Today’s Notadeepdive is 1,286 words. If you missed last week’s newsletter, catch up here.

Heads up: With another big story on an implosion at a tech startup, Nigeria’s tech media is now an ecosystem cheerleader and accountability partner.

Notadeepdive is brought to you by Fincra and Haul247. Fincra provides reliable payment solutions for fintechs, online platforms and global businesses. Haul247 provides real-time, digital and tech-enabled logistics support, designed for you.

TOGETHER WITH FINCRA

Devs get in here!

Connect with top global businesses by assisting them in integrating Fincra's APIs, and earn money while at it! Ready to make some extra money doing what you enjoy?

Devs get in here! 

Connect with top global businesses by assisting them in integrating Fincra's APIs, and earn money while at it! Ready to make some extra money doing what you enjoy?

Sign up for Fincra's developer program

A shift in tech reporting

If you’ve been following Nigeria’s tech scene this year, then you know that there have been a lot of big and shocking stories. Reports on several startups like Bento, Flutterwave and Rise have shown a worrying pattern among tech companies. Most of the allegations in those reports border around bullying, toxic work environments, employees being cheated out of stock options and sexual impropriety. These stories have captured attention because, for years, Nigerian tech startups have played themselves up as the better, more fulfilling alternatives to working at legacy companies. The image somewhat looks like a room full of people in shorts, flip flops and hairstyles that won’t be allowed at traditional companies screaming “it’s day one,” while at a company offsite meeting at a fancy resort in Lagos. 

While tech companies sold these dreams for years, they had the cooperation of tech media who propped up everything that these startups did as news. To be fair, this type of hagiographical coverage was important; the tech ecosystem was young, funding was only trickling in and every successful fund raise was big news. It was a time to cover — doe-eyed — the grand vision and mission of these founders. In the early days, there were probably some disturbing stories already within the ecosystem, but no one was going to publish those. It felt like strangling the baby while it was still in the cot; tech media’s part was simply to act as a partner in progress and to amplify only the good bits. 

Ironically, this media stance soon became a baton with which founders beat journalists and media houses over the head with. As the ecosystem matured, the stance of startup founders went from appreciation for positive coverage to criticism. It was usual to hear that media publications weren’t writing important stories, weren’t critical enough or were hyper-focused on fundraises and nothing more. I’ve been in quite a few Telegram and WhatsApp groups where founders kicked the idea that any day they were bored, they could start a media company and do a better job than pretty much all the existing players. 

To be fair, this whole tech founder vs tech reporter squabble is not limited to Nigeria, neither is it very original. Since we’re copying a lot of Silicon Valley behaviour in chasing big valuations, working employees till they burn out, and treating founders like the second coming of Jesus, this ideological warfare between Nigerian founders and the media is par for the course. Jessica Lessin, the founder of The Information, sums the situation up nicely: “If you’re a journalist, you feel like [tech companies] don’t recognise the value in ferreting out the truth, and if you’re a tech person, you feel like ‘journalists are bad people[...] it can get nasty.”

Share

Why always tech startups? 

A few weeks ago while working on the story about allegations of sexual impropriety at the tech startup, Rise, one of my editor friends asked an important question: “Why is it always tech startups?” He was essentially asking, why does it seem like every scandal and story at a Nigerian workplace always has a tech startup as its subject? 

One of the best ways to consider his question is to speak to people who work at traditional Nigerian companies. For instance, one of my close friends with extensive experience in banking is often shocked at what we consider toxic environments at startups. According to him, these kinds of treatments are a lot more commonplace at legacy companies — people are only just likely to shut up about it and keep it moving. His position makes for an interesting argument that tech startups generally have much more accountability. While not every story leads to changes in a company’s leadership or any sort of public accountability, it is raising awareness of what behaviours are okay and those that are not. 

For founders and investors who sometimes argue that some of these stories are unfair or harsh, it’ll help to remember that these things are painful in the short-term, but are useful in the long-term to create a healthy ecosystem.

These days, I see conversations on the need for stronger corporate governance, and the importance of having clear policies on sex, relationships and sexual assault in the workplace. We’ve seen conversations on Twitter between founders and employees on what constitutes a great workplace. Four years ago, we weren’t having these conversations so this definitely feels like a big step forward. So, here’s a big yes to more accountability and frank conversations. 

I get the sense that you’re just waiting for me to get to the biggest story from this week, and I’ve stood on my soapbox long enough so let’s get to it! 

TOGETHER WITH HAUL247

Simplified Logistics Solutions with Haul247 

Haul247 is a one-stop platform for haulage and storage solutions. Haul247 matches haulage or storage orders with available assets using an "Airbnb" model. With this, partners are assured of reverse haulage and shippers are charged less, reducing transportation costs and maximizing asset use. Haul247's innovative solution to logistics and supply chain challenges is positioned to unlock African trade.

Book trucks and warehouses in Africa

The founder with his head in the Klouds 

WeeTracker’s story on the failure of the e-commerce startup, Kloud Commerce was a proper shocker. It was one of those stories where each paragraph had my jaw hanging lower than I’d imagined. Like I said on Twitter, it’s not every day you find investors speaking to a media house on a founder shitting the bed — startup failures are often treated as some sort of occupational risk; shrug it off and move on. But, this was different. It seemed like investors spoke to the media to provide disincentives for other would-be bad actors. One investor even spoke on the record; if you understand how secretive Nigeria’s tech ecosystem can be, then I can’t emphasise how big this is. 

In reading the story, it’s easy to tell what may have prompted the investors to form a choir and sing like there was no tomorrow. Here’s an excerpt from the article I found interesting: “D.O has great domain expertise and seemed to be on to something but I was never going to touch him with a ten-foot pole because he had a reputation for being super difficult,” said one investor who leads a prominent Lagos-based investment firm.”

“But [his idea/startup] looked like a strong play and many marquee investors — including prominent names in angel investing in Nigeria — were sold on its potential, as well as the profile and prowess of the team. “We thought we could overlook his character,” the same investor added.

Beyond the allegations about the founder’s behaviour, the collapse of Kloud commerce is a cautionary tale on the danger of valuation games. According to the article, “D.O was often setting unrealistic goals,[….] and this reflected the goal of pushing Kloud Commerce to a billion-dollar valuation in two years, which investors found to be disturbing and bizarre.”

There’s nothing better to end this episode than a quote from this April newsletter: “we are seeing more Nigerian companies playing valuation games and becoming obsessed with unicorn status, instead of building sustainable companies with real growth and tangible unit economics. And just like Fast, the employees and the ecosystem will bear the brunt of these valuation games. With every wave of startup funding boom in our industry, companies are playing valuation games instead of building a sustainable business with proper unit economics in an attempt to blitz scale. What’s worrying is that startups are failing at both.”

Share

What I’ve been reading:

There’s an interesting conversation about the creator economy in this story of why Patreon is struggling.

These days, Media companies are springing up with the promise of fixing something or the other that’s wrong with the news and how we consume it. This critical piece on Semafor, one of the newer entrants, is worth reading. 

The FG has ordered telcos to reverse price increases on data and calls. Read the very strange decision here.

Pollen, the startup that raised $200m is now pretty much dead in the water. This article analyses the company’s enormous debt–yep, it’s also owing staff salaries. 

If you’re a bored remote worker and you earn above $2,700, you should check this out.

Edited by: Yahaya Hassan Taiwo and Fuad Lawal