🦾 How AI Helps Cure 2.5 Million Africans

Plus: Finfluencer clampdowns 👮, SA’s VC rise & the truth behind Friday’s blue screens of death.

NEW
Newsletter
July 23, 2024

🦾 How AI Helps Cure 2.5 Million Africans

Plus: Finfluencer clampdowns 👮, SA’s VC rise & the truth behind Friday’s blue screens of death.

Got the power? These guys used Midjourney and Luma to put a bunch of political bigwigs on the catwalk. Now we just need to pull a Formula 1 and demand they wear their “sponsors” as badges.

In this Open Letter:

  • Health game: How AI is saving 2.5 million Africans.

  • Finfluencer clampdown, SA’s VC rise & blue screens of death.

  • Don’t miss out: Community events & engagement for you.

  • Who built your company website: The results are in.

  • Real value: Share this and get 100+ SA business ideas.

AI Helps Cure 2.5 Million Africans

Tuberculosis (TB) is a pretty big deal considering it now trumps HIV/AIDS and is second only to COVID-19 among the world’s leading infectious killers.

In fact, in 2021 more than 832 people contracted TB each day in South Africa, with 153 (18%) losing their lives daily to a disease that’s totally preventable and treatable.

But it ain't easy to diagnose…

Part of the reason why so many still die of TB is that it’s hard to detect:

  • Firstly, the symptoms of TB (coughing, fever, night sweats, weight loss etc), are pretty common in a ton of other diseases – so it's often misdiagnosed.

  • Secondly, the bacteria in TB is slow-growing, taking a while to detect, resulting in multiple doctor's visits, tests, X-rays, and, again, plenty of misdiagnoses (and expenses).

  • Lastly, given SA’s already buckling health system, clinics in poorer communities outside of major metropoles have up to 3 hours waiting time, so a real pain getting treatment (if you ever even get diagnosed).

By the time Piet got to see the Dr, he was already showing a whole new set of symptoms…

The true cost of TB

TB tests can cost as much as R3’000 a pop, and treatment is insane: one course requires daily medication for 6–8 MONTHS, easily running to R20’000 for some TB tablets.

Add in other meds like cough syrup, painkillers and immune boosters to alleviate the symptoms, and it starts turning into a costly exercise – not to mention potentially being off work all that time 😵‍💫.

Speeding up Diagnosis

The key to fighting TB is early detection. Enter local MedTech AI Diagnostics.

These guys are revolutionising TB screening with their AI-enabled digital stethoscope that captures and analyses a patient’s lung sounds and feeds it back to a state-of-the-art deep neural network that’s been trained on thousands of negative and positive lung sounds.

AI Diagnostic’s tech improves the accuracy of TB detection dramatically, cutting down on missed cases by 41% and reducing unnecessary tests by 33%. With this improved testing mechanism alone, you’re looking at a saving of R300 million on lab costs each year. 

The Western Cape Government is already using it to make TB diagnosis faster, cheaper, and more reliable, especially in primary healthcare.

With South Africa’s illustrious history of medical advancement and innovative MedTech startups working to solve real-world medical problems, we’re watching this space...

Want to understand how startups like AI Diagnostics make money? Or do you want to get access to up to 3 opportunities with them or in the space they operate in? Then, sign up for The Open Letter Pro and get access to our Pro Deep Dives in every The Open Letter Newsletter that goes out.


PLUS, when you sign up, you will join our community of 30+ South African founders who support each other in building high-value startups.

IN SHORT

🚀 On The Up. South African Venture Capital investments are on the rise, passing the R3 billion mark for the first time since the launch of the SAVCA annual VC Survey 14 years ago, with larger investments being made in a smaller number of companies.

🥶 Dead Blue Screens. ICYMI: On Friday IT security company Crowdstrike caused a mass outage event on Windows PCs. Planes were grounded, SA’s Capitec went down, even Crowdstrike-sponsored F1 team Mercedes had blue screens during Friday’s practice session.

💰Climate Bucks. Local ClimaTech, Plentify has closed its funding round from American and African VCs. The oversubscribed funding round will be used to accelerate growth and expand internationally.

😡 Taken for a Ride. If you’ve gotten the short end of the stick by taking financial advice from local Finfluencers on TikTok, Telegram and WhatsApp, there’s good news. South Africa’s Financial Sector Conduct Authority (FSCA) is setting its sights on efforts to regulate financial advice on social media.

👉 The Stack. Founders need leads to build and grow their businesses. Check out our Founder’s Stack with tools like Apollo that help you find new enterprise leads and Stream that helps you create the perfect outreach to convert them to clients.

Automate compliance and streamline security reviews - get $1,000 off Vanta

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Plus, you can streamline security reviews by automating questionnaires and demonstrating your security posture with a customer-facing Trust Center, all powered by Vanta AI.

Join the 7,000+ global companies that use Vanta to manage risk and prove security in real time.

ENGAGE

What You Missed in the TOL Community

Last Friday, we just couldn’t leave poor CrowdStrike alone for the Windows PC outage…

Coming Up This Week

  • Wednesday 10-11: Office Hours, where we all log in and work together, + the whole Open Letter team is at members’ disposal.

  • Our first in-person event coming soon!

  • Plus: All day, every day: unlimited introductions, recruitment, service provider referrals and business-building insights.

Want to join a group of South Africans building high-value startups together? Start your free trial now!

What You Said…

We asked if your company has a website, and it’s mainly no-code…

🟨⬜️⬜️⬜️⬜️⬜️ 🙅‍♂️ No, don’t need one (7%)

🟨🟨🟨🟨⬜️⬜️ 🤩 No, lemme get a Savvy.site (23%)

⬜️⬜️⬜️⬜️⬜️⬜️ 👩🏻‍💻 Yep, built by my school science prize-winning cousin (0)

🟨🟨🟨🟨⬜️⬜️ 🆆 Yep, using WordPress (23%)

🟩🟩🟩🟩🟩🟩 🎨 Yep, using some other no-code platform (34%)

🟨🟨⬜️⬜️⬜️⬜️ 👾 I build everything myself (13%)

Your 2 cents…

“I built my website on wix”

Farhaanah

Nice, Farhaanah, see Wix has also been expanding their product and building out a robust version for agencies, too.

Elmethra selected 🤩 No, lemme get a Savvy.site and wrote

“As a single mom, solopreneur trying to find the time to even work (looking after parents & my son)... Using a platform that streamlines what I need in order to get my professional space online, is overdue”

Nice one, Elmethra, sure the guys at Savvy will welcome you with open arms.

“I am surprised at the low adoption of WordPress. Globally, Wordpress has a market share of 43% of all websites, and 63% of content managed websites.”

William

Oh yes, William, there are some Open Letter team members who absolutely swear by WordPress, even though Webflow is our official affiliate. And you’re just never gonna sway them, just like PC and Mac, Pepsi and Coke…

😎 Getting 2.5M Hustles Online

Plus: AI war drones 👾, Cape carbon cash, Lula’s big new moves & the product manager’s rap you missed.

NEW
Newsletter
July 19, 2024

😎 Getting 2.5M Hustles Online

Plus: AI war drones 👾, Cape carbon cash, Lula’s big new moves & the product manager’s rap you missed.

Young forever? Scientists studying heart health “accidentally” stumbled upon a way to extend the lifespans of mice by up to 25% and make them look younger for longer. Not surprisingly, everyone wants to know when human trials start (some say it’s quite soon).

In this Open Letter:

  • Smart starts: Getting 2.5M hustles online in minutes.

  • AI war drones, Cape carbon cash & Lula’s big new moves.

  • Roadmaps and Trello boards: What you missed this week.

  • How you spot email scammers: The results are in.

  • Big plays: Share this and get 100+ SA business ideas.

Together with

Getting 2.5M Hustles Online

When tech entrepreneurs start a business, most whip up a website as their first priority long before doing any actual work…

But it’s likely that an online presence is not so high on the agenda for most of the 2.6 million SMEs (1.75 million informal and 710k formal ones). 

There are roughly 1.35 million .co.za domains in SA and that includes domains for non-businesses and larger organisations. So, we think it's safe to say that more than 1 million small businesses don’t have a website.

“started” 5 businesses last week ourselves…

But does it really matter?

Many small enterprises trade in their communities. People know them; they know the people; why do they need to be online? 

Well, Xero has been doing some research on small businesses in South Africa and in 2023, 43% reported that technology has enabled them to reach new customers – up 13% compared to 2022. 

What’s more Google Search, which is the dominant search engine in South Africa with 90%+ market share, globally caters for 8.5 billion searches a day. 

And whilst there is no available data on how many searches they do in SA per day, taking into account that 0.8% of the world’s online population reside in SA, that's roughly 68 million searches per day – 2 billion a month.

If you bake cakes, fix pipes or offer dance classes, you wanna rock up when someone searches for it.

And that's only search… social is likely way more

91% of people say they trust online reviews as much as they trust personal recommendations.

And 28% of users discover brands through social channels – the kind of behaviour that’s said to be driving the US social commerce economy to $79.6 billion by 2025.

So, if you are a small business in SA, being online and being able to convert successfully from social into sales online is a massive opportunity to get ahead. 

That’s what local startup Savvy Site is building for.

More advanced than Linktree, easier to set up than Wix, and way less painful than WordPress, Savvy has seen more than 3’000 South Africans go online since they launched their platform in 2020. 

It's perfect for both “link in bio” conversions and being found on Google. And, if you hook that up with WigWag, which lets you accept card payments within a day, you could be printing money by Monday.

If that’s what you are doing by Monday, let us know so we can cheer you on!

Plus: We had Savvy Site’s founder Trevor Swart on the podcast this week, and he shared some enticing insights on moving fast, including:

Get a deep dive into this trend and the startup’s strategy when you join the Open Letter Pro.

PLUS join our online community of 30+ South African founders building high-value businesses. We meet online twice a week, with many in-person gatherings coming up!

IN SHORT

🇿🇦 Crypto Randelas. Local FinTech NeoNomad has launched ZARcoin (ZARC), a stablecoin pegged to the South African Rondt. Whilst this isn’t new (ZARP has been going for some time) it is built on the Solana network which is poised for major mainstream transacting.

💰Carbon Cash. Cape Town has auctioned off R36 million in carbon credits that the city generated by reducing gas emissions at landfill sites around the city. The funds are going towards further improving urban waste management.

🕹️ Drone Wars. More than 200 startups in Ukraine are developing AI systems to operate drone fleets in hopes of helping in the ongoing war with Russia. The drones will primarily be used to identify targets and fly drones into them, do terrain mapping, and enable drones to operate in interconnected “swarms”.

🚐 Hop on Board. Local ride-sharing platform Lula has acquired the SA operations of UK-based Zeelo for an undisclosed amount. Zeelo is exiting SA after launching in 2018.

🌬️ Wind Power. Phase 1 of a R25 billion wind farm has just kicked off in Mpumalanga. The biggest wind farm of its kind in SA, this 900MW project will supply 75% of the power needs of Sereti Resources’ coal mines.

👌 The Stack. Founders need great tools and service providers they can trust. Check out our Founder’s Stack. It is packed with awesome project management tools like Notion and smarter business-essential services like OCFO, your instant CFO (when you don’t have one yet).

Intercom for Startups

Join Intercom’s Early Stage Program to receive a 90% discount.

Get a direct line to your customers. Try the only complete AI-first customer service solution.

ENGAGE

What You Missed in the TOL Community

We had a blast connecting and working together during Wednesday’s Office Hours…

Timo King even inspired Jason with a new song idea…

And we couldn’t resist, we had to let AI make the track for us…

Coming Up This Week

  • Friday 12-13:00: Online Gathering: we all get together for an online AMA-style session on mastering growth metrics.

  • Next Wednesday, 10-11:00: Office Hours, where we all log in and work together, + the whole Open Letter team is at members’ disposal.

  • Plus: All day, every day: unlimited introductions, recruitment, service provider referrals and business-building insights.

Want to join a group of South Africans building high-value tech-enabled startups? Start your free trial now!

Your Voice

We asked how you recognise scam emails, and the domain is the big giveaway…

🟨⬜️⬜️⬜️⬜️⬜️ 👑 When it's from Nigerian royalty. (14%)

🟨🟨⬜️⬜️⬜️⬜️ 🤬 Poor spelling and grammar. (18%)

🟩🟩🟩🟩🟩🟩🥸 When the domain and URL mismatch. (47%)

⬜️⬜️⬜️⬜️⬜️⬜️ Poorly photoshopped/photocopied company logo. (2%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🍭 When they ask for bank details to verify your identity. (7%)

🟨⬜️⬜️⬜️⬜️⬜️ ✊ Anything that's not from The Open Letter. (12%)

Your 2 cents…

“Spelling is a dead giveaway. That and formatting is sometime off (double-spaces etc). Also, my bank has never referred to me as "Hi Dear"...”

Jason

Jason, we literally just received an email from “the president of the world bank” opening with “Hello Dear”. Lol.

🔐 Securing 361 Billion Messages a Day

Plus: SA’s Wimbledon gold 🥇, bank of Gauteng, African investment roots & faster international payments for gig workers.

NEW
Newsletter
July 16, 2024

🔐 Securing 361 Billion Messages a Day

Plus: SA’s Wimbledon gold 🥇, bank of Gauteng, African investment roots & faster international payments for gig workers.

Rough weekend? We thought Trump was tough for surviving the US’s first assassination attempt on a presidential hopeful in 52 years this weekend. But that was only till we saw these two African lion brothers (one of them an amputee!) swim 1.5km through crocodile and hippo-infested waters at midnight, all in the name of love.

In this Open Letter:

  • Massive market: Securing 361 billion messages per day.

  • SA’s Wimbledon gold, Gauteng’s state bank & African investment roots.

  • What you need help remembering: The poll results are in.

  • Big plays: Share this and get 100 SA business ideas.

Together with WigWag

Securing 361 Billion Messages Per Day

Around 4.48 billion people send an average of 361.6 billion emails globally every day. 

It’s become integral in how businesses function and is still one of the most convenient and effective ways to engage customers or communities. 

We delivered 556.2k emails in the last 12 months!

But email was never perfect – it had a serious design flaw from day one.

You see, because emails get sent from so many different servers using the same domain (think how Hubspot, Salesforce, 365, beehiiv and G-suite all use your domain to send when you use it), receivers can’t reliably verify the sender’s true identity (and whether they’re authorised to send from the claimed domain). 

Which opens the door to unscrupulous individuals who want to pretend to be you and intercept transactions, etc., leading to 96% of phishing attacks arriving via email (an estimated 3.4 billion+ malicious emails are sent daily). 

What do these look like?

  • Intercepting transactions to send an email that looks like yours but with altered bank account details — you will likely be liable (ENSAfrica was recently in a high court ruling).

  • Pretending to be a service provider to you, asking for details, while using the actual domain name of the company to email you.

  • Acting on your behalf for all kinds of malicious activity using social engineering.

The email conundrum

So, email hit a crossroads. Either make it a secure channel through which to communicate, or we could see the end of this democratized communication protocol.

The latter is quite a big deal considering email is free and open to use as opposed to Whatsapp, which is free to use, but owned by Meta (not a good idea, trust us).

So, the only option was to try to make email even more secure.

Sure, SPF (sender policy framework) and DKIM (DomainKey Identified Mail) were already in place, but receiving servers often didn’t know what to do with emails that didn’t meet these standards, so they ended up landing in your inbox… until now.

Oh what a glorious day

Enter DMARC

DMARC (Domain-based Message Authentication, Reporting & Conformance) is an email authentication protocol that instructs email receivers what to do with an email that doesn’t meet security standards and then reports on it.

Whilst it’s actually been around since 2012, and many have used it over the years, it really shot to prominence lately when Google and Yahoo announced that bulk senders have to use DMARC from February 2024 onwards. 

By June of this year, all DMARC requirements have become mandatory. This means that if your email sent doesn’t comply, it will not be delivered to Yahoo or Google mail inboxes or in the best case scenario, land in the spam inboxes.

It's massive

In South Africa alone, there are roughly 200’000 businesses that likely use email daily, and they will eventually need to set up and comply with DMARC to get their emails to hit inboxes. Globally, it’s even enormous!

That’s where local startup Sendmarc is in a great position to capitalise. They offer a range of solutions for everyone, from small businesses all the way up to enterprises, that manage your email settings to comply. All of which:

  • Improve email delivery (making sure your customers get your emails).

  • Improve domain authority (so that you are less likely to end up in spam folders).

  • Protect against spoofing and spam (so people can’t pretend to be you).

  • Collect XML reports and analyse them to help improve all of the above.

With 4.48 billion people using email, this might just be one of the biggest markets there is, and this South African company has the goods to take on the big players globally. We are watching this space.

PS: Navigo Solutions, a Sendmarc distributor, has made it easy for you to secure your email. Wanna analyse your email address’s vulnerability score? Check it out using their interactive tool.

Get a deep dive into this trend and the startup’s strategy when you join the Open Letter Pro. PLUS join our community of 30+ South African founders building high-value tech-enabled businesses.

IN SHORT

🌍 Travel Money. Local travel-focused FinTech TurnStay has secured over R5.4 million in funding from investors in Silicon Valley and New York to expand into Africa.

📈 Growing Deeper Roots. Nigerian investment platform Bamboo has expanded its offering into South Africa after receiving its financial services provider licence from SA’s Financial Sector Conduct Authority (FSCA).

💰 Banking on Gauteng. Looks like Gauteng could be getting its own provincial state-owned bank which will aim to invest in infrastructure projects including in areas of ICT, business information centres and township-based enterprises

🏆 Winning Wimbledon. Local tennis hero Kgothatso Montjane won the wheelchair women’s doubles final at Wimbledon on Sunday with Japan’s Yui Kamiji. Nicely done Kgothatso.

😎 The Stack. Founders need great tools and service providers they can trust. Check out our Founder’s Stack. It is packed with collaborative design tools like Figma and Metavolve, which help companies avoid stress by scaling well.

CHECK THIS OUT

EFT is just not a thing for them…

We call it electronic funds transfer (EFT), some call it a wire, and some plainly refuse to do any of it…getting paid from abroad is a pain. And even if a client agrees to do a transfer directly into your bank account:

  • Getting paid takes ages, or even worse, it’s unpredictable how long it takes.

  • The fees can be ridiculous.

  • Sometimes, the funds get stuck, and a very manual process of releasing the funds goes lost in communication (hello bank call centre)

As a freelancer, you wanna keep things admin light…

But what if there is a better way?

Meet Melissa Raath, an international award-winning conceptual art director.

Melissa does work for clients across the world and mostly faces the same issues with payment:

“The awesome thing about working for myself and remotely is that I get to work with clients from all across the world. The not-so-awesome side is that some international clients prefer to pay by card or opt to do wire transfers and this comes at a bit of a cost”

But there is an easy way to get around that Melissa started using:

“Wigwag has made the whole process incredibly smooth and easy. I signed up and was vetted the same day, and their customer support went above and beyond to assist me with a tricky international payment. As an art director, I also appreciate the simple, intuitive UX and super fun brand identity. Plus, their fees are the lowest I've found 😚👌

Ready to get paid instantly from anywhere in the world?

WigWag is offering The Open Letter readers:

  • One month free (Up to R20 000)*

  • if you sign up before 30 July

  • using this link.

That’s zero fees in your first month!

ENGAGE

What You Missed in the TOL Community

The Open Letter community is only one week old, but more than 20 founders and builders have already joined. Here is what wen down thus far…

  • We got to know each other a little better on Wednesday in our weekly office hours!

  • We had a lively discussion around this CEO’s LinkedIn post announcing they’re the world’s first “HR solution” for AI employees…

Coming Up This Week

  • Wednesday 10-11: Office Hours, where we all log in and work together, + the whole Open Letter team is at members’ disposal.

  • Friday 12-13:00: Online Gathering: we all get together for an online AMA-style session on mastering growth metrics.

  • Plus: All day, every day: unlimited introductions, recruitment, service provider referrals and business-building insights.

Want to join a group of South Africans building high-value tech-enabled startups? Start your free trial now!

What You Said…

We asked what you always need help remembering, and it’s what your fellow builders are developing…

🟩🟩🟩🟩🟩🟩 🌱 The names of all the new startups at networking events (23%)

🟨🟨🟨🟨⬜️⬜️ 📬 Replying to emails before they become ancient history (18%)

🟨🟨🟨🟨⬜️⬜️ 🔑 Where I left my car keys. Every. Single. Day (18%)

🟨🟨🟨🟨🟨⬜️ 🥱 To actually take breaks and not just talk about them (20%)

🟨🟨🟨⬜️⬜️⬜️ 🙉 The punchline of that great joke I heard last week (12%)

🟨🟨⬜️⬜️⬜️⬜️ 🏆 To help me win every single argument (9%)

Your 2 cents…

“For a kasi broer not really exposed to the tech world in my daily life, the open letter has been phenomenal, love reading and staying up to date.”

Nelson

Hey, Nelson, glad to hear you like and appreciate it — here’s hoping some tech inspiration brings your next big business idea!

📿 AI Bling For Your Memory…

Plus: High-tech taxis⚡, 2026’s heater gas, SA’s super cyber sleuths & the matrix your B2B startup.

NEW
Newsletter
July 12, 2024

📿 AI Bling For Your Memory…

Plus: High-tech taxis⚡, 2026’s heater gas, SA’s super cyber sleuths & the matrix your B2B startup.

Counter-intuitive? Ha ha, companies looking to use AI for customer service might be in for a shock. Gartner just published a survey showing 64% of customers say they “hate AI” and would “move to another business if they have to talk one”. We sense a perfect storm brewing here.

In this Open Letter:

  • AI memory: Wear this, and never forget anything again.

  • High-tech taxis, 2026’s heater gas & SA’s super cyber sleuths.

  • Solid start: The metrics to max any B2B startup.

  • The hardest pre-sale to make: The results are in.

  • The lead: 100+ SA business ideas — get access.

Did You Really Say That?

Ever forget to take out the trash, and now the wife’s upset? 

Or that thing you committed to in that meeting, and now everyone’s hissy fitting? 

You’re not alone. 

Forgetfulness is human. But what if you need a good memory to keep doing your job well?

bliss

Introducing Compass Wearables. A low-energy Bluetooth microphone device you hang around your neck to listen in on conversations (if you allow it) and then upload the transcript from your phone to the cloud so that AI can pull out the important stuff to create reminders:

  • You promise to call your wife later in the day. So Compass reminds you: “Call your wife” later in the afternoon.

  • Or you told a mate about The Open Letter and how you’d love to be considered for a feature. Compass will hit you up… “Remember to email Renier and tell him about the awesome SA startup you are building”.

A couple of use cases here… you can also go back through your day and reflect on anything that was said, plus see key summaries of interactions with people. Great for work, but even better for accurate recall and winning arguments: “No, no, what I actually said was…“

To be honest, it's what we all expected Siri to be before she let us down so spectacularly.

The SA connection

Okay, okay, this is a San Francisco-based startup, but with strong South African connections, which makes it a cool story to cover today. 

Co-founder Shai Unterslak, is a UCT grad who started his first business, Dado, while still studying.

That business eventually exited to Yoco, which set Shai on a journey to the US to work on something big. That’s where he started working on Everything Bagel — an AI startup that plugs into all your online profiles (think Facebook, Instagram, Snapchat, TikTok) and then analyses your content to show you how much you’ve changed or grown over time. This didn’t work, and Shai explains why here on this week’s podcast.

However, a random engagement with someone who stayed over at their commune in San Francisco led to them merging companies to develop Compass. 

The device sells for $99, and it does a limited number of minutes of transcription per day, forever free. Alternatively, you can upgrade to premium, which allows unlimited recordings and transcriptions for $20 a month.

The future

Right now, they are building on workflows. Wanna be more positive in your communication? It will listen in and give you pointers. They’re also working on auto-creating diaries and digests you can keep or make TikToks from. Pretty neat.

AI all up in all our conversations is quite new, and many people might have concerns about “are you recording this?”. But to be fair, it's very easy to record anyone using your mobile phone these days. With an AI wearable, at least, you are showing respect by making it obvious…

We had Shai on the podcast this week, and apart from sharing his interesting journey, he shared some gems like:

🔥 The Open Letter Pro Members Only 🔥

Open Letter Pro members get access to bonus insights on this trend and startup:

  • The real (hidden) growth opportunity in this trend

  • Startup metrics & business model deep dive — learn how this startup makes money and grows.

  • Plus: Auxiliary opportunities – businesses and deals you can start now and begin earning from day one.

Plus:

  • SA-focused startup building tips and insights.

  • Join our online community when you go pro.

Subscribe today - Starting from R250 - Cancel anytime.

IN SHORT

📱Trading Open. Investec’s no-admin-fee, zero-commission share trading and investing platform Clarity is open to the public with beta testing made available to non-Investec Private Bank Account holders.

🚐 Taxi Cash Platform. The Wealth On Wheels platform was unveiled by the South African National Taxi Council (SANTACO) (and a bunch of other partners) at the 42nd Southern African Transport Conference. The platform allows digital cash payments, advanced fleet and vehicle management systems, camera monitoring, and more.

💰It’s CEO Tyme. Local digital bank TymeBank has just appointed a new CEO. Karl Westvig will take office on 1 October 2024, with the bank's current CEO Coenraad Jonker focusing on driving the growth of the multi-country digital banking group.

💨 Hit the Gas. A non-exclusive joint venture agreement amongst about 30 local piped gas users is being concluded to ensure gas supply to the country after Sasol stops its gas supply in 2026.

🕵️‍♀️ Stopping the Leak. SA’s State Security Agency is finishing assessing the government’s cybersecurity strengths (or lack thereof). This was after it came to light that over R300 million had been lost from the Department of Public Works and Infrastructure (DPWI) over ten years through cybercrime.

😎 The Stack. Founders need great tools and service providers they can trust. Check out our Founder’s Stack. It is packed with tools like Make that help non-developers connect different apps via APIs and Dommisse, which can protect you from making bad deals.

BUILDER’S CORNER

The Metrics You Need for B2B Startups

And how to get going…

by Renier Kriel – co-founder and Ideas Guy at The Open Letter

If you hang around at a startup event long enough, you’ll hear someone saying ARPU or CAC (no, they are not swearing.) Those are some of the metrics that show how well (or bad) a business is doing. 

But for many, understanding which metrics matter, how to measure them, what to do with them in the early stages, and finally, how to benchmark themselves against them is a bit of a myth. 

get them right…make it rain

So today, we are diving into key metrics for a B2B SaaS business in South Africa and how to use these metrics to determine where you should focus your efforts.

🇿🇦 Sign up to The Open Letter Pro to see how to calculate these metrics; use this metric specifically in the local South African setting PLUS a benchmark calculation to measure your progress.

1. YoY ARR growth: Tracking Expansion and Investor Appetite

Why it matters: YoY ARR Growth indicates how well your startup is expanding its customer base and revenue, which is crucial for attracting investors. Consistent growth in ARR shows that your business is scaling effectively and that there is increasing demand for your product or service.

2. Gross Rand Retention: Assessing Customer Loyalty and Product Effectiveness

Why it matters: Gross Rand Retention helps assess the loyalty of your customer base and the effectiveness of your product or service. High retention rates suggest satisfied customers who see value in what you offer, reducing churn and promoting long-term revenue stability.

3. Net Rand Retention: Measuring Revenue Growth Potential from Existing Customers

Why it matters: NRR provides insights into your revenue growth potential from your existing customer base. By including upsells and cross-sells, this metric highlights your ability to expand revenue from current customers, which is often more cost-effective than acquiring new ones.

4. Gross Margin-Adjusted CAC Payback: Assessing Customer Acquisition Cost Efficiency

Why it matters: This metric tracks how long it takes to recoup customer acquisition costs based on gross margin. It helps you understand the efficiency of your spending on acquiring new customers and how quickly those investments are paying off.

5. Magic Number: Measuring Sales and Marketing Efficiency

Why it matters: The Magic Number measures the efficiency of sales and marketing spending in driving new revenue. A higher Magic Number indicates that your sales and marketing efforts are yielding significant returns, which is vital for scaling your business.

6. Rule of 40: Balancing Growth and Profitability

Why it matters: The Rule of 40 combines growth rate and profit margin to assess overall business health. A Rule of 40 score above 40% suggests a balanced approach to growth and profitability, making your startup more attractive to investors.

7. Revenue Burn Multiple: Evaluating Capital Efficiency

Why it matters: The Revenue Burn Multiple indicates how efficiently a startup is using its capital to generate revenue. A lower multiple suggests better capital efficiency, which is crucial for sustainability and growth, especially in the early stages.

8. ARR per FTE: Measuring Employee Productivity

Why it matters: ARR per FTE measures productivity by calculating ARR per employee. It helps you understand how effectively your team contributes to revenue generation, guiding decisions on hiring and resource allocation.

Today’s Builder’s Corner was written by Renier Kriel from The Open Letter, who is an expert in SA startup strategy & growth.

Connect with him on Linkedin here.

YOUR VOICE

We asked what’s the hardest to sell before it's built, and startup ideas are toughies…

🟨🟨🟨🟨⬜️⬜️ 💻 Custom software (36%)

🟩🟩🟩🟩🟩🟩 💡 My startup idea (45%)

🟨⬜️⬜️⬜️⬜️⬜️ 🌐 A web-based service (14%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🙊 My latest purchase to my spouse/partner (5%)

Your 2 cents…

“Trying to explain my ideas to the possible investors is like selling ice to Eskimos”

Vakele

Ah, man sorry Vakele, just don’t lose hope — you only need 1 right investor to believe in you. Don’t have a specific resource at hand, but basically getting investor buy-in is showing them how much money they are going to make out of it. It’s kinda the beginning and end of the story, ‘cos investors are usually also founders themselves, and they’re in the game for benefit — either making money or gaining some sort of strategic advantage.

Lead with what’s in it for them, and you hopefully get a better response.

Here’s a deep dive into what it takes to get VC backed, if that helps.

“I even struggle to sell my startup idea to myself.”

FJ

Ha, FJ, that’s us like every 5 seconds. If it helps, we overcome the self-doubt by launching things that don’t exist yet, just to gauge the response, and then only build it once you see actual interest. You’ll be surprised at how much faster you learn.

🏡 How to Sell 100+ Homes in 24 Hours…

Plus: TOL Pro is here 🔥, corporate gaming, ring payments, PeugeotGPT & 5 more tools to build a big business.

NEW
Newsletter
July 9, 2024

Out of place? While simulating a moonwalk (for the first time in 50 years), NASA astronauts ran into a cow. Also, some cool pics of them training & sunrise on the lunar surface.

In this Open Letter:

  • Big developments: How to sell 100+ homes in 24 hours.
  • The PRO dive: Exclusive industry deep dives for PRO members.
  • Ring Payments, PeugeotGPT & LinkedIn games with your boss.
  • Upcoming events: Next-level online and in-person startup events.
  • Max growth: The next 5 tools and partners to level up your business.
  • The state of online fraud in SA: The results are in.

Plus: It’s a big day, we just launched PRO subscriptions, so today features bonus deep-dive content only PRO members can see — plus a host of awesome PRO benefits and access to exclusive Open Letter events.

TRENDING NOW

Selling 100+ Properties in 24 Hours

If not in the first 2—5 minutes…

A recent popular measure is to sell new properties off-plan – a developer creates sketches or a demo build of what units in a new development will look like, and try to sell the homes before they’re even built.

Gaining traction in 1998, when SA implemented the Housing Consumers Protection Measures Act, buying off-plan promises buyers financial benefits:

  • Better pricing and savings: It’s a little cheaper buying in early-stage development, and the value increases over time (plus transfer costs do not apply, although VAT does).
  • Finance and payment flexibility: Normally, a deposit secures your purchase and then you can find your own home loan or use the developer’s own pre-arranged deals – but you usually only start paying interest once development is completed.
  • Customisation options: You can usually ask for custom fittings and finishes, so it’s more your style.

And it’s good for the developer too, since they get some funding up-front, market validation through the early sales process and they can use economies of scale by purchasing building materials and contracting services in bulk.

Dream come true?

Not quite, buying and selling off-plan is pretty challenging at both ends.

The challenges in selling off-plan

  • When you buy, you never know exactly what your property will look like until it’s done, which makes it harder to sell.
  • Developers need to sell enough early on to raise working capital.
  • High marketing costs – selling off-plan can require insane marketing strategies and expensive sales teams eating your margin.

For those reasons, there are only a few developers in SA that make money doing off-plan development. But that might just change…

Levelling the playing field

After years of helping property developers put in place more effective marketing material that gets results faster, local founders Brad M and Dean Lederle founded LaunchBase. Whilst they still perform the creation of marketing materials and ads, the magic lies in the online sales process that happens on their platform…

Took us at least 10 mins to sell the first Open Letter Pro subscription 🫤

As the launch day of off-plan property sales approaches, LaunchBase:

  • Markets upcoming sales through various platforms, including their own database consisting of thousands of investors.
  • They then record interest and monitor engagement to accurately predict demand – lowering the risk of over- or underspending on marketing.
  • This creates FOMO – gorgeous 3D models with live views of unit sales drive purchasing decisions.

Their results speak for themselves – some developments sell out in as little as 5 minutes, and others nearly sell out on launch day.

With LaunchBase offering a win-win for developers and buyers alike, it’s no surprise they’re making waves in PropTech. We’re watching this space…

PS: Their latest project, The Daily in Greenpoint, launches tomorrow (Wednesday 10 July 2024 at 1 PM). Check it out and see how a launch works in real time. Who knows, you might find something you like.

THE PRO DIVE

What is it:

  • Buying off-plan is an attractive option for homeownership
  • But it is risky and extremely hard/costly for developers
  • Helping developers sell more stock faster creates benefits for buyers and sellers.

Market size in SA:

  • Municipalities approved 77k–88k new building plans in 2022 & 2023
  • Of this, 18’270 were new homes built.
  • At an average house cost of R1M.
  • That’s an estimated R18bn per year industry.

Featured Startup:
LaunchBase

Founder(s):
Brad M & Dean Lederle

🔥 PRO Members Only 🔥

Only Open Letter Pro members get access to bonus insights like:

  • The real (hidden) growth opportunity in this trend
  • Detailed unit economics & business model deep dives
  • Margins, ARR, CAC, Burn rate etc.
  • Plus: Auxiliary opportunities – businesses and deals you can start now and begin earning from day one.

Plus:

  • Exclusive Pro community chat with us & top founders
  • Weekly office hours: Pro support with PMs, strategists etc.
  • AMA Masterclasses with successful founders & investors
  • Exclusive free ecosystem events & excursions.

Upgrade to Pro

IN SHORT

💍 Ring Payments. Not one, but two local companies are launching their contactless payment rings developed right here in SA.

🎮 Corporate Gaming. LinkedIn and YouTube have joined the ranks of tech platforms offering on-platform gaming in a bid to attract more users. But if you’re worried your 1st-degree LinkedIn connections are going to pester you for money to feed their crops on Farmville, fear not LinkedIn games are limited to once per day.

🚘 PeugeotGPT. Ever had a burning question you wanted to ask while driving? Well, if you own a Peugeot simply ask the i-Cockpit “OK Peugot” and fire away and have your question answered by ChatGPT. This is not available in SA just yet - but check back in 2025.

☁️ Head in the Clouds. Huawei South Africa and the Department of Communications and Digital Technologies are offering free training in cloud computing from the 22nd to the 25th of July for small, medium and micro enterprises (SMMEs) as part of a Digital Entrepreneurship Programme. Applications close on 15 July.

⚡️Fission Mission. South Africa’s Minister of Electricity has announced that SA is working on a deal to secure the funds for a 2’500 MW nuclear power plant to increase the electricity supply and secure the country’s energy needs.

📈 Become a VC. CatalyzU is launching its 5th cohort of its VC fellowship program on 23 July 2024. The program is designed to give fellows a comprehensive understanding of the African VC landscape and ecosystem. Applications close soon, sign up here!

UPCOMING EVENTS

🎯 Key Metrics for Startup Success
What: Got a unit economics or metrics question?
When: 19 July 2024, 12:00. Where: Online — join from anywhere.
Who can join: Free to Open Letter Pro members - Upgrade now

🇿🇦 Specno’s Founder’s Den is coming to Joburg!
What: Startup people unite for a one-of-a-kind networking experience.
When: 25 July 2024, 18:00. Where: Old Mutual, Sandton
Who can join: Free. Apply for tickets here.

BUILDER’S CORNER

The Tools You Need to Level-Up Your Startup (Pt 2)

Last week, we showed you how to plan, design, get paid and be startup legal-wise. Now we need to get you the financial, marketing, growth and deal-making skills to take your business from here to the moon with the tools we use to move faster.

1. Understanding Money: OCFO

Up until a point, spreadsheets do the job. But when you need to make sense of your cash flows and start paying income tax, no one gets finance better than OCFO. From monthly accounting, bookkeeping, and financial planning to help you raise your next round of funding, with OCFO, you don’t need a CFO on payroll.

2. Scaling Well: Metavolve

We have personally felt it: Growing fast can be painful for a small team. That’s where Metavolve can help. Their scale program assists businesses in developing a clear understanding of how to grow with minimum pain.

3. Growing Your Brand: Stream

CACs are rising and ad effectiveness tanking. The new name of the game is building your authority and an audience with content on owned channels. But how many founders have the time and skill to do that (on top of everything else)? That’s why Stream is great for creating content for lead generation, sales funnels, ads and marketing, socials, blogs, newsletters, video scripts, speeches — everything you need to drive sales and conversions.

4. Automate Your Workflow: Make

Efficiency is key to startup success. That’s why we love Make for creating easy no-code integrations. Whether it's automating repetitive tasks, syncing data between platforms, or creating complex multi-step workflows, Make saves you time so your team can focus on what matters most.

5. Finding Clients: Apollo

Outbound sales can be daunting. Especially early days when you’re just starting and need to land your first 10 customers — doubly so if it’s enterprise sales. That’s why we love Apollo: It helps you easily identify high-quality potential clients and then reach out to them quickly and painlessly using automation.

We didn’t have space to show them all, so for more, head over to our preferred startup supplier stack.

YOUR VOICE

We asked if you’ve ever been a victim of online fraud, and credit card fraud “wins” the day…?

🟨🟨🟨🟨⬜️⬜️ 🙌 Fortunately not (35%)

🟨🟨⬜️⬜️⬜️⬜️ 🤏 No, but almost happened (19%)

🟩🟩🟩🟩🟩🟩 💳 Yes, a credit card transaction that wasn’t mine (42%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🕵 Phishing or Vishing (4%)

⬜️⬜️⬜️⬜️⬜️⬜️ 📳 A sim swap (0)

Your 2 cents…

“I was trying to buy a cheap laptop. I used my credit card details and several transactions tried to get through overnight. Fortunately, I was able to cancel the card that night.”

Vakele

Close one, Vakele. Glad you were able to sort it fast.

🏴‍☠️ When Orca Tackles Fraud...

Plus: Wanna buy a bank? 💵 Radioactive rhinos, recurring gold subs & how to build an HR Tech startup in SA.

NEW
Newsletter
July 5, 2024

The future? Well, sci-fi fans asked for it so this startup delivered real-world holograms. So when Metaverse meetings fall flat you can just beam yourself to boxes around the world instead.

In this Open Letter:

  • Cyber play: Orcas and AI fraud detection for Africa.
  • Radioactive rhinos, recurring gold subs & how to sell a bank.
  • Human element: How to build an HR Tech startup in SA.
  • Who needs more profit: The latest poll results are in.
  • The lead: 100+ SA business ideas — get access.

Together with WigWag

TRENDING NOW

Africa’s AI-Powered Fraud Busters

20-odd years ago, you could stay safe on the internet as long as you didn’t reply to any emails from “Nigerian Princes”.

But things have gotten complicated in the last few years. Online fraudsters have seen SA record a 600% increase in fraudulent activity between 2018 and 2022.

Just on the banking side, the gross loss due to online fraud in 2022 was as much as R740 million for the year, a 68% increase from the year before.

But what’s worse, it is estimated that up to 80% of fraud goes undetected. So the problem is bigger than many people realise.

So what if I make a little money on the side while trying to be a helpful citizen?

In comes AI

The introduction of AI to fraud is a double-edged sword.

On the one hand, you have criminals who use these tools to create, among other things, deep fake videos. Some of these AI-created ads have scammed millions from over 150 South Africans.

On the other hand, AI can be particularly good at analysing large amounts of data (like customer transaction data) in real-time, to identify anomalies that might indicate fraud.

Pretty useful in 3 key places:

  • Identifying fraud in real time to freeze accounts and prevent damage.
  • Analysing large datasets to investigate incidents.
  • Pattern-spotting and identifying fraudster strategies to implement future countermeasures.

Dealing with fraud

When it comes to online fraud, big banks deal with it in two ways: prevention and insurance.

They implement world-class solutions that often employ AI to detect and prevent fraud. Anything that slips through, is typically covered by insurance.

However, this approach doesn’t work for FinTechs in emerging markets for two reasons:

  • The tools deployed by big banks are typically built in developed countries, where the cost is higher. Not to mention the impact these tools have at the scale they operate – they are super expensive. Bring them to Africa and their ROI on fraud prevention is way less impactful.
  • FinTechs (especially startups) often can’t afford comprehensive insurance to cover all cases.

Not to mention that fraudsters employ different tactics in emerging markets than in developed countries.

That’s where Orca comes in. Orca (which derives its name from fraud prevention orchestration), is a South African startup that specialises in fighting online fraud in emerging markets, with AI.

Orca’s machine learning modules combine KYC (Know Your Client) data, transaction data, case management data and reporting to spot anomalies and help FinTechs and banks manage their fraud risk better.

And whilst they only started the company earlier this year, they're already making waves in fraud prevention on the back of a recently raised round of funding and a few flagship clients. We are watching this space.

For the water cooler or your next braai…

Key takeaways from this trend & the startup capitalising on it:

What is it: 600% rise in fraud in SA between 2018 & 2022 and AI is making it easier to combat. AI can also fight fraud with real-time transaction analysis to spot anomalies.

Market size in SA: Fraud in SA is R740m per year, but with 80% undetected/unnoticed could be as much as R3.7 billion. Preventing that from happening one could justify charging a decent chunk of it. We’d say it’s likely a R1bn opportunity at the moment and growing fast.

Featured Startup: Orca AI

Founder(s): Thalia Pillay and Carla Wilby

Investors/Backers: Norsken22, First Circle, Musha Ventures, Everywhere, Kara Ventures - latest round: $550k

IN SHORT

🥇 Gold-Level Subs. Troygold has partnered with Precium to launch a gold subscription service where you can purchase fractional amounts of gold for as little as R10 per month.

🦏 Radioactive Rhinos. The Rhisotope Project, a local startup implanting radioactive pellets into rhino horns to deter them from being poached (as the horn will not be safe for consumption), has entered the final research stage of the project and is seeking VC support to launch.

🛒 Shoprite’s Bulk Buy. Shoprite has launched its Cash & Carry stores’ e-commerce platform for bulk buyers. The platform offers visible stock access (to cut down on excess inventory and cash flow constraints) and free delivery within 50 km.

📺 Streaming SABC. The SABC’s streaming platform SABC Plus has just relaunched with a few enhancements, as well as apps available for the service on Apple TV & Google TV coming soon.

🏦 Wanna Buy a Bank? Bidvest Finacial Services is looking to sell Bidvest Bank and FinGlobal as it restructures the group to focus on core areas of the business. The group is already in the process of disposing of Bidvest Life.

😎 The Stack. Need tools or services to help your business grow? Check out our Founder’s Stack. Packed with tools like Apollo that help you find customers and Metavolve which helps founders stress less by providing a framework for growth.

Get Paid Faster, Easier

Nothing greases the wheels better than an easy payment process.

Just ask VISA — seamless payment experiences increase satisfaction by 23%, up conversion rates by 35.26% and reduce cart abandonment by up to 21%.

And with the number of online transactions in SA is set to double by 2027, card payments will be more important than ever.

That’s why you need a payment provider that:

  • Utilises innovative yet trusted payment technology
  • Offers simple setup and receiving of funds
  • Enables 24/7 instant payouts
  • Offers responsive human support
  • Has competitive pricing

WigWag uses Stitch’s world-class technology to offer:

  • E-commerce plugins: Integrate your Shopify, WooCommerce, Webflow or Squarespace site with WigWag to seamlessly accept card payments.
  • Embedded payments: Check out WigWag’s API docs if you are building a tech solution and want to embed payments.
  • Global receiving: WigWag processes any Visa and MasterCard, globally, getting you paid, from anywhere in the world.
  • Instant payouts: Real-time withdrawals for smooth business operations.
  • Human support: WigWag is always available to help.
  • Ad hoc payments: Use checkout links or add card payments to Xero invoices for payments outside of your store.

New to card payments? Check out this simple payments directory to easily guide you step by step.

Ready to simplify your payment processes? WigWag is offering Open Letter readers 1 month free (Up to R20 000)* if you sign up before 30 July using this link.

That’s zero fees in your first month!

HOW WOULD YOU BUILD IT?

Building mass-market HR tech for developing markets.

If you’re looking for insights on building solutions for corporates this week’s podcast is for you.

We spoke to co-founder Caroline van der Merwe about how they built SA HR Tech solution Jem HR, and she shared some gold insights about how they arrived at strategic decisions such as building the entire employee-facing experience via WhatsApp.

Catch the highlights

1. The No. 1 way to reduce friction for users

Solving key problems, boosting delivery and security while driving value where your end-user already engages – see how Jem’s WhatsApp approach works.

2. Building a business off clients with little-to-no budget

When the entire industry underinvests in HR, it pays to look for the spaces where you can actually generate a real saving – here’s how Jem ended up focusing on the “bakkie crowd”.

3. Drop everything and do this for 1 day a week

From building what you think is best and chasing deadlines to getting serious about your business and doing what it takes – learn how to do the hardest thing for founders.

4. Building a solid team via baptism of fire

Hopes, dreams, reality and building a solid startup team by becoming the leader you know you need to be – discover the one type of question you need to ask to succeed.

Check out all our startup podcasts.

YOUR VOICE

We asked what industries could use a profitability boost, and school she goes…

🟨⬜️⬜️⬜️⬜️⬜️ 🙋 Mine, I need more cash. (17%)

🟩🟩🟩🟩🟩🟩 🎓 Teachers, they should be paid more than soccer players. (57%)

🟨⬜️⬜️⬜️⬜️⬜️ 🍜 Restaurants should boost efficiency, not just hike prices. (11%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🎨 Design – must be a way to do more and earn more. (0)

🟨⬜️⬜️⬜️⬜️⬜️ 🛍️ E-commerce – gotta be a way to make it profitable. (11%)

⬜️⬜️⬜️⬜️⬜️⬜️ 💬 Other (tell us in the comments) (4%)

Your 2 cents…

“I really like teachers, but right now I need the cash myself.”

Michael

Oh, we hear you, Michael! It’s like “When’s month end?” (and it’s only the 5th).

“Live music”

Wendy

Definitely, Wendy. Did you catch our piece on Okhayi a week back? That solution could help musos get paid, too.

🌽 Margins from 0.5% to 5%+…

Plus: Certified Rolexes ⌚, WhatsApp money card, Cape Town’s Moody nod & tools to level-up your startup.

NEW
Newsletter
July 2, 2024

New on the shelf? If you haven’t seen them yet, meet all of South Africa’s GNU cabinet members right here. For the first time in 28 years, it’s no longer an all-ANC show, and this extra mix of DA, PAC, IFP and even FF+ faces has already caused a rally in the Rand, shares and SA bonds.

Question: Will this new cabinet be good for business? Hit reply to this email and give us your take…

In this Open Letter:

  • Nice market: Boosting agriculture profits in Africa.
  • Certified Rolexes, WhatsApp money card & Cape Town’s Moody nod.
  • Let’s scale: Tools and partners to help level up your startup.
  • What you’d pay to watch: The results are in.
  • Plug & play: The tools and services you need!

Together with

TRENDING NOW

Enabling African Food Production

Farming in SA is known for small margins. Data is limited (most are private companies) but a few people in the industry suggest it's typically only a 0.5% to 5% nett profit margin depending on crop type and buyer.

But these small margins are in most cases systemic rather than intentional exploitation. Before the internet, the chain to get your potatoes to your local grocer involved:

  • Distribution of inputs (fertiliser, services, equipment, packing materials etc.) to a farmer in a remote location.
  • Growing the crops and then taking them to a government-owned market which takes a 5% share of transactions.
  • At the market, there will be selling agents and buying representatives (after all, farmers aren’t always good negotiators) each taking roughly 6–8%.

Darryl likes to be paid on time, in cash, no questions.

What’s squeezing the farmer’s margin

  1. At sale time, ±15% is gone to all the roleplayers facilitating the sale.
  2. The farmer often has to take whatever price is offered – you know, ‘cos fresh goods can go off, leading to major losses.
  3. Often farmers don’t know where the highest-yielding market is which results in them trucking produce to a market only to sell to a store in their area - lots of money wasted.
  4. Inputs (fertiliser etc.) are hyper localised and this reduces the ability of of farmers to benchmark pricing and selection which could lead to higher costs.
  5. Finally, farmers often need a lot of working capital and, with a lack of data, traditional financiers can’t always calculate the risk of lending them money, which pushes up the interest rates on loans unnecessarily.

In isolation, each of these might not be big enough a business but put them together and the soon-to-be R418 billion market locally offers a major opportunity.

Keeping the produce flowing

The answer to unlocking more margin for farmers (and making a good margin yourself) lies in 3 parts:

  • Discovery: Enabling farmers to find buyers and vice versa before the produce leaves the farm, as well as helping them find the best and most affordable inputs (fertiliser, services, equipment, packing materials etc.).
  • Distribution: Making sure the goods move efficiently.
  • Data: Collecting better data (how much you produce, sell and your input costs) helps qualify a farmer for more working capital.

And that’s exactly what Nile.ag is doing. It’s Africa’s largest online agri-marketplace, connecting farmers directly to commercial buyers in 38 countries and 100 produce categories. It’s fast replacing the traditional government-owned markets which do upward of R20 billion per year.

What’s more, they also help farmers source the inputs they need at a better price — helping input providers deliver at lower costs by removing some of the need for expensive sales and distribution efforts.

But likely the most exciting play is how they are using data. Nile is leveraging data from the entire supply chain, both inputs provision and produce offtake, to offer data-driven financing solutions to farmers. These solutions would either not have been possible or not at the same interest rate (in the absence of data). And this credit extension provides a powerful lever to grow the ecosystem.

Will this work everywhere? Not really, developed markets’ supply chains are more mature. That’s why Nile is focusing on emerging markets.

And it makes sense, once the supply chain is established, it's hard for a newcomer to break into it at that scale.

A winner-takes-all market.

So far it seems like this South African startup is winning. We are watching this space…

Refer one friend to sign up to The Open Letter and view our top opportunity pick for this trend (and all future trends we cover).

Get your sharing link here.

IN SHORT

💳 WhatsApp Money Moves. Cross-border money transfer operator Mama Money is launching its Mama Money card which allows its customers to transfer payments internationally and manage their accounts using WhatsApp.

📋 Wining Record Keeping. A local medical records system CareOn (built by the Netcare hospital group) has beaten 87 entries from 19 countries to win the Digital Innovation Award at the 7th International Quality Awards in London.

📈 Soaring Tech Stocks. Tech stocks are leading global markets in the 1st half of the year, with Nvidia and the rest of the Magnificent 7 (Alphabet, Amazon, Apple, Meta, Microsoft & Tesla) adding $3.6 trillion in market value.

👍 Mother City Moods. Cape Town has received a revised outlook from stable to positive from rating agency Moody’s. And the city could be upgraded even further if its operating and financial performances continue to strengthen.

⌚️Pre-Loved Guarantee. Rolex will start offering an authentication service for its pre-owned watches in South Africa to help prevent buyers from getting scammed by fakes. The Rolex-certified pre-owned (RCPO) programme has been in a few select markets since late 2022.

Save Time and Money on Routine Doctor’s Visits

Doctors are super expensive — SA healthcare costs have shot up by 105% in the last 10 years alone.

Not only that, but the whole process takes so long… You need to phone to book an appointment. Drive all the way out there. Then sit in the waiting room, then drive over to the pharmacy, then, then, then…

Or, you can just jump onto Udok and see the doctor on your phone in less than a minute and pay up to 40% less.

What’s cool is you can pay with a card or medical aid, with no co-payments.

And they’ll send your prescription to any pharmacy you like.

So next time someone’s unwell, just Udok instead.

BUILDER’S CORNER

The Tools You Need to Level-Up Your Startup (Pt 1)

Building a business is tough, but using the right tools and partners might just make it a little easier.

We’ve been in the game for a while, and we often get asked: “Who can I speak to, to help with X, Y and Z”.

So we assembled the best of the best: A selection of tools and some unique South African service providers that can help you get the job done better and faster. We call it our Founder’s Stack. Today we will be featuring 5 of those, but to check out the full list, head on over to the brand-new section on our website.

Here are your first 5…

1. Planning your moves and keeping track of it all: Notion

We’d be lost without it. Notion is a flexible documentation, project management and task management hybrid tool. Use it to store your research and easily cross-reference it to a project or task list. It’s the only tool that has managed to keep us organised and that is quite a feat.

2. Get your website up: Webflow

Building beautiful websites has never been this easy. Choose from over 5k+ templates as a start and tweak your site without any coding experience. With Webflow you can get up and going within days.

3. Design with ease: Figma

When it comes to design, Figma is a game-changer. This collaborative interface design tool allows your team to work together in real time, whether you're creating wireframes, prototypes, or final mockups. Its cloud-based platform means you can access your designs from anywhere, and its intuitive features make the design process smooth and efficient.

4. Get paid: WigWag

All credit card payment switches offer the same right? Wrong! WigWag is not only extremely simple to set up and start receiving payments but also offers highly competitive rates and great customer service —they’re a local SA provider with local support. It’s simply the fastest most convenient way to get paid in SA.

5. Getting the house in order: Dommisse Attorneys

At some point or another, you are likely going to need legal support. Be it a shareholder agreement, memorandum of incorporation or term sheet for new investors. Dommisse offers all this and more and with a 10+ year track record of working with the top startups in South Africa, these guys know what they are doing.

And if you need any more connections to stellar suppliers we’ve used and recommend, check out our new preferred startup supplier stack.

YOUR VOICE

We asked what content you’d pay-per-view for, and coaches take note…

🟨⬜️⬜️⬜️⬜️⬜️ 🎯 Startup how-to podcasts (7%)

🟨🟨🟨⬜️⬜️⬜️ 🎸 Live shows/concerts (18%)

🟩🟩🟩🟩🟩🟩 📊 Business coaching/consulting (32%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🏋 Health and fitness-related (4%)

🟨🟨🟨🟨⬜️⬜️ ⚽ Sports Events (incl. school sports) (21%)

🟨⬜️⬜️⬜️⬜️⬜️ 🎨 Craft masterclasses (making cool stuff) (11%)

🟨⬜️⬜️⬜️⬜️⬜️ 💡 Other (oh, please tell us in the comments…) (7%)

Your 2 cents…

“I would also pay for great Live shows/concerts if fee is reasonable and for live sports events like Pickleball (if reasonable fee).”

Madelein

Hey, there’s a use case we didn’t think of, Madelein, amateur and semi-pro sports clubs! They can upload matches and content here and people can buy and watch. Nice.

“I love the school concert idea! As a choir mom, we struggle to fundraise. We could upload a video, and then all family, close and far can watch at a small charge. This is a game changer.”

Liesl

Yes, Liesl, and it also allows you to record and upload more to make more concerts available for viewing later on. We’d get on that and tell the school immediately. This is perfect for that kind of thing.

🍿 SA's School Play Revolution…

Plus: Uber’s free job rides 🚘, SA’s top employers, City Power’s chatbot & how to ace the first few months of your startup.

NEW
Newsletter
June 28, 2024

Enjoying The Open Letter? Some thought we were crazy for trying this 2 years ago and now people are saying this is "like being at a startup event without leaving home" and "an absolute must-read for anyone building a business in SA".

Well, we're about to do it again. In a few days, we're launching another revolutionary new SA startup tool that's gonna help boost our ecosystem to the moon, by boosting your startup to the stars.

Want in? Hit reply to this email right now and tell us about your business and your progress. The first 20 replies get exclusive first dibs on early access.

In this Open Letter:

  • Revenue streams: A new way to earn from content in SA.
  • Uber’s free job rides, SA’s top employers & City Power’s chatbot.
  • Start strong: How to thrive in your startup’s first few months.
  • Things in SA you’d like optimised: The results are in.
  • Plug & play: 100 Startup ideas in Rbn industries.

Together with

TRENDING NOW

A New Way to Earn from Content

Creating content in SA? Making money is quite tricky…

After all, nowadays it is possible to script, shoot, and ship your content pretty quickly…

But can you really eke out a living (never mind living large) as a content creator when you’re properly up against it? Kajabi's State of Creators ‘24 report makes for some interesting reading:

  • 96% of creators earn very little – chasing virality and battling the algorithm all while raking in ad spend for the platforms.
  • Most 6-figure creators have multiple income streams ranging from digital products, platform payouts, physical products, consulting and coaching.
  • The real money lies in monetising with your own products.

In South Africa, YouTube, for example, can pay out max R300 per 1’000 ad views on your videos via AdSense, but you need to reach a set number of views before they pay anything.

At that rate, you would only need to achieve 100k ad views just to earn R30k. But it’s not that simple, either…

And 8 of them are family members.

See, Google pays out more or less for different audiences and topics. An African audience is worth 3 times less than an Asian one. And news, gaming, fitness and beauty content is worth but a fraction of law, government and homemaking content – you can actually calculate projected incomes on YouTube here.

Making a buck on smaller audiences

Why so little? Well, all the big platforms are geared toward global audiences, so you need millions of views just to get a small cut of the money that’s in content creation.

Creators in the US and Europe have more options because they simply have more people with disposable income. That’s why so many overseas creators can earn ad revenue, get sponsorships and report that selling their own products is quite easy.

So when you’re focussing on building an audience in a small niche in South Africa, well, it's gonna be tough to make money on those platforms.

A new way for SA creators to earn

Enter Ohkayi, a local content streaming service where content creators upload their content, choose how much they want to sell it for, and how long a viewer has access to it.

There are no ads (which let's face it, we love ads), no ongoing subscriptions, and no random algorithms serving up whatever content it feels like – just the content your viewers are looking for.

With content creators getting 90% of the income from their content – Ohkayi takes a 10% processing fee – you can already start making money from your first view.

Check out their Afrikaans promo vid (sorry, no English version yet):

One of the early use cases that caught our eye was school concerts. Schools used to make and sell DVDs of concerts or performances. Well no one has DVD players anymore and YouTube doesn’t give them the option to sell it. So this might just be the platform for it.

With 12.8 million kids, if 10% of them do a concert listed on the platform and 30% of those parents buy at R200 view, that’s a cool R76.8 million in revenue.

And while it’s still early days for Ohkayi, they’re onto something unique and we’re watching this space…

Refer one friend to sign up to The Open Letter and view our top opportunity pick for this trend (and all future trends we cover).

Share the newsletter with one friend to see our top picks every edition!

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IN SHORT

☂️ Under one Umberella. Ukheshe, a local FinTech startup has rebranded to EFT Corporations after acquiring them in January. The rebrand combines the offerings of both companies under one unified identity.

⚡️Joulene. Joulene. Joulene. Joulene. Joburg’s power utility City Power has launched its customer-facing AI chatbot Joulene (Geddit? Joule is a unit of energy). PS: Good luck getting that Dolly Parton song out of your head.

🎶 AI Music Rip Off. Some of the world’s biggest record labels, including Sony Music Entertainment, Warner Records, and Capitol Records, are suing popular AI music generator platforms like Suno and Udio for using music from their top artists to train their generative AI engines without permission.

💼 Top Bosses. A list of South Africa’s top employers has been updated to include the Shoprite Group, the country’s largest private sector employer, who received their certification based on an independently audited and fact-based HR Best Practices Survey.

🚙 Rides for Jobs. Uber and Metropolitan Collective Shapers are partnering to bring 500 free rides for job seekers between 18 and 35 in South Africa attending job interviews, training sessions, or induction programmes during June and July.

Add Digital Gold to Your Product Stack

When it comes to storing value, gold bullion has stood the test of time.

For the last 93 years, gold has outperformed SA Bonds, Global Bonds and Cash.

In fact, only equities could match it for performance — and that’s a way riskier asset class.

However, buying and storing gold is not practical for most people. That’s why Troygold lets you buy fractions of gold bullion — purchasable in fractions from R10 and up, and stored on your behalf with their partner, RMB Bank.

What’s more, Troygold now offers access to this service to partners via API.

This means businesses across Africa can now offer their customers gold savings and gold-based financial products within their own platforms.

Imagine your customers’ response when you offer them secure wealth-building gold as a value-add or benefit…

Reach out to Troygold today to learn more.

THE BUILDER’S TOOLBOX

How to Ace The First Few Months of Your Startup

Hit the ground running and need some pointers? No worries, we got you with a few copy-and-paste guides to doing all the right things in your first few months of starting up.

1. Learn to Outbound Like a Boss

Master outbound strategies for effective customer acquisition by personalising your outreach efforts, tracking the most NB metrics, and continuously refining your tactics – here’s how to nail your startup outbound.

2. Create a Killer Pricing Page in 5 Steps

Optimise your pricing page to highlight value and benefits. Ensure clarity, focus on customer benefits, and use compelling calls to action – here’s the guide to crafting a standout pricing page.

3. Maximise Your Onboarding with 3 Core Principles

Enhance user engagement through effective onboarding processes by creating a seamless, empowering, and continuous onboarding experience – check out these principles to perfect your onboarding.

4. Boost Your Public Image

Implement PR strategies to enhance your startup’s visibility and reputation by focusing on strategic communications and targeted messaging – elevate your public image with these essential PR tips.

5. How to Scale This Thing to Its Maximum Potential

Assess your startup’s scalability and implement growth frameworks using structured growth strategies and scalable business models – here’s how to maximise your scaling potential.

6. Avoid the 8 Biggest Startup Mistakes

Learn from common early-stage mistakes to ensure smoother growth by managing hiring and marketing expenses wisely and avoiding over-reliance on PR – steer clear of these startup pitfalls.

Plus: For 70+ more in-depth guides like these, check out our builder’s toolbox.

YOUR VOICE

We asked what you’d like computers (AI) to optimise, and wow, it’s pretty unanimous…

🟩🟩🟩🟩🟩🟩 📝 Home Affairs – no way IDs and documents take that long to prep. (95%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🤡 The intern who keeps copying the boss on office memes. (0)

⬜️⬜️⬜️⬜️⬜️⬜️ 🌳 The gardener who accidentally prunes the neighbour's plants. (0)

⬜️⬜️⬜️⬜️⬜️⬜️ 🧽 The dishwasher that never gets the dishes clean. (0)

⬜️⬜️⬜️⬜️⬜️⬜️ 🍕 The fridge that hides my fave snacks in plain sight. (5%)

Your 2 cents…

“Could be used for fraud monitoring too”

Nicholas

Oh, yes, Nicholas. Like especially AI was made for that!

Cape Town Driver selected 🍕 The fridge that hides my fave snacks in plain sight. and wrote: “Funny thing I have a similar concept but for the resutaurant industry. Let's chat.”

Well, don’t leave us hanging — now we have to know!

“Definitely home affairs. This chat of saying that the system is offline is not on and the queues are ridiculously long for no reason.”

Panache

Yes, Panache, I mean a simple algorithm for just handling peak times would go a long way already.

“Computerising Home Affairs will get rid of rive corruption and incompetence.”

Vakele

Hey, Vakele, you just gave us an idea — imagine if getting your ID/passport/documents was like going to an ATM. Beep, beep, print, done.

🍟 Making Fast Food Even Faster...

Plus: ChipTok 🤖, big office perks & how to knock the socks off your first customers.

NEW
Newsletter
June 25, 2024

Weird news? While the rest of the world is getting worried about how much land and energy AI data centres are consuming, Europe is faced with a whole different problem: what to do with all its too-cheap energy. First-world problems, eh?

In this Open Letter:

  • Revenue boost: Hawks, lions and faster fast food.
  • Big office perks, more BRICS in the wall & Takealot’s Temu headache.
  • Sweet deal: How to absolutely delight your first customers.
  • What’s hindering SA homeowners: The results are in.
  • Plug & play: 100 Startup ideas in Rbn industries.

Together with

TRENDING NOW

Hawks, Lions and Boosting Production Revenue

Imagine any production environment (factories, fast food restaurants etc.) where you have a host of humans without many standardised processes, task allocation or timed objectives… chaos.

London’s famous 1954 match factory fire.

That’s exactly what manufacturing was like in the late 1800s until a gentleman called Frederick Winslow Taylor introduced :

  • Time Studies: Measuring how long it took workers to complete various tasks and identify the most efficient ways to perform them.
  • Standardisation: Advocated for standardising tools, equipment, and work methods to ensure consistency and efficiency.
  • Task Allocation: Breaking down tasks into smaller, more manageable parts and assigning them to workers based on their capabilities.
  • Training and Development: Importance of training workers to perform tasks most efficiently.
  • Incentive Systems: Rewarding workers for meeting or exceeding performance standards, thereby motivating them to improve productivity.

His work laid the foundation of modern management practices and influenced later management theories, including operations management and quality control.

Lingering issues

Needless to say, it had a great impact on output and productivity – but up until recently, it still had two major limitations:

  • You can only pick up issues or inefficiencies in production after the damage is already done.
  • Relying on human managers’ involvement can be too expensive for certain processes – even super managers only have so much time.

The latter has in some places been replaced by tech already. For instance, Amazon is gamifying its packing stations in warehouses to drive employee efficiency.

But there is a new tech in town that’s taking this capability to a whole new level.

Julie been packing 500+ boxes per hour

When AI marries Computer Vision

Imagine being able to track and analyse every single step of a production process and, in real time, relay feedback to the team executing the processes. This is what Hawktivity, a Stellenbosch-based computer vision startup is providing its customers.

Their solution uses video combined with data and algorithms to provide real-time guidance to optmises production processes. This kind of solution is particularly useful in time-study data gathering and manufacturing, but one of its early successes has been in quick-service restaurants.

The Hungry pilot

A recent pilot project in 50 Hungry Lion stores, helped the stores cut average customer waiting time in half. It did so by analysing queue length in real-time as well as the current pace of servicing customers, pinpointing the area of bottlenecking and alerting a team leader to send more staff to the bottleneck.

But it’s not only waiting times and customer satisfaction that was impacted. The stores on the pilot saw:

  • a 25% increase in revenue
  • 30% of which can be attributed directly to the solution
  • meaning, the solution helped increase revenue by 7.5% on average - pretty neat.

Taylor’s work brought about a revolution in manufacturing and his principles remain valid today. And with the advancements in computer vision and artificial intelligence, we are about to witness another iteration of major improvements in modern management practices.

We are watching this space….

Refer one friend to sign up to The Open Letter and view our top opportunity pick for this trend (and all future trends we cover).

Get your sharing link here.

IN SHORT

☁️ Head in the Cloud. Africa Data Centres has secured R2 billion in funding to expand its operating capacity and meet the growing demand for cloud computing in SA.

💪 Octomorphing. Software product development consultancy Polymorph is joining Octoco, a Stellenbosch-based group of technology companies to complement the group’s technology consulting company’s services.

🤖 ChipTok. TikTok’s parent company ByteDance has joined the AI chip race with partnership talks (with a ‘Murcan firm no less) to design and manufacture its own AI chips.

🤕 Takealot’s Temu Trouble. Local e-commerce platform Takealot has recorded an R252 million trading loss over the last 12 months, pointing the finger at global competitors like Temu & Shein slinging their wares to local shores.

🤩 The Big Office Perk. In a bid to get more people back into the office, global companies are bringing out the big perk guns: a desk of their own. Yeah. The only thing employees value more than the freedom to work from home is having their own desk.

🤝 Building BRICS. At least 12 more countries are looking to join the BRICS bloc including Cuba, Venezuela, Turkey, Laos, Bangladesh, Sri Lanka and Kazakhstan.

The Truth about Getting Ahead in Life

“Enough money to cover 6 weeks' worth of expenses” – that’s what JPMorgan Chase believes the majority of households need to weather most financial storms that could hit.

The problem however is that 65% of households don’t have this in place.

The main reason? Failing to plan for it – or budgeting.

But we get it, budgeting is difficult when your income or spending is inconsistent. It simply “never” works out the way you planned.

That’s why you need real-time tracking of income and expenses, automatically mapped to the right categories to keep you on top of your spending and work towards your financial goals.

Start your journey to financial freedom with FinWise today.

BUILDER’S CORNER

How to Delight Your First Customers

by Renier Kriel from The Open Letter and Stream

“Do things that don’t scale” has become part of startup folklore.

Written 11 years ago by YC founder Paul Graham, many have drawn inspiration from his often counterintuitive advice on, among other things recruiting your first customers, embracing fragility, creating insane customer experiences, containing your fire and delighting users.

The TLDR (although you really should read it) – it feels wrong to do time-consuming things that you won’t be able to do once your company is economically viable, but by skipping those things you miss out on vital steps and learnings.

So for today’s Builder’s Corner, we are focussing specifically on how to delight your first customers. WARNING: These things don’t scale…

1. Solve their problems (and some more) as if they are your only customer, ever

We all know startups exist to solve customer problems and when you are building SaaS products, it's easy to fall into the trap of trying to solve “for the whole market” you’re chasing. The problem with that thinking is that, early on, the whole market aint buying.

Let your customers feel like buying from you was the best decision they ever made and then, once they buy, exceed all their expectations. Why?

  1. Early adopters are talkers. They like to be in the know and tell other people about the smart stuff they find. When you delight them, others will hear about it.
  2. You will uncover nuances about their problems that are very hard to uncover when you service them at a distance. Get in the mud with them and you will learn a tonne. What’s more, your competition is likely not going to do it.
  3. When you add more value than they could reasonably expect, it becomes easier to ask for a referral or get them to help you get another customer.

2. Champion their business

When they win, you win! Can you add value beyond what your product is doing for them? This could be in the form of an introduction, or insights on an observation.

The key here is that, if they really feel like you are on their side, chances are you will get access to information, insights and relationships you otherwise would not.

Be proud of working with them and making a positive impact.

3. Add that personal touch

Like Paul Graham says, Tim Cook can’t send a handwritten letter with every Macbook sold, but you can. Use your smaller, nimble approach as a weapon to personalise your engagement.

What does this look like?

  • Handwritten cards are a good one, but many have caught on to this.
  • Maybe a personalised welcome kit, including a note with a small gift or product sample.
  • Anniversary and birthday surprises could work well if you can find the data.
  • Most underrated of all? Call them regularly to ask how you can help them win, and then go and do that.

Today’s Builder’s Corner was written by Renier Kriel from The Open Letter who is an expert in SA startup strategy & growth.

Connect with him on LinkedIn here.

YOUR VOICE

We asked about the biggest barriers to home ownership in SA, and it’s pretty much prices…

🟩🟩🟩🟩🟩🟩 📈 High property prices – "I need to win the lottery first!" (32%)

🟨🟨🟨⬜️⬜️⬜️ 😭 Can't save for a deposit – "Saving is harder than finding a unicorn!" (15%)

🟨🟨🟨⬜️⬜️⬜️ % High interest rates – "Banks are robbing us blind!" (16%)

🟨🟨🟨🟨⬜️⬜️ 🫰 Low salaries – "I need a CEO's salary just to dream!" (22%)

⬜️⬜️⬜️⬜️⬜️⬜️ 😈 Corruption and bureaucracy – "Too many palms to grease!" (3%)

🟨⬜️⬜️⬜️⬜️⬜️ 💸 High cost of living – "My grocery bill eats my savings!" (10%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🏡 I’m too lazy to mow the lawn (2%)

Your 2 cents…

Nix selected % High interest rates – "Banks are robbing us blind!" and wrote

“Transfer costs and Duties are hideously expensive. It costs you the price of a small flat to buy a decent 3/4 bedroom home in a good and secure area. This just feels like a rip off!”

We feel your pain, Nix. Everyone’s out to get their pound of flesh.

Thula selected 🫰 Low salaries – "I need a CEO's salary just to dream!" and wrote

"High legal fees" is another option that can be a serious barrier to homeownership. You may get 100% bond approval but the bank will not finance the legal fees associated with buying the property. If you did not have that as savings then you have to opt for a personal loan, which has exorbitant rates.”

Exactly Thula. And we already know how few South Africans have any sort of serious savings.

Natasha selected 📈 High property prices – "I need to win the lottery first!" and wrote

“The unnecessary high prices for property are ridiculous. Buying or renting. Then go look at some of those houses that is for sale or open for renting, they need maintenance that's for your cost as the agent tell you it's a steal price hence some tlc needed. Bulldust! The carpets and cupboards comes from Noah's time. Try renting were the owner is an ass and repairs and paint nothing, but your rent is paid well before its due. I've heard of some tenants that made an arrangement with proof that their wages is being paid late and the owner gave them a week to vacate the property? Seems to me that estate agents, banks and owners are the only ones that benefits. Everyone would love to own a place to stay, why not try and make that possible with rent to own options from either the bank,rental property groups. In all of S.A not just certain parts. And why is it that a property is paid back over 20 years and a car for the same value 6-7 years. Greed, is the answer. Continues cash flow for banks.”

Sure a fixer-upper sounds like a fun adventure, but you’re gonna break the bank popping in by Builders every weekend…

Erla selected 😭 Can't save for a deposit – "Saving is harder than finding a unicorn!" and wrote

“The main reasons in our area, which is popular with young famlies moving out of townships, is that people have a judgement of some sort against them. Not earning enough is a close second.”

Yeah, definitely Erla. That adds an extra layer of complexity to an already stressful situation.

Chrisjah selected 😭 Can't save for a deposit – "Saving is harder than finding a unicorn!" and wrote

“Saving for a deposit is difficult if we combine low salaries and high cost of living as a combo.”

100% — a double-whammy to the pocket.

🔑 The End of Rental Deposits…

Plus: New sea legs app, floating solar panels & how to manage your startup brand during a pivot.

NEW
Newsletter
June 21, 2024

Making friends? A new study found that people like you better if you’re more facially expressive when talking to them.

In this Open Letter:

  • Smart move: Say goodbye to rental deposits.
  • Top pick: A PropTech business idea to serve 3M+ users.
  • New sea legs app, floating solar panels & Meta to save SA media.
  • Big swing: How to manage your brand during a pivot.
  • The WhatsApp service you really want: The results are in.
  • Plug & play: 100 Startup ideas in Rbn industries.

Together with:

TRENDING NOW

Solving a Few Rbillions in Landlord-Tenant Headaches

For renters, there aren’t many payments quite as begrudged as the damage deposit.

Two months’ worth of rent just sitting there for 12+ months – it’s a cashflow killer.

And, according to one founder building in the PropTech space we recently interviewed, as much as 70% of renters may never get their deposits back (no officially published stats on that, but we know it happens).

Deposit-related issues are a double-edged sword:

  • Renters may need to go into debt to come up with the required 1–2 months' rent for a deposit.
  • Landlords, on the other hand, face risks if the deposit doesn’t cover a month’s rent (or even more) for potential damages or loss of income.
  • Not to mention that it’s a time-consuming process especially when people are literally moving out in the morning and need to move into their next place that night.
Jaco was “between places” and swore it would only be for a couple of days, a week max…

It’s a fine balancing act for landlords

Charge too much up front and you increase the barrier to entry and risk a drop in occupancy.

Charge too little, or nothing at all, and you won’t have any windfall if there are damages or the tenant defaults.

This is where local PropTech startup LeaseSurance are making some moves by offering protection on rental lease agreements that eliminate the need for property rental deposits.

Using tenant data gathered from landlords, they develop tailored premiums and coverage on rental contracts that give tenants the option of selecting to add a small additional monthly fee instead of the cash deposit.

Then LeaseSurance will cover any claims should they move. And the fee is typically around roughly 5% of the rental amount per month… much more affordable from a cash flow perspective.

And it's a big market

With over 3.3 million rental properties in SA, the likely amount of deposits locked in rental contracts of just the R5’7001–R7’500 pm properties bracket (just under 30% of all rental properties in the country) alone right now could be around R9.6bn.

According to the 2023 Q4 results of PayProp Rental Index:

Rental Bracket

No of Properties in SA

Percentage of Market

R0-R2’500 pm

201,300

6.1%

R2’501–R5’000

702,900

21.3%

R5’001–R7’500

963,600

29.2%

R7’501–R10’000

765,600

23.2%

R10’001–R15’000

521,400

15.8%

R15’001–R25’000+

145,200

4.4%

Formal Rental Housing

3,300,000

100%

Get access to more tenants

Traditionally only 30% of those who qualify for a rental property end up taking it, simply because they can’t come up with the cash deposit at short notice.

So, by incrementally upping monthly payments over lump sum deposits, you address serious barriers to entry for renters, giving landlords a larger pool of potential tenants to choose from.

And LeaseSurance seems to be onto something – currently projects show that 3 out of 4 tenants opt for the marginally higher monthly payment option as opposed to paying a deposit.

Pretty soon, the rental deposit might be a thing of the past… We are watching this space…

Refer one friend to sign up to The Open Letter and view our top opportunity pick for this trend (and every future trends we cover).

Get your sharing link here.

IN SHORT

🤝 African x Korean Kollab. AfricaLabs and The Korea-Africa Foundation have signed a memorandum of understanding for a strategic partnership to drive innovation and economic growth across the continent via AfricaLabs’ network of nearly 500 hubs across 260 African cities.

🤢 All Aboard. Dr Nicole Taylor, a postdoctoral research fellow from Stellenbosch University’s Mechanical and Mechantronic Engineering Department is developing an app, Mariner 4.0 in the hopes of curing seasickness in professional seafarers.

🤑 Funding SA’s Media. SA’s Competition Commission is considering starting a fund for struggling South African media houses which will be funded by global big tech players like Meta and Google.

Eskom’s High 5. Eskom has won an appeal to keep 5 of its oldest plants operational until March 2030, exempting them from the more stringent restrictions on pollutants kicking in next year. The 5 plants currently generate a quarter of SA’s coal-fired generation capacity.

☀️ African Lake Power. New research has shown that Ethiopia and Rwanda could generate more than 100% of their energy needs from floating solar panels on large lakes and other water bodies.

Using Content to Drive Leads

The rise of AI has brought about the rise of automated sales emails…. It’s just too much. And it begs the question: “How effective will outbound sales be in the future?”

Only time will tell. But what has always worked is content marketing that drives inbound leads.

In fact, according to HubSpot, inbound SEO leads have a 14.6% close rate, while outbound leads have a 1.7% close rate.

But how do you create more inbound leads? One way to do this is through content marketing.

When it comes to creating high-quality business content, you don’t need “good writers”, you need people that understand tech and business.

That’s where Stream comes in: Unlimited content subscriptions to grow your brand, drive inbound leads and front-load value to prospects.

Check it out here and set up a call to learn more.

HOW WOULD YOU BUILD IT?

How to Manage Your Brand When You Pivot

If you have to pivot but are stressing over the impact it might have on your customers and reputation, then this week’s podcast is for you. We spoke to Ean Barnard, head of brand and marketing at Finch Technologies, who had to transition from mixed-level B2C to full-on B2B, and he had some gold advice for when pivoting.

Catch the highlights

1. Overcoming the No. 1 brand hurdle in a pivot

Separating your business case from messaging and a useful framework for redefining your brand messaging. It’s about clarifying/redefining who are and what to say to clients – get the insights here.

2. Unlocking the power of collaboration for clarity

From team workshops and sessions to expanding to stakeholders for diverse perspectives, it’s vital to get as much input as possible to uncover new insights for messaging that resonates – see what Ean did here.

3. Adding a touch that resonates universally

No matter who or where you’re pivoting to, one thing remains true: Humans respond to human stories. Showcasing the people behind the company and their stories results in wins in any market – see how it’s done here.

YOUR VOICE

We asked what else you’d prefer to do via WhatsApp, and it’s a mealtime affair…

🟨🟨🟨🟨⬜️⬜️ 👩🏻‍⚕️ Drs appointments (31%)

🟩🟩🟩🟩🟩🟩 🍳 Restaurant menus and bookings (40%)

🟨🟨🟨⬜️⬜️⬜️ 🔗 Business registrations (19%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🙌🏼 Asking for a raise (4%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🔮 Getting psychic readings (2%)

⬜️⬜️⬜️⬜️⬜️⬜️ 👛 Couch cash collection booking (4%)

Your 2 cents…

“Great article. I have also heard good things about FinWise.”

Jay

“Love the key nuggets and how updated it is with current and global affairs.”

Boka

Wonderful, thanks, guys! More coming real soon.

🤩 They Did What to Sell More…?

Plus: Uber permits 🚘, SA-India solar, JSE cannabis & how to build a bigger, more valuable company.

NEW
Newsletter
June 18, 2024

3-Second memory? Try a goldfish that can drive a car. Yeah, would you believe those Israeli researchers developed the tech almost a decade ago and trained fish to do that? How on Earth don’t we have them as pets yet?

In this Open Letter:

  • Niche boost: Driving sales with the human connection.
  • SA-Indian solar boost, Cannabis on the JSE & Uber permits.
  • Big deal: How to build a bigger, more valuable business.
  • What you want more scanners for: The results are in.
  • Startup power: 100+ businesses SA needs right now.

Together with:

TRENDING NOW

Connecting Sales Faster than You Can Say WhatsApp

When it comes to sales, rapid response is a game changer.

In fact, responding to a sales enquiry within 5 minutes has a 10 times higher chance to convert compared to after 10 minutes. Let 20 hours go by, and you’ve probably lost the deal.

Now, inbound call centres are great for that rapid response agent, but that’s not always practical or financially feasible.

Think estate agents or car salesmen. They’re on the road a lot and leads are coming in all hours of the day. Arguably the fastest and most convenient way to connect reps to leads is likely on an app.

Preferably one they both already use… WhatsApp.

But this is problematic for a few reasons:

  • Many aren't comfortable giving out their personal numbers.
  • That relationship is then between the rep and the customer, not the company.
  • The company has no way to monitor sales rep’s response times and engagement if it's on their personal WhatsApp number.

Empowering the human-first connection

In a world that’s going AI-driven chatbots for first response, Sudonum is building tech to supercharge human-first engagement… and we are here for it – reaching out to an estate agent, you want the human touch.

Because, let’s face it, when it comes to facilitating emotional decisions, humans just work better.

Makes the whole sales process a little less daunting.

Sudonum enables companies, like estate agencies, to add a “Contact via WhatsApp” button on a website or digital property (like Property24). Clicking this button, the customer gets routed via a WhatsApp Business account to a real human agent (or sales rep).

In WhatsApp, in a chat, without having to add a new contact, retype standard messages, and repeatedly copy-paste text.

What’s more, while the chat itself remains private between participants, the company can track some all-important business metrics:

  • how quickly a lead was responded to (if at all)
  • how individual reps are performing
  • and conversation durations.

At the same time, the lead gets popped into a CRM of choice to ensure it doesn’t get lost and that the company keeps the relationship details (not the agent).

And they have great traction. With customers across four continents and several industries including real estate, automotive and marketing agencies, rapid human response is taking off and we are watching this space…

Refer one friend to sign up to The Open Letter and view our top opportunity pick for this trend (and all future trends we cover).

Get your sharing link here.

IN SHORT

☀️ Funding Solar. Local clean energy company candi solar has closed its Series C funding round securing $38 million to support its growth plan including bringing 200 MW of business solar across SA and India.

🚙 Legal Lifts. SA Prez Cyril Rampahosa has signed the amended National Land Transport Act into law bringing regulation for Uber and Bolt operators to obtain operating licenses just like other public transport providers.

👕 Profitable Threads. Mr Price’s financial services division is about to hit the R1 billion revenue mark. This after the division’s revenue increased by nearly 5% to reach R869 million according to the group’s Financial year-end results.

🌿 Listing High. Cilo Cybin Holdings will become the first cannabis company to be listed on the JSE when its listing on the AltX market takes place on the 25th of June.

🚍 Reversible Lane. The MyCiTi bus lane on the R27/Marine Drive between Loxton Road and Broad Road in Cape Town will become reversible allowing inbound travel to the City in the mornings, and outbound travel to Table View in the afternoon.

Manage Your Money Better

Things have gotten pricey over the last two years in South Africa. With inflation of 6.9% and 6% in ‘22 and ‘23 respectively, and interest rates kept at the highest rate in 14 years, consumers are feeling the pinch. In fact, the South African middle class is facing increased pressure with debt servicing levels at 79% of their income, up 28% from two years ago. It's never been more important to budget well. That’s why we recommend Finwise.

Finwise connects securely to your bank account, to track your income and expenses and then it helps you:

  • Budget and keep tabs on your spending (per category).
  • Track and compare your spending to previous months.
  • Track all your investments and your net worth.
  • Plan and forecast your future finances to see if you’ll have enough.
  • Get tips, insights and nudges to manage your money better.

Use FinWise to simplify the way you work with and think about your personal finances. Save money, get peace of mind, and be in full control of your finances.

Start your Finwise journey for free today — Sign up here.

BUILDER’S CORNER

How to Increase the Value of Your Business

by Elvorne Palmer from The Open Letter and Stream

Once you’re going and growing, something that always comes up is: Where is this going?

Do you want to list, sell or build an ever-growing stable group of companies?

Either way, at some point, you’re going to want to know how to increase your value…

There are several ways to deliver a big payday for shareholders. The one the startup world is probably most familiar with is the growth-focussed “winner-takes-all” method. Where you build out a new idea, raise a ton of VC money and try to grow as big as you can, as fast as you can, to dominate the market and then list on the stock market to create liquidity for the shareholders.

But that doesn’t always work in SA, though. We have a smaller market and thus it’s not always possible to reach profitability at scale.

So another more sensible approach is to build for profitability as fast as possible and leverage that success to build an even bigger business in that specific sector.

Here’s how that works…

The consolidation play

1. Build for profitability

The goal isn’t necessarily to become big early on, but rather as stable as possible. Prove the business model and the unit economics. This often means prioritising optimisation and streamlining the business over growth. You want to understand the dynamics well and also start building up some cash — you will need both later.

2. Build a strong team

It’s vital to build a company that can eventually run by itself – without too much of you as the founder’s interference. And the easiest way to achieve that is to have all the right staff in all the right places so that if you, as the founder, step out, it doesn’t really affect the business’s ability to earn. This will free up your time to focus on doing the deals later which will make this go big!

3. IP or Proprietary processes

It’s a tough one because you can’t always own IP, copyright or trademark, but it really makes a big difference if you have something – a process, system, method or technology — that’s clearly identifiable as your own. This could be vital for helping you do number 4…

4. Buy out others to augment your offering in the same sector

There are often major opportunities in consolidating smaller businesses into a larger company. This brings about scale benefits which unlocks bigger margins.

The thinking around this in the startup space would be: if you’ve developed some tech/IP that helps you do business better/faster/cheaper – whatever – than the other guys, there should be some “traditional businesses” or competitors who will eventually be struggling more than you.

And the idea is to use your success (or this is even a good reason to raise some funding) to go and buy them out – competitors, suppliers and other companies in the same space. So you can take whatever customers they have, optimise it as much as possible and assemble a group that’s perceptibly more valuable.

There’s even a formula for these kinds of buyouts:

  • Only offer to put up a percentage (say 10%) of the business’s purchase price upfront.
  • Then to do a leveraged buyout deal – you take the assets of the business you’re buying and put them up as collateral for a loan to buy it (asset finance).
  • You could even create a deferred payment deal with the seller – where you agree to pay them off over time instead of all at once.
  • And then you pay back the loan or the deferred payments with the money the business you’ve just bought makes – hopefully, combining it with your business you can optimise it enough to have it pay for itself very quickly.

So effectively you use a little bit of cash, but mostly your track record and future vision to buy entire companies.

Today’s Builder’s Corner was written by Elvorne Palmer from The Open Letter & Stream who is an expert in go-to-market & content.

Connect with him on Linkedin here.

YOUR VOICE

We asked what types of scanners you’d use, and truth detection it is…

🟨🟨🟨🟨🟨⬜️ 🥑 Food nutritional content scanner (30%)

🟨🟨🟨⬜️⬜️⬜️ 🤸 An “Is my exercise actually working?” check (17%)

🟨🟨🟨⬜️⬜️⬜️ 🤖 Scanners linked straight to AI doctor for diagnosis (17%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🧌 A real-life internet troll toxicity checker (3%)

🟩🟩🟩🟩🟩🟩 🤬 Instant bulls#$% detectors for parliament and meetings (33%)

Your 2 cents…

“Really enjoyed content and style of delivery”

E Klopper

“I am so glad I signed for this newsletter its very informative...thank you”

Abigail

Awesome, thanks guys — keep an eye, we’re launching lots of big new things soon!

🥵 Relieving 75M+ Users' Pain…

Plus: SA’s robokiddos 👾, biltong-powered fuel, TymeBank’s global play & how to spin up, pivot and build faster.

NEW
Newsletter
June 14, 2024

AR ready? A couple of former Magic Leap execs are betting on slowly introducing AR to the public with their new startup Sightful, releasing a laptop with no screen, just AR goggles.

In this Open Letter:

  • Global reach: A 75M+ impact for SA Biotech.
  • SA’s robokiddos, biltong-powered fuel & TymeBank’s global play.
  • Founder fuel: How to spin up, pivot and move super-fast.
  • How you like your rewards: The latest poll results are in.
  • Startup power: 100+ businesses SA needs right now.

Together with

A 75M+ Impact for SA Biotech

Four years after the global COVID-19 pandemic, the world has largely returned to normal. Except for nearly 75 million people globally who developed “Long COVID” and basically never fully recovered. 

The Long COVID problem

Between 10% and 20% of the 750 million+ people who contracted COVID-19 have developed Long COVID, a chronic after-effect condition with symptoms including fatigue, brain fog, shortness of breath, chronic pain, worsened fatigue after exercise, and heart palpitations.

Problem is there are currently no diagnostic tests for Long COVID, and clinical tests often show no abnormalities, leading to the thinking that there’s nothing wrong with sufferers, leaving them with no end in sight to their symptoms – which persists for at least 3 months, or way longer.

And just like that, Covid memes are back.

Enter Biocode, a Stellenbosch based Biotech startup spun out of Stellenbosch University’s Physiology Department. In research, they discovered persistent blood clots in most Long COVID patients. These microclots are between 1 and 100 micrometres small – slightly more than the diameter of a strand of human hair.

But microclots cause seriously big issues

Causing obstructions in smaller blood vessels, they throttle the body’s blood and oxygen flow, further damaging the arteries – which is what Long COVID symptoms actually are: the body struggling for oxygen supply.

Biocode has developed a world-first diagnostic tool, Biolab, to detect these abnormal microclots, the test results help patients with actionable next steps to reduce microclot levels, offer a long-term health roadmap, and validate the experiences of those suffering from Long COVID. 

Which is big: Across the pandemic, South Africa had around 4 million confirmed cases of COVID-19. And global guidelines estimate about 15% of those will likely have Long Covid – that’s 600k South Africans some of whom may not even know they have it, but just feel “off”.

But it’s even bigger: Expanded globally, there are 75 million potential patients, who could benefit from this technology, which is why the tech is already being sublicensed in Germany, Switzerland, the US, and the UK, with plans to go full global. 

Not to mention, the potential of expanding this microclot detection into other medical applications. But that’s not all Biocode is up to…

The even longer game

Biocode is also developing its Biocheck Inflammation rapid test kit, which screens and tracks chronic inflammation, a key factor in coronary artery disease, diabetes, cancer, and Alzheimer's – which combined cause over 70% of global deaths annually. 

The Biocheck test provides results in 15 minutes showing the presence of inflammation as well as the level of inflammation. This can help people adjust lifestyles to lower or eliminate this inflammation which in turn could lead to longer and healthier lives.

The market for this? Probably most of the 8.1 billion+ humans on Earth.

The impact of Biotech on the quality of life can be enormous and local startups such as Biocodes make us excited about South Africa’s role in this. We are watching this space…

IN SHORT

🍞 Bitcoin, Milk & Bread. Pick n Pay recently reported generating R1 million in monthly sales from shoppers paying with cryptocurrency. This is one year after becoming the first (and only) large retailer to accept crypto payments for groceries.

🤖 SA’s Coding Kiddos. The Department of Basic Education has gazetted an amendment to the National Curriculum Statement for Grades R-12 to offer coding and robotics from as early as grade R in public schools across SA.

🥩 Biltong Going Global. Vivo Energy is expanding its footprint with the acquisition of Engen South Africa. The deal includes a ”biltong clause” to ensure that Vivo Energy will source and offer SA products like biltong across its fuel stations even outside of SA.

📡 Canning Satelite TV. MultiChoice has lost 400’000-odd subscribers in SA alone the last 12 months including a 9% drop in DStv Premium & Compact Plus subs, a 9% drop in Compact subs, and a 2% drop in its DStv Family subs. Eina!

🏦 Banking on Scale. Local digital bank TymeBank is raising nearly R2.8 billion in preparation for its planned listing on the NYSE by 2028. Once completed, this raise will value the business upward of $ 1 billion….unicorn loading.

NOTHING LIKE COFFEE & CRYPTO

Need a gift for that one mate who doesn’t stop talking about his bitcoin?

Nothing tells your mate “I get it, stop telling me about it” than buying him some Crypto Coffee.

Not financial advice… just crypto & coffee.

A medium roast arabica that will take your friendship in one direction and that is up. Buy online here.

HOW WOULD YOU BUILD IT?

How to Spin Up/Pivot and Move Fast

If you’re looking for insights on how some founders seem to spin up (or pivot) and launch ideas into businesses so fast (and successfully), then this week’s podcast is for you. We sat down with Kim Whitaker, now with Airbnb but perhaps best known as the person behind Ubuntu Beds during Covid – one of SA’s gold-standard case studies in innovation/pivoting.

And Kim shared her insights into spotting opportunities and quickly spinning up a new company, in record time.

Catch the highlights

1. From zero to success in 48 hours

From closing down Cape Town schools to contracting Covid to getting on the radio and launching a game-changer in two days – this is the real story behind Ubuntu Beds.

2. The No. 1 secret to building fast successfully

Pulling off miracles in no time requires the perfect mix of two special ingredients in your team: discipline and creativity – here’s how it works.

3. The only skill you need to build something they’ll love

From first dates to brands, we all make the same mistakes until we realise the one thing that changes it all is learning to see through the user’s eyes – get the insights here.

4. How we could fix all of SA with design thinking startup mindsets

If SA was run like a tech company, the Finland example and gold advice for founders and builders – check it out here.

YOUR VOICE

We asked what activities should give bonus rewards, and it’s a tie between coffee and work…

🟨🟨🟨⬜️⬜️⬜️ 🎾 Padel (16%)

🟨⬜️⬜️⬜️⬜️⬜️ 🪂 Fortnite (8%)

🟨⬜️⬜️⬜️⬜️⬜️ ⚔️ Dota (4%)

🟨🟨🟨🟨⬜️⬜️ 🚴 Mountain bike (20%)

🟩🟩🟩🟩🟩🟩 ☕ Coffee shop hopping (26%)

🟩🟩🟩🟩🟩🟩 💻 My work (26%)

Your 2 cents…

Ha ha, yeh there’s one nobody thought of yet, Marian — supporter’s rewards!

We can see it now, Chris — big five survival rewards out on the greens…

Ah, the only question in life worth answering before 8 in the morning, hey? Give Crypto Coffee a shot, we love their brew.


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⛳ When Hobbies Finally Pay Out…

Plus: Amazon’s slothy launch 🦥, 1-hour Apples, SARS klaps Temu & how to spot business ideas before they get big.

NEW
Newsletter
June 11, 2024

Adding up? Apple blew a few minds at their developer conference yesterday. We especially love the new iPadOS scientific calculator. Here’s to never doing long division again.

In this Open Letter:

  • Game on: The tech to make golf hobbies pay off.
  • Amazon’s SA trouble, 1-hour Apples & SARS klaps Temu, Shein.
  • Check it: You’ll never guess who won this week’s lucky draw.
  • Way ahead: How to spot new business opportunities, early.
  • Industries you want gamified: The results are in.
  • The lead: 100+ SA business ideas — get access.

Finally, the Golf Hobby Makes Sense

With over 420 locations, South Africa ranks 12th in the world for golf courses. 

And the sport’s a biggie: Golf contributes an estimated R49 billion to the economy – roughly 0.6% of GDP – whilst also providing 40k jobs annually. In the USA, it’s even bigger: R1.8 trillion to the US economy in 2022 and created over 1.65 million jobs.

Within this industry, there are major opportunities to help the three major roleplayers do more:

  • Golf courses want to sell more rounds of golf at better prices.
  • Equipment and gear manufacturers want to engage the players to sell products.
  • Golf players want to play more rounds, for less.

It's complicated…

Golf courses have fixed expenses, and pricing every round is tricky. 

Once courses cover their fixed cost, the cost to accommodate a player is minuscule… pure profit. 

So, for many courses, it would make sense to get the courses filled up, even if it means dropping the regular price somewhat.

Golfers, on the other hand, are likely to play more should it become more rewarding or cheaper to do so.

Get into it and it takes up more time than court cases

So how do you drive benefits for all 3 role players?

It’s time to Golf 2 Earn

South Africa has long been a major player in global golf. And it's only fitting that a local startup pioneers another golf first.

Introducing Wunderpar. It’s a blockchain-based reward program where golfers earn Wunder tokens by activating their app before playing a round. The app then tracks movement on the course and rewards the player with tokens. 

These tokens can then be used to redeem entries into raffles, claim discounts or even redeem for physical goods.

By rewarding golfers for playing, Wunderpar can capture an audience of golf enthusiasts which then allows them to:

  • Get golf courses to boost the amount of Wunder earned on their course, effectively increasing traffic to the course.
  • Get brands onboard to engage the audience and sell through their store.
  • Build a golfing community with leaderboards and prizes that drive playing and engagement.

They’ve been active in South Africa for 8 months and have seen 67’627 rounds being played on the app and 8’708 items purchased using Wunder. They have also onboarded Callaway as a partner, driving more value to users while also expanding their offering to the Middle East and Sweden.

The gamification of physical world actions is on the rise and it's exciting to see a local startup get in on the concept in golf. We are watching this space…

IN SHORT

🦥 Sloth-like Launch. One month in and it looks like Amazon is struggling to make inroads in SA with one local marketplace seller saying they sell 2 or 3 products a week on Amazon vs 10 a day on Takealot.

🛒 Booming Bash. The Foschini Group’s online shopping platform Bash is set to break even ahead of schedule. With the release of TFG’s annual financial results, the online retailer grew by 44.4%, and became the No. 1 fashion and lifestyle app in SA.

🍏 1-Hour Apples. Riding the on-demand wave, Apple’s iStore has introduced free iStore ”RightNow”, a one-hour delivery service available in the Sandton and Cape Town CBDs, and set to expand to Tshwane and Durban soon.

👗 Taxing Threads. Your Temu (and Shein) order is about to get ±39% more expensive starting in July. From the 1st, imported items of clothing valued at under R500 will carry the same duties as bigger orders which carry a 45% import duty plus VAT.

💰German FundFest. Germany’s Federal Ministry for Economic Cooperation and Development has launched a new funding scheme develoPPP Ventures for African startups including South Africa, Nigeria, and Kenya. Applications for the R2 million in grant funding close end of June.

AND THE WINNER IS…

Congratulations, Kunal! You’ve won a R1’000 in Troygold (remember you need an account to claim) and a copy of SA startup must-read, The First Kudu. We’ll contact you personally with your prize, but we just wanted to share how your big win went down…

We’re putting together another lekker comp, so check back for details real soon.

BUILDER’S CORNER

How to Build For The Future

by Renier Kriel from The Open Letter

Want to be good at spotting startup opportunities? Become a futurist.

Startups are essentially bets on how the world is changing and how that change will create the opportunity for a business to capitalise. They then build for this new world and, if all goes well, are ready to capture the market when the anticipated change goes mainstream.

Examples: 

  • Holidaymakers wanted entire apartments/houses, not hotel rooms: Airbnb was born
  • Use tech to drive down insurance premiums: Naked Insurance
  • Boost the booming coffee industry’s supply chain: Henlo Coffee
  • When banks won’t do small business loans: Lula
  • Unlock the township economy with payments infrastructure: Kazang 
They see me rolling….

Sure, it makes sense in hindsight. But how do you spot opportunities like these BEFORE the time? 

Let’s dive in…

1. When new tech emerges

After using ChatGPT for the first time, many asked “What will this do to job X?”. And it's a good question to ask. But to find the opportunity, you need to go a few layers deeper. Ask “What will happen once AI actually kills job X”. 

This will lead to a whole host of anticipated happenings. I.e. People skilled in job X will be out of a job, but those people will pivot careers or find a niche that AI can’t do, or it will result in a social dilemma. Each of those brings forth its own set of opportunities (help them find jobs, help them pivot, help them find AI-proof niches etc.).

If you play out these scenarios it could lead to finding a big market…

2. When the law changes

NHI, Bela Bill and many other legislative changes bring forth a new set of rules. Anticipate how these laws will play out and what some of the associated challenges will be, then start building to solve that!

I.e. the Bela Bill proposes that homeschooling should be regulated. This will likely mean a host of reporting for homeschoolers. Be the first to build this tool and you are set to have a bunch of customers.

3. When there are big problems

Big problems mean big opportunities. Anticipating that Eskom will not be able to resolve loadshedding in the short term led to a boom in renewables. Could the same happen with clean water supply?

Imagining the future and how it will impact the world is a great way to find startup ideas. If you need some inspiration, check out our list of 100+ startup ideas for South Africa.

Featuring multi-billion-Rand opportunities across 25 industries, including:

- 15 too-hot FinTech opportunities
- 12 Groundbreaking B2B & ecosystem ventures
- 11 Entertainment & Sports businesses waiting to be built
- 11 Insanely cool tech companies to start
- 9 Disruptive E-commerce plays to change the game

Plus: PropTech, InsureTech, EdTech, HealthTech, Automotive and so many SaaS opportunities just waiting to be built…

Share your referral link with a friend and get them to sign up and we will email the list to you!

Today’s Builder’s Corner was written by Renier Kriel from The Open Letter who is an expert in SA startup strategy & growth.

Connect with him on Linkedin here.

YOUR VOICE

We asked what industries need some gamification, and a lot of eyes are on home affairs…

🟨🟨🟨🟨⬜️⬜️ 🚨 Doing your taxes – blegh! (19%)

🟩🟩🟩🟩🟩🟩 🪪 Applying for ID, passport or vehicle licensing. (27%)

🟨🟨🟨⬜️⬜️⬜️ 🩺 Waiting for the doctor or at the hospital. (14%)

🟨🟨🟨🟨⬜️⬜️ 📸 Tourism and hospitality should be way more fun. (19%)

🟨🟨⬜️⬜️⬜️⬜️ 🧺 Laundromats and just doing laundry in general. (11%)

🟨🟨⬜️⬜️⬜️⬜️ 💵 Banking – cue the “banking royale playoffs”. (10%)

Your 2 cents…

Exactly, Bobby! And free quality collectable stickers and board games at Caltex on the way to your holiday destination.

Nogal, Jason. It’s like the doctors are all Googling, WebMDing or asking ChatGPT “What the heck did that patient have?”

Ha ha, yeh getting money for almost nothing and creating jobs (which the employees apparently hate). Shame, though, we’d all benefit if only they’d embrace some new tech and approaches.


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『☕』Gamifying Your Next Cuppa...

Plus: SA’s pirate clampdown 🏴‍☠, Discovery breach, our thriving tech scene & how to build a killer newsletter in SA.

NEW
Newsletter
June 7, 2024

A winter nonny? Seeing as we’re all missing summer a bit, SAB has announced it’s bottling sunshine with Crona Cero in SA, a new alcohol-free brewski that’s enriched with Vitamin D — you know, for when you’re missing the sun.

In this Open Letter:

  • Big break: Here’s to gamifying the R12bn coffee industry.
  • Pirate clampdown, Discovery breach & SA’s thriving ecosystem.
  • Something for you: 100+ SA business ideas — get access.
  • Slam dunk: How to build a killer newsletter in South Africa.
  • Where you wanna invest: The latest poll results are in.
  • Giveaway extension: More chances to win R1k’s worth of gold.

Gamifying Coffee

Ask boomers how to buy a house and they’ll probably say something to the tune of “stop buying Starbucks”. 

And they might be onto something, with the price of a cappuccino ranging from R27.90 all the way up to R55.50 at SA’s favourite local destinations, coffee is pricey. Unless of course, you buy from Xpresso, which sells everything in their stores for R12.

Coffee is an estimated R12bn a year market and is set to grow to R15bn by 2025 and the likes of Food Lover’s Market are betting hard on coffee as a major area for growth in the next 5 years with another 245 Seattle Coffee shops.

Setting up shop

But when it comes to setting up your own coffee shop, the espresso machine and barista combo is the star of the show. And when you open 50 Coffee shops a year, you want affordable high-quality espresso machines and baristas that adhere to the quality requirements of your product.

That’s where local startup Henlo Coffee saw an opportunity. Their espresso machines are not only affordable (R169k vs R250k+ for imported machines) but get your cost of quality down using electronics all while being connected online.

Coffeemaking, gamified

Each machine has a built-in Barista Companion, measuring every step of the process of making your perfect cup of coffee. If the barista does anything that’s out of line with the perfect cup you ordered, the machine notifies them on the spot, allowing them to course-correct. Effectively gamifying quality and removing the need for ongoing barista training and quality checks.

What’s more, the data tracked gets passed back to a live dashboard giving owners oversight on the quality and quantity of coffees, which helps them fight losses (no more unpaid coffees going out) and plan better. 

Finally, with the machine being connected online, it allows Henlo to perform remote maintenance and monitoring to ensure the machine is running in tip-top shape.

Instagram post by @coffee.henlo

For Henlo, this enables nice SaaS revenue on top of the margin made on the coffee machine itself… smart.

Although South Africans have all the ingredients to design and manufacture world-class hardware products (high-quality engineers, low labour cost and an economy big enough to launch into), many shy away due to the supply chain challenges of being on the southern tip of Africa. 

But find a fast-growing market, an innovative product and a hardware supply chain with lots of fat in and you might just be in business. We love what Henlo is doing and watching this space (while sipping a cappuccino)...

IN SHORT

🤖 Health Bot. The local team behind GovChat has just launched Supple, an AI health chatbot to provide digital healthcare assistance to all 54 African Union members.

🏎️ Revving Up. Local payments orchestration platform Revio has changed to Precium to reflect its growth from a local processor to a global payments platform off the back of its $5.2 seed funding round at the end of 2023.

🇿🇦 Thriving Ecosystem. SA has landed the 52nd spot in StartupBlink’s Global Start-up Ecosystem Index 2024’s Top 100 Countries, with Cape Town (128th), Jozi (139th), Pretoria (426th), and Durban (547th) all cracking the Top 1’000 cities.

🥸 Discovered Data. Around 20 Discovery Insure clients have had their personal data extracted from the insurer by a fraudster including residential addresses and details of the items covered by the policies. This follows the massive TicketMaster breach where nearly 560 million customers' personal info was taken.

🏴‍☠️ Streaming Pirates. MultiChoice had a busy week, from taking action against the Waka TV streaming Kingpin who got arrested on Wednesday for “illegal sale of internet streaming pirate devices that allowed individuals to access MultiChoice content”, to the R125 per share cash offer from Canal+ to all shareholders.

🚀 Taking Off. Boeing’s Starliner (with 2 crew members on board) has docked with the International Space Station despite the discovery of 3 hydrogen leaks over the course of the launch and mission, as well as some thruster issues mid-mission.

100+ STARTUPS SA NEEDS RIGHT NOW

Looking for your next big business to build?

How bout tapping into over 20 months of active startup market and industry research… all at once…

Introducing our new stack of 100+ South African business ideas, complete with industry deep dives, market sizes and broader economic insights — all hand-picked and vetted by us.

Featuring multi-billion-Rand opportunities across 25 industries, including:

  • 15 too-hot FinTech opportunities
  • 12 Groundbreaking B2B & ecosystem ventures
  • 11 Entertainment & Sport businesses waiting to be built
  • 11 Insanely cool tech companies to start
  • 9 Disruptive E-commerce plays to change the game
  • Plus: PropTech, InsureTech, EdTech, HealthTech, Automotive…

The only thing we ask is that you refer 1 friend to The Open Letter. That’s it, just use your referral link below to share The Open Letter with someone you know will also unlock value from it, and all 100+ startup ideas are yours, for free, forever!

Claim it by referring someone with this link…

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HOW WOULD YOU BUILD IT?

How to Build a Killer Newsletter

If you’re looking to create a hyper-engaged audience for your product/business (you know, to lower CAC or up conversion rates), then this week's podcast is for you. Because, obviously, that’s exactly what we do! And that’s exactly what we’re doing here: Telling you how we built The Open Letter – enjoy!

Sizzling highlights

1. Finding the niche and getting the confidence to press GO

From walking around with an idea in your head for years to meeting the right people and suddenly BAM, 5 minutes later you’re in business, this is the value of pinpointing a niche where you can add value – get the insights here.

2. Email is the most valuable primary medium

Evolving from the stock-and-stale standard company email format to something truly unique, inspiring and personal – here’s what most people get wrong about email.

3. Growing your audience & beating the algorithms 

Going from little-to-no engagement to record-setting open rates while maintaining a super high-quality audience – some serious insider secrets here.

4. Turning your haters into followers

The not-so-nice side of any direct engagement with a business audience, the right mindset to engage on a human level and flipping a potentially bad situation into a win – here’s how we turn haters into fans.

5. Keep adding value

Dev jobs, cool events and a focus on building really valuable businesses – get a taste of what's coming up next from The Open Letter.

You can also grab the Spotify and Apple Podcast links on our website here.

YOUR VOICE

We asked what you’d like to invest in, and startup’s the way...

🟨🟨🟨⬜️⬜️⬜️ 🏢 Commercial property (18%)

🟩🟩🟩🟩🟩🟩 🦄. Local startups (32%)

🟨⬜️⬜️⬜️⬜️⬜️ 📊 More options of listed companies (6%)

🟨🟨🟨⬜️⬜️⬜️ 👑 Gold bullion, baby (17%)

⬜️⬜️⬜️⬜️⬜️⬜️ 🛰 Space tech and cool industrial projects (5%)

🟨🟨⬜️⬜️⬜️⬜️ 🤖 AI companies (12%)

🟨⬜️⬜️⬜️⬜️⬜️ 💪 I only invest in myself (9%)

Your 2 cents…

Lekker Wesley, yeh SunCash is the bomb — remember that time we interviewed with the Momint CEO?

Wise words, Panache! Upskill, try new things, push yourself and test boundaries — then you achieve the kind of success that allows you to invest.

You’re probably right, Vakele. In the last few weeks we’ve seen reports of how countries, from France to Dubai and even Mauritius are positioning themselves as the “AI hub” of their region — meaning they’re trying to attract AI companies to come put up headquarters in their country. SA should be doing the same in Africa, for sure!

ENTER TO WIN BIG!

We’ve extended the competition till Tuesday!

So you can still enter…

To celebrate our 10k subs and TroyGold’s launch of a first-of-its-kind subscription, we’re shaking things up and giving away R1’000’s worth of gold bullion with this week + a copy of SA startup must-read, The First Kudu (check out the new audiobook here).

To enter, simply refer one friend this week using your unique referral code.

That’s right, just one friend to sign up. Want more entries? Refer more friends and each referral will count as one entry into Friday’s draw.

(Note: In order to claim your prize you’ll need an active TroyGold account, which is free to create.)


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🏪 Is This the Future of Markets...?

Plus: Here comes TrumpTok 📣, Pick n Pay’s pickle, why Apple’s chips are down & how to build a killer website yourself.

NEW
Newsletter
June 4, 2024

An SA shake-up? Yes, by now we all probably know the ANC lost their majority rule, both nationally and in a few key provinces.

But, interestingly, if we ran in the elections and got all our readers to vote for us, we’d be SA’s 32nd largest party (just about 4k adrift from COPE).

Yep, we hit 10’000 subscribers over the weekend and we want to say thank you for reading and engaging!

In this Open Letter:

  • Capital Markets: How blockchain and CASP are shaking up finance.
  • Here comes TrumpTok, Pick n Pay’s pickle & why Apple’s chips are down.
  • Go to market: How to build a beautiful website yourself.
  • How we like our insurance freebies: The poll results are in.
  • Giveaway time: Win R1k’s worth of gold & The First Kudu!

An Alternative Way to Capital

The JSE (Joburg Stock Exchange) has seen 22 delistings in 2023, down only slightly from the 25 delistings that occurred in 2022. And apart from the recent separate listing by WeBuyCars, there isn’t too much else cooking on Africa’s top stock exchange.

Shoutout to our friends at The Outlier for this awesome chart.

It’s worrying for asset managers who are pressed to make do with fewer options, but it's also worrying for companies that want to use the stock market as a means to raise funding.

But why is the JSE listings shrinking?

Well, it might have to do with the costs of listing: It’s estimated that for a company to issue traditional financial assets (shares) via the exchange, typically involves up to 40 intermediaries. Wow, 40 extra hands all taking a cut from the transaction.

In fact, the global financial intermediary sector is said to extract over $200 billion in value from the market every year (that’s R3.8bn).

Yes, listing is pricey, but for good reason: Compliance and trust are crucial for the functioning of capital markets. 

But we can’t help asking if that risk could be done at a lower cost…

There’s a better way, Harold.

Tokenising assets the future of finance?

A smart contract can represent ownership of an asset. Think shares, a bond or even a representation of a real-world contract. And on the blockchain, these smart contracts can easily be traded with other users in exchange for cryptocurrency.

With the first 75 FSCA Crypto Asset Service Provider (CASP) licenses being issued earlier this year, we might see more tokenised asset exchanges and solutions hitting the market. 

And Mesh is one such local startup. Mesh developed the infrastructure to enable the issuance and trade of assets. Running on the Stellar blockchain, Mesh recently launched one of the continent’s first tokenised bond sales, raising R100m for “Die MOS inisiatief” to fund the development of private education facilities. 

The bond was fully underwritten and guaranteed, offering investors prime + 2% with a minimum investment size of as little as R5’000. 

It’s one step closer to bringing alternative investment opportunities to the man on the street, all while helping companies raise funding more affordably.

Exciting times ahead….we’re watching this space…

IN SHORT

🌬️ Cape Doctor Power. The V&A Waterfront in Cape Town is testing 5 small-scale, pole-mounted vertical wind turbines as part of its green energy mix.

🍏 Apple Chips Down. Nvidia is set to replace Apple as the world’s second-most-valuable company thanks to a massive upshot in demand for the high-end chips that power AI applications, and a seemingly decreased demand for iPhones.

🔻Petering Out. Retail OG Pick n Pay looks to be in a spot of bother after publishing its financial results ending 25 Feb 2024. The results show a 373% decrease in net profit from R1.17 billion to a net loss of R3.2 billion.

🎺 TrumpTok. Former US Prez and presidential nominee Donald Trump joined TikTok this weekend and has already amassed 1.7 million followers. Guess he doesn't hate everything Made in China.

🤷🏽 Berkshire Affordable. The NYSE claimed a bizarre glitch that displayed Berkshire Hathaway’s stock as being down by 99.97% has been fixed.

BUILDER’S CORNER

How to Build a Good-Looking Website Yourself

by Renier Kriel from The Open Letter

One of the most valuable concept validation techniques is to get a website up that markets your products and services, and then send some traffic there.

Best-case scenario, it leads to a few customers. Worst case, you get market feedback. But if building your site takes a long time, costs a lot of money or doesn’t look great, this experiment quickly becomes too costly.

We’re really trying, Bob…

That’s why I use Webflow.

Webflow makes it easy (for even non-coders) to build visually appealing websites in a visual interface. You pretty much design the website (or start from a library of over 1k+ templates) and Webflow writes the HTML, Javascript, etc. in the background.

After building many sites, including The Open Letter and our latest venture, Stream’s site on Webflow, we think it’s good enough to give you a quickfire guide on using it to get a new website up in a jiffy.

1. Set up your Webflow account

Head on over to Webflow and create a free account — it gives you dashboard access and lets you explore the features before you fully commit. The free plan allows you to build a site with 2 pages, 50 content items and 1’000 visitors per month before having to pay. Enough for you to get a feel for how it works.

2. Browse for a template you love

They have over 1’000 templates, catering to various industries and purposes. Whether you just need something basic to test an MVP and messaging or want to, later on, go full-blown e-commerce (check out WigWag’s plugin to enable E-commerce in SA), you likely don’t need a designer to get a really slick-looking website.

3. Start editing

The best part is how easily you can just change up the template to suit your brand needs — it’s basically an intelligent drag-and-drop editor. And if you get stuck, they have like a thousand video tutorials on how to do virtually everything you can imagine on there.

4. Find a site plan (hosting) & connect your domain

Webflow has hosting plans built into it all, making it super easy for you to connect your domain and publish your work of art to the world!

5. Click publish

It’s basically done and live as soon as you’re happy with it. And then you can just use the Webflow editor to make changes and republish… no developers or designers needed (just yet).

If you want to get started with Webflow, please use our affiliate link which will help us earn revenue.

Today’s Builder’s Corner was written by Renier Kriel from The Open Letter and Stream, who is an expert in SA startup strategy & growth.

Connect with him on Linkedin here.

YOUR VOICE

We asked where you’d like to earn some “free” embedded insurance, and most eyes are on the FinTechs…

🟨⬜️⬜️⬜️⬜️⬜️ 🍟 My Uber Eats and takeaways (8%)

⬜️⬜️⬜️⬜️⬜️⬜️ 📱 My data purchases (3%)

🟨🟨🟨⬜️⬜️⬜️ ⛽ When filling up with petrol (22%)

🟨⬜️⬜️⬜️⬜️⬜️ 🎬 My DStv bill or Netflix sub (10%)

🟨⬜️⬜️⬜️⬜️⬜️ 🛒 Rewards for my online shopping (14%)

🟩🟩🟩🟩🟩🟩 💰 My bank or digital wallet, for sure! (43%)

Your 2 cents…

An intriguing thought there, Charles? Yeh, many would probably say that was the idea behind the RAF, but a properly structured, controlled and individualised (preferably commercial) product would likely be quite welcome with vehicle owners.

Not a bad idea at all, Jason. Wonder if FNB would bite…

ENTER TO WIN BIG THIS FRIDAY!

To celebrate our 10k subs and TroyGold’s launch of a first-of-its-kind subscription, we’re shaking things up and giving away R1’000’s worth of gold bullion with this week + a copy of SA startup must-read, The First Kudu (check out the new audiobook here).

To enter, simply refer one friend this week using your unique referral code.

That’s right, just one friend to sign up. Want more entries? Refer more friends and each referral will count as one entry into Friday’s draw.

(Note: In order to claim your prize you’ll need an active TroyGold account, which is free to create.)


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💰 Africa's Untapped Insurance Goldmine…

Plus: Bots gets Starlink 📡, most phones in SA, startup acquisitions & how to go from idea to market: the quick-fire playbook.

NEW
Newsletter
May 31, 2024

Good boy? China now has an army of rifle-equipped robot dogs — watch them open fire on targets here. PS: Swarm of drones with automatic rifles also included.

In this Open Letter:

  • Huge potential: Cracking Africa’s trillion-Rand insurance game.
  • Bots gets Starlink, most phones in SA & local acquisitions and funding.
  • And the winner is: You’ll never guess who won this week’s lucky draw.
  • Startup collection: Going from idea to market — the playbook.
  • Where most go to find a date: The poll results are in.

A R1.5 Trillion Africa Insurance Play

The African insurance market was valued at $81.6 billion in 2022 (a cool R1.5 trillion), of which South Africa holds the lion's share with roughly 74% of total premiums. This means the rest of the continent represents a mere 0.4% of the global insurance market (at the moment). 

Currently, insurance penetration (the insurance market divided by the GDP) in Africa is just 3%, compared to Europe’s 8% and the USA’s 11%.

But the potential market is huge and, quite frankly, this is where the world’s future growth lies, so there’s some real gold for those who can help Africa catch up…

Why does it matter?

There are many broader economic benefits of insurance for both individuals and businesses, including:

  • Risk Management - Those unexpected losses don’t take you out.
  • Business growth - Encourages business expansion and innovation by mitigating risks.
  • Social Security - Offers a safety net against economic hardships, improving quality of life and workforce productivity.
  • Saves tax money - Reduces the need for the government to foot the bill in the case of disasters, allowing that money to work elsewhere.

Many say insurance is like the backbone of a growing economy. Without it, there is a constant erosion of value making it hard to make progress.

But why’s Africa lagging behind?

  • Economic challenges - Most simply can’t afford it. 
  • Limited access to insurance products - Traditional insurance distribution models simply don’t cut it. 
  • Lack of consumer awareness about the benefits of insurance - Once again, traditional models of distribution just don’t work well in most of Africa.
  • Lack of frictionless payments - Mobile money is really popular in Africa, but only 14% of providers support auto debit which undermines sustainable insurance take-up 

Preach it, Rev

A new way to distribute, price and sell insurance

Inclusivity Solutions is a Cape Town-based startup that’s replacing much of the paperwork and manual processes involved in issuing policies with a new digital enablement platform. 

(But this isn’t the novel part, local startups like Root offer a similar solution.)

What makes Inclusivity Solutions interesting is their embedded insurance offering – a form of digital bundling, enabling partners from virtually any industry to offer insurance policies as an add-on or feature, generally as part of a digital sale.

  • Think mobile network operator that wants to drive up their ARPU; they can offer free life cover for every user spending more than a certain amount per day/month.
  • Add a hospital cash insurance product free of charge with every cross-border transaction.
  • Embed insurance to cover loans to businesses in the case of death or disability of the owner.

Insurance as an incentive drives customer behaviour helping the businesses they partner with grow. On the consumer side, by rolling out the insurance products digitally and partnering with customers with large established distribution, they solve the major prohibiters of insurance in Africa. 

A win-win-win.

With predictions showing the African insurance market heading to $123.8 billion (2.3 trillion) by 2028, this is definitely a South African startup to watch….

IN SHORT

🧫 Growing BioTech. Immobazyme, a BioTech that leverages the power of precision fermentation to create high-value proteins has secured its latest round of funding, taking its total funding to just over R24 million. The investment will go towards scaling up Immobazyme’s production capabilities.

🛠️ DIY Buy. SA Short-term Insurer Santam has acquired Kandua, an online marketplace for home services (think “Uber of plumbers,” etc.), bundling it into Santam’s existing Home+ service offering.

🚌 Keep on Rollin. Local ground transport operator management platform Ratality has been acquired by Busbud, a Canadian global mobility group to accelerate its B2B software growth.

🛰️ Another One. Botswana has just become the latest African country to grant Starlink an operating license. At this rate, South Africans will get GTA VI before getting Starlink…

📱Phone Frenzy. PEP and Ackermans, part of the Pepkor Group, sold 5.6 million cellphones between October 2023 and March this year, selling 7 out of every 10 prepaid smartphones in SA and making it the biggest cellphone retailer in the land.

AND THE WINNER IS…

Congratulations, Ngcebo! You’ve won a R1’000 Takealot voucher and a copy of SA startup must-read, The First Kudu. We’ll contact you personally with your prize, but we just wanted to share how your big win went down…

But all is not lost if you haven’t won! We’ve got a brand-new competition coming up next week — with sweet, sweet new prizes. Details next Tuesday…

THE BUILDER’S TOOLBOX

From Idea to Market: Your Quick-Fire Startup Playbook

Lots of ideas but no clear route to market? No worries, we got you with a few copy-and-paste guides to take your next build (or iteration) from zero to one, fast.

“Builders, Assemble!”

1. How to Validate Your Idea in 10 Minutes

7 Desktop-validation methods to gauge the market size and scope, discover pain points (and how NB they are) plus what the competition’s doing – learn to validate ideas in 10 minutes.

2. How to Build a High-Performance Marketing Engine

3 Steps for high-gear marketing through next-level segmentation, iteration on qualitative feedback and affinity, plus 6 tools to automate it all with the ultimate marketing engine.

3. How to Secure Pilot Users (for Feedback & Learning)

Steal a page from Notion’s community-led model, the “test ads” and iterate method or check out this B2B SaaS user play in the guide to securing pilot users.

4. How to Grow by Asking for (and Receiving) Feedback

4 Steps for getting more useful feedback you can build on – including ensuring honesty, powerful question-framing and listening so you can grow your startup on feedback.

5. How to Make Sure You Have Market Fit

Nailing all 4 market fit types – including 1) How to check if you have each fit (type) and 2) What to do if you don’t (yet) – check the gold standard in ensuring market fit.

Plus: For 70+ more in-depth guides like these, check out our builder’s toolbox.

YOUR VOICE

We asked how you’d find a last-minute date, and most lean on a friend…

🟨🟨🟨⬜️⬜️⬜️ 😘 Tinder, Boardroom or some other dating app (20%)

🟨⬜️⬜️⬜️⬜️⬜️ 💬 Online forums or stalking on socials (6%)

🟩🟩🟩🟩🟩🟩 🙊 Ask a friend to set me up (34%)

🟨🟨🟨⬜️⬜️⬜️ 🍻 Just go down to the pub/club and meet people (15%)

🟨🟨🟨🟨⬜️⬜️ 🤶 All of the above – just don’t know what my wife/hubby will say. (25%)

Hey, thanks, Vivaldo — glad you like it! We unpack a variety of different industries and business opportunities throughout the year, so hope you keep finding cool and unique things here (and that million-dollar opportunity, of course!).


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The Open Letter is a great way for me to get out of the day to day of my work and see what else is happening out there. It helps me add value to my portfolio companies.
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Different type of business news and views of the future.
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Best newsletter for quick trends in the technology and startup space, with many quirky jokes, and an easy to read and follow model
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I enjoy the concise round-up of latest tech/startup news and the relevance to South Africa
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An informative newsletter that gives insight into sectors in the economy I don't have exposure to. I always click through a number of the articles and topics they reference. It's worth the time it takes me to read it!
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Veda
It’s great that there’s one place to get all the latest information in tech/startups to stay up to date!
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Renda
The Open Letter is great space to get informed of relevant trends. Whether you are an entrepreneur or futuristic leader, this one's for you!
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JD
Interesting and quirky tech news and items often about things I didn't know or wasn't aware of. I also benefit from many of the Start-up items and information, thanks.
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I look forward to Tuesdays and (now) Fridays because of this newsletter. I find it fascinating - a group of interesting South Africans exploring various industries and sharing local and global insights. Thank you!
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Joseph
This is the best newsletter on Startups in SA and everything innovation related. Its a gem and a great asset that keeps me abreast of whats happening in tech locally and abroad.
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Bulu
The Open Letter strikes the perfect balance between globally-relevant startup advice and trends specific to SA, all neatly wrapped up in a digestible (and kinda funny) morning read
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Nicholas
Renier and team have successfully created an intellectual hub for SA's local tech insiders.
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Dane
An interesting, well curated information about new technology and tipos and ideas for startups
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William
I have never met Renier and the team from The Open Letter - in fact, the Capetonian Cool in me would probably walk straight past them in public! - but I never ignore a fresh newsletter in my inbox. It's possibly the best source for current and meaningful insights into the local innovation industry, and it's delivered in a way that always makes it stand out. Keep up the good work!
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The one newsletter, if you're building something, you shouldn't miss
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This is a must-read local newsletter for business folk, techies and entrepreneurs alike.
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A great resource for entrepreneurs and tech enthusiasts who want to stay up to date, but don't have the time to scroll through the internet every day.
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This is the best newsletter in SA. A must read for all startup founders, people interested in business and tech and those who just want to stay up to date with trends in the industry in SA and globally.
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John
Amazing curated nuggets on the tech industry at large with interesting analysis on market opportunities. Short and sweet, serious yet funny and easy to read. Love it
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Sebastien
Awaiting the day the disc golf is featured. Then my testimony will be fabulous
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Chris
If you're looking for a combination fun business news, practical start-up advice and the odd meme, The Open Letter is for you.
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Carl
A great day to keep to start your day to inspire you and keep up to date on latest trends in the venture space
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Paul
Fun and informative, great for anyone working in the startup space or thinking of moving into it.
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Karel
The best and most applicable newsletter if you in the tech or startup space in SA!
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Michael

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