10 rules of sales and distribution in African fintech


In 2021, Africa’s tech startups raised nearly $5 billion, nearly double the funds raised in 2022. Britter Intelligence’s 2021 Africa Investment Report showed that the fintech industry contributed to a lion’s share of the investment in startups across Africa, with close to $3 billion. Last year, five startups also reached unicorn status in the continent – Flutterwave, OPay, Wave, Chipper Cash, and Andela.  Four of them were fintech.

In the first half of the year, African startups raised over $2 billion. This is an over  130% increase from the $1.19 billion raised within the same period last year. The top leading sectors were fintech – which raised $305,430,000 (71.7%), energy tech (8.4%), and mobility/logistics (7.7%).

From all indications, the fintech industry in Africa, and especially Nigeria, appears lucrative. However, does this mean that a good fintech idea and product automatically lead to success? Of course not.

A fantastic tech idea is only a fraction of the work required to build and scale a viable startup in Africa or in any part of the world. Building a sellable product that can appeal to the right target market; retaining the right talent, and good business and sales models are some requirements.


A good sales and distribution strategy is invaluable

A good sales and distribution strategy can never be overrated. From driving revenue growth, handling revenue-creating processes, and increasing market share, a suitable sales strategy goes down to the fundamentals of the product and its target. And here are ten rules every startup owner must live by to succeed:


  1. Get your technology right

The product is the first proper experience for the customer; it is important to get the tech right.

Second chances are a hard ask. When a customer/agent tries your platform once and it fails, they move on to someone or something else that can help solve their problems. So, take out time to thoroughly fix anything that might impede the functionality of your product. Test the product, retest and test it again. Launching by ITEX, took a lot of resources from the QA team. Ernest Uduje, CEO of Itex Integrated Services insisted that the product pass all the required tests to ensure it delivers the required outcome to end-users the first time.

Ensure you are delivering something of utmost value to the customer. Customers don’t purchase an item simply because of its aesthetics. “Can this solve my customer’s problem?” that is the most important question. If you are unable to answer that in the affirmative then you cannot move to any other steps just yet. It might be time to return to the drawing board.


  1. Automate your processes

Automation tools help to improve performance rapidly. It can make it possible for companies to deliver on the reduction of internal cost and speed of service. However, not all automation is the same, and it varies from business to business. Choosing the right tools for your business will depend on understanding the need, and knowing how you wish to address it. It is critical to reduce as many processes as possible to enable efficiency and the best way to improve efficiency is by automation.  The next time you think of efficiency in your processes, think twice before throwing bodies at the problem. Can technology solve the problem? Performance management should not be done manually, reports from the field by the sales team should be automated and feedback near real-time. Agent commission should be automated and made visible to the agents in real-time, as well.


  1. Compliance is key

It is important to understand the legal requirements of the industry within which your business operates. This is an avoidable pitfall that can be solved by working with the right legal partners.

Whatever you do, always protect your license. Licensing of a fintech company depends on the category of the company. It can either be a Digital Bank, a Payment Service Bank, or a Payment Service Provider. These three categories have various licensing procedures.

Your business needs to be fully compliant, as that is the only way to guarantee protection. The price of non-compliance can be colossal. It may led to loss of jobs, the Board of Directors will ask for blood and someone or some people must fall on the knife, is still mild as long the license to operate is not revoked. A case in mind was the popular $5.2b fine levied on MTN Nigeria by the Nigerian Communications Commission (NCC) in October 2015. The NCC claimed that MTN had continued to provide service to customers with unregistered SIM cards. The size of that fine shook the business community to its core. There are reports of other fines by the CBN on various banks for a number of infractions in the Nigerian banking ecosystem


  1. Properly define the target for your sales team and monitor performance

Don’t expect what you don’t inspect. First off, create a detailed landscape of your prospects, and develop a rigorous, goal-oriented pipeline. That is, articulate proper OKRs (objectives and key results) and KPIs (key performance indicators). Establish proper documentation for each step in the sales process to ensure alignment and follow-through. This will allow for accountability and ensure that everyone is aware of their responsibilities. It is very easy to lose a salesman who is remote and is not being asked questions about his performance regularly.

Critical questions to ask as part of the strategy session are to determine the size of the opportunity. For example, to drive agency banking in Nigeria, the EFInA report indicates that 36% of the Adult population is yet unbanked. Mitchel Elegbe, CEO of Interswitch, an integrated payment platform believes that the figure is 50% of the population. If the adult population in Nigeria is 106 million people, do the math. Then, ask questions about the location of the target audience, in this case, the unbanked people. Now you are close to setting the right target. Also, ensure you engage in very robust performance management. This will allow for accountability and ensure that everyone is aware of their responsibilities.


  1. Be competitive but don’t engage in a price war

Every good business needs to have a strong understanding of its key competitors, their strengths and weaknesses. It is critical for survival.

However, there is a tricky part that many stumble into – be competitive but not devolve into a price war. Price wars are a nightmare – they can harm your bottom line and your brand.

You need to ensure that you do not have a knee-jerk reaction to the competitor’s actions. Your strategy cannot be reactionary. Develop an informed strategy and stick to it. However, you also need to be nimble and responsive to the market and situation when the need arises. A major undoing of the Fintech companies in Nigeria today is the unhealthy competition that is eroding value through unfair pricing. The agents further complicate this by wanting the terminals for free and the charges at almost nothing.

Another aspect of this is that you need to manage capacity smartly as well. And it might get to a point where there is significant over-capacity, so you need to be extra careful.


  1. Keep your staff highly motivated

Attrition and cross carpeting amongst fintech staff is very high. To develop a unique culture and brand that attracts the right talent, you need to invest in building an employee and company map that is entrenched with strong values. . The industry is highly competitive and demanding, and it is important that staff feel valued, seen and heard. This is the first stepping stone to building a highly motivated and productive employee experience.

You also need to manage your risks, don’t avoid them. Provide a clear vision for employees so that the business can be consistently focused on its long-term plan.

Ensure they have a clear understanding of how their work contributes to overcoming obstacles and directly contributing to the company’s future. The success of a business relies entirely on the people responsible for delivering its strategy and building the technology, not on the technology or the strategy alone.

Organizations must strive to build an environment that is seen as a great place to work. Beyond this, a new concern created by the pandemic is the work-from-home model. Whether it is a hybrid or full remote work policy, the real problem today is how to ensure that your staff remain productive when they work offsite. Some staff see WFH days as the time to do their laundry and visit their homies, this can affect productivity greatly.


  1. Partner with the right VAS providers

Value Added Service (VAS) Providers increase customer satisfaction, eliminate complexity through abstraction, simplify the experience, and convert customers to brand evangelists. The right provider can do all of these and more, but engaging the wrong provider for your service can be equally detrimental.

So, be insistent on exploring the best offerings till you have the right fit, well negotiated to remain profitable. The Payvice App today is the online store for various VAS. Partnership with Discos has ensured that Nigerians can from the comfort of their palms purchase electricity tokens, renew their digital TVs, recharge their phones, buy insurance, bet, pay bills and do a host of other things. This simply means that the highway for more products to be present online is still largely free.

Engagement must continue between fintech and various VAS providers on how to collaborate to make these products available to the end users where they live, work and play.


  1. Hit the road and develop connections

The fintech business is very volatile but this shouldn’t stop you from stepping out and getting things started. This involves actual man-hours and sourcing talents dedicated to understanding the ins and outs of the business, receding remote locations and building strong partnerships across your industry.

Certain data and relationships cannot be collated or built from behind a desk, no matter how much work is done. The concept of rubber on the road remains valid to this day. If you must understand your products, your competitors’ products, the loyalty of your agents etc, you must engage your customers in the various markets where they reside and work on a consistent basis.


  1. Software development rapidly evolves

To get to the top of the range, you must compete with international organizations. Your software developers must be at the forefront of innovation and the changes within the industry to be able to resolve issues quickly and anticipate challenges while developing their solutions.

Managing the developers in Nigeria has however become a major challenge. The market has suddenly become their market. They want to be paid in forex, they want to work from home, they want flexible hours, they want to go work somewhere else, they want to ‘JAPA’(Nigerian parlance for relocation).


  1. Partner with your Agents

Sales agents may or may not be part of your organization’s internal sales team but that doesn’t make them less important. In most cases, sales agents are the first touchpoint a customer has with your organization, so you must make sure they are aware of new products or features and can communicate unique selling points effectively. Ensure they are located in the right places and focus on key markets. They must become your Ambassadors.

To gain loyalty of the agents in this very competitive market with several players is an uphill task. Just keep climbing.

As investments in startups across Africa keep increasing, the fintech sector appears poised to continue to take the lead for the foreseeable future.  Ensure you have the right product and have done extensive research before venturing into the ‘lucrative’ industry. For existing startups, invest in the right distribution strategy – it will save you millions in headaches and debt.

Kunle Adebiyi is an award-winning business leader dedicated to helping corporate organizations achieve scale through excellent sales growth and channel development.

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