💰 Africa's Untapped Insurance Goldmine…

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.

TRENDING NOW

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 

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.

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!).