Vendease puts payroll on a diet

South Africans are getting a double whammy from large government corporations. First, Eskom, the state-owned power company, is increasing tariffs again on April 1, 2025. Likewise, Telkom, the majority government-owned telecom operator, will also increase tariffs for its mobile subscribers by—you guessed it—April 1, 2025.

Telkom will hike tariffs for its telephone and mobile internet services for both businesses and consumers by 12%. Customers will also see a 6% tariff increase for fibre services and voice plans. Telkom cited “increasing operational costs and external economic pressures” as a major problem. South Africa’s inflation has quickened by 40 basis points since October 2024 but remains within the Central Bank’s expectation.

The telecom tariff hike, coupled with the electricity tariff increase, will add more pressure to the pockets of 24 million subscribers who use Telkom.

South Africans are no strangers to tariff increases from Telkom. It has raised prices several times in the past, often in response to economic conditions. Other telecom providers, including MTN and Vodacom, have also made adjustments in previous years, and it remains to be seen whether they will follow Telkom's lead this time. Given the economic climate, they might feel forced to—even if it risks customer dissatisfaction.

For consumers, the new prices mean higher bills. A 50Mbps (megabytes per second) fibre plan that currently costs R629 ($35) will rise to R665 ($37), while a 100Mbps package will go from R909 ($50) to R965 ($53). These hikes will add up for businesses and households already struggling with rising costs. 

While Eskom’s price increases have pushed more South Africans toward solar energy, there is little alternative to Telkom’s services. However, competitors might see this as an opportunity to attract cost-conscious customers by stabilising their prices. 

There is an opportunity for internet service providers like Afrihost, Herotel, and MWEB—known for its affordability—to crash Telkom's party. But how low can they go?

After two rounds of layoffs in five months, Vendease, a Y Combinator-backed Nigerian food procurement startup, is replacing traditional employee compensation with a performance-based pay system.

Its new compensation model will see all its employees first receive equal salaries that will be increased overtime after performance reviews lasting five phases. The first increasing by 30% of their former salaries by May 2025. Employees will only start earning back 90% of their former salaries by November 2025, with the unpaid parts of their salaries converted to equity options. The stock option plan is enticing because if the startup grows in value, employees could cash out at a higher value when they sell their shares.

In February 2025, Vendease paid ₦140,000 ($90) to all employees—about 150 of them left—regardless of what they previously earned, according to TechCrunch. It is unclear whether this new structure also affects company executives. 

The jury is still out on whether the new plan will work as intended or lead to a high employee turnover.

While it is easy to make a case for non-loyalty, the cost-of-living crisis is squeezing pockets, and for many of the employees, it could be hard to reconcile that they'll part with a significant sum of their salaries for most of the year.

There could also be downsides to the equity stock options experiment. In the past, companies like Bolt WeWork have experimented with similar models during financial crunches, leaving angry workers disappointed that their stocks became worthless when they left the company. 

Yet, if it works, Vendease will succeed in improving employee productivity while keeping runway and re-investing in the operational areas of its business that roll in revenue. Despite tripling its revenue in naira terms since its 2022 Series A, currency depreciation and inflation have eroded gains in dollar terms. The startup is looking for fresh capital.

Elon Musk’s Starlink continues to shake up Kenya’s internet market. The satellite broadband provider is now the seventh-largest internet service provider (ISP), overtaking local heavyweights like Dimension Data and Liquid Telecommunications Kenya—just six months after cracking the country’s top ten.

According to Kenya’s Communications Authority of Kenya (CA), Starlink grew its customer base to 19,146 users by December 2024 to secure 1.1% market share. While that’s still light-years behind Safaricom’s 36.1% and Jamii Telecommunications’ 23.6%, it’s a significant leap for a satellite provider in a fibre-dominated space.

And it’s not just about the numbers, Starlink’s growth is also expanding satellite internet adoption. For context, its rivals including Viasat and Indigo Telecom serve a combined total of 257 customers.

But rapid growth comes with a price: regulatory pushback. Kenyan telcos aren’t thrilled about Starlink’s rise. Safaricom and Airtel Kenya argue that the company’s expansion threatens to distort competition, and the CA is responding. The regulator plans to hike satellite licence fees by 837%, from $12,302 to $115,331, and impose a 0.4% levy on annual turnover.

Still, Starlink isn’t backing down. It’s doubling down on local infrastructure—a Nairobi ground station launched in December cut latency from 120 to 26 milliseconds—and aggressive pricing with a $10 data plan and hardware rentals.

With plans to deploy satellites that connect directly to mobile devices by 2025, Starlink is gearing up for a bigger fight in Kenya’s crowded broadband market.

MultiChoice Group has announced price increases for its DStv satellite and Showmax streaming platforms in South Africa, with football fans bearing the brunt. Effective on April 1, 2025, the Showmax Premier League package will see the sharpest rise of 43.5%, climbing from $3.80 to $5.45 per month.

Other Showmax plans are also subject to changes. The Showmax Entertainment Mobile package will increase by 11.1%, now costing $2.75 per month. Meanwhile, the combination of Showmax Entertainment and Premier League packages will rise 7.1% to $8.26. However, the standard Showmax plan will remain unchanged, providing some relief for subscribers.

DStv satellite packages are similarly affected, with the DStv Access package seeing the highest percentage increase at 7.9%, followed by Compact Plus at 6.5%, and Premium at 5.4%. However, certain services like DStv Stream packages and Box Office movies will not see any changes, and the Add Movies premium will experience a 38% price cut.

According to MultiChoice South Africa CEO Byron du Plessis, the adjustments reflect efforts to balance affordability with the company’s operational demands. The company is also adding value to its Compact package by introducing new sports channels and expanding its sports coverage. As MultiChoice navigates these pricing shifts, it remains to be seen how customers, especially football enthusiasts, will respond to the rising costs amidst growing industry competition.