Understanding Jambo: An All-Star Institution Endorsed, Africa's WEB3 Super Portal

Compiled by: TechFlow Intern

Source: Techcrunch\Hashed\MapleLeafCap\Santiago

Africa is Unveiling the WEB3 Era

Jambo is a startup based in Congo that aims to build Africa's Web3 portal by providing crypto-based revenue opportunities through "learn, play, earn." It has currently raised $7.5 million in seed funding.

Investors include Coinbase Ventures, Three Arrows Capital (3AC), Alameda Research, Tiger Global, Delphi Ventures, AllianceDAO, DeFiance Capital, Yield Guild Games, and Polygon Studios, as well as several angel investors from the Web3 ecosystem.

Notable supporters include Sandeep Nailwal, co-founder and CEO of Polygon; former ParaFi partner Santiago R Santos; Do Kwon, co-founder and CEO of Terraform Labs; Piers Kicks, partner at Delphi Digital; and Jihan Wu, co-founder of Bitmain.

Southeast Asia has become one of the best case markets for Web3, and Africa seems poised to enter Web3 in a similar manner, with the former being home to startups like Axie Infinity and Yield Guild Games.

Positive factors such as a rapidly growing population (the youngest demographic globally), solid smartphone penetration, and increasing cryptocurrency adoption, along with negative factors like low GDP per capita and high unemployment rates, are making Africa the next hotbed for Web3.

Jambo is preparing for the explosion of Web3 in the African market. According to its co-founder and CEO James Zhang, Jambo aims to lead millions of African users into the Web3 world through its application. After noticing the opportunity to replicate the success of Southeast Asian Web3 projects across Africa, he founded the company in November 2021 with his sister (a Chinese national born in Congo).

Since users of Axie Infinity and other guilds can only earn income through a revenue-sharing model while playing games, Jambo has adopted a dual approach, allowing its users to earn income while participating in both Web2 and Web3 activities.

For example, users can save on their data expenses while using Jambo. Zhang explains that Jambo partners with telecom providers to offer nearly 70% discounts and sells directly to its users at 50% of the original cost, stating, "This is one of our main user acquisition strategies, and we hope to double every African's talk time and data."

Secondly, Jambo is collaborating with social media companies so that users can earn tokens while watching their content on the app (which they can convert into income).

"The reason we can do this is that by partnering with these companies, we are tokenizing part of their advertising budget and providing it directly to end users," he said. "Many existing Web2 businesses and even Web3 user acquisition costs range from $100 to $200, so we can lower that cost by directly incentivizing end users."

The last point is P2E gaming. Currently, there are no popular Web3 P2E games from Africa due to a lack of infrastructure built through guilds. Zhang stated that Jambo wants to build such infrastructure.

However, unlike those well-known guilds whose business models involve taking a percentage of profits from users, his company does not intend to take a cut from users' earnings. Instead, Jambo's revenue will come from a Web2 model—charging advertising fees and commissions through the sale of talk time and data.

As the "Web3 portal for Africa," Zhang stated that Jambo will test over 10 games in the coming months to showcase to users, but how does Jambo expect its project to run smoothly in a region that knows little or nothing about how Web3 works?

"Education is at the core of our work; I believe there are no shortcuts in Africa. We must first educate the user base before we can start thinking about monetization or user acquisition. That’s why we are launching a comprehensive curriculum on Web3. We plan to roll out this service in over five universities in Africa by the end of the first quarter," he stated.

So far this year, Jambo has signed up over 12,000 students across 14 countries (Morocco, Nigeria, Ethiopia, Equatorial Guinea, Kenya, Congo, Uganda, Rwanda, Democratic Republic of the Congo, Tanzania, Zambia, Namibia, Madagascar, and South Africa) to participate in carefully curated Web3 courses.

The company stated that this allows students to explore opportunities in gaming and decentralized finance (DeFi), with a 10-week course offered at universities and over 600 partner entities, with hundreds of ambassadors registering students at these locations.

With nearly 60% of Africa's population under the age of 24 and nearly 50% of university graduates unemployed, Jambo believes that educating users about P2E gaming and DeFi models can "bring financial prosperity to Africans in ways that were previously unattainable."

Why Invest in Jambo?

Folius Ventures partner @MapleLeafCap shared his logic for investing in Jambo on Twitter:

Africa's land area (three times that of the U.S.), demographic composition (median age <20 years), internet penetration rate (50%), and diversity of African cities (more countries than Europe) make it a very different market, highly suitable for the growth of Web3.

For a continent with over 15% of the world's population, it could also yield the greatest benefits—especially by enhancing domain expertise through access to Web3 networks. Onboarding is also a way to develop hyper-local business and a profound cultural understanding of user habits.

The ultimate winners of Web3 portals (who I believe will enjoy significant returns) are likely not typical SV-based startups but those rooted in the region and localizing global offerings.

However, challenges remain, and user acquisition is still the biggest issue. I consider myself unfamiliar with Africa, but I feel that Africa needs more than just a small fox-like Web3 wallet; how to narrow the application scope and meet users' core needs will be another key focus area.

It could be content push, mobile data purchases, or fiat OTC services; whatever it is, the team needs to genuinely explore and discover to meet local users' needs.

Ultimately, users still need a reason to choose Jambo (as they are already using M-Pesa), and the entry point is likely to earn money in P2E games, which can effectively attract users into a deeper Web3 ecosystem. Jambo needs rapid updates and iterations to align with Africa's current national conditions. I believe Jambo has the capability and determination to capture opportunities beyond Africa's existing Web2, becoming a killer project for Africa's Web3.

Web3 investor and former ParaFi partner Santiago R Santos believes Jambo has the potential to become a super app in Africa similar to WeChat. "Just as WeChat became the all-in-one app in China, Jambo can become the all-in-one app for Africans looking to engage with and benefit from Web3, starting with education and expanding into DeFi, gaming, and more."

Korean investment firm Hashed is also optimistic about Jambo building a Web3 "super app" that provides banking, education, and entertainment services across the continent.

Hashed stated that Africa is one of the fastest-growing countries with a tech-savvy Generation Z—75% of Africans are under 35, and 60% are under 25. They live amid hyperinflation, instability, and high unemployment rates.

Jambo's vision is ambitious, and its execution is well thought out:

a. Focus on localization, building content relevant to end users

b. Establish a broad ambassador network in various cities

c. Build influence in major centers and expand it to smaller areas

d. Educate, teach, and showcase

Jambo's mission is to provide Africans with new tools, the best games, and financial applications. Starting with financialized gaming, users can participate in P2E, after which Jambo will provide access to DeFi services such as currency exchange, remittances, yield assets, and more.

Africa Embraces WEB3

Educating young Africans about Web3 and decentralization seems to be a recurring theme among recent African Web3 newcomers. For example, Nigeria-based Nestcoin raised $6.4 million to expand its Web3 initiatives, including Breach, a media company that creates informative crypto content for its users.

The two companies have different profit models—Nestcoin operates a gaming guild called Metaverse Magna (MVM), while Jambo does not. However, they are building a new Web3 niche in Africa that is distinct from more mature platforms like cryptocurrency exchanges.

For Zhang, the fundamental difference is that while traditional platforms help Africans save money and remit funds, newcomers are increasing users' income and wealth potential. "I believe in Africa, there is no money to save because only 1% are super-rich and 99% are poor. Therefore, for us, we have taken a different approach, which is to help ordinary people make money."

"That’s why every component in our ultimate application is actually designed to help ordinary people—from playing to earning, from watching videos to earning, and saving on data point costs.

So ideally, within three to six months after our app goes live, ordinary people could earn $50 a month by playing Axie Infinity, earn another $20 a month by watching videos, and save an additional $10 a month from their money. That’s the ideal situation for our application to apply to everyone."

Jambo expects to release its beta version in the second quarter and go live in the third quarter. To build its ultimate application, this 60-person team is spread across sub-Saharan Africa, Santa Clara, and Shenzhen.

Wishing them good luck!