Tanzania Report

InterviewsMay 14, 2021

Smart Codes: A Leading Digital Transformation Platform Company in Tanzania by Edwin Bruno

Edwin Bruno, Founder and CEO of Smart Codes

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: Written by Sandra Francisco; Published: May 14, 2021

Interview with Edwin Bruno, Founder and CEO of Smart Codes

What are your current projects?

We are working on multiple projects, especially to elevate the innovation startups together with corporates. Right now, in the world, Africa, and East Africa, especially Tanzania, we are in a digital transformation. We are a digital focused company so we have a lot of things to do and it is a good time for us.

What are the major challenges that you are facing?

Since we have a lot of opportunity, the main challenge is getting the right talent to execute these complex projects. But with time, we are continuing to train the team we have and trying to acquire the new team. Of course, the customer and partners need to also be open for new opportunities. We are selling the future which is going to impact their business. Certain organizations still work very manually. Our customers are everywhere. They do not need to go physically to their office. When we propose a certain platform, it is a bit of a challenge, but of course, after you breach that border the results are always amazing. It is more about changing their culture, changing the way of doing things. With this new wave of pandemic, it has actually helped because now people are forced to go to the digital and to understand it. How can digital work for them? Capital is another challenge. As we are looking to expand into different countries we start looking for raising capital for our different products. We are looking this year and in the next year to expand to more than five countries in Africa.

How do you plan for this external expansion?

For us as Smart Codes, we are segmented into four subsidiaries. As a 360 marketing agency, we market brand products for different companies and elevate them so that they can reach more people and for them to make sales and make profit at the end of the day. We have another subsidiary called Smart Lab where we work with startups in corporate to connect them so that they can create new products or they can invest in each other in terms of products. That is the path that we want to expand. We have another subsidiary called Smart Knowledge for building products for different corporates. The other subsidiary we have is Smart Foundry. This is our major product firm whereby we create our own internal products. This arm we plan to expand into different countries including all our products in paper whereby we distribute newspapers and magazines around the world for local newspaper. We used to only sell all Tanzanian newspapers and magazines. But now, we have started to onboard different newspapers in different countries. We want to finalize in the Kenyan market, Uganda, Ghana, and South Africa. Our main goal is to digitalize newspapers and magazines across Africa. With just one click, people can access newspapers around the world. This product has been growing significantly. We launched the product in 2015. In 2016, we were one of the best innovation apps in Africa. But the major challenge is that we are looking to expand this to five other targeted countries. Within that, of course, we will be raising funds in order to accommodate our marketing, expansion, and to partner with all publishers so that anyone around the world can access newspapers and magazines in Africa with one click. With the pandemic, our sales have been growing because now people are working from home and they do not have time to go outside and get the newspaper. Before, you would go and buy in the local shop where you can touch, but now, people do not want to touch things. It has been a great acquisition for us for the customer to understand that you can always read the papers page by page on paper but then, of course, also through smartphones. We have another product called Kwanza where we help companies and agencies to buy media online through the local and global brands through just one platform. We are looking to expand it as a product in different markets with many other products but also a partnership with startups.

Describe your scope of business. What are your competitive advantages?

We are a digital transformation platform company with a mission to solve African challenges through creative ideas, media, technology, and make a mark in everything we do across Africa.

We are on a mission to build a platform of companies whereby we are focused and add value into this African ecosystem. Our main vision is to take African brands to the world. For us, the competitive advantage is that we are not just an agency, we are not just a tech company, we are not just a product company, we are not just a studio company. We have everything in one house. First, we have Smart Codes whereby we deal 360 in advertising because we believe for any company to grow it needs to brand, to showcase to the customer, the way you speak to the customer, you need creativity, production, and strategy in terms of communication and everything in between. In order to make the idea targeting the consumer or targeting business or targeting the government agencies, there are different strategies. When you talk about that 360 from above the line, below the line, digital, our main core is advertising. But, we are not stopping there. We also have our subsidiary called Smart Studio, where we are creating content for businesses and consumers to understand. Smart Studio is a full-fledged production studio, whereby we work with different organizations, different platforms, and different channels for all those advertising strategies and campaigns. Tanzania, East Africa, Africa, and the world as a whole are in this very strong wave of digital transformation. Now, we are using our skills for technology because the core of everything we do is technology and innovation. We have a subsidiary whereby we create products and technology for companies or for business, but we also have a technology and innovation department where we are creating products just for ourselves. When we create this product, now we use our skills for advertising to take this product to the market, for production, to create content for this product. Even in terms of access to capital or financing, we already have this ecosystem. That is why our costs are going down. We are using the same resources. Also, we have managed at Smart Codes to hire and to partner with the best talent you can find. This gives us a strong advantage when you talk about the agency right now. We are the top agents in terms of talents, in terms of output, in terms of growth, in terms of how impactful our campaign and our products are. With all these amazing talents, all these genius, talented people which you can find at Smart Codes, we are not 100% utilizing their time based on the project we have and based on the client we have. While we are waiting to onboard more product, they can be onboarding more clients so that they can be fully busy. We decided to open our own innovation which is called Smart Lab whereby now we are using the unsold time of our talent to invest to other startups with other corporates whereby maybe they need to be digitalized in a certain kind of way. Sometimes, we partner with corporates or we partner with a startup in the US, or we give them the value and then they give us equity within that product because maybe at the beginning they did not have enough money to invest in that product. The startups need a big idea in terms of the strategy and analysis based on the impact of their customers. Since we have a strong strategy team from digital to offline, we research if that kind of product is going to work in this market, the market size, if this startup wants to expand in different countries and how difficult it is going to be. After that, we have a strategical report to showcase that this product can work. With a product, you need to develop it. Within our talented, genius team, we have the best developers you can find. Most of the big corporates, from telecom to banks, when they have a crisis or when they need deep analysis or development of software, they always reach out to us. So, with these kinds of teams, we are also using them now to create our own product or to create the product which we can partner with this corporate where we invest more into the skills as a company. Another partner may give us equity because they do not really understand where they are going. But for us, we already have a vision and we know what needs to be done and when the product is ready. With other companies, they could go somewhere looking for an agency to promote them or to get a product to their customer. Our agents have created a whole strategy in terms of how to roll out. The most important thing is the partners: we have telecom, FMCG, FinTech and everything in between. It is for them to focus on their core business and then we do all the innovation in terms of product. We do the marketing for them, we do the branding for them, and, of course, we do the research. We like to look in terms of the future. That means looking globally at what is happening. What is the wave and can this wave be customized and be localized into our market? Does this fit in our market? If it does not fit, how can we convert it so that our customer or maybe their customer can be impacted? Smart Codes, as a group, is building a very strategic, strong platform of companies, whereby we are integrated and they are depending on each other. Either we are looking to grow within ourselves or we are looking to grow within our partner. That is why even through the impact of this pandemic, we have continued to grow. We are looking at these challenges as opportunities.

What is the impact of the digital transformation in Tanzania?

Of course, when we talk about digital transformation, it is not only internet. In Tanzania, less than 50% have access to internet. The goal of our government by 2025 is to reach more than 85% internet coverage across the country. The distribution will be by the infrastructure of the telecoms, and the partner in between to achieve this goal. The race of the product within the country, is going to be huge. Another advantage across East Africa is that Tanzania is the country where we have low cost internet compared to other markets. We have very good speed, 4G, and fiber internet even within the home. But now, the government and the industry drivers, the telecoms, have a goal to push this across even the villages. Now is the time to innovate. But while we are waiting for the product to meet delivery to the customer, as in digital through the internet, we have products whereby people do not need internet to receive a certain type of product, such as to transfer money, receiving medical services, getting insurance. These are services which you can get with a normal mobile phone here in Tanzania, whereby you can just dial star and then within the ussd string, you can subscribe, get to those services, transfer money, receive money, withdraw money, etc. So, mobile is key. We always have this saying that Africa is mobile, and we are mobile. Through the mobile penetration, either in digital form in terms of smartphones or feature phones or a normal phone, still, there are services which can be customized for the market. That is a huge infrastructure which we are looking to penetrate.

What are some of your success stories?

Most of our customers and the community at large have been impacted by COVID. So, if these customers and the users are getting impacted, and if you innovate a certain product, you are still not going to reach the majority because most of the businesses are not growing such as banking, FMCG, etc. With that impact on the economy at large, that means people are spending carefully, they are spending less, most of the people have lost their jobs, or their jobs have been cut down. The economy in general has been slowing down. People are also very conscious in terms of digital transformation on top of that. That is why as innovators we are looking at the best way of delivering the normal service which they used to get but now through digital. With most people spending time on their mobile phones or watching TV, how can we broadcast a certain message which they can see on the TV or listen to on the radio, but also for service delivery? How can we push it through the mobile? There has been huge market growth in terms of delivery companies because people did not want to roam around. Delivery companies, especially on food, have been growing in this market. Our products have also been doing well. Now, we have a new subscription or new business model during the pandemic. In paper, we used to deliver newspaper to the consumer. You need to download the app and you get your newspaper wherever you are. But with this pandemic, we realized there is a new market to target, whereby companies used to buy newspapers for their employees physically in the app. But now, they cannot do that anymore. So, since these people are working from home, one of the tools now is for the corporates subscribe, whereby we deliver across all the departments of the company and their employees and they can enjoy reading those newspapers. We then bill the company as corporate. That has opened a new business wavelength into that. With that counter force of the digital, it has also helped people to understand and force themselves to start reading newspapers on mobile. With that impact, these people understand how to use it. Now, they are telling their friends, they are telling their family, they are telling their uncle, which helps our business to expand and expand the axis of diasporas. Tanzanians outside of Tanzania want to know the news. Of course, they can get news on Facebook, Twitter, and all kinds of social media or on WhatsApp group, but sometimes you need to get a verified, audited newspaper. For other people, especially the youth, they want to go to the newspaper to look for new opportunities in terms of jobs. The consumers are sensitive in terms of cost. The good thing about M-paper is you get all the newspapers for half the price, because there is no cost for printing. There is no cost of distribution. We just give you the paper wherever you are. COVID is challenging people to use different means or to have different ways of bringing things. It gives people more time to read, more time to think and innovate, and also more time to spend with their family and loved ones.

You have several parts of your business that you are developing. Which are the ones that you really want to push more?

We have many targets. We are looking especially for this year and next year to focus more on innovation for three markets. First of all, how can we transform telecoms to have more product as a service? Telecom we take as an infrastructure company. We already have a network of people. They make calls, they send SMSes, but what else can we do within their phone? Our innovation wing is working to come up with a lot of products so that we can help facilitate and deliver products through the channel of the infrastructure of the mobile. We want not to compete, but to work closely with telecoms in Tanzania and outside of Tanzania in order to bring new products, but also the other markets which we are working on or where we have been partnered for a long time and that we understand such as the banking industry. The banking industry now has been disrupted by FinTech. There are a lot of startups dealing with transfer of money, receiving of money, KYC, etc. It is a huge market because at the end of the day, everyone wants to pay, everyone wants to get paid, anything within the transfer in country or outside of the country. With these kinds of things, banks cannot do it alone. That is why the telecoms need to be there. Banks also depend on telecoms as an infrastructure platform to reach their customer, but as a telecom, they are looking to see how can they partner with the bank in order to make sure they are locking down their potential customer as well. So, of course, they might look like they are competing, but at the end of the day, they are giving value to each other. The third market which we are keying on is FMCG, fast moving consumer goods. Everyone wants to eat, everyone wants to stay clean, everyone wants to stay healthy, in terms of food and distribution as a whole. Because now people are not moving around, we found a way of how we can create more innovative products and put it in the infrastructure within the mobile payment within the bank or the FinTech ecosystem. Those three industries are our core in terms of innovation. Within the Smart Lab, we are partnering with and accelerating a lot of startups. For example, now, we have partnered with the largest telecom in Tanzania, Vodacom. We are doing Vodacom Accelerator and the main thing is to partner and accelerate the startups for them to grow. We are looking to the startups on their way to reach a mass audience, solving a unique problem or challenge, and then we boost the startup to connect within the Vodacom Network as a platform so that it can accelerate. Of course, we use the Smart Lab and Vodacom brand equity so that the customer can trust this startup and so we can help this startup to grow and strengthen and to reach the millions of users within that type of partnership. The innovation wing, in terms our partnership with people like Vodacom Accelerator, also gives us the ability to make the startup think about the future and how we can become an infrastructure connector to accelerate them so that when we go together, we go for an impact on our community in terms of users and gain trust within them. We create the product to give a solution to simplify their lives.

What is your vision for the medium term? What would you like to have achieved in the next three years?

Our mission is very simple. We are looking to have a platform of 10 companies, but also to partner with more than 100 startups. These startups should be impacting more than 1 million people. We are looking at more than 1 billion people in the next two to three years. That is our main focus at the moment. With that goal we are between 9% to 12% now. Looking forward to the end of this year and next year, we are looking to raise some funds within the product and startup which we have. If we get a good partner in terms of raising funds, we are looking to reach that goal in the next two to three years. Raising funds and getting investors is actually helping us to reduce the time to our goal from five years. We are very strategic. If we have a product or if we are partnering with a startup, that startup needs to have a strategy to impact more than 1 million people. That impact does not need to be in Tanzania alone. We are more than 60 million people and of course with our East Africa partnership with Kenya, Uganda, Rwanda, Burundi, to reach 1 million is really easy. After reaching 1 million, we are looking now to raise the series A B so that we can reach more, even 5 and 10 million.

What is your inspiration? What drives you to do what you do?

My passion is all about helping people and the only thing I am passionate about and I understand is technology. So now, my passion is to see how can I use technology as a platform to help people because if I am going to help more people, automatically those people will also help my growth in some way. I have a vision to reach more than 1 million people. Of course, that mission means that when helping people in terms of helping our consumers we are also helping to create more jobs. We have hired more than 75 people and we are providing jobs in Tanzania, Uganda, and Kenya. It is pressuring me to do more because we cannot fail. At the end of the day, I am not just helping in terms of giving money, I am helping in terms of connecting people. I am very good in terms of identifying tech talents because that is my core. I am very passionate about solving problems, solving different challenges. I am using my expertise to put the right team to work on the right project so that it can impact the right consumer. I have the title of CEO, but most of the time in the office, they like to call me "Chief Visionary". My daily job is just to have a vision and coming up with crazy ideas. We have good, talented people and engineers at Smart Codes. Having a good strategy team means you get time to analyze the product. Most of the time when we launch a product, our team have been growing year over year, quarter over quarter, onboarding new clients and coming up with new products to acquire more. The passion to help and using technology as a platform is what drives me every day.

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Smart Codes: A Leading Digital Transformation Platform Company in Tanzania by Edwin Bruno

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