French footballers back African mobile video network StarNews Mobile in $3 million funding round

by MMC
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Image credits: Getty Images

African Mobile Video Network Star News Mobile has secured $3 million in pre-Series A funding. StarNews offers African content creators a platform to monetize their work through a subscription model. Currently, the service is available in six African countries, including Cameroon (where it started), Nigeria, Ghana, Congo, Benin and Ivory Coast.

Founder and CEO Guy Kamgaing launched the startup in 2017. His inspiration for this venture draws from his extensive 10 years of experience in content monetization, particularly within the VAS (Value-Added Services) business. During this period, he was actively involved in SMS campaigns and monetization efforts, which formed the basis of StarNews.

The five-year-old mobile video network prioritizes providing monetization opportunities to African content creators through distribution partnerships with major telecommunications operators like MTN and Orange. Content creators often face difficulties generating revenue due to the limitations of existing streaming platforms. As a result, StarNews connects them to mobile users who often lack access to relevant content due to expensive mobile data plans and a lack of services tailored to local markets. A win-win for both parties.

“I realized that although I could monetize jokes and horoscopes through telecom operators for several years, no one was monetizing content on traditional platforms, especially in Africa,” the Los-based Cameroonian entrepreneur told TechCrunch. Angeles. “There are thousands of creators online who don’t make money on YouTube or other platforms. So it was just putting two and two together, saying, “Well, this content is here that no one knows about and it’s very difficult to get the audience on YouTube and in search, but I can help creators make money because I have a relationship with telecom operators.’”

Mobile operators play a vital role in promoting content within the African media industry, with unrivaled distribution capabilities. Close collaboration with these operators is imperative to establish a solid presence in the market. Over the past few years, these operators have been instrumental in increasing data usage across the continent, simultaneously selling in-house content to their customers or partnering with entities like StarNews. To draw a parallel, Kamgaing said one can consider Orange as the “Apple” of the telecommunications world in Africa and MTN as the “Google”.

Connect mobile subscribers to local content creators

StarNews has an active subscriber base of over 4 million through its partnerships with MTN and Orange in six markets (it left South Africa after a misalignment with MTN’s strategy to engage content creators) and a community of over 120 content creators. This approach allowed StarNews to organically expand its user base while securing nearly $8 million in funding (including $900,000 from friends and family, a $2 million seed investment and a $1.8 million extension) from a range of US, European and African venture capital firms, including investors. & Partners (I&P), Snap via its Yellow Accelerator ProgramLoftyInc Capital, Graph Ventures and Expert Dojo.

The platform is structured around channels, with each creator having a dedicated channel. Kamgaing says the company works closely with creators by providing financial support and helping them with content production; in addition, it guides creators in their digital journey, offering them support in digital acquisition. As highlighted earlier, a significant portion of the company’s user acquisition comes from telecom operators, as it is a transparent process allowing, for example, MTN to send messages encouraging its customers to subscribe to Star News to watch social media personalities including music artists, comedians. and influencers. For users, the registration process is simplified for convenience, followed by a simple payment mechanism, allowing them to pay using their airtime; It works on six different networks, each offering users various plans, weekly subscriptions and daily plans.

In addition to creator-produced content, StarNews offers deeply hyperlocal content, covering topics such as motorcycle taxis in Cameroon or cooking recipes in Ivory Coast. The platform also hosts genre-specific shows, including the African Cup of Nations soccer competition and a program modeled on a reality TV competition, The Voice. StarNews leverages its partnerships with telecom operators to drive awareness and significantly increase user activations for these shows. For example, during the 2021 edition of the Africa Cup of Nations (AFCON), the platform actively produced exclusive content directly from the event, which resulted in the acquisition of 600,000 new users. Additionally, the company sponsors concerts, and at one point attracted a staggering 500,000 subscribers by offering them the opportunity to attend a concert. Fally Ipupa concert.

These initiatives highlight the power of strong partnerships, where telecom operators take the lead, followed by content creators or trade show organizers, noted Kamgaing, a former PwC consultant. According to him, this dynamic translates into an influx of users eager to access content or engage with the telecommunications company’s activities, while positioning StarNews remarkably well to effectively oversee the distribution, monetization and content creation.

“Production without distribution is increasingly difficult without monetization. There are a lot of people who create content, but they put it on YouTube and Instagram, platforms that control the distribution. There is no real monetization. We can have all three levels at the local level. We have offices in all markets and the teams work specifically with creators on content production, which is unique,” ​​the CEO said, while adding that the platform’s content spectrum has expanded to establishing major partnerships with companies like Sony and Universal. In the region.

Opportunity in the creative economy sector in Africa

Among its markets, StarNews has observed the most impressive retention rate in Nigeria, a market that has all the right parameters for exponential growth, according to Kamgaing. User acquisition is relatively simple and the platform enjoys high user engagement and stickiness; Additionally, monetization is booming, he added. StarNews uses an internal metric to evaluate monetization, known as billing rate. This measure represents the number of people with enough available airtime to pay for digital services; notably, the billing rate is three times higher in Nigeria than in French-speaking markets.

Kamgaing revealed that the platform distributed $1 million to content creators last year while maintaining an average monthly payout of around $70,000 to these creators. The new capital infusion represents a significant boost to Africa’s creator economy, an underserved sector of African technology (despite the fact that startups like those focused on e-commerce Selar hold up). This funding will allow the Los Angeles-based company, which currently has 40 employees, to better support its creators and gradually increase payments in the coming years, a crucial step in supporting the region’s creative industry.

Additionally, in a press release, Kamgaing outlined the startup’s expansion plans, noting its intention to strengthen its dominant presence in French-speaking Africa while rapidly expanding into strategic markets like Nigeria and Ghana. StarNews plans to be in 11 markets by next year, the CEO noted on the call.

Janngo Capital, an Africa-focused venture capital firm, led the pre-Series A funding round. Other notable investors, such as footballers Aurélien Tchouaméni of Real Madrid, Jules Koundé of Barcelona and Mike Maignan of AC Milan, all affiliated with an athlete representation agency Sports Nation of Excellence, participated in the tour. Kamgaing, in the interview, highlighted the shared African heritage of these actors, emphasizing their connection to StarNews’ mission and their genuine interest in engaging with African audiences and investing in startups across the continent. These French footballers are now joining the ranks of investors like Blaise Matuidi, a former French international who has already invested in the Sudanese fintech company Bloom and currently runs Originsa venture capital firm in collaboration with other football players who serve as limited partners.

Fatoumata Bâ, founder and executive chairman of Janngo Capital, affirmed the company’s support for StarNews, emphasizing the platform’s unique positioning, strategic partnerships, technology and content. This support is anchored in the belief that StarNews is well-positioned to capitalize on the immense growth potential of Africa’s creative industry, which is poised to quadruple its expansion by 2050 and generate up to $20 billion. dollars of GDP, she said.

“I am very excited and proud to support StarNews, the first media platform that supports African creators and tells the world the true African story,” added Fernand Tchouameni, spokesperson and investment advisor to Aurélien Tchouameni. “Being of Cameroonian origin, I also see StarNews becoming a bridge to connect with the African diaspora, and I personally look forward to being a part of it. »

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