🛣 There’s no set path: your journey, your terms

Welcome to Sati - Sourcing Africa to Invest

👋🏾 I’m Marge… ethnically Ugandan 🇺🇬 raised in the US 🇺🇸 and a dreamer 💭 

I’m joined by Ona…also Ugandan 🇺🇬 studying in the UK 🇬🇧 and honestly, she’s a rockstar! This publication could not take place without her.

Here at Sati, we’re on a journey to uncover Africa’s history of tech and private investment to understand the present and predict the future.

Join me; let’s see where this ride takes us 🚌

We’re back again!

And we’re here to pick up where we left off.

We were in the middle of understanding how goods are transported in Sub-Saharan Africa

Our objective with Part 1 was to give you context.

We walked into the discussion knowing that it is 50-75% more expensive to transport goods in Sub-Saharan Africa than in the developed world. And we figured out why. Feel free to dig in here.

We closed off in agreement that digitization is the most practical solution to reduce transport costs

And the benefits we laid out were specific to freight forwarding, which we will explain shortly.

But before we dive in, we wanted to give you a quick overview of the logistics and supply chain landscape.

We thought freight forwarding was the right place to start because it would give us a macro perspective on the transportation of goods in Sub-Saharan Africa.

We will dig into other subsectors in the future.

What is freight forwarding?

Given that 90% of goods in Sub-Saharan Africa are transported via roads, we’re focusing on hauling via road.

There are several players digitizing the road freight forwarding process…

But we are zeroing in on an outlier, Kobo360

Kobo is a platform that connects cargo owners, truck owners, truck drivers, and cargo recipients to ensure the optimized delivery of goods.

Of the players above, we chose Kobo because they’ve successfully scaled into several markets and raised significant financing.

In the past, we’ve jumped right into the players and their solutions, as we did on the pieces about telcos.

But with Part 2 on freight forwarding, we’re taking a different approach.

Kobo’s co-founder, Obi Ozor, has an inspirational story.

We wanted to take the time to share it with you.

We hope that reading this piece will lead you to believe that no matter where you came from, you can do ANYTHING you put your mind to.

Grab your tea ☕️

This one is special.

The Power of Mindset 💭

From Naija to the US

The last born of 8, Obi and his family didn’t have much.

Although poor financially, they were rich spiritually, a mentality that has played a crucial role in Obi’s trajectory.

He went to a village primary school in Enugu. For secondary, he aspired to attend a seminary school to become a Catholic priest, a journey that required 6 years of study.

He applied and was accepted to Sacred Heart Seminary School. He skirted in and ranked applicant 103 of 104.

Despite this, Obi performed. He finished his second year 5th in his class.

Like many poor families, his struggled to pay school fees.

The plan was for him to return to the village high school, but he loved the seminary and had to come up with a creative solution to remain enrolled.

13-year-old Obi was determined to muster up a way to pay his school fees.

Phones were all the rage at the time, and having one meant that you could facilitate calls for a fee.

Students would often queue up to give a single person money to make calls.

Obi envisioned himself being that person at the head of the queue.

Voilà 💫

A business opportunity 🙌🏾

While on holiday between his 2nd and 3rd year, he stayed with his relatives who gave him 1500 Naira. The new 3310 Nokia cost 3500 Naira, meaning Obi needed 2000 more to purchase one.

He asked his friend and classmate, Charles, for a loan which Obi promised to pay back within 2 months.

With the funds, he approached another friend’s mom who helped him get a phone.

He poured his heart out to this woman, sharing his dilemma and need to pay for school fees.

Obi and his friend's mom became business partners.

Within the required 2 months, Charles could have collected Obi’s debt. But he instead chose to remain invested.

They grew the business.

The parents of his rich classmates started bringing money to invest as well. He was creating wealth for his community.

4 phones later and now also selling recharge cards, Obi had plenty to pay not only his school fees but also his sister’s pocket money.

At 14, Obi was contributing to household expenses to supplement his mother's 13,000 Naira salary. Therefore, he and his mother had a deep bond. Together they worked through the challenges to provide for their family.

Obi’s remaining time in school was smooth sailing.

He was making money, providing for his family, and was a well-known, respected prefect.

6 years was up. Obi finished and was planning to enter the priesthood.

However, things took a turn on 27th August 2006.

After returning from long vacation, Obi noticed his face swell up one morning. When he got home it was getting worse so he went to a hospital.

Little did he know, he was now faced with battling kidney disease (stage 2 kidney failure).

Obi was at a loss.

His mom used the little money she had to pay his hospital bills.

At some point, she was forced to close her Union Bank account, and Obi was transferred to another clinic.

All he could do was cry. He contemplated both dying to relieve his mother of this stress and holding on to his life because of all the love he was getting from everyone around him.

But as a man of faith, he remembered a prayer: “Lord, let your will be done.”

At this juncture, he realized that his kidney failure was God’s will to prepare him for what was to come. His fear of death waned.

After 9 months in the hospital, he was discharged. The kidney disease wasn’t cured, but it was being managed via bi-weekly checkups.

Doctors encouraged him to take it easy, but he couldn’t.

The theme remains. Although weak physically, he was strong mentally, and this was his second chance at life.

Obi’s bi-weekly checkups were expensive, 12,500 Naira.

No longer wanting to burden his family with the expense, he had to find a way to pay.

He got back in business with his friend's mom, now selling call credits.

It seemed like things were getting better.

Bi-weekly appointments became monthly, bi-monthly, then every six months.

But in 2008, Obi relapsed and was on the verge of needing dialysis, meaning he was staring death in the eye.

But this wasn’t the end.

One of Obi’s uncles living in the US came for his dad’s burial. He was looking for Obi at the burial service. But of course, Obi wasn’t present due to his disease.

Said uncle heard about Obi’s efforts to support his family. He talked to his wife and they decided they would help Obi get to the US for treatment.

On 14th September 2008 Obi left for the US alone.

He was staying with his aunt at her apartment.

His priority was to help wherever he could. He wanted to ensure that he wasn’t a burden. He cleaned the house, did the dishes, got the kids ready for school, and learned how to use public transport to get to his appointments.

Obi’s health started to rebound. He was starting to feel like his old, strong self.

But he wasn’t cured.

His doctors encouraged him to sign up for a trial medication. It worked.

He was on the meds for 11 months, but they were expensive.

One of his relatives was paying the bill.

But at this point, we know Obi. He wasn’t comfortable with this. He had to find a way to pay on his own.

Obi’s foray into the trucking business 🚛

From cleaner to CEO

He remembered that in Enugu, tippers (dump trucks) would make 25,000 Naira per trip. He thought this would be a lucrative business.

The issue was that it cost 6M Naira (~$18,000) to buy a tipper.

Determined Obi started making inquiries.

He went to his uncle first who told him that he couldn’t live in the US and run a business back home.

So, Obi had to find another way.

Obi was receiving money from an uncle through his JP Morgan Chase account.

One day, to his surprise, he ran into an Igbo (Igbo is a big tribe in Nigeria) banker.

Keep in mind, Obi was in Michigan where you hardly ever saw blacks, let alone Nigerians.

So when the banker saw Obi’s name, he instantly recognized where it was from.

Obi confided in the banker about his desire to buy an $18,000 tipper. But the banker told him he needed collateral. He asked if Obi was in school. Obi informed the banker that he was sick and therefore wasn’t enrolled.

The banker told Obi that the easiest way to get a loan was to take some financial aid and prove that he was disciplined enough to repay it.

Obi knew it was a risk, and that if he failed to repay the financial aid, it would kill his career because the US economy runs on credit, not cash.

Nonetheless, Obi told his uncle that he wanted to start school. But his uncle advised against it because doctors said that he wasn’t ready.

As usual, Obi wouldn’t take no for an answer.

Obi’s secondary school final exam scores from Nigeria weren’t strong enough for enrollment because he studied and wrote the exams while essentially in his hospital bed.

Therefore, he had to take the GED, a test that if passed, certifies one with high school-level academic skills.

Obi passed and shortly thereafter started at the local community college. Now that he was in college, he could access loans to buy his first tipper

Obi managed to take a $12,000 loan. He still needed $6,000 more.

Unable to raise from family, he decided to work.

Don’t forget, Obi was still sick.

At Costco and at his care job, he was often on his feet, which was difficult with his disease.

But he was resilient.

While working at Costco, Obi’s eye for opportunity got him the funds for the truck

At times he noticed merchandise running low and advised warehouse managers on what to stock.

One of the warehouse managers found Obi’s confidence abnormal. He wanted to know Obi’s story, so he took him out for dinner.

Humble Obi was reluctant to open up, but his manager pushed for the truth. Taken aback, Obi’s manager encouraged him to take the exam to become a warehouse supervisor.

Obi felt ill prepared, given his lack of understanding of the company.

Therefore, his manager introduced him to Carol, one of the senior supervisors.

Obi worked under Carol as a front-end assistant for 3 months. Ready, he took the supervisor exam and passed.

This was rare. It took others 4 years to do the same.

However, Obi still had gaps in knowledge.

So every night, he stayed up with Carol learning how office operations worked.

From cleaning toilets for $9/hour, he was now making $22/hr at the same company.

He had enough to pay his medical bills and was saving up for his tipper.

His mom observed his grit and contributed 400,000 Naira from her pension.

With funds in hand, he went to find a tipper.

He searched Craigslist and landed on a Nigerian seller.

Trusting his faith, he sent the seller the money without going to see the tipper. Once delivered, Obi shipped it to Port Harcourt.

Business was good. In 3 months, he had enough to buy a trailer truck.

The business continued to expand. He sourced used trucks from the Mid West and shipped them to Nigeria.

By the end of 2014, he had 11 trucks and created 23 jobs.

He called this venture Bezmo Global.

Two minds ✌🏾 one vision 👆🏾

Meeting his co-founder

During his second year at the community college, Obi applied to the University of Michigan.

In 2011, he was accepted and started a degree in Biochemistry with plans to become a doctor.

While there he met his wife.

Obi’s wife had a friend, Ife Oyedele II’s sister.

Ife was a second year pursuing a degree in Business Administration and Information Technology.

Ife’s sister told him that he should meet Obi. They both had a love for business.

They eventually met and hit it off.

Not only friends, they also became business partners.

They dabbled in logistics, shipping dog soap, diapers, and other goods from different markets to Nigeria.

The shipping business wasn’t a full-time gig

It was a side project.

Obi was still running Bezmo, and Ife was working as a Research Assistant at iLabs and in Quality Assurance at Perficient on top of their studies.

Obi’s professor challenged his desire to pursue a career in medicine. He helped Obi understand that medicine was not the only means to help people. Leaning into his natural talents as a business person might be the more efficient route.

So Obi transferred to Wharton to pursue a degree in International Relations with a focus on Finance.

Ife went on to get two jobs. One as a Business Analyst at Mercedes Benz and another as a Business Intelligence Specialist at CFI group.

He left Mercedez to pursue a Master of Science in Information Systems and Technology at Michigan. He continued to work at CFI part-time.

Despite the geographic distance, they continued to work together remotely shipping goods to Nigeria. But challenges existed:

For example, the two were exporting goods from China to Nigeria with plans to sell in Maiduguru. However, it would take 14 days to haul goods from Lagos to Maiduguri (1,600km), a typically 23 hour nonstop drive.

Moreover, Obi was also experiencing challenges with Bezmo

He realized it wasn’t scalable.

Continuing to acquire and ship trucks to Nigeria was an asset heavy approach, and he didn’t have the resources to build a technology platform to onboard other fleet owners and drivers to expand his reach.

From these challenges, the idea for Kobo360 was born.

Sowing the seed of a startup 🌱

From theoretical models to real-life logistics

The idea for Kobo was born in 2014. Obi was the logistics guy, and Ife was the techie.

But another contributor was Obi’s professor, Dr. Marton Markovits, an expert in lean operations.

The three began designing what they believed would be optimal supply chain models.

Around this time, Obi started at JP Morgan as an investment banker.

While there, he was on a team that was negotiating a $5 billion project with Dangote group.

In March 2015, the Dangote team attended the Wharton Africa conference. Obi was also in attendance.

While there, Obi heard that Dangote’s main challenges were with power and logistics.

Due to the JP Morgan transaction, Obi had strong relationships with key members of the Dangote group.

Obi was bold.

He asked Dangote’s Chief Strategists if they were open to outsourcing their logistics

Surprisingly, they gave Obi a nod.

Obi brought the news back to Ife and they began strategizing on how to serve Dangote.

Obi shared their supply chain models with Dangote. The models piqued their interest. However, they were left with the question of how to build an Africanized leading supply chain platform from the U.S.

This would be difficult.

Therefore, Obi decided that he needed more Africa-focused logistics technology experience. When an opportunity to lead the operations team at Uber Nigeria arose, he took his chance.

Obi was tasked with growing Uber’s supply in Nigeria. This involved getting thousands of cars on the road so anyone in the Lagos metropolis could get a ride within 5 minutes.

Given issues with smartphone penetration and the traditional cash-based economy, this would be a tough task.

In January 2016, they launched a cash option which helped drive adoption.

Additionally, they instated a massive driver training and stakeholder weekly information session to bring people along.

While at Uber, Obi and Ife kept building.

A lot of Obi’s experience at Uber played into the systems they built for Kobo.

When the time was right, Ife left his jobs and degree to move to Nigeria to build Kobo full time.

Beta began on 17th April 2016.

I’m assuming you’ve finished your tea ☕️ at this point!

What an absolutely inspirational story!

This piece is for the founders from humble beginnings.

Success isn’t instantaneous. It takes years of patience and perseverance.

But it can be achieved.

Interesting Reads This Week

We will spare you this week! We gave you enough to read 🙃

Future Events

Jas and I kick off our next quarter of office hours on July 6th. sign up to join us!

That’s all we have for you this week!

Thanks so much for making it to the end!

In 2 weeks we will regroup and wrap up Kobo’s story.

We will unpack how they entered Nigeria and expanded across Sub-Saharan Africa.

If there’s anything else you’d like us to explore, send me a note. I’d love to hear from you! You can find me on:

• Twitter

• LinkedIn

• Email (Reply to this email)

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Until next time!

👋🏾 Ona and Marge