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Startup Series: Reimagining EVs in Kenya with Mazi Mobility
Today's guest is Jesse Forrester, Founder and CEO of Mazi Mobility.
Mazi Mobility is a Kenyan Mobility as a Service (MaaS) company that is re-thinking mobility through the implementation of an electric vehicle ecosystem in Africa. Mazi assembles and sells electric two and three-wheelers while building and operating the EV charging infrastructure to support these vehicles. A Kenyan award-winning entrepreneur and visionary, Jesse believes in the confluence of impact and profit. He is a former Zayed Sustainability Prize winner and has been involved with social enterprises for the last 6 years, touching on the food, water, and energy nexus.
We were excited for this one because while the MCJ podcast focus has primarily been in the Western world, developing nations are just as important. Transportation in countries like Kenya will be critical in terms of emissions and Mazi is trying to bring about positive change. We learned a lot from this one and are so grateful that Jesse was willing to share his story. Enjoy the show!
As always, please consider giving us a rating or leaving a review. We appreciate your help in spreading the word and engaging more folks in the climate fight!
Jason Jacobs: Jesse, welcome MCJ.
Jesse Forrester: Thank you, Jason. Good to be here.
Jason Jacobs: Great to have you. Uh, as we chatted, uh, a little bit before we started recording, we had another company in the, in the same broader space, BasiGo, on recently, but this is such an important area and it's so new to me, and you guys have a different approach with a different customer-focus, with different vehicles and, and potentially some other tweaks to the model as well, and I figured it couldn't hurt just to learn more about this important area and just to get to know you better as well since we have a bunch of points of commonality.
Jesse Forrester: Yes, Jason, I think I just had a podcast with Jit and Moxxie, so I thought was really interesting. And I like there's more of a focus around developing markets and what's happening in terms of the people who are attempting climate in those places. So...
Jason Jacobs: Yeah, I feel like I need this disclaimer when I talk to people that we... It's not been exclusive, but it's been pretty heavy US focus on MCJ over the last couple of years that we've been doing this. And that's not by any stretch because we believe that the US is a more important lever for change. In fact, given how developed it is and how much development is left to do in other parts of the world, the US and other Western nations arguably are less of a lever for change. It's more just been that we've had such a tiny team and there's so much ground to cover, it almost doesn't matter where we start. But directionally, we absolutely aspire to get more global over time. So thank you for helping us take one more small step closer towards doing so.
Jesse Forrester: I think that's fine. And, um, as you mentioned, there's a lot of opportunity here on the continent, specifically because we are going to be disproportionately affected by climate change. Um, so having stories come out of here and, uh, MCJ also expanding their focus is cool. Yeah, I'm happy to shed light in whatever ways possible and provide another perspective.
Jason Jacobs: Well, taking things from the top as we typically do, what's Mazi Mobility?
Jesse Forrester: Mazi Mobility is a, a mobility-as-a-service company based in Nairobi, Kenya. We assemble and sell electric motorcycles, as well as build and operate the infrastructure that supports that. We started in April of 2021, became operational then, so it's almost been a year and one month, and, uh, pushing forward in making sure that we can have more electric motorcycles on the road.
Jason Jacobs: Now, what's the origin story f-... uh, for the company? How did it come about and why did it come about?
Jesse Forrester: So I was living in South Africa in 2018, and I have a background in entrepreneurship and economics, and I really wanted to do something back in Kenya. I was focused on, on building a business. I just didn't know what business. And so, I was walking around in Nairobi and passed by Nairobi [inaudible 00:05:59]... I don't know if you've been to Nairobi, Jason. It's very, you know, crowded with lots of, uh, matatus... I think, uh, the audience knows what matatus are... uh, moving around Nairobi, and one just crossed my path. I got a lot of smoke in my face. And this was really upsetting to me because I just kept thinking, "Well, can we not figure out a way to make sure that this doesn't happen?"
And previously, I'd done a lot research on transportation and coordinated infrastructure development in the continent and just seen that that had really never happened and since... well, forever. After kind of complaining to myself for five minutes, I thought, "Hey, wouldn't it be interesting if we were going to electrify matatus?" So, Mazi initially started [laughs] electric matatu business, which is interesting 'cause BasiGo's on here. And then through the pandemic, we had a bit of a tactical shift towards motorcycles, because motorcycles are the fastest growing vehicle segment on the continent, growing about 15% CAGR, and there over 250,000 of them in Kenya registered every single year. That number is going up to 300,000 and they are absolutely necessary for movement in a city and in East Africa. They're estimated to be about 1.6 million and, and support about 5.2 million households of people directly and indirectly, so it's a big, big, uh, segment of the market.
And my why is simply because as a person I've always been drawn to climate or impact-based businesses and solutions. Previously to Mazi, I was working for a waste management company. I also built a waste management treatment facility here in Johannesburg, uh, Living Machine. Cycle and recycle wastewater from the school's campus, school's kitchen, and then the reusing, growing vegetables, et cetera. So it was very much circular economy. So for me, it's very at the core of what I do, um, and the core of who I am.
Jason Jacobs: And I'd love to unpack that shift from matatus to motorcycles a little more. So what was it that convinced you that motorcycles were a better place to focus?
Jesse Forrester: We were doing matatus... So we kind of started doing Mazi around March 2020, the idea came around, and then COVID happened. When COVID happened, investors and such like people were saying, "Hey, we're focusing on our portfolio companies," and I started talking to more policy influencers, so people who work in the National Transport Safety Authority in Kenya, talking to the Kenya Revenue Authority. And the idea at the time was do a matatu conversion and then have them run on the road. And so, there were issues from a vehicle stability standpoint and also from a customer standpoint in terms of owning the matatu and who would bear the cost of a converted matatu because the chassis would still be an old one. So enough... A couple of question marks that came about from a policy side, regulation side, and also from a customer's point of view that then made me think, "Hmm, this might be a bit more of a tall order to pull off," especially because we had such little [inaudible 00:08:42] capital in the beginning. And I was really trying to get, um, something off the ground with a really strong MVP that could showcase this is a viable solution, [inaudible 00:08:50] it's a viable solution on the continent.
And so, when I started sharing a little bit a... more about motorcycles and thinking, "Hmm, it's not too, too big of a shift from matatus," but also lowest hanging fruit and has the most impact, uh, just because of how many there are, and how many people they support directly, and just how big the vehicle segment is growing. So when I looked at those factors, it almost became a no brainer to me that I... a switch from matatus to motorcycles was needed. Also you'll see the price parity of a new electric motorcycle and a new petrolized motorcycle is not that far apart. So this was the most likely solution to take off based on where we were, based on where the world was, and something that we could then push and have a solution come out into market. So, a bunch of different factors really pushed me towards that direction. One year later, here we are.
Jason Jacobs: And when you talk about solution, when you looked at the rise of electric motorcycles in Kenya, what problem or problems did you see?
Jesse Forrester: Motorcycles on the road for 10 plus hours a day. And unlike here... I'm now sitting in, in South Africa where you have your Harley Davidson that's, you know, more of your personal motorcycle, really loud... In Kenya they're used for commercial, uh, work. So this is, you know, carrying people, carrying food, carrying parcels. Very much... You know, really pounding the pavement. And when you look at that from an operational standpoint, optic standpoint, petrol was really a big cost to these, uh, motorcycle owners despite how much they were making. And so, this became a real sticking point amongst most of the motorcycle drivers I spoke to. And then when it comes to maintenance, they had to spend about $10 to $15 every... say, every two weeks on engine oil, which might sound like a small cost, but to them is, is really, really sizable.
Um, and so when you looked at it from an operational standpoint and said, "The inefficiencies of a petrol-driven, uh, motorcycle compared to the efficiencies of an electric-driven motorcycle and the differences in the price of energy and the price of petrol, it made a lot more sense as a viable business, but also something that would speak to the economics of the consumer, which is the most important thing to them when it comes towards switching to electric." Now, the other effects that were more interesting is air pollution affects, uh, one million people in developing markets. And if you're on the road inhaling fumes all the time for about, like, 10 hours, six days a week, it becomes such a problem. And the vibrations of the electric... of the, uh, ICE bike also was so hard for the motorcycle riders to, to bear. So these different factors from a social standpoint was something that we said we could help them, but then would also be paired with a economic in- incentive to really make sure that it would work out.
Jason Jacobs: When you looked at the electric motorcycles, you talked about the 250,000 that are getting registered every year. You talk about the problems with petrol or the advantages of electric, but what were the issues in electric that you spotted and set out to address?
Jesse Forrester: Electric motorcycles are great, but when you buy one, the first thing you think about is, "Where am I gonna charge my motorcycle? Um , where am I going to find the infrastructure necessary?" And this, after the cost of the motorcycle, which can be bridged with [inaudible 00:12:06] financing, is the second biggest sticking point to preventing the mass adoption of these electric bikes. Mazi as a company saw that as a real interesting opportunity, not only to deliver value, but to capture value as a business. And we started out by developing our own swapping stations where we own the IP, and they work in a way that a motorcycle rider who buys a Mazi motorcycle is able to look at an application, mobile app, and know exactly how much battery charge is left in the battery on a motorcycle, where the next swapping station is going to be, um, and what percentage of the batteries are in those photo site... in the... in those swapping stations and be routed to a swapping station and book a battery that... so they can do a, a swap in under a minute.
And what you see is because they're on the road so frequently, you don't have time to charge your motorcycle for eight hours or six hours, and the sophistication due to the size of the batteries on motorcycles is not that high. Though, you know, doing a, a DC fast charging, for example, is really tricky when you look at a motorcycle as opposed to a car. You know, we were building on an ecosystem that allows the riders to know where the swapping station would be, to access a battery without having to get to a swapping station and not find one, and also to actively monitor the amount of charge they have left so that they plan their trip. We've also had to make some m- modifications to our motorcycle, making sure that it's a dual battery bike, just to have that peace of mind and security for the rider to then be able to go about his or her day without having to worry about my battery running out. When they switch to the second battery source of power, they then know, "I can go into swapping station and do a quick swap and [inaudible 00:13:44] for the day."
Jason Jacobs: So it sounds like when you looked at the landscape that both the lack of robust infrastructure was one issue, and also being able to leverage that infrastructure efficiently and manage your trip planning to make sure that you aren't having to stop every 10 minutes, but also aren't running out of charge either. That by combining the bike and the charging infrastructure and then layering a digital platform on top, you can provide an experience that is more efficient and reliable for customers.
Jesse Forrester: Absolutely. And this really speaks to how they, they work, right? If you are a food delivery company, you wanna do under 30 minutes delivery on this dinner, okay? We not yet hit a 10, a 10 minute delivery, um, sort of, like, startups. And so getting there, if you have a motorcycle that just terminates or doesn't have enough charge becomes a big problem for that company, but also for the rider 'cause they're paid on a per trip basis. So this naturally has a lot of hesitation if the infrastructure is not deployed, and no, we're still in early days of deploying infrastructure. But we're seeing this peace of mind application that we're learning and we're building, ensuring the drivers are able to, you know, quickly access a battery and not have that fear, um, when it comes to range anxiety.
Jason Jacobs: What type of customer are you focused on?
Jesse Forrester: So we've got two different customer focuses. So the lowest hanging fruit is the B2B side of the market. So these are delivery companies that own fleets of motorcycles, and then do food delivery, personal delivery, uh, ride hailing. And then, you've also got the individual. So these are boda boda riders who are individual riders that then are part these platforms and move people, goods, and what have you. These are kind of the two big customer segments. The biggest one of... is definitely B2C side, um, of the individual customers, and I think they comprise more than 95% of the market and are really the ones we are targeting in the medium to long term.
Jason Jacobs: When they ride electric motorcycles today, how are they primarily doing so? Is it by buying the motorcycle directly or are they getting it through a service like a Mazi?
Jesse Forrester: How they're riding the motorcycle today is from Mazi's standpoint they're buying from us directly. We're thinking about doing a distribution model where you, you have a franchise or you have a, a distributor that's then able to have consumers come in and buy motorcycles. So what you'll see is with motorcycles in particular, a lot of them are financed. Having that financing arm attached to a distributor, that infrastructure already exists for petrol bikes. And so what happens if it's you, Jason, you wanna buy a motorcycle, you'd walk in, pay a certain deposit, about $150, and then pay maybe 4.5, uh, USD per day for 30 days for about 12 to 18 months or 24 months, and then get your motorcycle. Um, so you're able to start working right away. And the same model we've chosen at Mazi, and initially now because they're not so many motorcycles, we're doing it ourselves, but then think that there's long-term utility in ensuring there's a distribution model that can serve customers at the point in which they are.
Jason Jacobs: If Mazi didn't exist, how are... The, the bikes or the motorcycles that people are riding today, are, are they getting them largely through those distributors?
Jesse Forrester: Yes. Largely through those distributors.
Jason Jacobs: And so, are you positioning yourself as a better bike? Or what- what's the value proposition that you are presenting to customers? And relatedly, are you looking to displace other motorcycles that customers own or are you looking to convert people that have never owned one before?
Jesse Forrester: If Mazi were not around, people would still buy it through a distributorship because most of the petrol bikes now, the headquarters are in India and China, and then the bikes are brought here and assembled, and then go through distributorships. And from a bike standpoint, as a better bike, what we believe at Mazi is that motorcycles will be commoditized and the real value to the customer, and we've seen this, is there's a certain price ceiling, um, but then customers just can't afford it. It just doesn't make sense with the mass market to buy a, a more fancy bike.
Um, and so, what we're looking at is getting a bike that is fit for market, but matches exactly the needs consumers w- want and in a price range that they can afford. And this is, uh, what you'd see at sub-1400, uh, US, uh, 1500 US dollars. And so, the value prop that we give con-... customers is based on the savings that they're making from switching to electric, and the fact that once they do, we are able to completely manage, um, infrastructure for them so that they have no downtime. So the economics is what's really pulling consumers into, into the space and what we are competing on is having the best network, uh, that can serve these customers when they do make the switch. Because, uh, once it's, it's cheaper to operate, then customers are drawn in, and then from that point in time, you have the scenario where, "Can I actually manage my battery? Can I swap? Can I do X, Y, and Z?" And, uh, that's where Mazi is, is really operating.
Jason Jacobs: So the other motorcycle manufacturers that are electric, how does charging work with them? Are they doing it themselves like you are and is it, is it in a proprietary way? What does the public infrastructure look like for charging? I'm just trying to get a sense of the, the charging landscape overall and the strategies on a bike-specific standpoint.
Jesse Forrester: Um, what you're seeing is there's no real, real public infrastructure for charging, uh, motorcycles. Um, and in the market what you see is the different form factors that exist now of batteries. Um, and so... And different voltages, et cetera, so this makes it really challenging when it comes down to having maybe unified, uh, swapping or unified, uh, charging infrastructure, and what you see is people are doing it themselves. And there are different approaches towards charging. There is charge points where a rider drops off a battery and it's plugged in and it's being charged. And then there are two forms of swapping. So there's container-based swapping where you have a 20, 40 foot container, um, somewhere on the side of the road or at a petrol station, and usually this is for heavier battery, about 40 kgs, that then is plugged in and charged, usually have an attendant there.
And then there is cabinet-based swapping, which is what Mazi is going for. That's OpEx-light and you have your 1021 battery swapping station cabinet where the rider is then able to do a self-service swap and be ready to go still with the same amount of time. And so for different reasons, the market is choosing, you know, charge points, it's choosing cabinets, it's choosing, uh, container. There's a consensus that cabinet-based swapping is ideal. I think the tricky bit is how do you have a customer swap a battery that's 40 kgs? Uh, it's, uh, it's pretty heavy. And so, we, we sit at the 18 kg mark which then makes it a bit simpler for a consumer to then put in a swapping sta-... to put a battery into a swapping station. And then there's also more analytics you can collect when you have a cabinet based on, you know, how many batteries are charging at one point, how many times have they been swapped, et cetera, all kind of, like, automatically.
This is kind of what, what looks it like on the landscape. We don't have a major, uh, you know, like, electric motorcycle to, uh, e- enter into the market right now because it's... from country to country, it would be different. Um, and also, again, you just can't deploy motorcycles, you'd have to also deploy infrastructure to support them. Um, and so, our positioning as a company is to be that battery-fueling business, um, that's able to support our batteries, but then maybe one or two more batteries at scale, to then have an intelligent system plugged into the battery and plugged into the bike that allows us to manage 1000s of assets without downtime or without compromising service delivery to the consumer.
Jason Jacobs: Uh-huh. And when you think about... And th- this is not a Mazi-specific question, but when you think about the transportation landscape and the, the ways that people get around throughout cities in Kenya, what does that look like today? And is your bet that that breakdown will remain the same directionally but just with cleaner inputs? So for example, with electric motorcycles instead of regular motorcycles, but the motorcycle percentage stays the same? Or do you have a view on how the transportation landscape overall should and will evolve?
Jesse Forrester: I think the question is more... First of all, the question is, you know, how would the infrastructure from a government perspective come about? So I think motorcycles was a answer to the gridlock in Nairobi. I think, you know, even though it's incredible traffic, um, [laughs], the hours you can spend on the road, and when you need to get somewhere quickly, use a motorcycle. Now I think that as more people [inaudible 00:22:37] and grow and more people get in the city, there has to be more strain on road infrastructure and people will then need to still move things faster. So I think the growth of motorcycles will increase as a percentage for transportation of people, but we're also going to have to see more safer motorcycles come on board. Because the biggest thing that's holding people back from then individuals for owning a motorcycle in a personal capacity and not in a commercial business sense is the safety aspect of a motorcycle on Kenyan roads.
Um, and I think as this is beginning to change, because you can have a little bit more inputs with an electric motorcycle, not any specific, you can make it a little bit safer, uh, and we think that maybe more people will then begin to switch towards, um, a motorcycle as a mode of transportation. But I still think there's an opportunity or still a space for, um, buses, for matatus. There's a mixed mode of modal transport that's still arriving. And the government in Kenya, for example, is trying to phase out these 14-seater vans and move towards bigger buses, uh, which would then move more people. But fundamentally, um, we had this scenario, uh, where motorcycles were banned for about two or three days and almost all business in Nairobi came to a standstill. And it's not an exaggeration because when you need a parcel delivered, who do you call? Your motorcycle rider. When you need food brought to your house, who do you call? Your motorcycle rider. When you're late to a meeting, um, and you need to get there in 30 minutes, who do you call? Your motorcycle rider. So these scenarios are just going to keep happening the more people flood into Nairobi and more people flood into urban cities across the continent. And I think this is some of the indicators why it's growing the way it's growing.
Jason Jacobs: When you talk about safety as a barrier, and I guess this is not a climate-specific question, but it is a climate-specific question if it's actually inhibiting adoption, how do you make electric motorcycles safer?
Jesse Forrester: Mazi's approach is we're working with AI, a company that looks at [inaudible 00:24:31] matrix of the motorcycle rider and it comes up with a scoring system. So acceleration, braking, uh, a bunch of these factors, um, because there's a big percentage of these accidents that are caused by the rider themselves and I think it makes sense. If you're trying to make as many deliveries, as many trips as you can in a day, you're not gonna drive in the safest way possible. So what we're trying to do is pair an incentive to have maybe cheaper insurance or better financing with a safer mode of transportation that then has the rider thinking, "I don't, I don't need to go above a certain limit, or if I'm moving this way..." and they can actually see on a specific platform how their score changes from time to time. Um, and we think that this would be one solution. We're not saying this is, like, the way that's gonna make mo- motorcycles safe, you know, completely, but that behavioral change or that incentivization or behavioral change from the personal rider perspective is going to help make motorcycles just a little bit safer from a rider perspective.
Because what you see is... For example, you've got a red light in Nairobi. Motorcycle does not stop at the red light. Um, I was very, um, im- impressed when I went to Rwanda and I was in Kigali and motorcycles were parked [laughs] at, at a red light. In Nairobi, they just kind of zoom past you, uh, and when you're on the back of one and you're late, you think, "That's great." When you're in a car you think, "Oh, man, this is really terrible. This guy's..." That really tends to be the case. And what we're trying to do is say, "Hey, can we narrow this as a potential opportunity to have, you know, impact-based investors and people to then say, 'Hey, we could actually have cheaper financing for motorcycles if you're a better rider'?" Or you could have, uh, better insurance if you're a better rider. Uh, better premiums if you're a better rider. Uh, if you s-... If you ride safer through this particular ma- matrix, and that's much easier to track on an electric motorcycle because you don't have vibrations, which then influence, you know, collection of acceleration, acceleration data, um, telemetry data. Then they could just... Then the data is more... has more fidelity than what you would see with a petrol motorcycle. So that's one way we're thinking about it.
Jason Jacobs: Well, where are you now as a company in terms of taking these motorcycles to market?
Jesse Forrester: We did uh, uh, MP testing last year, which was great. We were running 10, and then now have partnered with, uh, SmartAsset financing company to bring in, uh, 50 more. Wh-... And we've... We're then now looking at scaling that number to about 1000 or about 1000 by the end of year, hopefully three or 5000 by the end of 2023. Uh, and so, this is still a small percentage of the market, as I mentioned, 250,000 bikes. But we also know that it's very important to walk before you can run, because as you think about selling motorcycles, which is proven that that can be done, I think you also have to be very cognizant of how you then deploy infrastructure in a capital-efficient way to be able to meet that growth of motorcycle demand.
And so, this is kind of where we are now in terms of saying deploying motorcycles, pushing them out, as well as then putting infrastructure. We have about... We're deploying about 10 more batches of [inaudible 00:27:25] across Nairobi in the course of this year, and have the third largest fleet, I think, in East Africa to the best of my knowledge. So, things are really starting to get excited. Obviously, we've been slowed down by COVID in, in China, as everyone else has, and just the absence of, of lithium ion batteries, which is just such a challenge to the business. But still lots of prospects for growth, not only in Kenya but also outside Kenya, um, and people are really excited about having a full-stack solution. If you're a financing company, you want someone who's gonna manage the bikes and [laughs] infrastructure and you just finance what you need to finance. And the same thing, but in your business, uh, you wanna focus on your core business, but make sure that it's green and make sure that it's cheaper to operate.
Jason Jacobs: Can you talk a bit about both how the company has been financed today, but also how you anticipate it will be fi- financed directionally, both in terms of the capital intensity but also what types of capital will be the best fit?
Jesse Forrester: We've only had non-dilutive forms of financing. So we bootstrapped, uh, the last year and then just recently got revenue-based financing from the Untapped Global, which is based in San Francisco, and we are now raising our equity round, so we think that there is one or two more equity rounds. But then the rest of the CapEx financing would then sit, um, at a sample of loan or debt, um, financing to the business. Because what you see is once you import or assemble the... your electric motorbikes, most of them are then financed through, uh, SmartAsset financing companies or asset-financing companies, um, then take the, the bikes off balance sheets.
And so, these people then tend to manage a book of, you know, nearly 100,000 customers, et cetera, um, so that becomes a really interesting way of then shifting motorcycles from an assembly plant into consumers hands. And we think that this might then have Mazi look a lot at working capital needs in the medium to long term, uh, to then be able to just bring in the units that we need and the assembly that we need, and then push those, those motorcycles out. That then becomes a really interesting baseline for revenue growth, right? Because if you're then financing with CapEx, um, and have already marketed with some customers already willing to take up the bike, then it becomes a really interesting equation when it comes to selling motorcycles. And so, that's ideally how the financing with the bikes will be done. For the swapping stations that we own, we think it will still be some form, you know, of debt CapEx financing, um, and we're looking at really interesting models that are coming up for financing within the continent, uh, that then really speak to the nature of business here. We don't just... You know, your traditional debt, you look at venture debt, mezzanine financing, et cetera that prove, like, as interesting models for financing.
Jason Jacobs: How important is government in this whole equation? And that could be in terms of incentives, that could be in terms of future policy. How much do you think about and/or resource to government and government relations now and directionally?
Jesse Forrester: I think about them all the time. [laughs]. Um, I think it's one of those industries where you, you have to speak to government. And I think... You know, it was the same with fintech... Um, regulations when it comes to a motorcycle or a [inaudible 00:30:35], we've seen a lot of push and a lot [laughs] of, like, adoption from government. So I sit on the KEBS Technical Committee of s-... of Standards and we're coming up with standards for battery swapping, um, for motorcycles, for safety of, of batteries. And then there's also talk in... from the National Treasury to come up with a policy for e-Mobility in a government that's soon to form in Kenya. So we're seeing a lot of push from different government bodies and ministries and institutions that are really getting behind this as an avenue towards making the city or making the country... You know, we always use the buzz- buzzword leapfrogging [laughs]. So to leapfrog... Allow me to use that... dirty form of transport towards something that's clean.
I want to say that we've, we've pushed as an industry, we've had lots of support from the international community as well, um, to then get government in a place that's oriented, but now they're listening. And we are potentially going to have the first safety standards developed in Kenya, on the continent, and then have that push to East Africa and potentially Africa, as then we'll craft policy that's really required and harmonized across the continent. So government is, is crucial, and at least in our case, they are paying attention and they are willing to move the needle for e-Mobility.
Jason Jacobs: There are some narratives that say that, that climate change and worrying about the existential threat of climate change is a privilege because it means that you probably don't have near term considerations, like how to put food on the table and shelter over your head, and, and things like that. On the other hand, there's narratives that talk about how the wealthiest people and nations are the biggest contributors to the problem, yet the poorest people and nations are much smaller contributors, but will bear the brunt of the symptoms of climate change at, at, at least as they first come to bear. Given that, it'd be interesting to hear from you how much people in Kenya care about climate change, and how much they worry about it, how much it's on their minds, what is the... what is their perception about the problem and how big a threat it poses, uh, t- to them.
Jesse Forrester: I think there's an emergent awareness, um, amongst people about climate change. Um, and so, I would split it into if you're talking about my customers, whatever it is, really care more about the economics. And so, I wanna say if petrol bikes were more efficient than electric bikes, then petrol bikes would be a mainstay technology, despite the fact that they're so terrible. But from... As you said, I think it's, it's more of a privilege because when you think of people and they're in the middle class and, and, and growing and, and, and, you know, like, uh, the rich, the rich you have this awareness of climate change. And I think now as the narrative gets pushed and people start to think, "Wow, you know, air pollution is such a big deal," I'm hearing some discourse from motorcycle riders saying, "I'm gonna buy a motorcycle because it, it saves me money, but also because I want to breathe better," which is something that's really emergent, but again, it's an education.
I think it's not that they don't care. I think it's just they don't know and they don't... just don't know how beneficial it will be to their health in the long term. And this is, this is kind of like a, a point where we or people who do have an understanding of climate need to educate motorcycle riders, and Mazi tries to do that, and I think there other people in the industry as well... You know, they publish articles and videos et cetera on, on effects of climate change and how it's going to help them become better workers for a longer period of time so their families stick around longer, um, which is then also beginning to shift perceptions on that particular topic.
But as you said, Western or developed countries do contribute a lot more than the continent, and you probably mostly see climate adaptation strategies as solutions here as opposed to climate mitigation strategies, which we're doing with electric mo- mobility. 'Cause we just think that transport is such an integral part to development of any other sector that it just needs to happen, uh, from this particular perspective. So initially, you know, in... back in 2019, I would have told you, "No, there's, like, no way, you know, riders are thinking about climate," but this is beginning to shift. And as more motorcycles actually come in and there's more visibility, then we're seeing more consumers starting to care, more of our customers starting to care that they're driving an electric bike, and even a sense of pride where people say, "Oh, we really like that we have an [laughs] electric motorcycle because we are contributing to making sure Nairobi's cleaner."
Jason Jacobs: Jesse, there are some that argue that there's no bigger, more existential issue than climate change and if we don't address that, then nothing else matters. There's other people that say, "Well, actually, look, climate change is a big issue, but energy poverty is as big or maybe bigger. I mean, there's still a billion plus people that don't have access to basic electricity that, that you and I take for granted and that is a more pressing issue than climate change." How do you think about that?
Jesse Forrester: I think climate change underpins a lot of the problems. You know, when you're talking about energy poverty, when you talk about, um, food insecurity, when you talk about water insecurity, climate change completely covers, and in many cases, will exacerbate the issues that are already present on the continent. And I think that it's not wise to think about them as mutually exclusive, that these problems are then, you know, independent and we need to focus on, on one more than the other.
Climate change does tie into poverty. I think... You know, I'm here in, uh, South Africa and the minute I, I, I got to Johannesburg there was load shedding, which means, you know, the power just went off. And this has been happening here, right? In one of the most developed, uh, countries on the continent. And so, you know, when you, when you look at how energy is distributed or is made with hydro, et cetera, then distribution of power is absolutely key. But then if you don't have food, you're not gonna think about power as a human being. I think, you know, you've got food, water, shelter as basic needs and that's really affected by climate change.
And even when we speak towards more urban areas where we're operating, it's absolutely crucial for us to take climate change into consideration because we just know it's gonna get harder and harder for our consumers to move and, and to operate. And if there's more problems with health when it comes to air pollution and stuff like that, it's just not gonna work. So for me, how I think about it is climate change really underpins most of the problems we're facing [laughs] and it's only gonna make that worse. And we don't have to silo ourselves into, "Oh, you know, I'm climate change, I'm gonna reduce poverty," but what is the bridge that exists and how can we then figure out a way that then connects both? And what we're doing, I think, speaks a little bit to that.
Jason Jacobs: Where does justice fit into all this? And what I mean... I mean, you could take that many different ways, but what I'm thinking about is the Western nations and the Industrial Revolution and the externalities weren't factored in at all. And, you know, the quality of life that we in the West have enjoyed has put a big toll on the planet and put us out of balance with the planet that we rely on to sustain life. And then in more developing countries that haven't had the chance to enjoy that quality of life, just when they finally start to get a taste of it and they want it very bad, right? And then we're gonna come along and say, "Well, you can't do it because, you know, that'll be a big source of emissions and it'll knock the planet out, out even further out of balance, and there's already an emergency," right? And so, should the restrictions be the same across all as-... all corners of the world? Or is it fair that the developed countries play a bigger role in cleaning things up? How, how do you think about that?
Jesse Forrester: Incredible question, uh, Jason, because that's a sentiment that's really shared by many in the energy-managed spaces, uh, but also by a lot of on-the-ground Kenyans and Africans. Um, I'll give you an example. Mozambique just discovered natural gas off the shore, and you could say natural gas would be cleaner, but when it comes to exploitation of that, then you... it kind of... people then, you know, lean towards this is a global agenda towards to keep Africans poor, or, or doesn't wanna have Africans be able to exploit the natural resources. And to a big extent when, when we speak about justice... And you're right, I mean, the continent contributes, what? 3% total to global emissions, I think. As a conflicting point, as, as a person who does believe in climate change, I see, I see the necessity, but also understanding the very [laughs] fundamental problems at face and, and how fossil fuels have enabled development at an incredible scale.
And so for me, there's no really easy answer there. I think that there needs to be a s-... a transition. I don't think it's gonna be, "Hey, guys. Completely switch, move from this particular area." Kenya is lucky. We have a nice [laughs] 2% Clean Grid that is geothermal, but that's not the same case for the rest of the continent, and it almost seems that we're... there's a bit of a punishment, uh, especially when you can, like, amount of financing that's going into this particular industry, green financing, and saying, you know, anything that's not shouldn't be financed.
And when you think about it from this perspective... I spoke to someone who wa-... works in oil and gas and he said, "It's our right to exploit these resources. We've not had that opportunity." And so, I think that there is a space for that. I think if developed countries can get down their own emissions to a certain point and the continent can have a little bit of a space to build resiliency as we then think about transitioning, 'cause I think that transition still needs to happen. But expecting a complete shift when you don't have the right... As you said, there's a lot of energy poverty, um, there's the lack of infrastructure, et cetera, I think is a little bit kind of sitting on a high horse and not really being in touch with the realities of a billion people that really need this particular dirty and... And you're right. It's a tough question. But I think it- it's something that people debate all the time and then say, "Oh, yeah, yeah. You know, climate change," blah, blah, blah. But we know where our capital comes from and how capital is allocated, and so that becomes a, a challenging prospect as well for people to then exploit resources. So...
Jason Jacobs: When you see these climate scientists on places like Twitter or wherever else they can get a megaphone that are saying like... Essentially, trying to, like, shake us all by the shirt collar and say like, "You need to wake up!" Like, "I've been screaming for 20 years and nobody's listening to me and we all need to wake up. There... You know, revolution," right? Um, but you're talking about how something is petrol-powered but 10 bucks cheaper, right? Then, then people are gonna go with the, with the petrol-powered. A- And so, my question for you is, yes, we need to bring about change, yes, it needs to happen aggressively, but how productive is it, uh, and how important is it to try to win the hearts and minds of the masses in terms of the, the existential problem of climate change versus just swapping out the infrastructure under the hood invisibly and letting them go about their daily lives?
Jesse Forrester: I think it's, uh, both a shorter and, and, and long-term question. I think swapping out [laughs] infrastructure, as you said, under the hood is the lowest hanging fruit, right? Speaking to economics, speaking to... Because lots of people, I think, in Kenya and on the continent are very much, "Show me, I'll believe you," right? And where something affects them directly. 'Cause that's why we say when you have more electric motorcycles, then more trust is developed. Because, you know, when, when we talk about, like, crypto, for example, and, and online checking, that wasn't a thing that happened until, you know, COVID, and you're see now people on, on the continent really adopting crypto because that pushed people to think about more, you know, secure checkout, whatever, banks did stuff online. There's a lot of hesitancy on moving that particular direction, and I think the same case when it comes to climate change.
I think that the narrative has... A few people would have said, "Yeah, I've heard about it, but it doesn't really affect me so I'm not [laughs] gonna care about it." Like, that's a, a Western problem, right? That's, that's a problem that's affecting in, in the West. You can't really think about that from a consumer standpoint or consumers thinking about that directly. Some do, as I mentioned, it's coming up now, but majority still think about economics. So I think in the short term, yes, swap out the technology under the hood, but that doesn't mean that we don't tell people about climate change. We don't say what's the solution. And it's not just about saying, "Hey, climate change is bad, i- it's happening and, and, and it's [inaudible 00:42:48] threat and it's gonna kill humanity, but what's an alternative? Because if you're gonna say that and you're gonna tell me stop doing this, you have to... you better [laughs] give me something that's not only as good or better than what I was using that's gonna make my life similar or in a better state of quality of life."
And I think that's where, uh, climate activists sometimes fall short in terms of saying, "You know, what's the alternative? What can this person do, what can these millions of people do that will then be cleaner, but then affect them?" And you see this with, with, with cooking stores where, you know, you got briquettes now, so there are lots of examples of technologies that are emerging that then speak to climate change, but also solve a very fundamental problem. And I think when you [inaudible 00:43:27] those two together, you have a really win... you have an interesting formula that then speaks to not only the economics, average African person, average Kenyan person, but also to their hearts. And I think if you're thinking about creating climate justice, that is absolutely required. You need people to think about it in a way that affects them directly. But the way that's gonna happen is once they see that [laughs] as an affect... as an effect to their lives, not some abstract thinking of saying, "Oh, you know, climate change is bad." Uh, it's, it's [inaudible 00:43:55], because when that happens ab-... maybe a bit too late [laughs]. But this is the challenge you're facing, and making it real to people is potentially one of the biggest ways to then drive adoption.
Jason Jacobs: You, you mentioned crypto. I mean, is, is it... Is that something that is being talked about and utilized much in Kenya?
Jesse Forrester: Yeah, but not, not specifically for, you know, direct payments. Like, we wouldn't sell a bike and get paid in crypto, for example, or you then buy tomatoes from a lady's house on the side of the street with crypto. But there is an imagined culture, um, of crypto being used and, and then as a democratizing tool in Kenya, but nothing really on a, on a massive scale.
Jason Jacobs: There's certainly some segments of the climate community that highlight the energy intensity of crypto and say, "Look, it has... It might have other uses, not that we can see. Uh, we just see a bunch of, like, Ponzi schemers and, and get, get rich quick people." But even if it did, which it doesn't, look at the energy footprint. I mean, you are climate motivated and building a business that is trying to accelerate the clean energy transition, how do you think about crypto?
Jesse Forrester: So I think the use case for crypto was really, really powerful with re- remittances. You've got a lot of African diaspora that are sending money back home. And I don't know if you've ever sent money to a continent, Jason, uh, but it's really tricky [laughs]. Um, and so you've, you've got, like, i- imagined, uh, fintechs that are, are working on this problem. But, uh, before ATMs, gas fees are so high, you could quickly just send money to someone and, you know, boom, it's in your pocket. No government, no waiting at, you know, whatever, uh, Western Union. You just get your cash and you're ready to go.
And I think that was really, really interesting and that's why you see it's one of the biggest things in Nigeria as a use case. And the problem... The, the payment infrastructure, um, and the way people live, uh, crypto really enabled that, right? People... Crypto really solves a financial problem when it comes to remittances and permission securities, a lot of opportunity, um, o- on the blockchain, but also crypto as a, as a whole that can help.
Now, when you speak about, about that from an energy perspective, I think that crypto isn't particularly the only way that we could do this. I think it's the easiest now and potentially has a lot of, like, fanboys and, and people that really love it. You know, I, I have a crypto account, [inaudible 00:46:18], et cetera, but when we speak about it from, again, an adoption point of view and an energy point of view, those data [inaudible 00:46:25] are not present on the continent, right? Most of them are outside and, and, and admissions really are, are producing in that particular area. I don't see it as an... Especially when speaking reflectively back into, into Africa, I don't see it as a, like, [inaudible 00:46:38] problem, but I do think that you got power users in Nigeria. I think there was a stat that I could be misquoting here, but outside China, et cetera, Nigeria was one of the largest people... crypto users in the world. Um, and so I think that for us it solves a fundamental problem.
And, yeah, I think people are gonna use what makes sense to them financially first before they think about energy, before they think about climate, before they think about anything else. Because you don't need to say, "Hey, Auntie has sent me 200 bucks. I've gotten it in three, in three sec-... in three minutes and I'm able to continue living my life," right? You're not gonna think, "Oh, you know, what is the intensity of energy," et cetera, et cetera. So from a purely practical standpoint, you're going to be able to do a lot more with crypto. Um, is that energy intensive? Yes. But is that the only option that we could do? No. So I think there's a, there's a avenue that doesn't really use crypto, but right now there's a lot of adoption, and I, I think i- it's probably gonna be here to stay.
Jason Jacobs: Coming back around to Mazi, if you look at the challenge in front of you and the factors that are outside of your control, if you could change one thing to most accelerate your progress that is not something that you control, what would you change and how would you change it?
Jesse Forrester: I would, I would source motorcycles locally [laughs]. I'd been able to, to bridge my supply chain gap, because I think that's where the real challenge is, uh, in terms of just getting units into the country. And if I, if I, if I could cheat a little bit and, and say two things, I would also ensure that the government takes out VAT and, and takes out particular taxes and gives incentives for electric vehicles in Kenya with us from a [inaudible 00:48:22] perspective of electricity charging, especially in addition, tax rebates or, or b- benefits, um, and just accelerate electric motorcycles. I think if I could control that, that... I think that's something that would really push the needle. And, you know, in, in terms of just, like, supply chain or it's just something that affects people and manufacturing on the continent is, is still coming up. But I think those two are, are the challenges now that are affecting everyone in, in e-Mobility, um, but also really things that would then really accelerate the transition to towards electric motorcycles or trans e-Mobility on the continent.