Hi there,

Love irony? AI startups are now clamouring to hire all the writers and poets that publishers are laying off due to their products, to help improve their products. See, we told you it’s no biggie – even developers have nothing to fear from AI.

In this Open Letter:

• SA cash flows: Opportunities inside the grey list.
• Ancient Zambians, grocery subs & where to semigrate to.
• Your turn: Get your hands on R2’500s worth of gold.
• Get found: Building more discoverable products.
• What AI’s really for: The results are in…

TRENDING NOW

Keeping SA’s Cash Flowing

Remember the morning of Monday 28 August? SA crypto traders choked on their cornflakes as US crypto exchange Kraken’s arbitrage premium suddenly doubled overnight. It made trading BTC a nightmare.

However, the reason’s a bit concerning: one of Kraken’s banking partners, Bank Frick in Liechtenstein, put SA on its anti-money-laundering blacklist and stopped accepting deposits from SA altogether.

It’s not the first time, either. USDC stablecoin issuer Circle stopped taking fiat deposits from South Africa earlier this year, too. So, what gives?

Well, it has everything to do with SA’s greylisting on 24 February this year. Now, remember, Government told South Africans that the greylisting is not so bad. Yeah, we’re not so sure…

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It’s already affecting our economy

And it’s actually worthwhile plotting out some recent events around SA’s greylisting:

• Feb 23 – SA greylisted by global money laundering and terrorist financing watchdog, Financial Action Task Force (FATF).
• Mar 23 – Al Jazeera uncovers a massive gold-based money-laundering operation in SA implicating bankers at Absa, Standard Bank etc.
• Apr 23 – USDC stablecoin issuer Circle blocks deposits from SA.
• Jun 23 – The United Nations Conference on Trade and Development shows that SA loses R1.1 trillion per year due to Illicit Financial Flows (IFFs), mainly misinvoicing in imports and exports.
• Aug 23 – Bank Frick blocks deposits from SA.
• Sep 23 – SA’s car industry confirms billions are lost due to illegal imports and exports in September 2023.
• Sep 23 – FirstRand (FNB, RMB, WesBank) CEO Alan Pullinger expresses concern over SA’s efforts to get off the greylist.
• January 2025 – SA’s deadline to comply with anti-money-laundering measures or get permanently greylisted (if not blacklisted).

Let’s just be very clear about the risks. If SA doesn’t get taken off the greylist, any bank or company would have the right to simply stop dealing/trading with SA altogether. (In fact, they’d probably risk being greylisted themselves if they didn’t.)

At best, we’d have to wheel, deal and pay a fortune to import basic stuff. At worst, we’d have access to nothing and our financial system would collapse.

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So it’s probably worth knowing what the greylisting is really all about…

SA’s greylisting in a nutshell

The greylisting is about SA not having enough anti-money-laundering (AML) and counter-financial-terrorism (CFT) controls in place.

See, criminals and terrorists fund themselves with perfectly legal financial tools. So being AML and CFT compliant simply means getting SA banks, FSPs and some other businesses to check customers against international Sanction Lists before doing business with them. And this also creates opportunity…

The scope of the opportunity

Thing is, it’s not just banks, there are quite a few industries that would by law be required to do this type of screening, including: Estate Agents, Loan issuers, Deposit takers, Crypto exchanges, Banks, Insurance companies, Medical aids, PSPs, Industry bodies, Lawyers, Brokers and FSPs.

That is a HUGE market. With 10’157 FSPs, 36’000 estate agents and 29’981 lawyers alone, you’re talking hundreds of thousands of businesses affected. All of whom don't necessarily have the tech or capacity to check all customers against Sanction Lists, but need to, else we all go under.

Moving in this space

That’s where Southern African startup ZenDetect comes in. They’ve built a super sleek platform that lets companies in SA, Namibia and all of Southern Africa upload their clients or plug into their API and scan them against Sanction Lists in real-time and continuously.

SA has just about 14 months to get its industries AML compliant, and the consequences are dire if we miss that window, so we’re watching this space.

Refer one friend to sign up to The Open Letter and view our top opportunity pick for this trend (and all future trends we cover).

Get your sharing link here.

OVER TO YOU

What's your take on the whole greylisting thing?

Vote to see what others say...

• ❓ What is greylisting?
• ☑️ Yes, my company is ready.
• 😡 I hate KYC.
• 💁 I don’t care.
• 🙃 It’s government’s job, they mustn’t bother us.
• ⚖️ They should just legislate it right now.
• 😲 First I'm hearing of this.

Login or Subscribe to participate in polls.

IN SHORT

🚛 Considering Semigration? At the forefront of the semigration trend are these small towns across SA, with beautiful scenery, slower pace and cheaper goods as major drawcards. Property prices in these hotspots have also seen a significant increase over the last 10 years – anywhere between 44% and 167%.

🏍️ Special Delivery. After a couple months of pilot trials, Checkers Sixty60 subscriptions are available to all customers. For R99 per month, you can get unlimited deliveries (gotta spend more than R350 though) and other special subscriber perks. Also, check out the rad launch ad featuring a Cruising Hollywood actor and the references to his most iconic roles.

🛸 Geeking out. Comic Con Africa is set to hit Jozi this weekend with 80’000 comic fans expected to attend. The event will be host to Cosplayers, gamers, board game players as well as some international celebrities from films and TV shows like Yellowstone, Star Wars and The Walking Dead.

☀️ Solar Slump. Seems like solar isn't as big a deal for home buyers despite South Africa’s ongoing loadshedding woes. But while 75% of agents noted an increase in backup power systems, 64% have said that pre-installed systems are not something prospective buyers are looking for.

🪵 Ancient Wood. Archaeologists in Zambia have found a wooden structure believed to be nearly half a million years old at the Kalambo Falls near the Tanzanian border. The discovery is set to reshape our understanding of early hominid behaviour, suggesting that they used a variety of stone tools (also found at the site) to cut, chop and scrape the logs. Could also just be some oke’s Heritage Day Braai from 500’000 years ago.

💰 Bag Secured. After being blocked by the UK’s competition regulator back in 2022, it looks like Microsoft’s multi-billion dollar purchase of Activision Blizzard is set to go through. The proposed amendments to the deal are to allay concerns that Microsoft’s control over Activision would withhold popular titles like “Call of Duty” and “World of Warcraft” from other competing gaming platforms.

⛏️ Golden History. Gold has been mined for thousands of years, with as much as 86% of the above-ground gold being taken out in the last 200 years. South Africa was topping the charts of gold-producing nations up until 2007 when China surpassed us. Wanna get your hands on some gold really easily? Talk to our friends at Troygold.*

_{*This is a sponsored short}

JUST FOR YOU

Last Chance to Win Gold!

Share The Open Letter and you can win! We’re giving away R2’500 worth of gold, plus this cool merch from Troygold.

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And all you gotta do to stand a chance of winning it all is 1, 2, 3, 4…

STEP 1: Click on this shiny button 👇
(The button opens a LinkedIn tab.)

STEP 2: Click “Share in a post” right under the Open Letter logo in that new tab.

STEP 3: Type a few words on what you think about The Open Letter, as a post to your followers.

STEP 4: Tag us: @TheOpenLetter and hit “post”.

Done, now you’re entered to get gilded.

­

BUILDER’S CORNER

How to Build Products to Be Discovered

You know how everyone wants lots of organic traffic so they can save on marketing? Then there’s the running joke that South African builders tend to battle with marketing itself… Well, the idea of “building for discoverability” could be a solution.

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What is Building for Discoverability?

No, it’s not about how your product helps users discover features or whatever. It’s about how you position your product to help users find you out of the blue.

Building for discoverability is twofold:

1. Building features you know people are looking (searching) for
2. And marketing them in all the right places.

And it’s important because, on Lenny’s Podcast the other day, they said some US SaaS companies found that building for discoverability helped reduce the time it took to recoup their acquisition costs from customers by 36%. (A fancy way of saying “make your money back faster”.)

For example: Zapier

Zapier gets this very right. Quick, go Google “workflow automation tools” (what Zapier technically is). See any Zapier ads there? No. Because they don’t want to waste their money…

See, software users rarely search for new products, they search for the problems they want to overcome. Now go Google “connecting Typeform with Google Sheets” and watch those Zapier dollars hard at work.

See, Zapier spends their bucks not on telling you what they are, but what their product can do for you – that’s how they almost tripled their annual revenue between 2020 ($50m) and 2021 ($140m) alone.

Also: Canva

They don’t focus so much on ranking for “design software”, but check out “how to make a flyer”. See the trick?

Others that do this well are HubSpot, Ahrefs etc.

How to Build for Discoverability

1. Know your ideal customer
2. It’s extremely important to know them inside out. Not just basic demographics, but what they do during the course of the day, how they look for solutions, who they trust and where they hang out. Because only when you know this can you discover the next one…
   
3. Speak to the outcomes they’re looking for
4. When you know who they are and where they hang out, you can do the research needed to find out what problems need solving. What will they search for, what do they look for during the course of a day, a week? Etc.
   
   Now, you’ll already have a great product if it actually helps them solve a lot of those. But you can take it even further…
5. Create content + advertise on those pain points
6. Forget the idea of telling people your product is “a (broad startup category) that helps you…”. Rather spend your money on appearing when someone searches for the outcome they’re looking for.
7. This extends to social and other ad types, too. Remember how Zapier appears on YouTube with ads on “how to connect X to Y”? Well, do the same, just for your product.

Found a way to help people find you faster? Or maybe you have a specific question about building smarter? Hit reply and let us know…

THE RESULTS

Alrighty, we asked what you really use AI for and most people here automate workflows and social posts…

🟩🟩🟩🟩🟩🟩 🦾 Automating repetitive tasks and workflows (27%)
🟨⬜️⬜️⬜️⬜️⬜️ 🦸‍♀️ Enhance customer support and engagement (7%)
🟨🟨🟨⬜️⬜️⬜️ 🔎 Analyse user data and gain insights (12%)
⬜️⬜️⬜️⬜️⬜️⬜️ 🍕 Debate AI on whether pineapple belongs on pizza (0)
🟨⬜️⬜️⬜️⬜️⬜️ 👨‍👨‍👧‍👧 Streamline recruitment and HR processes (7%)
⬜️⬜️⬜️⬜️⬜️⬜️ 🤡 See if AI can tell jokes better than we can (0)
🟨🟨🟨🟨⬜️⬜️ 🎨 Write stuff and draw pretty pictures (20%)
🟩🟩🟩🟩🟩🟩 🚀 Automate social media posting (27%)
⬜️⬜️⬜️⬜️⬜️⬜️ 🤨 What on earth would I use an AI for? (0)

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