Right Place, Wrong Time

Hey, Sheriff here 👋 

A few months ago, we wrote about tarpit ideas in Africa—the sectors where startups find swift death.

And you (plus 62,000 others) loved it. 

But there’s another side we didn’t talk about in that article: companies that were right on the idea, but too early for the market.

Because sometimes, the right companies can spring up at the wrong time.

But before we start, we have something to tell you…

Now, on to this week’s story….

Name any big startup today, and we’ll show you a dead version of it that was built five years earlier.

Like ShareYourWorld, a company founded by Chase Norlin in 1997.

It was a way for people to make videos and share them online for others to watch, just like YouTube.

But there were a few problems:

• It was the late 1990s, and most people used landlines to access the internet. Landlines were slower, so watching a 2-minute video online took forever 

• Only 3% of US homes had high-speed internet at the time.

• And mobile cameras that could record videos on the go weren’t yet a thing.

This meant that while ShareYourWorld had a good idea, it simply couldn’t deliver a good product.

So, ShareYourWorld never reached the world.

Four years later, in 2001, ShareYourWorld shut down, and online video sharing was temporarily dead, 

Until 2005, when three coworkers decided to build a dating site.

Steve Chen, Chad Hurley and Jawed Karim were PayPal engineers who wanted to build a better way for people to find love.

Their big idea was to have people upload videos to introduce themselves, so potential matches don’t get catfished.

They called it YouTube.

And for three months, no one tuned in. 

One night, Chad—one of the co-founders—missed the Super Bowl performance and wanted to rewatch it. But he couldn’t.

Then it hit him: what if they tweaked their app so people could broadcast themselves to anyone, instead of just a few potential dates?

So they pivoted, and the new YouTube became one of the fastest-growing sites ever.

Within a few months of pivoting, it grew to 2 million daily viewers.

By 2006, YouTube had 72 million users. That same year, Google bought it for $1.65 billion, a shocking number for a one-year-old startup.

YouTube is ShareYourWorld resurrected. But one died, and the other thrived.

Sometimes, being early is the same as being wrong. 

And some of the most popular companies you know today also had earlier alternatives that paid the punctuality tax.

• Taxi Magic was founded in 2007, two years before Uber. But it failed mainly because their maps were clunky, and most drivers couldn’t follow them. 

• Couchsurfing was Airbnb, but from 1999. It never grew big because online travel booking was small. The site was also free, so people had no incentive to host guests.

• And before companies like Spotify and Audible, Odeo tried to simplify podcasts. But they just weren’t popular yet.

Many startups missed out on massive goldmines because they were born too soon.

But this punctuality tax doesn’t only apply in the US. It’s a real thing in Africa, too.

How to lose a big win

In 2009, Tayo Oviosu launched Paga, a Nigerian fintech with a cool new way to bank people.

Instead of using bank branches or ATMs, he’d use agents; everyday people armed with POS machines that could help people transact.

These agents took in deposits, paid out cash to customers, and even helped them send money to other people.

It was like having a bank around the street corner.

Today, this is called agency banking, and today, the top three agency banking fintechs collectively processed over $200 billion.

But Paga isn’t one of them. 

It’s a distant fifth, having processed about $16 billion in its 16 years of existence.

The top spots are cleared by companies like Opay, FirstMonie, and Moniepoint—all started nearly ten years after Paga.

While Paga still runs today, it seems to have lost out on a big headstart to be the king.

But it’s not for lack of funds or vision; it raised nearly $40 million across five rounds..

It’s not for lack of skills, either.

Tayo Oviosu, Paga’s CEO, is a Stanford-trained MBA with some of the best insights on African tech.

And he’s seen as one of the OG founders on the continent.

So, what was missing?

Timing, the silent co-founder

When Paga came up in 2009, two things weren’t on its side: policy and people.

Nigeria’s cashless policy—a policy to make people spend cash less and use digital payments more—wasn’t announced until 2012.

Even then, it didn’t go into full effect until 2014.

And back in those days, people had a different relationship with digital payments in Nigeria.

They still kept huge sums in banks and mostly they paid cash for things. 

And when they try using POS machines, it often failed.

So, Paga had the right vision: to put a bank on every street corner.

But it was ahead of its time.

As time passed, fintech’s adoption in Nigeria grew. And new companies popped up.

Nomba rolled out its agency banking product in 2018, Moniepoint came on the scene in 2019, and Opay joined that same year.

But in 2023, Nigeria’s central bank announced that it had redesigned some of the currency notes.

This meant that old naira notes would now be worthless. And it gave people an ultimatum to swap their old notes for new ones.

The result? A cash crunch that sent millions scrambling. 

With most Nigerians still reliant on physical cash, the sudden shift triggered long queues, chaos at banks, and widespread panic.

Almost overnight, digital payments became the first option.

This time, though, the market had changed.

People were used to POS machines, card payments worked better than in 2009, and fintechs were just as popular as banks.

But now, instead of Paga, other startups like Moniepoint and Opay had taken the fore for being fast, easy, and reliable.

Their machines were used by everyone, not just registered “agents”. When people processed payments, they went through. 

It would only take 5 minutes for sign-ups.

When the frenzy settled, they had gained millions of new customers.

Moniepoint and Opay were best prepared for the chaos of those times.

But beyond the great products and massive distribution they’d built, the seasons were also on their side.

Paga paid the punctuality tax.

And other African companies have paid it too:

• e-Tranzact preceded Paystack and Flutterwave by 13 years, but it didn’t have a growing e-commerce economy to help it score a massive win.

• Mocality shut down its business directory business in Kenya and Nigeria, a market where companies like Bumpa are finding significant growth.

• And Simplepay failed where many mobile wallet apps thrive today.

Many companies have had their destinies shaped by timing. 

What if time could be a guide?

Here’s an interesting question: What if we looked at early startups not as failures, but as prototypes?

Because the thing is: no startup steps in the same market twice.

The rails change. The rules change. The behaviour changes. 

Jumia Food’s wild discount wars may have burned cash and shut them down.

But they also trained a generation of consumers to buy food online.

Now, that same behaviour powers Chowdeck and Glovo.

Even crypto has had its turn.

The first generation of exchanges in Nigeria and Kenya was clumsy and crushed by regulation.

But they forced regulators to pay attention—and today, the climate’s warmer.

Startups like Yellow Card and Canza Finance are walking back in with new tools, better compliance, and clearer demand.

Yellow Card, for instance, now has stablecoin payments backed by Visa, a nod to crypto payments becoming mainstream in Africa.

That’s the hidden gift of failed companies: they don’t just disappear. 

They spin out talent, educate customers, and shape regulation.

So maybe “too early” is just “early enough to light the path.”

And if that’s true, then maybe the smartest founders today are looking backwards to see forward.

What’s one dead African startup you think could work today?

Let us know here.

That’s it for this week. See you on Sunday for a breakdown on This Week in African Tech. 

Cheers,

The Tech Safari Team

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