4YFN recently had a catch-up with Alexander Hizikias, the Co-founder & CEO of eQUB - and asked him to go through his experience showcasing the fintech initiatives at MWC 2024. The winners of the Fintech Pitch Battle, shared the journey from eQub so far and what are their plans for the upcoming years.
- Could you tell in a few words, for those who don’t know you yet, what is eQub?
eQUB is a mobile app that allows users to engage in peer-to-peer saving & lending between groups of people, oftentimes referred to as Rotational Saving & Credit Associations (RoSCAs). The name “Equb '' is the Amharic word given to the traditional financial system in Ethiopia. This social solution to finance is prevalent in Africa & goes by different names across the continent such as “Chama '' in Kenya, Esusu or Susu in West Africa etc. This RoSCAs work where individuals come to save & pool their money together for a defined period of time then one lucky person takes the collected sum each month via lottery - the contributions go on until all members of the saving community have won their respective rounds. Equb, traditionally, is used by the underbanked population which represents more than two-thirds of the Ethiopian population.
- Could you share the journey that led to the creation of eQub? What has inspired you to start this venture in the Fintech sector? What unique challenges have you encountered along the way?
Our journey started in 2018 with a humble request for credit, for our previous startup, from banks & microfinance companies where we heard a resounding rejection from all formal financial institutions. The reason for discarding our request was that the collateral was not sufficient, or that it would take 6 months or more and in some cases, the interest rate exceeded 16%. This led us to source much-needed capital from families & friends through Ethiopia’s informal, yet long-lived & traditional financial tool, Equb. This interaction, in our eyes, opened the Pandora’s box on how credit can be accessed with no collateral or interest in a small window of time.
Shortly after, I started exploring how the traditional system can be efficient, scalable, accessible, democratic & decentralized just by using technology - The financial utopia that is reimagined through just a mobile device. We designed & innovated Ethiopia's first-ever digital-first peer-to-peer platform for saving & lending circles in 2019. By 2020, this idea became Equb Financial Technologies PLC by August of 2020. Upon releasing our beta product to the market in February 2021, we were faced with an overwhelming amount of positive feedback from our early adopters. From local to international media to big-name investors, everyone stood in line to grab a piece of the eQub pie. Through time, we understood our product was missing something. We understood that to build a real solution one needs more than an idea but understanding the users’ pain points & validating assumptions we once had to the real problem on the ground. Our main challenge for our unorthodox entry to the market was the lack of secondary data available on Equbs. Therefore, we decided to take it upon ourselves to dedicate 18 months in primary data collection & product development to come up with eQUB 2.0 - decentralized social financing on steroids. And that's exactly what we did.
- How is eQub driving innovation and making an impact in the Fintech industry? What significant changes or advancements do you aim to achieve in the next five years?
Fast forward to 2024, eQUB is driving innovation in the Ethiopian FinTech space through its innovative mobile app which boasts more than 35,000 user downloads & growing exponentially. We have been able to host more than 1000+ saving groups since October 2023. We have ambitious plans to become Africa’s largest peer-to-peer platform for saving groups & lending circles. Having fulfilled our plans in Ethiopia, we will be expanding to other African economies soon.
- Winning the Pitch Battle at 4YFN24 is a remarkable accomplishment. Could you describe your experience during the Pitch Battle and how it has influenced the trajectory of your startup?
Winning the Pitch Battle at 4YFN24 was an exhilarating and transformative experience for our startup. The competition was intense, with many innovative companies showcasing cutting-edge solutions. The preparation process was rigorous; we had to fine-tune our pitch to clearly convey the unique value proposition of eQUB and demonstrate its potential impact. Our BizDev lead, Nahom Mchael, standing on that stage, presenting our vision to a panel of esteemed judges and a large audience, was both thrilling and nerve-wracking.
The recognition we received from winning the award has had a significant impact on our startup. It has provided us with tremendous validation, both within the fintech community and beyond. This accomplishment has not only boosted our credibility but also opened doors to new partnerships, investor interest, and media attention. The momentum generated by the win has accelerated our growth, helping us to attract top talent and expand our customer base. It has also reinforced our commitment to our mission of providing accessible and equitable financial solutions.
- How has participating in initiatives like 4YFN contributed to your startup’s growth? In what ways have these platforms provided essential support and resources?
Participating in initiatives like 4YFN has been instrumental in our startup’s growth. Thanks to our partners at UN-ITC (International Trade Centre) & the NTF-V program, we were able to showcase our startup. These platforms offer unparalleled opportunities for networking, exposure, and learning. Through 4YFN, we were able to connect with a diverse group of industry experts, potential investors, and fellow entrepreneurs, fostering valuable relationships that have been crucial to our development.
The feedback we received was invaluable, helping us refine our product offering. Access to workshops and panels provided us with insights into the latest industry trends and best practices, which we have applied to improve our operations and strategy. Furthermore, the visibility gained from participating in such a prestigious event has significantly raised our profile, attracting interest from potential clients and partners who may not have discovered us otherwise.
- Based on your experience, what do you believe is the key to success for startups in your industry?
From our experience, the key to success for startups in the fintech industry lies in a few critical areas such as Innovation and Differentiation. The fintech space is highly competitive, so it’s essential to offer a solution that stands out. This means not only being innovative in terms of technology but also in addressing real, unmet needs in the market. Our focus on creating a digital saving group app that facilitates accessible and community-based financial services is a prime example of this. User-Centric Approach is also important in understanding and prioritizing the needs of the end-users is crucial. A deep commitment to user experience, including ease of use, security, and reliability, can make all the difference in gaining and retaining customers. We constantly seek feedback from our users and iterate on our platform to better serve them.
In this dynamic fintech space, agility and adaptability are crucial. The fintech landscape is rapidly evolving, with regulatory changes, technological advancements, and shifting consumer behaviours. Startups must be agile and adaptable, ready to pivot or refine their strategies in response to these changes. Lastly, building a robust network of mentors, advisors, and partners can provide essential support, resources, and market access. Engaging with industry events and communities, like 4YFN & MWC, has been a cornerstone of our strategy to forge these connections.
- What’s on the horizon for eQub? Are there any upcoming projects or milestones that you’re particularly excited about? How can the community assist you in reaching your future goals?
We are happy to announce that we are raising our first seed round before the end of 2024 and we would like to invite investors to join us in successfully raising our round & also partners that would like to work with us in our efforts towards financial inclusion & access to finance in Africa.
Looking ahead, we have several exciting projects and milestones that we're eager to pursue. As a bootstrapped startup, we are happy now to officially announce to the 4YFN community our readiness to raise our first seed round before the end of 2024. We also have plans to engage in:
We are in the process of expanding our app to include additional financial services, such as credit scoring. This will provide our users with a broader range of financial tools to help them achieve their goals. We are also planning to expand our services into new markets, both domestically and internationally. We believe that our platform can offer significant value in regions with limited access to traditional banking services.
We are actively seeking to establish partnerships with banks, insurance companies, payment facilitators, non-profits, and other fintech companies to create a more robust ecosystem for our users. One exciting initiative involves collaborating with e-mobility companies to provide credit access to gig workers to increase employment opportunities for our users.
Not to mention that we are investing in cutting-edge technologies, such as artificial intelligence and blockchain, to enhance the security and efficiency of our platform. We are also exploring the integration of decentralized finance (DeFi) solutions to offer our users more innovative financial products.
The 4YFN community can support us in Marketing efforts: Word-of-mouth and social media sharing can significantly boost our visibility. If you believe in our mission, please share your positive experiences with our app and spread the word about our services.
We are grateful for the support we’ve received so far and look forward to continuing our journey with the community’s help. Together, we can make financial services more accessible and inclusive for everyone.
The applications for the prestigious 4YFN25 Awards are now closed. Stay tuned to find out which companies will become finalists and which will have the chance of receiving a €20,000 cash prize, along with numerous other benefits designed to accelerate their business growth and visibility. For more information, see more here.