As young Africans begin to make more money than their parents did at their age, holding fancy multinational jobs at multinational startups pursuing unicorn status, they’re begging to see the need to invest and begin to grow their money. Even in this social media age, the good old way man has generated, accumulated and diverge wealth for ages past remains relevant.
During the recently concluded elections in Nigeria and Kenya, a focal point for candidates running for the president’s office for youth was how they would be introduced into the real estate market. Young people don’t just want to rent homes in highbrow areas at best. They want to begin to own their real estate at worst.
But there remains a financial barrier in the way. Even though young people are beginning to gather together their coins from short-term investments on platforms like Piggyvest and Cashbox, it will take a few more years for the average African youth to begin to pursue the real estate of their dreams.
This is why the Kenyan startup alphabloQ’s solution is perfectly in tune with the conversation. Founded by Trevor Kimani and John Mbui, alphabloQ was part of the inaugural ARM Labs Lagos Techstars Accelerator Program, which had its demo day just this month.
“alphabloQ is a real estate investment platform whose mission is simple – to reduce the entry barrier for real estate investors by enabling investors to purchase a fraction of income-generating properties,” communications material from Techstars Lagos says of the company.
“At alphabloQ, we are enabling investors to buy shares of income-generating real estate assets,” Trevor Kimani, one of the co-founders, told Technext in a recent interview.
He says that with alphabloQ, he hopes to give access to young Africans looking to get into the real estate industry.
This is the premise of alphabloQ. Users come on the platform looking to invest in real estate. alphabloQ collects their investments and puts them into real estate, gives them a token, rents the properties out, and they continue to earn money from the rent. If the properties appreciate, so does their dividend.
“In order for someone to own real estate on alphabloQ’s platform what we do is we take the sellers’ assets, and then we tokenise it unto our blockchain. This enables us to break up that value into fractions. And then those fractions are purchasable by the investors on our platform where they can buy as much as they want,” the co-founder said.
He compares the offers on alphabloQ to what one would typically get trying to pay a much more expensive mortgage.
“Take an example of a mortgage where you’ll need to pay more than four times the value of the asset just to be able to pay off the loan. So it already eliminates the majority of Africans and people of the developing world to be able to own real estate. We are solving that problem and digitalising it. And you can be able to break it into as many pieces as you like. That allows you to now own a piece without having to take out a loan.” he said.
But that is not just all alphabloQ offers investors. On the platform, investors have access to data which helps them make informed choices about how and where to put their money.
“The value proposition that we will give is access to a lot of data so that you can be able to make a decision based on the best practices or maybe your own specific goals in terms of real estate investing. That way we actually create a liquid market for Africa,” Trevor added.
But the company, like many startups, is facing challenges trying to recruit and retain the right talent, especially as Africans flee the continent for greener pastures in the west.
“The biggest challenge we are facing right now is meeting the demands because we really have a lot of customers that are interested, a lot of partners that are ready for us to launch this product and give it to their customer bases,” he said.
“But we are very early stage and we’re planning on recruiting. That is one of the blockages, trying to get the right team on board,” he added.
Where does Trevor Kimani see AlphabloQ in the next five years?
“We would be fully pan-African. Any African can be able to invest in any country and buy any real estate assets from any country. And this process will be as easy as maybe ordering a burger online,” he said.