to change in the next 10 years?” That’s a very interesting question.

I almost never get the question: “What’s not going to change in the next 10 years?” And I submit to you that that second question is actually the more important of the two.

You can build a business strategy around the things that are stable in time. In our retail business, we know that customers want low prices, and I know that’s going to be true 10 years from now. They want fast delivery; they want vast selection. It’s impossible to imagine a future 10 years from now where a customer comes up and says, “Jeff I love Amazon, I just wish the prices were a little higher.” Or, “I love Amazon, I just wish you’d deliver a little slower.” Impossible.

So we know the energy we put into these things today will still be paying off dividends for our customers 10 years from now. When you have something that you know is true, even over the long term, you can afford to put a lot of energy into it.

This tweet is apt. I remember a few years ago during the first wave of eCommerce, the major pain point seemed to be payments and delivery, with payment on delivery being the major debate in most places. Fast forward to this day and there’s less talk about payment and more about Logistics. Payment got better, but logistics kinda stayed as it were. As I mentioned last week, a major contributory factor is that “The options for delivery might have increased but I don’t think the road network now is better than that of 5 years ago.”

On things that don’t change, Logistics affects how fast customers get their goods and cost of purchases. If figuring out logistics is the only thing, the second wave of eCommerce does, we’d all be better off in Africa. 

OPay’s Dilemma on defining success

When we covered Opay’s recent decision to shut down some services in the weekend’s newsletter, we concluded that “ It’s been a tough year for many businesses including Opay but it might be too hasty to claim OPay is ruined, shedding the weight of its other services, for now, would help them focus more on its profitable payment business and deepen its reach.”

One more thing worth noting as highlighted by Justin Norman is the question of how we define success in Africa.

"And in immensely difficult and complex environments, doesn’t the mere fact that companies are building workable solutions to problems mean, in and of itself, that these are high-quality products? Aren’t these the kind of success stories worth sharing? In fact, aren’t these successes the requisite success for this stage of the African tech ecosystem?"  

Yes, for what it’s worth, Opay tried to enter the market in an unsustainable way, but then the question is, is there a right way in a market where everyone is figuring it out? There are preferred ways quite alright but does it make OPay a failure because they experimented with a different approach? How do we draw the line between success and failure because it matters what stories we tell ourselves about what success looks like?

What other ways can companies in Africa describe success and how can companies push these narratives of success? 

For example, Amazon, which took 9 years to record it’s first profit, from day one advocated for a focus on long term growth over profitability, over time the media and its shareholders had to re-align their focus to judge them on that over short-term profitability.

I’d say celebrate new products, celebrate small milestones, celebrate different approaches. Basic zero to one success stories might not seem like much when compared to western success stories but they're our Africa's success stories. 

Carbon’s Transparency

In recent times I’ve complained about how there are more private companies than public companies in Africa. The major reason for this complaint is because it’s difficult to know how they’re really doing financially, it’s easy for a private company to claim to be the biggest or largest. Everyone’s doing really well until you see what their numbers look like.

That’s why financial services company Carbon (formerly Pay later) publishing it’s audited Financial statement for the 2nd year in a row is a good step. Of course, private companies don’t need to show their books to the public because they don’t own a stake in the company. From a writer/analyst’s position, I’d love to get a glimpse of the books of all privates companies because it’s makes talking about companies easier but then switching hats, using Opay as a case study, for companies in a space where the public defines success in different ways for companies still figuring out, it would be better to control the narrative by not exposing themselves to unnecessary attention till they figure it out.

So thank you Carbon for your transparency, one part of me wishes other companies would imitate you but then again, maybe they shouldn’t — at least not yet.

👋I’m always looking for interesting/important topics to write about, so please reply/DM with suggestions.

Have a splendid day! 💛