Venture capitalists Scramble for Africa’s Bike-Hailing Services

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Tech investors are scrambling for bike-hailing services in Africa. From Rwanda to Nigeria to Gabon, numerous bike-hailing services are rising by the day, with many of them attracting venture capitalists for better expansion and profitability. Just the way cab-hailing services like Uber and Lyft have taken America and Europe by storm, bike-hailing services now provide jobs for thousands of jobless youths across countries to the relief of various governments.

Although thousands of people are now self-employed and raking in good daily incomes with their bike-for-transport services, they enable people to reach their destinations faster and beat traffic gridlocks in major cities and busy towns. While some avoidable accidents have occurred with lives lost or injuries sustained due to overspeeding, most people would want the commercial bikes around rather than having them banned. Rwanda banned them but later reinstated them again.

The commercial bikes are known as “boda bodas” or “moto” in East Africa but called “okada” in several West African countries. Many of them have signed up to hailing services such as SafeMoto, YegoMoto, and SafiRide in Rwanda; and Max, Gokada, SafeBoda, and ORide in Nigeria. There is Grab and Go-Jek in south-east Asia and others in other parts of the world. Uber even launched boat services in Lagos, Nigeria.

With analysts saying the bike-hailing services in Africa is worth $80 billion, tech investors are looking for who to back among the operative services across the continent.

Established by two alumni of the MIT Sloan School of Management, Adetayo Bamiduro, and Chinedu Azodoh, Max got $6 million from venture capitalists and another $1 million in grant to expand its services across Africa from its Nigerian base.  As further testimony to how well it is attracting investors, Max also partnered with Yamaha recently. A Japanese motorcycle manufacturer, Yamaha invested $150 million in Grab, a Singapore-based transportation service, last year.

With almost all the bike-hailing services enjoying investors funds in one capacity or another, venture capitalists determine who to back based on the bike service’s potential to expand all over Africa and the digital platform upon which they operate. It’s pointless to state that all the bikes can be hailed via dedicated apps on Android, IOS or Windows devices. Still, they are quickly going beyond that to add identity verification and financial services such as mobile payments, credit facilities, micro-insurance, food orders,  and product delivery, among others, to their services.

The tech investors see into the futures of these bike-hailing services and their potential uses for the digital future in emerging markets, hence their huge investments and scramble for bike-hailing services in Africa.

 

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