Weekly Business Insights from Top Ten Business Magazines | Week 304 | Shaping | 2

Extractive summaries and key takeaways from the articles curated from TOP TEN BUSINESS MAGAZINES to promote informed business decision-making | Week 304 | July 7-13, 2023

How Mobile Money Is Bringing Electricity to the World’s Poorest

By Antony Sguazzin | Bloomberg Businessweek | July 6, 2023

Listen to the Extractive Summary of the Article

In 2013 Malango and his childhood friend Iongwa Mashangao moved back to their native city, Baraka, on the shore of Lake Tanganyika, Democratic Republic of Congo and founded Altech Group, a business selling solar-powered lanterns. Early on they focused on teachers, doctors, nurses and others with reliable paychecks from the state, deducting regular payments from their salaries.

As the mobile banking platforms provided an easy way of extending credit and getting repaid,  the two thought, could dramatically expand sales, —and would let them turn devices on and off remotely if customers fell behind on payments.  The strategy enabled Altech to become a leader in what’s called pay-as-you-go solar, operating in 23 of Congo’s 26 provinces, with 3,500 agents making a total of more than 10,000 sales a month. In 2019 it added larger systems with several lights and outlets for plugging in televisions, computers and even refrigerators, and it recently started trials with electric scooters. Revenue grew sixfold over two years, to $20 million in 2022.

Congo is among the most challenging places on Earth to do business. Transparency International, a global corruption watchdog, says its culture of graft allows politically linked criminal groups to plunder the country’s vast natural resources, leaving the government chronically underfunded and the bulk of the population impoverished.

Yet Malango says his contacts and background have helped him navigate the culture in ways that would challenge outsiders. Altech got $18 million from investors including a fund backed by the Shell Foundation and Dutch development bank FMO, and it’s in talks with three potential backers to secure an additional $75 million. “Altech is well-positioned because of local know-how,” says Edmund Higgenbottam, managing director of Verdant Capital, one of the companies negotiating to fund Altech.

Africa offers almost limitless demand for small-scale solar installations. Nigeria has some 90 million people without access to the electric grid, Congo has 70 million and Ethiopia 56 million, according to the Off-Grid group. The global market is on track to grow tenfold by 2030, to 1 billion households, the group says.

3 key takeaways from the article

1. Altech, solar-powered lanterns supplier,  has become a leader in what’s called pay-as-you-go solar, operating in 23 of Democratic Republic of Congo’s 26 provinces, with 3,500 agents making a total of more than 10,000 sales a month. In 2019 it added larger systems with several lights and outlets for plugging in televisions, computers and even refrigerators, and it recently started trials with electric scooters. Revenue grew sixfold over two years, to $20 million in 2022.
2. Congo is among the most challenging places on Earth to do business.  Yet Altech got $18 million from investors including a fund backed by the Shell Foundation and Dutch development bank FMO, and it’s in talks with three potential backers to secure an additional $75 million.
3. Africa offers almost limitless demand for small-scale solar installations.

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Topics:  Technology, Energy, Solar, Poverty Reduction, Africa