Last month, Y Combinator He said he intentionally reduced his summer team by 40 percent. According to Accelerator, the decision to reduce the S22 batch size – much smaller than recent batches – is due to this year’s economic downturn and changes in the venture funding environment.
It was the latest in a series of recessions, layoffs and hiring that the tech world has become all too familiar with — and to some, no surprise.
YC’s summer cohort includes 240 companies, notably fewer than the summer 22 class, which has 414 companies. in order to It did not surprise anyone that this reduction would trickle down to other states; For example, eight startups in Africa entered acceleration this summer compared to 24 in the previous cohort, a 60 percent decrease. While the region represents 6% of the total winter batch, it is 3% for this category.
As YC moved away during the pandemic, the number of companies accepted by the group from summer 2020 ballooned, as did African startups. While this summer batch is still a long way off, this is YC’s first in-person presence in the past two years: About 30% of the group moved to the Bay Area during the three-month program, and about 23% were already in the Bay Area. When applying for YC. Therefore, it is fair to say that the physical phenomenon has given rise to a few African startups.
All eight African companies in this summer’s batch say they are far. But from a geographic perspective, five are based in Nigeria, one each from Kenya and Ghana, and one, although focused on Africa, is based in Geneva. They seem to solve challenges related to financial services and payments, catering, merchant accounting, and wholesale automobile procurement.
Fintech… and more.
Fintech is the hottest startup segment in Africa, and startups here make up the largest percentage of any typical YC cohort – in this case, five out of eight are fintechs. Fintech is also the most funded sector in Africa. One of the reasons it attracts so much VC dollars is how expensive it can be to build a fintech product when things like integration, compliance and licensing are factored in.
Globally, banking-as-a-service (BaaS) platforms like Unit and Treasury Prime have helped startups grow thousands of customers. And as financial services proliferate in Nigeria and the rest of Africa like the rest of the world, startups offering neobanks and embedded financial services on BaaS platforms like Anchor – a startup in this batch – are quick to launch.
Meanwhile, Anchor’s partner, BridgeCard, offers card-issuing APIs for businesses to create virtual or physical cards, one of Neobank’s many offerings in Africa. And speaking of Neobank’s offerings, Moneco, which was started by three founders with a finance and payments background, is targeting immigrant communities in Europe, starting with the African diaspora. On the other hand, Pivo (the second all-female founded group in a batch since Tres, a social community for black women hairdressers in 2017) is focused on truckers in Africa.
While Pivo helps small and medium-sized businesses in the cargo space with cash flow problems by providing bank accounts, Patika aims to solve the same problem for many businesses with a SaaS accounting tool.
According to the report, by 2050, Africa will be the world’s second largest owner of vehicles, with 400 million vehicles, spending more than $1,000 a year on vehicle supplies. That’s a vast market where YC Garage Mobility hopes to become a dominant player in the coming years. Also backing Mecho Autotech, YC says it made a big bet in the African auto parts distribution chain — whose business model is focused on retail and leans toward car repair and maintenance compared to garage wholesale focus — last summer.
A.A 🤝 Africa Catering area
In Africa, another segment that catches YC’s eye is the catering market. On the back of DoorDash’s IPO, YC seems poised to replicate that success in other markets, including Africa. The accelerator has backed Biu Delivery, a food delivery app in Addis Ababa, Ethiopia, and a similar platform, Heyfood, in Ibadan, Nigeria. Chowdeck and Foodcourt mark YC’s third and fourth bets in a series of batches.
“A reminder that when it comes to ‘bets,’ we don’t invest because of the sector/category/idea. Only the founder. So the vertical trends you see are from the founders and the areas where they’re pursuing their problems — and we’ve got great people who have been working in the food tech space,” a YC spokesperson said when asked about the accelerator. Investments in the four platforms in two sets.
Revenue in Africa’s online food delivery segment is expected to reach over $2 billion next year. Despite facing poor logistics infrastructure and an unpredictable regulatory environment, platforms such as Jumia Food, Bolt Food and Glovo have stepped up efforts to capture market share. Although these semi-existing fighters have bigger war chests than the YC newcomers, Chaudek and Foodcourt have shown different levels of traction to show that they can fight in their respective profiles. It’s an area we need to watch out for in the future.
