The Story of Bootstrapping a Nigerian Broker #027

In episode #027 of Fintech Underground, our CEO Yoshi Yokokawa interviews Tosin Osibodu, Alpaca's Executive Director of Sales. They discuss his pre-Alpaca entrepreneurial ventures, key learnings, and their relevance to Africa's investment climate.

Full Transcript

[00:00:00] Yoshi: Hi, welcome to the Fentech Underground podcast. Uh, this is episode 27. Uh, I'm your host, Yoshi. I'm the co founder, CEO of Alpaca. Today, I'm excited to be joined by Tosim. He is, uh, most recently, uh, co founder of Nigerian investing app Shaka. com to enable Nigerians investing their local and the U. S. stock market, and then recently sold the business.

[00:00:31] Uh, and then he started the business due to his motivation to close the access gap for the Africans to access financial markets. And then now Tosin is the, uh, executive director of the sales, uh, for Alpaca. Welcome, uh, Tosin, uh, joining us, uh, for the Fintech Underground podcast.

[00:00:49] Tosin: Hi, Yoshi. Yeah, glad to be here.

[00:00:51] Yoshi: Yeah, so I want to start this part by asking you, what is the biggest difference that you see between the [00:01:00] African and the Americans in terms of the investing behavior that you have experienced?

[00:01:05] Tosin: That's a great question, Yoshi. And, uh, it's a great question because I've lived in America when I was younger in my life, and that's actually where I got to learn about investing and trading and, uh, for, In Nigeria, and actually more broadly in Africa, where I moved when I was 25, I've then come to see that the behavior pattern is very different.

[00:01:27] So, I would say the main difference is the motivation, as well as the level of understanding and financial literacy in both markets are very different. So, You could argue that the motivation for investing is extremely high in Africa, even though the financial literacy is very low. Whereas in America, from what I saw, it's almost as if it's a, there is a [00:02:00] automatic plan that you can go on, whether it's your 401k or your retirement accounts.

[00:02:08] There's more of a culture that if you're not doing it, you're doing something wrong, not that you had to really think about it. Um, and of course there's a whole

[00:02:15] industry of people. Um, looking to advise you. So in Nigeria and Africa more broadly, because there's less to save and less to invest and currencies, uh, currencies devalue over time versus the dollar, I think in Nigeria is an average of 15 percent devaluation since 1990.

[00:02:34] And then also.

[00:02:35] Uh, there's inflation in there. People are saving and investing just to stay afloat. So there's a high motivation.

[00:02:42] Um, and the good side, when people figure out what works, they double down and they'll commit to that. On the bad side, it also means that some people can be taken advantage of and invest in unsustainable things or promises that don't make any sense because they're really trying to,

[00:02:58] still trying to, like, make that work.[00:03:00]

[00:03:00] So I would say that's one

[00:03:01] big thing. The level of education, um, needed is

[00:03:04] very different.

[00:03:05] Yoshi: you say, uh, like, you know, the difference between the, uh, Americans and Africans, like, obviously there's inflation and that, as you say, like macroeconomic factor in education, uh, when the, um, like, especially your community and the targeted users that, you know, Chaka targeted, what are the sense that they, uh, are interested in more in the like US stocks or local stocks or stocks in somewhere in the world?

[00:03:34] Um, like why did you, uh, you know, start with the, like, you know, the, uh, like asset classes of the U. S. stocks and then, you know, local stocks, like, you know, did you, like, have a, like, really deep analysis on, like, what are the demands?

[00:03:48] Tosin: kind of sociological research, but I could pull people close to me and I knew what I wanted. Uh, and I was a user as well. [00:04:00] Uh, you start investing in what you know. And what you know are the brands that, and the markets that you're in, as well as the global brands that you use.

[00:04:10] So you don't, it doesn't take Much education that somebody wants to invest in Apple or Amazon or Meta and brands that they use at Uber, brands they use every day, they, they already have an affinity or those brands are close. It may be more difficult to invest in some brands that are not consumer brands.

[00:04:27] And then in the local markets, these are also, the assets that people already knew a lot about. So the motivation for most users who came on our service. was how can they invest and save in a way that would preserve their value. And also it was the first time that people had access to these locally.

[00:04:48] So before, you just did not have the access. It was not possible whether you wanted it or not. So there was a novelty factor as well of making, of bringing it, uh, to the [00:05:00] market.

[00:05:00] Yoshi: How vibrant, uh, is the local stock market? Is that, like, a lot of, uh, local brands, uh, getting IPO'd in the local markets or, like, you know, they try to go to the Wall Street of the, you know, U. S. market?

[00:05:13] Tosin: That's a great question. Uh, I think everybody aspirationally wants to invest in the New York Stock Exchange and ring the bell and it's, you know, around the world. Uh, But, uh, you know, the local market has seen some pretty big IPOs recently that keep the market vibrant, um, MTN, Etel, there's, there's some recent IPOs, there's some IPOs that are rumored to be coming, uh, next year as well, that would be pretty big in the local market.

[00:05:39] So whenever there's an IPO, there's a surge of activity, brings new people to the market. And it helps to boost the overall activity in the market. But there's still a sense that aspirationally to list on the London stock exchange, to list on the New York stock exchange is seen as a bigger deal because of the higher [00:06:00] requirements.

[00:06:00] Um, um, to do that. And you can see some companies like Airtel Africa, for example, are cross listed on both the Nigerian Stock Exchange as well as the London Stock Exchange. Um, and people perceive that to be, mark to be able to achieve that than just to list on one.

[00:06:15] Yoshi: That's interesting. Like, you know, the, um, because Airtel is like, you know, humongous brand and then, um, kind of showing that like, you know, they cross like, you know, IPO'd in multiple markets. Um, I guess like that is the way for that to get that really big brand locally as well then.

[00:06:32] Tosin: Exactly, exactly. Um, so you, you see, you see that in places. MTN are listed in South Africa. Um, they're listed in Nigeria and they're also listed through American Depository Receipts on the New York Stock Exchange. So you can still see that, you know, there is this sense of you get big enough, you can get, you can list almost where you want.

[00:06:51] [00:07:00] Yeah, type of the brand and like, you know, direction like Acorns.

[00:07:15] Yoshi: Front betterment, like, you know, the consumer targeted, basically like new FinTech app. Uh, you know, how did you see the market and competition, uh, when you started it in, uh, uh, when you started in, uh, Chaka in 2019?

[00:07:28] Tosin: when we started, the funny thing is that there was no service like ours. I was doing, offering US stocks and when we started, it was as if there were three other services, um, uh, who also started at roughly the same time. So, some people get confused, like, were we all together in a lab? And that's us, there's RISE.

[00:07:49] There's Trove, there's Bamboo, that all started at roughly the same time. Did we all come together in a lab and decide to like, all, all just start companies at the same time? But no, it was just, the timing was, the time had [00:08:00] come for, for, for US stocks to be accessible in the local market. Um, and so I think that was to the benefit of the market in that more people got a chance to be educated about the offer.

[00:08:11] Um, I think since then, what we've seen that's really interesting is that more and more different kinds of services want to be able to offer this, whether it's a bank, whether it's a neobroker, whether it's a super app, um, in the market. So I think the way we started is the way to go, and it's still going to be spread, not just through direct neobrokers.

[00:08:37] Yes, through some more, but also through other kinds of financial brands and technology brands in the market.

[00:08:44] Yoshi: why do you think that there is a, this kind of same timing or similar timing, the, you know, multiple apps. Like

[00:08:52] Tosin: It's a mystery.

[00:08:53] Yoshi: uh, you know, at the same time, like, what, what is that?

[00:08:57] Tosin: It's a, it's a mystery to

[00:08:58] me, Yoshi, to be honest. [00:09:00] It's still a

[00:09:00] mystery to

[00:09:01] Yoshi: mm,

[00:09:01] mm,

[00:09:02] Tosin: maybe some,

[00:09:04] some divine force somewhere decided to snap their finger and said, go

[00:09:07] guys. Um, uh, and I've talked

[00:09:09] to some of the other founders. It's a mystery to us all why,

[00:09:12] why it was all, all happened within like a three to six month

[00:09:16] period that.

[00:09:17] We all were working on something so similar, but I think if you take a step back,

[00:09:22] Yoshi: right.

[00:09:23] Tosin: it's also the case that in 2015, Nigeria saw a massive devaluation, um, something

[00:09:30] on the order of 40 to 50%, and so the time of the idea had

[00:09:33] Yoshi: mm.

[00:09:34] Tosin: And perhaps it was just the fact of the KYC, digital KYC technology, digital payments, some of the precursors to be able to offer a digital first experience were all in place, as well as the macroeconomic, like, realization was there too, in that we knew that people would want to use a service like this.

[00:09:53] Yoshi: Got it. That makes sense, right? Like, you know, the, some of the like microeconomic factors, um, you know, influenced it. Amongst the, you [00:10:00] know, competition, um, because like, you know, when I talk with like, you know, the B2C, uh, investing, uh, uh, you know, entrepreneurs and founders. Um, when there's a, you know, other offering, like you also try to kind of create this, uh, kind of characteristics or uniqueness.

[00:10:14] Like, did you think about that when you're running Shaka? And if, if you did, like, you know, what is the kind of this edge or like, you know, the uniqueness that you are trying to, uh, you know, come up with?

[00:10:26] Tosin: That's a great question. Um, so one thing we, we were very aware of from the start was that the whole market was underserved by the offering. It wasn't just a slice. It wasn't a Robin Hood type offering where it was just coming in, targeting an underserved segment, um, both rich and poor, both young and old.

[00:10:46] We're not able to access. And so we came in looking at wanting to offer both local and global stocks together in a bundle and doing it in a licensed fashion. So we were always very focused [00:11:00] on how can we make sure that we can be a stalwart and be viewed from a regulatory lens as preferred offering.

[00:11:07] So we were the first to get a SEC. FinTech license. In fact, we worked with the regulator there to come up with the license. Um, so that was a way that we were looking at, we want to differentiate. And then we also were looking to cater to a lot more of the high net worth individual market. Now, I know it may always seem like catering to high net worth is not an access play, but even people who have a high net worth in a Nigerian context, but also had access issues.

[00:11:37] And so accessibility isn't always just about. Um, accessibility at the bottom of the pyramid. It's also accessibility for people who have the means but have not been able to be onboarded to be served that way. So, we looked at a couple of those things as ways that we wanted to differentiate, um, and then we also did make some inroads into serving [00:12:00] A business segment as well.

[00:12:02] Now, of course, I'm an alpaca for a reason. Um, the business segment turns out to be the area where there was the most interest, um, and the most potential that I saw. but it also turned out to be the area where the depth and the capability needed to serve that really well is really high. And, of course, Yoshi, we've talked about this before.

[00:12:21] That's why I think there's so much promise, um, to work together. And that's why I'm here.

[00:12:26] Yoshi: I think like customer acquisition and then, um, you know, segmentation of, uh, you know, go to market even at the B2C is super, uh, important sensitive, right? Because I think when the Um, back in 2017, 18, um, people are talking like a lot about customer acquisition costs rising for the robot advisors in the United States and where, and what is that like lifetime value of the customer against that, like, you know, payback period, you know, maybe really long, you know, obviously like Wealthfront came up with the, uh, like announced like pretty.[00:13:00]

[00:13:00] You know, good revenue that they're making now, uh, you know, I think which shows that it just takes a lot of time for the B2C FinTech app to actually like get to the scale that needs to be. How, how were you thinking about that? Like, you know, customer acquisition side, you know, you obviously touched a little bit about like going to the enterprise and the business side of the things as well, but, um, how was your experience like, you know, targeting the, uh, uh, as a kind of targeting consumers as a FinTech app and in terms of the acquisition route, acquisition method, acquisition like costs and, um, You know, those, those kind of things.

[00:13:31] Tosin: Yeah, I think there's an area where obviously there's no, there's no definite answer and every app is different and every service is different and timing is different. So I think I can break it down into a few phases. There was the pre COVID phase when we were launching first into the market. There was then the, you know.

[00:13:49] I'll say post COVID phase where, in general, the awareness of, for investing and trading around the world was extremely high. Um, and, and you're competing across, across the board. So before, [00:14:00] before COVID, when we were just launching, it was a novel offer that there was a lot of free PR. So we did a lot of work to make sure we got free earned media.

[00:14:10] Um, whether it's TV interviews, um, getting, uh, press mentions and that all helped to bring. You know, by engaging a PR firm, um, that helps to bring, in a sense, a CAC, just you pay an amount for a PR firm per month, and then it's how much max PR can you get to cover that, and then you can calculate how many inbounds that you get, and then what's Non intuitive about it is that the CAC has actually driven a lot more in that business by how well you convert your pipe, not well you pay to get people in the pipe.

[00:14:44] So, your onboarding process, your KYC process, the cost of using verification providers, um, the speed through which you onboard, you know, is it going to be, uh, you know, dealing with exception customers who are willing to fund? But maybe have an exception while they're [00:15:00] onboarding, you know, that's going to affect your CAC from that customer, right?

[00:15:04] So, it turns out that for a service like this, that part of the onboarding chain, at least in our market, determined the CAC a lot more than the other. And then post, you know, when COVID was fully in swing, where there was a lot more saturation, then the cost of even getting the customers in. It becomes a lot more expensive, and so you spend a lot more, even more time, um, for the customers you get in on optimizing your flow.

[00:15:28] So, I, that's, that was maybe something about the CAC equation that I would say was, uh, maybe non intuitive to start with, is how much it's driven by

[00:15:38] the actual compliance of the onboarding process, as well as your onboarding flow, and designing for a shorter one.

[00:15:44] Um, I think something, just something I'll add on here is, you know, someone made a joke, um, when we first started that we should have, we should offer airtime to customers as a financial service, since people have money there, have airtime.

[00:15:57] And it's a, it's a joke because almost every service [00:16:00] in the Nigerian market offers airtime. So it's like somebody telling you, just offer

[00:16:03] something very basic in your product. And I just thought, what do you mean? That's not what we're about. Why that's such a smart move, we didn't end up doing it, but why it's such a smart move comes down to this question of CAC, um, customer acquisition costs, your CAC, which is, it is possible to acquire people very cheaply with a product and then pass on this high value product to monetize them.

[00:16:23] And again, we're seeing that with super apps, right? There's some apps, you know, I don't have to mention them, but a lot of people know, know about them and we have some potential partners coming who are, who are interested in us for this reason. They've acquired customers cheaply. With a service like Airtime.

[00:16:40] And so the cash is really low, and then they get to monetize them with a high value product like this. And again, they're gonna still face that question of how much of that conversion can you get from that customer.

[00:16:51] But it's much better when they're in your pipe, you've qualified them, and you can try and Engage them with email for free over time.

[00:16:58] Like, yes, take some, [00:17:00] there's some opportunity cost there, but it's for free versus you're paying a lot to try and win new customers on the outset from the outside. So I would say that was some nuances about

[00:17:08] the CAC equation that, that, that, that were very particular for our, our business.

[00:17:12] Yoshi: Got it. So I think like, you know, when we think about CAC, like, you know, customer acquisition costs, like, you know, the, what is the definition of the customer basically, right? Because like, you know, the register user, just, you know, the having the first email that could be people like kind of tend to think like that may be customer acquisition costs, but like, it's actually, there's a big

[00:17:30] Tosin: Funded accounts. actually changes a lot of conversion, right?

[00:17:33] Yoshi: It's a funded

[00:17:33] Tosin: yeah, Acquisition costs is like what really matters.

[00:17:37] exactly. Exactly. It's that funded account. it's it's the, the, all the blockers before that are all contributions to that CAC in, in, in our line of business. Yeah. [00:18:00] Yeah.

[00:18:01] Yoshi: account locally and the US as well.

[00:18:03] Like what is the, um, kind of like, oh, this is kind of weird, or this is a funny that we have to ask this either from, you know, Nigerian side or US side, like which one is the one that you felt kind of, oh, this is pretty funny or weird.

[00:18:19] Tosin: That's, that's a good question. Um, weirdly, both and neither. Uh, so

[00:18:25] let's start, let's uh, you know, to onboard you, you have to go through the regular questionnaires to know that you are who you, who you say you are and that the accounts are set up properly. That's it. Um,

[00:18:40] there may be roughly about 60 percent of the onboarding questions, maybe a bit higher than 50%, but not as high as like 75, were common.

[00:18:50] You know, it's your name, your date of birth, all those things, all those questions, you only need to collect them once. Um, and then the main differences for the U. S. have to do with intent. So that's not [00:19:00] something on the local side where that's questioned. It's not questioned, what is your intent? Do you, are you trying to, how you classify yourself as a, what kind of investor are you, how you classify yourself, um, some of the declarations about your job, etc.

[00:19:16] Those are not typically required in the local context, not because they're not important, but because in the local context, they have your The equivalent of your social security number, they have your bank details. So they, they look at it as they're able to know who you are and what you're trying to do.

[00:19:35] And then there are more guidelines around what you can do with an investment account. Whereas in the US, I think there's more of a guidance factor on what's your intent with an account. That was different compared to the local. So some people locally would ask,

[00:19:48] why are you asking me? About where I work, what does this have to do with investing?

[00:19:53] Why are you asking me about what I want to do with my account? That's my business. I'll use it how I want. And then we're explaining to them [00:20:00] that actually, you need to tell us so that, you know, how you use your account is in accordance with what you said. And yes, if you want to change, you can

[00:20:09] change that.

[00:20:09] But, you know, to make sure that, you know, you're not saying you want low risk, and then you're doing all these high risk behaviors. Funnily enough, a lot of

[00:20:16] people understood that and thought, oh, that's nice that you'd be looking out for me that way versus we're snooping in on you.

[00:20:22] Um, I think everyone's a bit sensitive about giving up data in that context.

[00:20:26] So it took some education to get people to understand what's for.

[00:20:31] Yoshi: Right, right, right. I, I think that is actually the one that gets, um, questioned a lot actually from the, uh, other countries as well. Like, why, why does it matter? Like my employees.

[00:20:43] Tosin: Yeah.

[00:20:44] Yoshi: right? Like, this is my money and like, you know, why are you asking? Like, you know, it's sometimes like, okay, do we need to get the address of the employer as well too, right?

[00:20:53] What does it matter, right?

[00:20:54] Tosin: Yeah. It's like, are you going to call them or message them to ask me that somebody's

[00:20:59] Yoshi: yeah, [00:21:00] yeah,

[00:21:00] Tosin: reach out to them

[00:21:01] Yoshi: exactly, exactly. Kind of scary. Yeah, yeah,

[00:21:04] Tosin: that's, that's a different cultural thing.

[00:21:06] Yoshi: and you mentioned about this bank details, like, you know, for the U. S. Of course, like we asked for the social security number and, like, if it matches, like, it just goes smoothly. Could you tell me a little bit of this, like, bank details?

[00:21:16] Like, how, how does it work?

[00:21:18] Tosin: Yeah, this is an area where I think actually, in Nigeria, we arguably, there's more protection for identity than in Arguably the U. S. here. So the way it works is that to have a bank account, you have something that's called a bank verification number. It identifies you as a user. It has your biometric information.

[00:21:39] That's your thumbprints. It also has your last registered address, the picture. Um, by having this account, all the banks Share that data. It's stored. It's a central bank scheme. So the regulator runs this as well. Um, and yeah, so, um, between central bank as well as the Nigerian [00:22:00] Interbank Settlement System, which is for settling funds, they can effectively ping that number and know your financial status across all banks and across all services that are regulated in one go.

[00:22:13] So it means that when you say you are who you are with that number, And you're on board, they can track your flows. Um, so it also means that if you provide that number to a service and the service has the right permissions, it can infer some things about you not being fraudulent, you, um, having relatively good credit, you being able to, uh, meet some certain thresholds in terms of like your.

[00:22:43] Your financial net worth, et cetera, for services that a bank or a financial provider wants to offer you. It also has the added benefit, from a security perspective, for example, of saying, like, in an automated fashion, when you set up an account with this bank verification [00:23:00] number, only let payouts happen to a bank account that has that bank verification number.

[00:23:05] So if somebody came and They can't steal your money because programmatically the money has to be paid out to an account with the same bank verification number. So yeah, there are a lot of security features that come from that level of standardization of identity. And so that's, that's what, that's, that's, uh, what it's for.

[00:23:26] In terms of just How

[00:23:28] prevalent it is. I think in Nigeria, it's roughly close to 60 million people have been onboarded to the bank to have a bank verification number. If you have a bank account, you necessarily have this. And so you can think of that as the high watermark of what people who are financially included from a digital point of view, if you have that number.

[00:23:49] Yoshi: and I think like, you know, from looking from outside of Africa, um, there is always like, you know, conversations about this, uh, leapfrog, uh, uh, uh, you [00:24:00] know, situation that happens whereas the like completely non-banked into the skipping this regular like, you know, bank accounts, but like, you know, going to the mobile, like, you know, based, uh, you know, way wallets.

[00:24:14] Tosin: Yeah.

[00:24:15] Yoshi: Is that, is that really true? And, uh, and also like, I think, what is the relationship between that, you know, this, uh, bank verification thing that you talked about because you specifically mentioned about bank, but like, is that applying to those, you know, mobile wallet thing that, you know, people think that, you know, it's really getting really big in Africa.

[00:24:32] Tosin: Yeah, that's a great question. Um, so I think the leapfrogging effect is definitely real. Um, I think it's real

[00:24:38] mostly even from a new generation demographic perspective where they get to redefine and choose how they want to engage financially. So a 23 year old who is, let's say, a software developer and working around the world can choose to have a local bank account.

[00:24:55] can choose to have a crypto wallet, can choose to have a multi-currency wallet in another [00:25:00] country, um, where that multi currency wallet verifies who he is through that bank verification number, but doesn't necessarily,

[00:25:07] beyond that, engage with the financial system. So, that bank verification number can provide you the ability to, um, bank Locally, but it can also service proof that you are who you are and provide you with, provide another service provider outside the country with, um, um, enough information to know that you are who you are in this country, and then you can get financial services from elsewhere.

[00:25:36] So I think that, that leapfrog effect in terms of the ability to engage, um, uh, across multiple jurisdictions for somebody who is digital native. It's definitely there compared to somebody who maybe has been in the legacy financial system, is used to operating that way, maybe only wants to interact via SWIFT [00:26:00] transfers and through the local bank.

[00:26:03] There is a bit of a difference there in terms of looking at how adoption is taking place there. And it doesn't necessarily require somebody to have a lot of money. I think that's the key thing. It's very possible to have a more complicated or more, uh, uh, internationally diversified financial footprint with a with a lot less money.

[00:26:24] It doesn't cost much to open these accounts. Just, you just have to prove you are who

[00:26:27] you are and have that, uh, serve as, as, as your, your key to access these services.

[00:26:33] Yoshi: So, so even, even if you're like, you know, started, uh, like, you know, basically like in the new generation getting, uh, onto this, uh, uh, you know, very much mobile wallets first, uh, instead of like incumbent, uh, banks, you still have this bank verification number, uh, to be obtained in order to get this, uh, you know, service, uh, uh, for you basically.

[00:26:55] Tosin: Yeah, yeah, because KYC is still KYC, right? So just because

[00:26:59] Yoshi: Okay. [00:27:00] Okay.

[00:27:00] Tosin: a non traditional service doesn't mean you, you, you shouldn't know who your customer is. And yes, you could decide to figure it out yourself, but why not leverage, a system that's working really well, is

[00:27:12] programmatically connected by API.

[00:27:14] There are a lot of KYC providers that give you that access. Um, and so just like Onfido is a KYC provider that can provide access to lots of places around the world. So there are regional providers who leverage that to be able to prove you are who you are. along with biometrics, et cetera.

[00:27:30] Yoshi: And like, you know, of course, like knowing all this KYC stuff and then, um, you know, very much, uh, like for us, it's becoming kind of basic at this point. Uh, but like, you know, how, how did you get into this thing? Right. Because like, I know, you know, you have some background, but like, does, does that like family background helped you to, uh, kind of think about, Oh, this is actually doable, like starting a broker dealer by yourself, like, like it sounds always to me personally.

[00:27:59] It's pretty [00:28:00] crazy. Like, you know, starting something, financial institution.

[00:28:03] Tosin: Yeah. not a, you know, like, you know, just an app. Uh, like, you know, what was the biggest challenge and like, you know, why did you think it was possible?

[00:28:13] that's a great question. Um, so I personally love, I love trading and investing, so I think aha moments actually came through, um, building trading bots, um, because you got to interact with a lot of APIs, and you were like, yeah, like, hey, look, these APIs all kind of look the same for all these services, um, and that's, that's for, whether it's crypto, whether it's forex, And at the time there wasn't for stocks, right?

[00:28:44] So it was just crypto and forex were the option. It was like, this kind of looks the same. There's no reason why the local version shouldn't be the same. Um, and so from a technology point of view, those are not hard there. Then I just decided to get qualified as a stockbroker. Um, there is a, you know, [00:29:00] my, my, my mom has been in financial services, so she understands that business.

[00:29:04] And so I said, Hey, look, I think I could probably help out in some ways in the family business if I became a qualified stockbroker, um, just to be able to have some oversight there. And my dad is an entrepreneur and I always have been. So there, I never really thought about this, but looking back, there are probably ways that each of these.

[00:29:22] craziness had some, had some factor that would be mystified, whether it's technology, whether it's exposure to financial services, whether it's entrepreneurship itself. Um, yeah, but you're right. It's pretty crazy when you look back and say you want to enter this, uh, abstract maze of rules, regulations to be able to offer these things to people,

[00:29:41] but I think it's worth it.

[00:29:43] Yoshi: for the, um, uh, the people to start, like, do you think those backgrounds need it or, uh, you know, you can just pick it up, uh, without any background coming from, uh, um, you know, your experience or family?

[00:29:56] Tosin: Yeah, I actually think that's, that's something that actually I don't think you need [00:30:00] those backgrounds. Um, uh, so,

[00:30:02] weirdly, I think, I think it makes sense to, to have at least an angle of attack, right? So if you were in the industry, you probably have some pretty good insights into how things work and go from there.

[00:30:13] If you're really into technology

[00:30:14] You probably could figure out the other stuff, maybe figure it out first, at least to some degree. Um, and have some respect for, for, for, for the side, you know, it's not like

[00:30:24] stupid rules, they're necessary rules. Um, and, and entrepreneurship wise, if you're, if you're rigged to build things, you know, this is just another field to play in.

[00:30:33] So I actually weirdly don't think you needed any of those, but maybe you want at least one to be able to like have an angle. Um, and not to turn it back on you, Yoshi, but. You know, I know from your perspective, do you, do you feel like you needed to be who you are to have started this kind of business or do you think somebody else could have at least played in a similar space?

[00:30:55] Just looking back now.

[00:30:57] Yoshi: Yeah, so I think looking back now, [00:31:00] um, because like I started my career at Lehman's, so like I at least had exposure to financial services, right. I think, like, you know, that really helped me a lot. Otherwise, like, you know, I even didn't think that, like, regulated business is, you know, doable, uh, in even tiny thought.

[00:31:18] Like, you know, because we knew, like, you know, I knew that, like, I was in the industry. I knew doing this is pretty crazy. But, like, if we do this crazy thing, it could be a very big differentiator. Like, I still at least had that kind of thought. So, um, maybe that was a Pretty good differentiation because like if he was only with, you know, Hitoshi's only himself starting to do this I don't know like, you know, that could be doable, right?

[00:31:43] Like without any financial services background So, but yeah, but at least like that's my only experience, right? And that it's only your experience So, I don't know how other people think about it.

[00:31:55] Tosin: well, one interesting thing, Yoshi, is that there is a reason why alpaca is the base layer [00:32:00] and then entrepreneurs can build on top, right? So, so in a sense, it probably makes sense that to be that base layer, you needed all that. But hopefully for the person who's building on top, uh, just to just. Yes, you want to have experience, but to be determined enough, um, to paint a vision, you can go out better.

[00:32:19] And there are players in our space in Nigeria who were not from financial services and just were very, very determined and absolutely have made it a success. So I do think that, you know, just from a, um, evidence that exists perspective, um, I have to say that like, you know, different paths can still get to the same place.

[00:32:42] Yoshi: So, uh, Tosin, thank you for your time on this. Um, and, uh, the final question that I wanted to ask, uh, was the, what is the hidden gem that people tend to overlook, uh, about the African market and the financial services market in Africa that you know the most [00:33:00] about?

[00:33:01] Tosin: That's a very good question. I think the, the hidden gem here would be that what's the, a lot of people think that, uh, when they do the rankings of total amounts of investment or total GDP per capita, or level of financial, um, access. Africa doesn't come out on top. Actually, it comes out quite the opposite, right? And so, for that reason, a lot of people feel that it's not a place where there's a market.

[00:33:32] But, because of a lot of the digital technology, and because there's a large swath of people underserved, I think what people miss is that there's tremendous opportunity to serve. a broad spectrum compared to other markets. You wouldn't see, um, or you typically wouldn't see, um, a service be able to, like a Robinhood, be able to service both the top 10 [00:34:00] or top 50 richest people in the country, as well as the bottom. It turns out that in financial services in Africa, it looks more like that. than to just pick a segment. And so it also means that if you do have penetration and grow that penetration, that you have a chance to really, um, uh, entrench yourself as well as service a large swap versus be, be a, be a niche player just servicing a small segment.

[00:34:28] And because of the way digital connectivity is working, I think there's a window of opportunity where certain players have an opportunity to Capture a market, connect it to the world, and be entrenched over a long period of time versus wait for the market to develop and then come in later. I think a lot of people are going to miss out on that in this period of capturing that market and connecting it to the world.

[00:34:54] And I think we're still early in that journey, though.

[00:34:56] Yoshi: Yeah, like I truly appreciate that perspective. Um, [00:35:00] and then, because I think like, unless, uh, you are really deep in the market, understanding the whole details of it, uh, you know, like people who don't understand how, like, you know, the, like, you know, big this opportunity is. And I'm very much like in agreement with the, what you're saying.

[00:35:13] So again, Tosin, thank you very much for your time. And, uh, uh, you know, let's, uh, catch up later on the, uh, Slack and the Google Hangouts. Thank you, man.

[00:35:21] Tosin: Great talking, Yoshi. Thanks for hosting this. Alpaca listeners, check out Alpaca for more information about stock, options, and crypto trading, and always remember to do research before investing. Investments involve risk, and past performance does not guarantee future results. There is no guarantee that any investment strategy will achieve its objectives. There is always the potential of losing money when you invest in securities or other financial products. Investors [00:36:00] should consider their investment objectives and risks carefully before investing.

[00:36:04] Nick: Securities Brokerage Services are provided by Alpaca Securities, LLC. Alpaca Securities. Member Finrecipic A wholly owned subsidiary of AlpacaDB, Inc. Technology and services are offered by AlpacaDB, Inc. this is not an offer, solicitation of an offer, or advice to buy or sell securities or open a brokerage account in any jurisdiction where Alpaca securities are not registered or licensed as applicable. The content of this piece is for general informational purposes only.

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