Which Ugandan Startups Have Been Involved in Acquisitions?

In the African startup ecosystem, acquisitions are rare. This is true for nascent ecosystems, and Uganda is no exception.  An acquisition happens when one company, typically larger and more established, purchases another, usually smaller and newer. 

This can be driven by various factors, such as the acquiring company seeking to obtain innovative technology or intellectual property from the smaller firm, expanding into new markets where the smaller company has a strong foothold, eliminating a competitor to gain a stronger market position, or acquiring a talented team from the smaller company. 

Despite how our acquisitions are, there are a few that have happened in our startup ecosystem. Remember, these are transactions between private companies, and thus, the parties involved are not legally bound to disclose these acquisitions, except in highly regulated industries like finance. So, we may not know all the acquisitions, but these are some of the ones that have been made public over the years. 

1. Onafriq (MFS Africa) Acquires Beyonic. 

In June 2020, Africa’s payments gateway, Onafriq (then known as MFS Africa), which connects wallets across different mobile money platforms through its API, finalised the acquisition of Ugandan startup Beyonic for an undisclosed amount. Beyonic, a digital payments startup, was founded by Ugandan software engineers Luke Kyohere and Dan Kleinbaum and operated in Uganda, Kenya, Tanzania, Ghana, and Rwanda. 

As part of the acquisition, Luke joined Onafriq’s management team. Speaking at the acquisition announcement, Onafriq founder Dare Okoudjou said, “With the MFS Africa Hub, we have been creating new digital pathways between mobile money users in Africa and the global economy. With the acquisition of Beyonic, we can now put this digital payment network at the service of these entrepreneurs whether they are SMEs, fintechs or social impact organisations.”

This acquisition presented a 4-5x return on investment for investors. It was paid for using cash and shares, even though the final amount remained undisclosed. MFS Africa went on to raise another $200m in funding after the acquisition, $100m in 2021, and $100m in 2022. 

2. Treepz Acquires UgaBus. 

On November 22, 2021, Nigerian mobility startup Treepz announced its acquisition of Ugandan bus ticketing platform Ugabus, marking a significant expansion into East Africa. Founded in 2019 by Onyeka Akumah, Treepz operated a digital platform that allowed passengers to book rides along fixed routes in Nigeria and Ghana, serving as an aggregator for various bus companies. 

Ugabus, established in 2016 by Ronald Hakiza, made its mark by aggregating inter-city bus operators in Uganda and facilitating online ticket booking and mobile money payments. With approximately 70% of bus operators in Uganda on its platform, Ugabus became a crucial player in the local transportation sector.

Following the acquisition, Ugabus was rebranded as Treepz Uganda, officially commencing operations under the new name on December 1, 2021. This strategic move not only aimed to enhance Treepz’s service offerings but also to digitize public transportation across Africa. Ronald Hakiza transitioned to the role of Country Manager for Treepz Uganda, overseeing the integration of Ugabus’s technology with Treepz’s existing platform. The acquisition was accompanied by a successful seed funding round of $2.8 million, which included investments from various venture capitalists, aimed at supporting Treepz’s ambitious expansion plans.

In 2023, Treepz pivoted from its initial bus-hailing model to become a car-sharing marketplace. This shift allows car owners to rent out their vehicles, offering a more affordable and sustainable transportation option for Africans. The company aims to become Africa’s leading car-sharing platform, addressing the continent’s high demand for accessible and reliable transportation.

3. Q-Sourcing Servetec Acquires Flip Africa 

In May 2024, Q-Sourcing Servtec Group (QSS) announced its acquisition of FLIP Africa Ltd. This transformative job tech platform significantly enhanced QSS’s capabilities in digital HR and manpower solutions across Africa. This strategic move aligned with QSS’s mission to digitise and expand its service offerings in response to the evolving landscape of remote work and the “Internet of Things.” The acquisition was positioned as a pivotal step in strengthening QSS’s presence in the African job market.

Following the acquisition, Q-Sourcing Servtec initiated a comprehensive 360-degree integration plan involving FLIP Africa and The Assessment and Skilling Center (TASC), the group’s training arm. This integration aimed to create a unified platform that streamlined recruitment processes while offering expansive training and certification opportunities. The initiative sought to revolutionise how companies hire, pay, and develop talent across the continent, enhancing operational efficiency and business accessibility.

The combined capabilities of QSS, FLIP Africa, and TASC featured a Pan-African Talent Database with over 100,000 rated professionals across more than 15 industries. This platform streamlined recruitment through AI-assisted profile creation and real-time contract management and expanded TASC’s internationally certified training programs to a broader online audience. QSS Group CEO Patrick K. Mbonye emphasised that this integration transformed their ability to meet the dynamic needs of the African job market. At the same time, FLIP’s Co-Founder Neha Pandya highlighted the acquisition’s potential to achieve the ambitious vision of creating dignity and upward mobility for workers in Africa’s gig economy. 

4. Guardian Health Acquired by MyDawa 

In July 2023, Kenyan health-tech startup MYDAWA announced its acquisition of Guardian Health Pharmacy, one of Uganda’s largest drug distributors. This strategic move came shortly after MYDAWA raised $20 million in funding from Alta Semper, a London-based private equity firm. The capital was earmarked for enhancing access to safe and affordable healthcare products and medical services through MYDAWA’s proprietary technology-based solutions, which include in-house logistics to ensure high service levels.

Founded by Ugandan pharmacist Anthony Natif in 2013, Guardian Health has grown significantly, operating multiple branches across Uganda and providing various pharmaceutical services. MYDAWA, established in 2016, has positioned itself as a leader in the digital healthcare space by offering consumers easy access to healthcare products and services through a fully regulated platform. The acquisition aimed to leverage MYDAWA’s innovative technology and operational expertise to expand Guardian Health’s reach and improve service delivery in Uganda.

The CEO of Alta Semper, Afsane Jetha, highlighted that this investment marked their entry into Africa’s digital healthcare market, viewing it as a significant growth area. He emphasised that MYDAWA’s scalable business model and regulatory knowledge aligned well with their strategy to democratise access to health and wellness across the continent. With this acquisition, MYDAWA aimed to enhance its service offerings while ensuring consumers have access to safe and affordable medication, further solidifying its position as a one-stop shop for healthcare solutions in the region.

5. Asaak Acquires Mexican Startup FlexClub

On September 4, 2023, Ugandan fintech firm Asaak announced its acquisition of FlexClub Mexico for an undisclosed sum, marking Asaak’s entry into the Latin American market. This acquisition bucked the trend, as it was a Ugandan-based startup acquiring another startup, rather than it being acquired. 

Asaak, which specialises in asset financing for mobility workers, aimed to leverage this acquisition to expand its innovative credit solutions tailored for the region. FlexClub Mexico, established four years prior by FlexClub, provided mobility financing and car loans to drivers navigating an informal market fraught with challenges. 

The acquisition rebranded FlexClub Mexico as Asaak Mexico, allowing Asaak to build on its successful model in Uganda.

The acquisition was seen as a strategic move for Asaak, which had recently achieved profitability in Uganda. Kaivan Khalid Sattar, Asaak’s CEO and founder, expressed optimism about leveraging FlexClub Mexico’s extensive database of vehicle applications received through partnerships with platforms like Uber. 

This integration aimed to enhance Asaak’s credit ecosystem by providing drivers with access to additional credit for fuel, repairs, and other essential needs. Tinashe Ruzane, CEO and co-founder of FlexClub, noted that the decision to exit the Mexican market was driven by the need for a sharper focus amid challenging economic conditions rather than a lack of potential.

Asaak’s acquisition of FlexClub Mexico positioned it to develop transformative financial solutions tailored specifically for the Latin American market. The collaboration was expected to facilitate access to affordable credit for drivers while enhancing operational efficiency. With this acquisition, Asaak aimed to replicate its successful financing model in Uganda and expand its reach across emerging markets, further solidifying its commitment to unlocking the economic potential for marginalised workers in the mobility sector