Category: INVESTMENT

OpenAI, the company behind ChatGPT, has decided to end its partnership with Scale AI, a startup that helps label data for artificial intelligence. This comes just days after Meta (the company that owns Facebook and WhatsApp) invested billions of dollars in Scale AI and hired its co-founder and some employees.

Why OpenAI Is Moving Away from Scale AI

Even though OpenAI has worked with Scale AI in the past, the company was already planning to rely less on them before Meta’s big investment. OpenAI is now looking for other companies that can provide more specialized data to help train its advanced AI models.

At first, OpenAI said it would keep working with Scale AI as one of its many data providers. But now, it seems the partnership is ending completely.

Meta’s Huge Investment in Scale AI

Meta recently invested $14.3 billion in Scale AI, taking a 49% stake in the company. As part of the deal, Scale AI’s CEO and co-founder, Alexandr Wang, along with some employees, will join Meta to help with its AI projects.

Before this deal, Scale AI was already valued at nearly $14 billion after investments from big tech companies like Nvidia, Amazon, and Meta. Now, with Meta’s latest investment, Scale AI’s value has jumped to $29 billion.

Why Other AI Companies Are Worried

Many experts warned that Meta’s investment could cause problems for Scale AI. Since Meta is a major competitor in AI, other companies (like OpenAI and Google) might not want to keep working with Scale AI if they think Meta could gain access to their private data and research.

When companies use Scale AI’s services, they often share confidential information about their AI projects. Now that Meta owns nearly half of Scale AI, rivals like OpenAI and Google worry that Meta could learn about their AI strategies.

Google Also Plans to Leave Scale AI

Google, which was Scale AI’s biggest customer, recently announced it would stop working with them. Google had planned to pay Scale AI $200 million this year for data-labeling services to improve its AI models, including Gemini (its competitor to ChatGPT).

Reports say that Scale AI made $870 million in revenue in 2024, mostly thanks to Google’s $150 million in contracts. Now, with both OpenAI and Google leaving, other big tech companies like Elon Musk’s xAI and Microsoft might also stop using Scale AI’s services.

What This Means for Scale AI

While Meta’s investment is a big win for Scale AI’s CEO, Alexandr Wang, it could hurt the company’s reputation with other tech giants. Wang, who is known as one of Silicon Valley’s top entrepreneurs, has worked closely with OpenAI’s CEO, Sam Altman, and even the U.S. government.

In a message to employees, Wang said:
“As you’ve probably seen in the news, big opportunities like this come with sacrifices. For me, that means leaving Scale AI. It has been the greatest honor of my life to lead this company.”

Scale AI Says Business Is Still Strong

Despite the challenges, a Scale AI spokesperson said the company is still doing well. They work with many big companies and governments and promise to keep customer data safe.

But with OpenAI, Google, and possibly others leaving, the future of Scale AI’s partnerships remains uncertain.

The Bigger Picture: AI Competition Heats Up

This situation shows how intense the competition is in the AI industry. Big companies like Meta, Google, OpenAI, and Microsoft are all racing to build the best AI models and they don’t want their rivals to get an advantage.

For now, Meta’s investment in Scale AI gives it a boost, but it may have cost Scale AI some of its biggest customers.

Money Fellows, a popular financial technology (fintech) company in Africa, has raised $13 million in new funding. This money came from big investment groups, including Partech Africa and CommerzVentures. With this new funding, the total amount of money the company has received since it started is now over $60 million.

The latest round of funding was mainly led by two investment companies Al Mada Ventures (AMV) and DPI Venture Capital, through a fund called Nclude Fund.

What Will the Money Be Used For?

Money Fellows says it will use the new funds to make its digital platform better. This is very important now because the platform has more than 8.5 million users, and it is working with over 350 local and regional partners.

The company wants to expand into more countries and help change the way people save, borrow, and invest money. Instead of doing these things the old-fashioned way, Money Fellows wants to digitalise them so they are easier, safer, and faster.

The company’s goal is to give more people access to helpful financial services—especially those who normally don’t have access to banks or loans. This is called financial inclusion, and it helps improve lives and grow economies.

“Money Fellows is an important part of Africa’s finance world. We use both the power of community savings and the latest technology to help people manage their money better,” said Ahmed Wadi, the company’s founder and CEO.

“This new investment proves that people believe in what we are doing. We want to help even more people especially in places where financial services are hard to reach, save money, get loans, and invest in a way that is easy and affordable,” he added.

What Is Money Fellows?

Money Fellows was started in 2017 by Ahmed Wadi. The company focuses on modernising a traditional savings method called ROSCAs, which stands for Rotating Savings and Credit Associations.

How ROSCAs Work

In a ROSCA, a group of people agree to put money into a shared pot every month. Each month, one person in the group gets all the money. This continues until everyone has had a turn.

For example:

• 10 people put in $1,000 each month.
• Every month, one of them gets $10,000.
• This goes on for 10 months until everyone has received their payout.

This system works best with friends or family because it’s based on trust. But it also has problems—like it being hard to grow or to get more money when needed.

Money Fellows solved this problem by creating a digital version of this system. Now, users are not limited to their own small groups. The app checks each user’s credit score, so it’s safer to join with people you don’t personally know.

According to Wadi, this savings model is very popular in over 90 developing countries. In different places, it has different names:

• Esusu or Ajo in Nigeria
• Kameti or Chit Fund in India
• Gameya in Egypt

Wadi said he first got the idea when he lived in Germany. He couldn’t get financial help there because he didn’t have a credit history. So, he thought of using the ROSCA system as an alternative.

What Investors Are Saying

Many investors are excited about what Money Fellows is doing.

Omar Laalej, managing director at AMV, said ROSCAs are old systems that have been around for centuries. He praised Money Fellows for turning it into a modern business that is helping many families in Egypt.

Mohamed Aladdin, from DPI Venture Capital, said the future of banking in Africa depends on new ideas like Money Fellows. He believes the company can make a big difference in Egypt and beyond.

Cyril Collon, from Partech, said he is proud to support Money Fellows. He said the app uses local savings traditions along with technology to help more people.

Patrick Meisberger, from CommerzVentures, said he is excited about how Money Fellows is changing people’s lives by making it easier and safer to save money.

What’s Next for Money Fellows?

With the new money, the company plans to expand to new countries, especially in North Africa. One of their main targets is Morocco, where more people are starting to use digital banking and saving tools.

Upcoming events like the 2025 Africa Cup of Nations and the 2030 FIFA World Cup (both being hosted in Africa) are expected to help even more people become interested in digital financial services.

Nigeria’s Central Bank (CBN) has imposed a hefty fine of ₦250 million (approximately $190,000) on Paystack, one of the country’s leading fintech companies. The penalty comes after the CBN accused Paystack of operating its newly launched consumer product, Zap by Paystack, as a digital wallet without the proper authorization. According to sources familiar with the matter, the CBN claims that Zap a peer-to-peer (P2P) money transfer app introduced in March 2024 functions like a deposit-taking service, which is only permitted for licensed banks and microfinance institutions.

Paystack currently holds a switching and processing license, which allows it to facilitate transactions between banks and other financial entities but does not permit it to hold customer funds. This restriction is at the core of the CBN’s decision to sanction the company. In response to the fine, a Paystack spokesperson stated that the company is cooperating with regulators to review Zap’s operations and declined to comment further out of respect for the ongoing process.

Understanding the Controversy Around Zap

In Nigeria’s tightly regulated financial sector, a digital wallet is defined as a service that stores user funds, enables payments and transfers, and often includes financial management tools. The CBN has become increasingly strict about enforcing licensing boundaries, particularly as fintechs expand into consumer-facing products. While TechCabal reports that Zap does not directly hold user funds instead partnering with Titan Trust Bank, which is licensed for deposits—the CBN still views the app’s functionality as too similar to an unauthorized wallet service.

This fine marks the largest known regulatory penalty Paystack has faced since receiving CBN approval in 2016. It highlights the challenges fintech companies encounter when venturing beyond business-to-business (B2B) services into the consumer market, where stricter regulations apply.

Zap’s Rocky Start and Broader Regulatory Crackdown

Paystack, which is owned by global payments giant Stripe, launched Zap as a bold move to compete in Nigeria’s rapidly growing digital payments space. However, the product quickly became embroiled in controversy. Shortly after its debut, Nigerian cryptocurrency startup Zap Africa accused Paystack of trademark infringement, leading to an unresolved legal dispute.

The CBN’s action against Paystack is part of a wider regulatory clampdown on Nigerian fintechs. Over the past year, authorities have intensified scrutiny of customer onboarding processes and Know Your Customer (KYC) compliance to combat fraud and ensure financial stability. In a notable example, two of Nigeria’s top fintech firms, Moniepoint and OPay, were each fined ₦1 billion in early 2024 for failing to meet regulatory standards.

What’s Next for Paystack?

Paystack must now work closely with the CBN to address the concerns raised about Zap. Depending on the outcome of these discussions, the company could face additional penalties or even be forced to suspend the product if it fails to comply with licensing requirements.

This case serves as a cautionary tale for fintech firms looking to expand their services: regulatory boundaries must be carefully navigated, and operating without the proper approvals can result in significant consequences. The situation also underscores the CBN’s growing vigilance in ensuring that financial innovations align with the country’s regulatory framework.

South African technology giant Naspers Limited and its European division Prosus NV have officially appointed Nico Marais as their Chief Financial Officer (CFO). The 51-year-old finance expert, who has worked with the companies for over 25 years, had been serving as temporary CFO since December 2024. His promotion was approved by both companies’ boards.

Marais replaces Basil Sgourdos, who retired after nearly 30 years as CFO. During Sgourdos’ time, Naspers grew from a media company into a global tech investor, most notably through its early investment in Chinese tech giant Tencent.

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Why This Appointment Matters

1. Experience Counts – Marais knows these companies inside out. He helped list Prosus on the Amsterdam stock exchange in 2019 and simplified how Naspers and Prosus own shares in each other.

2. Strong Teamwork – Company leaders say Marais works well with new CEO Fabricio Bloisi, who took over in July 2024. This teamwork will be important for future growth.

3. Good Timing – The companies are doing well financially. Prosus made 3.5 billion in profit last half−year up 741.5 billion (up from $866 million).

What Marais Brings to the Job

• Helped create Prosus’ stock buyback program that returns money to shareholders

• Managed the companies’ borrowing and debt strategies

• Expects Prosus to make $6.2 billion this year with 20% growth

• Will join Naspers’ board immediately and Prosus’ board next year

Other Big Changes at the Companies

• South Africa CEO Phuthi Mahanyele-Dabengwa will join the Naspers board in 2025

• New CEO Bloisi is focusing on making e-commerce businesses profitable

• The group plans to list more companies, including payment service PayU

• They have $20 billion ready to invest, especially in AI and fintech

What’s Next?

With Marais as CFO, Naspers and Prosus want to:

1. Keep growing their successful investments (like Tencent, Delivery Hero, Swiggy)

2. Make their online shopping businesses earn more money

3. Find new opportunities in artificial intelligence and digital payments

4. Possibly take more of their companies public through stock listings

The leadership team believes Marais’ long experience will help guide these plans while maintaining the financial discipline that has made Naspers and Prosus so successful.

Simple Explanation of Key Terms:

• CFO = The executive who manages a company’s money

• Prosus = Naspers’ European division that holds its international tech investments

• Stock buyback = When a company buys its own shares to increase their value

• Listing = When a company sells shares to the public on a stock exchange.

Alphabet Inc., the company that owns Google, is trying to borrow 2.8 billion dollars by selling bonds in Europe on Tuesday. This comes just one day after the company borrowed 5 billion dollars in the United States.

The money will be used to pay back old loans and for other business needs. The deal should be completed later today. Alphabet is offering different types of bonds that must be paid back in 4 to 29 years.

Details About the Money Borrowing:

The 4-year bond will cost a little more than normal interest rates. The 29-year bond will cost more than that. If this works, the 29-year bond will be the second longest company bond sold in Europe this year.

Big banks like Goldman Sachs, HSBC, and JPMorgan Chase are helping with this deal.

Why Does Alphabet Need to Borrow Money?

Alphabet actually has 95 billion dollars in cash right now. Over the next three years, it expects to make about 300 billion dollars more. But the company still wants to borrow money now because:

The borrowing market is stable right now after some changes in U.S. trade rules

It’s better to borrow now before things change again

What Will the Money Be Used For?

To pay back older loans (which can save money)

To invest in new projects like buying back company stock or working on artificial intelligence

Alphabet’s U.S. Borrowing:
On Monday, Alphabet borrowed 5 billion dollars in the U.S. This was its first time borrowing money since 2020. Part of this was a special 40-year loan worth 1.5 billion dollars that ended up costing less than expected.

Other big companies like Procter & Gamble (which makes Crest toothpaste) and home builder D.R. Horton also borrowed money this week. In total, 15 companies borrowed more than 18 billion dollars – the most since March.

Alphabet’s Recent Earnings:
Last week, Alphabet shared its money report for early 2025:

Total money made: 90.23 billion dollars (12% more than last year)

Biggest earners:

Google Search: 50.7 billion dollars

YouTube ads: 8.9 billion dollars

Google Networks: 7.2 billion dollars

New AI products also helped the company grow

Alphabet is borrowing money now because it’s a good time to do so. Even though the company has lots of money, this move helps it:

Save money on old loans

Work on new technology like AI

With strong earnings and smart money decisions, Alphabet remains one of the most powerful technology companies in the world.