Following your newsletters from Sept 5th on exits and the reasons why they're not disclosed, then associating with your latest. I
might be reductive and my conclusion would be based on deduction and available public data but here's my premise, if the deal was good enough considering the performance of Chaka and a possible valuation that could stand around $5m(they raised $1.5m pre-seed, during the global funding mania in 2021, especially for fintechs in Nigeria). A range of $5m to $7m was typically the post money valuation you saw with that sort of amount raised(so we are choosing the minimum for ease of my explanation). If we are to use app downloads to measure market share, risevest and Chaka sit approximately the same and data out there suggests Chaka has raised far much more than Risevest (still positing on available public data, risevest raised approximately $300k in funding so far). So finally we get to my take on this, I believe Chaka was struggling, business slowed down because they got caught up with the CBN over licensing issues, Chaka, bamboo, trove, risevest were victims and had their accounts frozen for 2 years since 2021 3rd quarter. Bamboo and Risevest still conducted business as usual but I believe trove and Chaka took a hit. The merger is likely cash and stock ( a possible 20 to 80% in that regard), I doubt risevest has the financial power to acquire 100% and if they did then Chaka must have heavily discounted it's valuation and perhaps wasn't even bought at a premium like normal acquisitions tend to be. Overall acquisitions and mergers on the continent are mostly lifelines being thrown to safeguard assets, and the overall trickle down effect of one business or the other closing. I believe this is the rise of Micro Mergers and Acquisitions (integrating companies together to save their value and validate the acquirers own value too for investors but also founder friends bailing each other out too for one reason or the other). We likely would never truly get public data because if the deal is good, investors would push founders to announce or even do so themselves so it's likely shame above anything else, the underreported news on exits by founders. When you talk with founders their path to exits tend to be acquisitions by foreign tech companies or an IPO, I doubt a large number of them envisioned merging with their peers, and as for value in the wealth investment space. The margins are small and bamboo and piggyvest are behemoths, everyone else is just playing catch up, so what's the likelihood risevest has cash lying around to make a purchase just because of chaka's license and users here in Nigerja and not as a means to expand cross-border to other regions of Africa (as some media outlets are implying). It's too bullish a reason to acquire or merge, and it's fishy in my opinion.
Following your newsletters from Sept 5th on exits and the reasons why they're not disclosed, then associating with your latest. I
might be reductive and my conclusion would be based on deduction and available public data but here's my premise, if the deal was good enough considering the performance of Chaka and a possible valuation that could stand around $5m(they raised $1.5m pre-seed, during the global funding mania in 2021, especially for fintechs in Nigeria). A range of $5m to $7m was typically the post money valuation you saw with that sort of amount raised(so we are choosing the minimum for ease of my explanation). If we are to use app downloads to measure market share, risevest and Chaka sit approximately the same and data out there suggests Chaka has raised far much more than Risevest (still positing on available public data, risevest raised approximately $300k in funding so far). So finally we get to my take on this, I believe Chaka was struggling, business slowed down because they got caught up with the CBN over licensing issues, Chaka, bamboo, trove, risevest were victims and had their accounts frozen for 2 years since 2021 3rd quarter. Bamboo and Risevest still conducted business as usual but I believe trove and Chaka took a hit. The merger is likely cash and stock ( a possible 20 to 80% in that regard), I doubt risevest has the financial power to acquire 100% and if they did then Chaka must have heavily discounted it's valuation and perhaps wasn't even bought at a premium like normal acquisitions tend to be. Overall acquisitions and mergers on the continent are mostly lifelines being thrown to safeguard assets, and the overall trickle down effect of one business or the other closing. I believe this is the rise of Micro Mergers and Acquisitions (integrating companies together to save their value and validate the acquirers own value too for investors but also founder friends bailing each other out too for one reason or the other). We likely would never truly get public data because if the deal is good, investors would push founders to announce or even do so themselves so it's likely shame above anything else, the underreported news on exits by founders. When you talk with founders their path to exits tend to be acquisitions by foreign tech companies or an IPO, I doubt a large number of them envisioned merging with their peers, and as for value in the wealth investment space. The margins are small and bamboo and piggyvest are behemoths, everyone else is just playing catch up, so what's the likelihood risevest has cash lying around to make a purchase just because of chaka's license and users here in Nigerja and not as a means to expand cross-border to other regions of Africa (as some media outlets are implying). It's too bullish a reason to acquire or merge, and it's fishy in my opinion.