Chpter, a Kenyan e-commerce startup launched by co-founders of YC-backed Marketforce, has raised $1.2 million in a pre-seed round and will use the new funding to improve its technology stack and expand into Egypt and Nigeria.

Founded in 2022 by Tesh Mbaabu, Mesongo Sibuti, Kuria Kevin and Mark Kiarie, Chpter helps businesses convert social media from a marketing channel to a sales platform with chat, order, and payment tools. The company charges a monthly subscription and earns a transaction fee for payments processed on its platform. Some of its clients include insurer Britam, shoe store Kicks Kenya, and e-commerce platform Phoneplace. The company operates in Kenya and South Africa.

“We are investing in our tech stack to offer an end-to-end product, connecting the APIs from social media platforms such as WhatsApp and Instagram with popular e-commerce and customer relationship management systems like Shopify and Woocommerce,” Tesh Mbaabu, Chpter’s co-founder and CEO told TechCabal.

Pani, an Africa-focused investment firm co-founded by Cellulant’s former CEO, Ken Njoroge, led the funding round. Other participants include Plesion Capital, Techstars, Norrsken, Renew Capital, and ViKtoria Ventures, and angel investors, including Nala founder and CEO Benjamin Fernandes and Workpay co-founders Paul Kimani and Jackson Kibigo.

The fundraising is a vote of confidence from investors in the young startup. It was founded while its two co-founders were running Marketforce, a YC-backed Kenyan e-commerce platform once valued at over $100 million. 

Some of Chpter’s investors had previously invested in Marketforce, although Mbaabu declined to share further details. Chpter operates independently of Marketforce.

“Chpter was and is not under the MarketForce umbrella. It is going to continue operating independently. However, MF is a shareholder in it,” Mbaabu told TechCabal in May 2024. 

Chpter’s acceptance into the Norrsken Accelerator in 2023 and the Safaricom Spark Accelerator in May 2024 may have positioned it as a key startup in conversational commerce. 

Norrsken Accelerator investment remains undisclosed. Chpter joined Safaricom’s Spark Accelerator in May 2024. The telco provided three months of training and mentorship to help Chpter scale.

Bolt increased the base fare on August 26 by 10% to KES 220 ($1.71) from KES 200 ($1.55). However, drivers claim the increase was insignificant and want a fare structure based on distance and time instead of discounted fares. 

“You just can’t offer a loan product while skipping our key grievance, which is unfair pricing,” said Dennis Nyariki, the deputy chairman of the Organisation of Online Drivers Kenya (OOD).

Bolt first offered car loans in 2019 and offered Renault KWID cars to drivers, but were paused during the COVID-19 pandemic. Drivers could buy cars valued at KES 1.2 million ($9,296) with monthly installments of KES 43,000 ($333). 

Under the new offering, fintech Hakki Africa will source the vehicles and handle loan disbursement. The interest rate will depend on the vehicle type and loan repayment duration. Bolt declined to share specifics on the type of vehicles and the cost.

The Organisation of Online Drivers Kenya (OOD) criticised the loan facility, citing monthly charges under the previous car offering. The union claimed that vehicles were repossessed from drivers due to missed payments, suggesting aggressive loan collection tactics under the offering.

Bolt did not immediately respond to a request for comments.

At least five drivers who spoke to TechCabal said they were not interested in the car loans. They argued that their earnings were insufficient to cover vehicle maintenance costs. 

“The loan facility can’t really help. The money we make is not even enough to service a car,” Stephen Njoroge, a Bolt driver partner, told TechCabal. 

Two other drivers said they were unaware of the facility, although Bolt Kenya may attempt to incentivise them with the product in future campaigns. 

“The loan is only good for people who want to enter the business. We already have the cars,” Timothy Wachira, another Bolt driver partner, said. 

Ride-hailing companies have come under increasing pressure after drivers began pushing for fare hikes to increase their earnings.

While Bolt hopes the car loans will offer some relief to aggrieved drivers, the company may have to consider making bigger concessions by lowering commission. 

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Daniel Yu and Belal El-Megharbel, the co-founders and CEOs of Wasoko and MaxAB, will jointly lead the merged entity as co-CEOs. They will also serve alongside existing investors, including Silver Lake and Tiger Global, on the company’s board of directors. 

Wasoko and MaxAB contributed nearly equal stakes to the combined entity, Yu told TechCabal on a call, dismissing earlier claims that MaxAB has a controlling interest. 

“MaxAB and Wasoko have a pretty close to 50-50 shareholding,” Yu said. 

The merger, seen as an attempt to create a category king in the contested B2B e-commerce sector, signals investor willingness to see consolidation. Wasoko (last valued at $625 million) and MaxAB had raised over $230 million from investors like Tiger Global, Impact Engine, and the University of Chicago.

TechCabal reported in December 2023 that the deal is structured as an equity consideration, which means existing shareholders will receive shares in the new company. First announced in December 2023, the deal was expected to be finalised in April 2024. Wasoko declined to provide specifics about the delay due to the merger’s “sensitive” nature.

The new entity will capitalise on MaxAB’s position as a leading B2B beverage supplier to a network of small retailers throughout North Africa. 

While Cairo will serve as the headquarters, there are no plans for job cuts since Wasoko made 100 duplicated roles redundant in December 2023. 

The new entity will initially operate in five countries—Kenya, Tanzania, Rwanda, Egypt, and Morocco. Wasoko was in Zambia, Uganda, and Zanzibar but closed shop in those markets in March 2024. The new entity will have 450,000 merchants serving 65 million consumers. 

The integration of Wasoko and MaxAB’s tech and operations was completed in 60 days, the company claimed. Former Wasoko employees told TechCabal in January 2024 that MaxAB’s systems were preferred, as MaxAB had also brought its staff from Egypt for the integration exercise. 

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“These changes are crucial as Twiga accelerates towards profitability and continues its mission of revolutionising food distribution in Africa through innovative digital solutions,” the company said in a statement confirming the layoffs.

Twiga Foods will also open 25 new roles in the growth and innovation departments.

In a dramatic year for Twiga, cloud provider Incentro dragged it to court in 2024 for failing to pay a $261,000 cloud bill. It provided a glimpse into the startup’s struggles to pay vendors and staff, exposing cash flow issues. In March, founder and CEO Peter Njonjo left the business after it secured new funding, prompting speculation that he may have been pushed out. 

Njonjo was replaced by Charles Ballard, an ex-Jumia executive, in May 2024. 

“These adjustments will allow us to improve our service offering and lay a stronger foundation for sustainable growth in the years to come,” said Ballard.

In November 2023, Twiga raised $35 million in convertible bonds from new and existing investors like Creadev and Juven. Njonjo invested $1 million of his personal funds in that round. 

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Customers interested in renting the Starlink kit, which costs $350 (KES 45,000), will pay a one-time activation fee of $21. They can choose between a 50GB plan for $10 (KES 1,300) or an unlimited package for $50.50 (KES 6,500). Both plans offer speeds of up to 200 Mbps.

In June 2024, Starlink introduced a monthly budget package of $10 (KES 1,300), a move that forced local internet service providers (ISPs)  to introduce promotions to retain customers.

Since its launch in Kenya in July 2023, the number of Starlink users has grown by more than tenfold, which shows favourable adoption of Elon Musk-owned satellite internet service. Starlink competes with existing players like Skynet and NTvsat. 

Three months before it launched in Kenya,  the country had only 405 satellite internet subscribers. This number jumped to 1,354 within two months of Starlink’s arrival and further increased to over 4,808 by March 2024, according to data from Kenya’s Communications Authority (CA).

Starlink’s presence in Kenya has also compelled existing internet service providers (ISPs) to refine their offerings to retain or attract more customers. 

Safaricom, which had over 522,000 fixed data subscriptions as of March 2024, started offering 4G and 5G routers to appeal to customers outside its fibre network coverage. The company announced plans for a satellite service in 2023  but has yet to launch it.

Jamii Telecoms, another provider with a fibre product and the second-largest market share in fixed data subscriptions, has been expanding its service to the outskirts of Nairobi to compete more aggressively in the home internet market.

Starlink’s popularity has been accelerated by its ability to serve customers dissatisfied with traditional ISPs’ limited offerings, particularly in rural areas. The company’s promise of providing broadband services beyond the reach of these established providers has made it a popular choice.

Names and phone numbers shared with merchants in transactions are often used for marketing, and PrivPay, which launched in 2022, sold the notion of privacy to users. Its solution was powered by  Daraja—M-PESA’s free payment APIs. 

The startup claimed it held talks with Safaricom about its business model and got the company’s buy-in before launch. It also said the telco backtracked after PrivPay began attracting media attention. 

“Your business model is not permitted by Safaricom,” Safaricom wrote to PrivPay in May 2023 in a letter seen by TechCabal. M-PESA prohibits third-party transactions. 

Safaricom did not respond to a request for comments. 

In May 2023, Safaricom suspended the fintech’s pay bill account—a cash collection number built on M-PESA that allowed the startup to process transactions. The telco said PrivPay—which claimed to have 30,000 users—contravened Kenya’s Anti-Money Laundering Safaricom and asked that it obtain a payment service provider (PSP) licence from the Central Bank of Kenya (CBK). Obtaining the payment licence takes up to six months. 

“PrivPay keeps a record of every transaction and ensures that the manner in which the records are collected and stored for at least seven years can pick out any suspicious patterns,” PrivPay said in a response to Safaricom seen by TechCabal. 

For Safaricom, in the absence of a licence, only a letter of no objection from the Central Bank of Kenya would suffice.

“We did not explore a PSP licence at the time due to the resources required. Also, it was going to take time,” a former PrivPay executive told TechCabal. 

While PrivPay hopes to stage a comeback, it must remember that good intentions alone will not help it meet regulatory requirements.

The CBK didn’t state a deadline for compliance, but the global deadline is at the end of 2025.

On Wednesday, NCBA, Kenya’s fourth-largest commercial bank, informed customers of the new measures. Other banks are expected to implement PoP codes for Real-Time Gross Settlement (RTGS) transactions, which allow customers to move large amounts of cash between banks instantly. 

“As part of adopting ISO 20022 messaging standards, the central bank of Kenya mandated the use of PoP codes for RTGS payments,” NCBA told its customers. “We will provide necessary support for a smooth transition to the new payment standards.”

The Kenya Electronic Payments and Settlement System (KEPSS) processed 1.98 million RTGS transactions worth KES 10.7 trillion ($82.3 billion) in Q1 2024, representing a 1.69% drop in volume but a 6% increase in value compared to the previous quarter’s 2.01 million transactions worth KES 10.1 trillion ($77.7 billion). 

PoP codes categorise transactions for transparency and regulatory compliance, in line with the Central Bank of Kenya (CBK) and ISO 20022 requirements.

PoP will allow banks to track and report the nature of transactions through additional fields for PoP code recording. 

PoP complements ISO 20022 by standardising data formats globally for consistent transaction communication and financial data processing. According to a banking executive who spoke to Techcabal, this streamlines cross-border payments.

A previous attempt to grant tax authorities access to bank and mobile money transactions through a Data Protection amendment in the now-withdrawn Finance Bill 2024 was unsuccessful.

Non-compliance with anti-money laundering laws attracts a $155,000 (KES 20 million) fine for Kenyan commercial banks.

This is the first time the interest rates have dropped since April 2020; they held steady at 7% for two years, until April 2022. From then on, they sharply increased, peaking at 13% in April 2024.

“Inflation is expected to remain below the midpoint of the target range in the near term, supported by a stable exchange rate, lower food prices with expected harvests, and stable fuel prices,” CBK said after the Monetary Policy Committee (MPC) meeting on Tuesday. 

The central bank’s decision comes as inflation eases in the East African country. Kenya’s inflation slowed to 4.3% in July from 4.6% in June, staying below the government’s target of 5%. Food inflation held steady at 5.6% in both months. In December 2023 and February 2024, the CBK raised interest rates to address high inflation and strengthen the Kenyan shilling.

The Kenyan shilling has been stable over the last six months. Kenya’s economy grew by 5% in the first quarter of 2024, per an earlier report released by the CBK. Strong agriculture and services boosted growth while manufacturing and construction slowed. 

“Exports were 11.8 percent higher in the first half of 2024 compared to a similar period in 2023,” the CBK added. 

The Kenyan economy is expected to grow 5.4% in 2024, driven by services, agriculture, and exports. However, global risks, including trade and geopolitical tensions amongst the world’s leading economies like the US and Russia, could affect this.

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DAT was imposed on crypto exchanges such as Binance and Coinbase. The law also directed that crypto taxes be remitted within five working days, along with a tax return detailing deductions and other required information.

None of the local cryptocurrency exchange platforms had remitted the taxes to the Kenya Revenue Authority (KRA) before Wednesday’s ruling that declared the bill illegal, a crypto executive told TechCabal on condition of anonymity. However, the companies had received notices to pay the tax weeks before the ruling. 

DAT aimed to tax Kenya’s digital asset market, which ranks second behind Nigeria in crypto-related activities. Over 350,000 Kenyans also registered for the cryptocurrency project Worldcoin before the company’s operations were suspended in August 2023. 

Given crypto’s volatile nature, a tax based on transaction gains or income, accounting for potential costs and losses, could have been more suitable, said an executive at the Blockchain Association of Kenya (BAK). In September 2023, BAK went to court to block the new crypto taxes. However, the case is now invalid, according to Kakai. 

Other crypto experts argued that the Kenyan government could have aligned the DAT rate with the existing 1.5% Digital Service Tax (DST), which was introduced in the 2020 Finance Act. DST is a 1.5% tax on income from online marketplace services in Kenya. 

The short tax remittance deadline was also seen as a burden to taxpayers with increased compliance costs.

Three court of appeal judges ruled that sections introduced to amend the Income Tax Act, Value Added Tax Act, Excise Duty Act, Retirement Benefits Act, and Export Processing Zones Act in the 2023 Finance Bill were unconstitutional because they lacked fresh public participation.