Stone Atwine is among the few people that kick-started Uganda’s technology scene. In his entrepreneurial life, he has worked on several ventures though with a soft spot for financial technology solutions. This is shown in the nature of companies he has built before - from Useremit to, now, Eversend.
Now based in Paris, Stone - in his own words - is “building a financial marketplace” through his latest venture, Eversend.
In this interview - which we held over a month ago, Stone takes me inside his entrepreneurial life and what Eversend is. Enjoy.
Malinz: You were doing Useremit right? And now you have Eversend. How are the two connected?
Stone Atwine: We built UseRemit with the aim of transferring money from the rest of the world to Africa. Especially to Uganda, Kenya, Rwanda, to deliver to mobile money. [But] after some time, we noticed something very interesting. That is that a lot of transfers coming into sub-Saharan Africa were coming from Africa.
There was no one in the fintech space looking at this. You might have a few - one or two small companies - but not the caliber of Wave and WorldRemit bringing money into the continent for transfers within Africa.
For example, transfers from Uganda to Kenya or Nairobi to Lagos are done by banks and brick and mortar money transfer companies like Western Union and MoneyGram.
So we said we want to work on solving this problem. And then we realized very quickly that the platform we have for UseRemit was not built for that kind of thing for intra-Africa and also of Africa. Because now we are also looking at sending from Uganda to China or to Nigeria. So we had to build a new platform. Even the team we had for UseRemit was not going to pull that off.
What were your figures when you decided to make a pivot?
I can't give you a real figure right now. But I can tell you that it was about US $400,000 per month. Which is very small [compared to the competition]. But that's the challenge, the competition has raised massive amounts of money. I think Wave probably even raised money with a Power Point. [That’s why] being in Africa has its own disadvantages.
Is that the reason you left for Paris to join Station F?
One of the reasons, yeah.
Has it solved the problem?
We are not yet raising [in May], so we are going to raise as soon as I get back to Paris. So probably July we will be raising. But that is one of the reasons we moved. Because it is a lot easier to raise money in Europe. So hopefully we raise quickly then focus on the business.
Would you recommend someone to take the same route if they find challenges raising funding from Africa?
Yeah, but not only that. There's a kind of revolution that is taking place almost anywhere in the world. Everyone is waking up to [the reality that] technology is going to solve our problems. So I think it's wise to think ‘Where is the best place for me or what I want to do?’.
Related: Useremit to focus on solving the intra-Africa money transfer problem
For us, we knew we wanted to have an office in Europe. First of all to get closer to our customers. Because, with Useremit, our customers were senders who were sitting in Europe. But also to get access to better funding and talent.
We [thus] had to choose between Amsterdam, London, and Paris. London would have been amazing. Because it is like heaven for a fintech entrepreneur. But then they have the issues of Brexit so we were not sure that's the place we wanted to go to.
Paris is having like this kind of revolution. They are waking up and changing laws to support startups. They are putting everything they can in technology with places like Station F.
That's what we were looking at. Paris is a good place to be now if you are a tech entrepreneur because they are putting in a lot of effort to grow it. To grow the whole ecosystem. And the government is supportive. So, I would tell somebody to do that.
Also read: Anthony Natif on lessons he learned from aggressive expansion, running out of money and finally raising around $3 Million
Though some people feel like they must build their companies from home. It depends on what the person wants. But for me, I realized that the only way to build my country and my continent is to first go where I can actually build something then see how to build it.
Worldremit raised around $40 million last year and said would focus on intra Africa. Could having a bigger player in the market be a challenge for you?
I can tell you that they will come to do intra-Africa remittances [eventually]. Maybe it will affect us from a competition point of view. [But] competition is always there. Though doesn't faze us because we know what we are doing and our product is very very different from them.
Our product is not really about moving money. It is just one of the things we do. So I do not see Worldremit very quickly or very soon doing things like payments of things like electricity and water payments.
[Yet] those are some of the things that we are going to have in the app. I do not see them having an application partnering with a SACCO software which is something we could do, so you can just pay your SACCO from the Eversend wallet.
What figure would you put on the intra-Africa market size?
Officially, figures for the transfers coming into Africa are estimated between US $39 and 40 Billion annually. The figures for intra-Africa are around 43% of that. Which is roughly US $17 or 18 Billion. Then transfers from the continent to the rest of the world are estimated at around US $12 Billion.
That’s a huge figure. But why hasn't someone said ‘Okay let me solve this’?
I think the biggest challenge is mostly information. We just didn't know it was there. Maybe the people who knew were not interested. Secondly, the problem of moving money from the rest of the world to Africa is so massive that we were all blinded by it.
Everytime you think about the US $40 billion - and possibly US $100 billion if you add informal channels of money going into Africa in just one cut - that's the problem you want to solve. So we were not looking at Intra-Africa and only thinking about the problem we must solve is the other.
But now with companies like the Sendfree and FSD Africa, a lot of effort has been put on quantifying some of these problems. Financial inclusion is [now] a big deal. So now the numbers are starting to jump out at us.
What is your main area of focus? Is it businesses or individuals?
We will have individuals create accounts in the beginning. But later, we will also have business accounts that will be used for transfers and even other things. The reason for that is again on the [African] continent if you have to pay someone as a business to business transfer it is still the same thing.
That's why you have startups like BitPesa. They are actually focusing on B2B. I don't know their charges very well but I hear they are not very cheap. So we will also be doing B2B transfers, but not in the initial period when we launch.
What do you think are the likely challenges you’ll face?
The challenges are huge. Most of the existing players are not doing that [charging heavy fees] because they are bad. They [also] want to make money. In fact, all of us want to make money. But the costs are also very high for them.
Though the advantage we have is knowledge of the market and that we have become so good at moving money. We know how to cut costs to levels that some of our competitors may not be able to do. But the challenges involved are huge. From regulation and compliance to making sure you are dealing with the right people. Fraud is a big one.
Africa has 55 countries, are there some sweet spots for you or going after them all?
There are some sweet spots. For example, we want to start in this market that we know very well. That’s Uganda, Kenya, Rwanda, Tanzania, Ghana, and Nigeria. Mostly markets with mobile money because we are going to be dealing mostly with the mobile money system. But for us, the sky's the limit. The money we will raise and how quickly we will grow will also determine where we shall go. And that is not only in Africa.