How Talk360 evolves from phone app to fintech with effect

It’s 2022. Is it still a growing business to offer paid international calls at affordable prices? That is, if you, like Holland-based Talk360, are willing to put your feet on the ground in Africa and focus your hard work there.

Talk360 allows people with lower incomes in Africa to make longer calls more frequently to their families back home. To get these people on board, founder and CEO Hans Osnabrugge, along with co-founders Dean Hiine, Jorne Schamp and the team, basically had to build an entire financial ecosystem across the continent from scratch. Now they are ready to evolve from phone app to fintech.

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The birth of Talk360

In the case of Osnabrugge, before offering cheap phone calls, there were free phone calls. His previous business was Ringcredible. The service offered free VoIP calls to anyone who had the app installed. An ideal product for making international phone calls. All you need is a stable internet connection and you can talk to the other side of the world at no extra cost.

For those who think: is not exactly what Whatsapp and the like offer? So yes. And to compete globally with that kind of giants did Ringcredible in. In 2015, Osnabrugge had to throw in the towel and file for bankruptcy. But when a door closes, a window often opens.

‘Fantastic technology, wrong audience’

Osnabrugge cracked the window while finishing his Ringcredible venture. He was introduced to South African entrepreneur and Talk360 co-founder Dean Hiine. “He told me our technology was great, but we were targeting the wrong audience,” says Osnabrugge. “He invited me to Soweto, Johannesburg, where he grew up to see how much Nigerians, Bangladeshis, Pakistanis and Zimbabweans needed such a product. The chance for them to talk to anyone at home via the internet is just incredibly small.”

“There are so many people who need this,” Osnabrugge said. Creating the product itself was not the biggest challenge. Talk360 allows users to call any landline or mobile number in the world at a greatly reduced rate. It can do this by using VoIP technology to cross most international borders and then buy local call minutes in bulk at a discount. The result is that end users pay far less for calling regular phones while not having to fully rely on an internet connection.

As easy as buying a loaf of bread

The biggest challenge for Talk360 was to get the target audience involved. “These people in the African townships are at the bottom of the pyramid. Trust is of the essence. They do not trust companies to do the right thing, so we had to locate our product and involve the community.” The second challenge is that over 70 percent of all African consumers are unable to purchase international digital services. So Hiine insisted that the service could only work if filling an account was as easy as buying local bread.

That was the difficult part. Africa is a huge continent with very different payment cultures. It has 45 different currencies, thousands of different payment providers and many different areas that prefer many different ways of paying. “South Africa, for example, is very cash-driven,” says Osnabrugge. “About 80 percent of the population is underbanked.”

Creation of its own payment infrastructure

This basically meant that Osnabrugge had to develop two different companies. “The call app was the basic part,” he says. “We could do it right away in 2016.” The hardest part was getting the payment infrastructure in place. Dean has traveled all over Africa to connect all the different payment methods to our platform. In the meantime, Jorne Schamp joined the Netherlands as co-founder to build the product here in the Netherlands. “

It took about three years of hard work when Hiine and Osnabrugge found out that they had made enough progress on the pay side. “In 2019, we began to fit the two sides of the company together, increasing our marketing efforts and showing the world that what we had imagined would actually work.”

Not just a phone app

Fast forward to 2022, and Talk360 is not just an app that lets people call another country. In the background, it is basically a fintech company that connects local suppliers, ATMs and other payment options. Talk360 has 1.25 million physical outlets worldwide, of which 750,000 in Africa, where people can top up their accounts. It supports 60 payment methods in more than 40 currencies. They have teams in the Netherlands, South Africa, Nigeria and India, a country that has many people on their way to work in Africa.

“That’s where we make an impression,” says Osnabrugge. “It’s the most important lesson I learned from Ringcredible. It was the easiest to use app to make calls with, but I had no assets. There were other apps like that, and they were just as easy to download as they were. “With Talk360, we have no competition because it involves a lot of work that no one wants to do.”

‘No investor understood us’

A lot of work requires a lot of money. Much of it came from Osnabrugge’s own venture builder Brooklyn Ventures. “No other investors understood what we could do with this. And even my partners at Brooklyn Ventures were in doubt. But they trusted me. And I believed in Dean (Hiine) and Jorne (Schamp). In the end, it took two years longer to get the payment structure in place, and we had to make around one million euros in loss financing. ”

Now Talk360 is getting ready to make an even bigger impact. It is already becoming clearly visible in times of crisis. Osnabrugge is reminiscent of the beginning of the pandemic. The insecurity of many people working abroad led to a massive increase in traffic on their network. Recently, they have witnessed local increases. When the unrest in Sudan happened at the end of last year, calls from their platform to that place went through the roof. The same with the recent protests in Kazakhstan. It shows that when the internet is down or unreliable, Talk360 offers a solution.

Reliable internet: more scarce than you think

This also speaks to the long-term viability of scaleup. From a first-world perspective, it is easy to forget that many parts of the world do not have reliable high-speed internet. And many parts will not get it for a while. In fact, Osnabrugge claims, even in Western Europe, it is sometimes tainted: “In countries like Germany, coverage is still an issue. Try having a Whatsapp video call on the German autobahn. Good luck with that.”

“Internet penetration is good in certain countries, for a certain group of people and sometimes even at certain times. In South Africa, the internet is great. But it is about 20 times more expensive than here. Many people will not download apps that are over 10 MB of for that reason. ” As coverage spreads, it will get more people online, but Osnabrugge says they can not trust it full time. “They get connected every now and then. So sometimes they can call home for free. But there has to be a reliable alternative when they can’t.”

Looking beyond cheap phone calls

In 10 years, it may be different, Osnabrugge admits. So what happens to his affordable phone calls then? “That’s when we’ve built the trust of our audiences to have a financial relationship with them. Fintech in Africa is huge. It’s like Southeast Asia 15 years ago. There’s a huge opportunity and we’re building something out of a problem. , we ourselves have experienced. ”

Now others also seem to be holding on. Talk360 is ready to open its payment structure to other parties, allowing technology companies to reach a whole new audience through a reliable means of payment. Osnabrugge says the first third party to use their payment platform will be an edtech company. “With Talk360, we are basically the first customer in our fintech business. This is not a good way to build a business, I admit. But it’s a great way to grow into something bigger. “

Handling growing pains at Rise

To ensure that the development process runs smoothly, Osnabrugge has recently joined the Rise program, organized by Techleap.nl. It showed him that while his business may be unique, his growing pains are not. Upscaling is sector diagnostic. Everyone runs into the same challenges. It is good to realize that some problems, however stressful they may be, are not unique and not necessarily your own fault. It gave me peace of mind. And with peace comes vision. “

“Before we joined Rise, we just started our fundraising efforts. The program helped me really bring the business back to the core. Some people who have been brought in by the program have seen it all. When they dive deep into your business, they may return with some harsh, fair criticism. It helped us improve our pitch, which gave us a better position during fundraising. ”

Now Talk360 is ready to close a seed funding round in the 1st quarter of this year. Osnabrugge can not yet share any details, other than that it will be with ‘a combination of fintech angels and African VCs’. It will allow them to grow their business, as well as their influence. Osnabrugge: “We have chosen the blue sea. Talk360 could have gone to the US market and tried to compete with the competition, but who cares? We’re trying to do something meaningful here, but that means we have to get through the fight first. “

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