Opinion: Konga’s numbers — data pornography for Nigerian startups

by Ngozi

The recent disclosure of Kinnevik’s valuation of Konga and the latter’s active customer numbers caused a stir in our little startup ecosystem. For many Konga looms larger than life and they felt that both reported numbers should have been much higher. Over the last few days I have taken part in numerous conversations in person and on the phone discussing this ground breaking event.

The best way to describe nature of these conversations is that they have been analogous to post adolescent schoolboys leafing through their first Playboy magazine.

Let me raise my hand up here and say that I am and was one of those school boys. I ran quickly to Kinnevik’s website and began downloading all their past reports once I realized that they had actually been reported for many months. I then began downloading them quickly just in case Kinnevik, the school teacher, decided to confiscate my magazines and restrict access. Pathetic right? I agree.
To be fair it’s not surprising as there is a shocking lack of data in the system. For all the hype, marketing, bravado, determination of so many startups there is a widespread reluctance to divulge even the most basic numbers. The reaction to Kinneviks disclosure was more remarkable in that they had been doing it for more than 12 months but nobody noticed.

So why don’t we (and I include myself) disclose even a basic size of our market? Is it a reluctance to entrust competition with sensitive data? Or fear that for all our marketing, efforts, determination we will feel smaller when others realize the limited nature of our progress as measured by — take your pick — profit, active customers, revenue, default rate, clicks, site visits?

There are a few exceptions to this rule notably Jason Njoku who I believe should be given a medal for demystifying Iroko, running startups and the difficulties of building businesses in Nigeria via his blog. Tayo Oviosu also releases agents and customer numbers but everyone else is silent. This data vacuum is a big problem if our so-called thriving ecosystem is to grow.

And just to be clear I am not talking about giving sensitive data that may affect competition but high level data to help gauge the size of the market. That I know Konga has 184k active customers only tells a small part of the story and yet it is instructive that people are having babies about it and predicting how Jumia has won. Seriously?? We have no inkling as to what their profit, return rate for goods, repeat business % by the 184k customers, expense growth, future strategy, KongaPay projections. I am not “holding brief” for Konga but we are a long way from having sufficient data to make any informed judgement. But the haters do I guess! And yet the disclosure of that numbers is important because the system is interconnected.

At OneFi, we make unsecured loans to consumers and expect e-commerce be a significant channel. Without this information, I might have started at my navel for a few hours and guesstimated that Konga/Jumia together had 3 million active customers, determined that 10% of that would form my addressable market and hey presto an amazing business opportunity. We would have then gone hired expensive developers (tautology I know!), project managers and then wasted time executing on a strategy that was destined to fail.

The saddest part for me is that whilst we internally don’t know our numbers, all the foreign investors do. So when I am pitching foreign investors, I am also thrilled when they throw me little scraps of data on the performance of the likes of SuperReturn, Printivo, Konga etc. It’s a shame because I could just as easily call the founders and ask — the worst they could say is no. And I should ask as I am not trying to get those numbers to compete but to help plug in and lend to them and their customers.

Fear has certainly driven my reluctance to disclose basic information as to the performance or growth of OneFi. Like many I am probably guilty of reading all the startup lore from Silicon Valley and judging myself against a different ecosystem. My sons watch Dora the Explorer and Barney because we as a community have decided that we are unwilling to invest in or create local cartoons or shows that espouse our values or our experiences. Like my kids, we are slaves to stories from other markets because we refuse to write ours, refuse to share data and refuse to create together.

So in the spirit of transparency and satisfying other data porn lovers, we have a Paylater app that has been downloaded over 50,000 times since we launched in May. Paylater is a 1 month cashless and paperless loan via any Android phone and first-time borrowers are eligible for up to N10,000. We issue between 100–300 loans a day across Nigeria depending on our marketing spend and our current risk appetite. Our current default rate is ….. Calm down friend, that info I won’t give as we are just starting to date!!

Now see what just happened. I just gave you a sense of our current size without dropping my pants completely. If you are a competitor, you don’t know how much I am doing to get those customers, what my repeat business is, my marketing spend. If you want to enter based on just that good luck!! But other operators out there now have a sense as to whether the credit we provide or the number of customer on our platform is interesting for collaboration or cross marketing.

OneFi (like Konga) has changed strategy over the course of 4 years — I see the company however as a 4 month startup. Competitors may be emboldened by what they see as low numbers. Others may laugh and hate because (well haters love to hate irrespective) of how they view us — numbers too small, app too green, amount too low. In truth to make any judgement based on the superficial is flawed especially as they ignore the knowledge gained and mistakes (o there have been so many) of three and a half years.

So maybe I have been rambling and there is no issue — maybe we all know one anothers’ data numbers but everyone colluded to keep me and Chijioke in the dark! But I can tell you that our goal is to be posting about 3,000 loans a day by the end of the year and we can’t do it without the support and collaboration of others in the system. You now have a chance to laugh at that goal or work with us.

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Op–ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija

Written by Ngozi

One comment

  1. Never give a negative thoughts a free rent in your mind.
    #TuesdayMotivation

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