JP Ssemyalo Presents Pebuu Africa: A Pan-African Electronic Bill Payment Solution Provider

Interview with JP Ssemyalo, Founder of Pebuu Africa

What is your main challenge to develop your business?

Human resource is always the biggest challenge for most companies in Africa, mine in particular. The turnaround in terms of human capital is usually high because most companies want to recruit from already established companies. You find yourself recruiting and training all the time.

How many employees do you have?

At Pebuu, we have about 64 employees across the five other countries where we are present. We supply about 3,800 agents.

Where are you headquartered?

The head office is in Uganda. We have seed offices in other countries. The Uganda office employs about 48 staff and the rest are spread out over the other countries.

What is your sales turnover?

On average per day, we do about 1.7 billion UGX or $500,000 switching through our services. We are a medium to large sized company.

You have several other businesses you are active in. What are they?

I am active in advertising and media. My advertising agency is part of DDB out of New York. I run DDB Uganda, Tanzania, and Rwanda. I am also involved in agriprocessing. I have a pineapple juice factory. I am also present in oil and gas through fuel stations. I put my energy and time into Pebuu at the moment because I want to grow it into a financial institution.

Are you looking for investors?

For such businesses, we are always looking for potential financial partners and low interest financing. As Pebuu, we have demand for the service and we heavily rely on innovation. Low interest financing will be a game changer. You can easily scale without fear and from that you can easily dominate the market. With our products it will be easy to dominate the East African and West African region.

What are the issues to getting this low interest financing?

Started in Uganda, Pebuu Africa is a Pan-African electronic bill payment solution provider that allows for everyday cash payments. Through its agents, mobile app and Pebuu Card, Pebuu Africa allows its clients to settle bills instantly and affordably.

Capital is quite expensive in this part of the world. We tend to tie growth to the profits we make. When we make good profits, we are able to open up other regions. The demand for our services is quite high in these new regions. If we were able to get access to low interest financing, we would be able to scale easily. We rely heavily on financing from commercial banks. That in itself makes the cost of onboarding our agents quite expensive. If I borrow at 22% from a financial institution or at 16% per annum from a development bank, in terms of audience, I will tend to speak to only the B and C1. Those are people who are able to become my agents. But if I could get access to lower interest financing, I would speak to a lower audience which would increase my transactional volumes and make my business more profitable. When you look at the countries where we operate, the kind of audience we tend to speak to are B2 to D1. These are people that live on about $100 per month. If the cost of becoming a merchant is $100, then this person will not be able to do business with me. I can only dominate these markets and become more profitable if I have access to low interest financing.

How are you overcoming this challenge compared to your competitors? What is your competitive advantage? How do you find your niche?

There are a number of factors. First is your business development strategy. Next is your network. We are in the space of payments. The biggest players here are telecom companies. We play in the same space as the likes of MTN, Safaricom, Econet, Airtel, Vodafone. These are giants who make a lot of profit from Europe, the States, Asia. All they want when they come here is market dominance. The way I compete is to create a fusion. I have created a switch whereby a Pebuu agent is able to transact with all the telecoms. They can do Airtel Money, MTN Mobile Money, Vodafone Money, and M-PESA. That is a unique value proposition that I offer. Other telecom agents can only offer services from that one telecom. That fusion of networks helps me identify the right niche that sees value in that. I am not exclusive to one network so the margins they give me over their direct agents are quite small. In order for me to survive, I have to do a much higher volume. But I am using this as a strategy to create Pebuu Money. This force I am creating will enable me to compete with these telecoms, go into money transfers, and much more.

Who are your competitors in this market?

The number one competitors are telecoms. There is another service called PayWay which is widespread in Uganda. JamboPay is big in Kenya. Selcom is big in Tanzania. EcoNet is big in Harare (Zimbabwe). Africell Money is big in DRC. Again, it is a game of finding your niche and focusing on that.

Is finding and recruiting agents also a major challenge?

Yes. We have managed to figure this out. We tend to ride on existing networks. For example, we have signed a pan-African partnership with Total so that every Total station will become a Pebuu agent point. Our plan is to heavily rely on supermarket chains, convenience store chains, schools, SACCOs, etc. If we sign a deal with the head office of those chains, it becomes easier for us to spread. We want to focus on the lower audience which is the masses. The only way we can be able to speak to them is if we are able to access low interest financing. Then, we heavily subsidize becoming a Pebuu agent or merchant for them.

What is your final strategy?

We want to be the dominant player in the low-income space, which is basically the majority. If we can dominate that space, that means we are commanding 65-70% of the market share. We can do a lot with that network and that traffic.

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