Saturday, December 28, 2013

2013: Zoona’s Breakout Year!

One year ago, I wrote a blog about how 2013 was going to be Zoona’s breakout year. We had spent most of 2012 securing our financing, getting the right people in the right seats on the Zoona bus, and focusing on a few key goals to put us on a path to success.

And what a breakout year it was!

To highlight but a few of our achievements in 2013:

  • We processed our 1 millionth Zoona money transfer since we launched in April 2009
  • Our agents and distributors processed 2.2 million cash in and out transactions valued at over $142 million
  • We injected over $500k in working capital to micro & small enterprises
  • We paid out over $1.4 million in commissions to our network of 200+ Zoona agents
  • We became cash flow positive!!!
  • We closed our first straight debt facility
  • We launched a partnership with Airtel Money in Zambia and integrated with their payment platform
  • We deepened our partnership with Zambian Breweries and are now processing a significant share of their payments
  • We released a new website, 
  • We appointed Lelemba Phiri as our Managing Director in Zambia as a strong signal that our Zambian entity can now stand on its own two feet

These are considerable achievements that would not have been possible without tremendous effort from every member of the Zoona family: our customers, employees, board members, investors, partners, and colleagues.

However, despite this progress we have much more work to do to achieve our vision of a world of Cashless Growing Businesses…everywhere! I am reminded of my favorite quote from the late, great Nelson Mandela:
“After climbing a great hill, one only finds that there are many more hills to climb.”

I see three hills on the horizon for Zoona in 2014. First, we have much work to do in Zambia to fully integrate Airtel Money into our agent service offering.  We want to activate 1 million Airtel Money mobile wallet users, and provide a guaranteed “cash in / out” service to these customers. This will involve scaling up our agent network significantly to meet the anticipated demand.

Second, we want to further scale our payment and working capital services to Zambian Breweries’ cross-country network of beverage distributors and the 25,000 small retailers below them. Our vision is to create a completely cashless distribution channel in Zambia as a proof of concept that we can scale to other value chains elsewhere.

Third, we are now looking beyond Zambia and a key priority for 2014 will be to test our model in new markets. Our dream has always been to build a pan-African business, and it is time to make this a reality.

As much as I am looking forward to a break after an exhausting year, I am more excited than ever to get back to work in January. The Zoona story is just getting started, and 2014 is going to be a big test to see if we can elevate our business to the next level.

Thanks to everyone for your continued support and I wish you all the happiest of holidays.


Mike Quinn

Group CEO
, Zoona
Follow me on Twitter at @ZoonaMike

Tuesday, June 11, 2013

Zoona Launches Micro-Entrepreneurs on Kiva

Growing a business is hard in Africa. Trust me, I have experienced this first hand as CEO of Zoona over the past 4 years (Mike’s Story). There are the day-to-day challenges that businesses everywhere have to go through – acquiring and retaining customers, hiring good people, managing a cash flow, and positioning against competitors. But in Africa, raising finance is a particularly hard challenge to overcome, especially for micro-entrepreneurs.

Take Cosmas for example a Zoona micro-entrepreneur who is in the business of distributing Coca-Cola products into the informal market settlements of Ndola, Zambia’s third largest city. In addition to supporting his family and sending his children to school, his business provides a source of recurring income to the 150 informal retailers that he supplies daily.

Cosmas’ biggest problem is accessing growth finance to increase his turnover because his profit margins are very small. He cannot access a bank loan because of the strict collateral requirements, and his business cannot sustain more successful microfinance loans because of the high interest (typically 42% pa in Zambia). His best alternative is to simply not grow and leave his dreams unfulfilled. As an entrepreneur, I can tell you there is no worse feeling.

This is why Zoona is so excited to be the first mobile payments partner of Kiva. Kiva’s mission is to create opportunities for people like Cosmas around the world by connecting him to a pool of lenders. Kiva raises over $1.5m per week for micro-entrepreneurs like Cosmas, which changes their lives.

Right now, Kiva has a promotion where first time lenders can make a FREE $25 loan to a Kiva borrower. A Kiva donor funds the loan. All you need to do is to accept my personal invitation.

Then, you can click this link to search for the Zoona micro-entrepreneurs that are fundraising:

And don’t stop with the first loan – you’ll find a continuous stream of Zoona micro-entrepreneurs looking for finance to help grow their business. These micro-entrepreneurs are the real deal, and we at Zoona are committed to do everything we can to unlock their growth potential and achieve their goals.

See you on Kiva!

Mike Quinn
CEO, Zoona
Follow me on Twitter at @ZoonaMike

Friday, January 4, 2013

Time to Break Out

2012 was an amazing year for Zoona. It started with us closing what was Zambia’s first ever venture capital investment as a technology start-up. This was no small feat for a company that started in 2008 with a late night text message from Brad to Brett Magrath about an idea to bring mobile payments to the masses in Africa. It felt like we had been fighting a trenchwar ever since, and finally had the breakthrough we needed.

But the investment was somewhat of a false dawn. As exhilarating, as it was to finally look at a cash flow forecast that didn’t plummet into the red at the end of the month, we didn’t fully appreciate how much of a hole we would have to dig out of before we could really start to grow. Our operational systems and processes were held together with duct tape and glue and it quickly became apparent they couldn’t scale. We had a dozen key hires to make, which would take months of interviewing, onboarding, and integrating into our existing teams. We had to set-up two Boards for our international and Zambian entities, which involved building new working relationships, getting used to new governance processes, and recruiting new independent Directors. We also had a backlog of pre-investment external development contracts to deliver on before we could even start to think about developing new products and executing our strategy for the future.

We were, as we liked to put it, constipated. Our business could not move forward until we could relieve the backlog and establish new foundations for growth.

The problem was that it took us a few months to figure this out. As a CEO who had spent nearly 18-months fundraising, I was the furthest away from the actual business on the ground; I didn’t recognize how constipated we were. I wrongly assumed that with the money in the bank the plan would play out like we had designed many months earlier and I had pitched repeatedly to investors. Our new investors naturally assumed the same, setting the stage for some difficult months of missed targets, misaligned expectations, and worst of all, an increasing cash burn.

Note to first-time CEOs who successfully complete a fundraising round: Don’t underestimate how much time it will take you and your team to really learn your business again once the money is in the bank. It’s a big transition from a pre-investment cash strapped start-up to the business in your investment plan, and your goal should be to make this transition as quickly as possible without burning through your hard-earned investment cash.

When we did get real about relieving our constipation in Q3, we took the first steps towards becoming a much better business and more effective management team. We set a list of operational priorities, none of which were related to revenue: We completed our hiring and onboarding, rolled out our new Zoona brand, restructured our agent operations, automated manual payment processes, and put in place new controls. We also spent a lot of time figuring out how to get the right people focused on the right things – which became my biggest priority in my role as CEO.

While this transformation is still not complete and we have had to endure some staff turnover, the results started to come in Q4:

  • We achieved our first $200k revenue month
  • We grew our Money Transfer revenue by 38% in Q4 versus Q3, with our biggest day ever on Christmas Eve (3,000 money transfers valued at close to $200k)
  • We launched a new Supplier Payment product from a cold start in August to close to $1m in payment value in December

These achievements have built some real momentum and have increased our intensity as a team. They have also enabled us to become much more focused on four key goals for 2013:

1.    Become cash flow positive.

Working for a start-up is a life and death battle every day until we can generate positive cash flow and regain control of our own destiny. In 2013, we need to grow revenue as quickly as possible without increasing expenses.

2.    Focus our resources on our core customers.

Getting more focused on paper is only the first step – the real challenge is ensuring that the bulk of our people and resources are allocated to serving our most important customers. In 2013, we need to have the courage and discipline to say “No” at least as much as we say “Yes”.

3.    Enable our employees to drive a delightful customer experience.

We will only become the business we want to be by developing a customer-centric culture. In 2013, we need every single employee at Zoona to understand how his or her day-to-day job touches – and delights – our core customers.

4.    Establish a data-driven culture and decision-making framework.

Finally, our business has grown to the point where gut-feel decisions are no longer good enough. In 2013, we need to complete the automation of business intelligence data and dashboards so that managers have the right information at their fingertips and make better decisions everyday.

Everyone at Zoona has a part to play to achieve these goals. As one of our core beliefs states:

We believe in performance. We will build a high-performing team with diverse backgrounds and skill-sets and hold them accountable for results.

This belief in performance starts and ends with me as CEO. I am accountable for ensuring these goals are met, and for leading Zoona closer to our vision of a Cashless Africa. Despite the hype around mobile payments, Africa is still dominated by cash, unbanked masses, and usury interest rates (for those “lucky” enough who have access to financial services at all). The market opportunity is bigger than ever, and the need for Zoona’s innovative payment solutions has never been greater. After a year of progress in 2012, we now have the team in place, the money in the bank, a solid base of customers and agents, and a strategy that can win. And best of all, we aren’t constipated anymore.

Welcome 2013. It’s time to break out.


Follow me on Twitter at @ZoonaMike