Mdundo registers 239% revenue growth from paying users

According to the report, premium subscription revenue grew 239% to $622 000, comprising 35% of total revenue, whereas advertising revenue grew by 37% to $1.1m through campaigns executed for leading brands.

The company exceeded expectations for user growth by reaching 26.6 million monthly active users (MAUs) and significantly increased revenue from paying customers, surpassing the yearly target of 25 million and revised guidance of 26 million.

“As the region embarks on an unprecedented digital journey, we’ve harnessed the power of connectivity to transform the music experience for millions towards our vision of providing Africa with easy and legal access to online entertainment,” Mdundo said. “Our growth and ambition of reaching 50 million MAUs as well as financial sustainability by the financial year ending 2025, underscore our commitment to redefining the African music industry.”

Over the period, Mdundo registered a steep revenue growth of 74% year-on-year (YoY) from $1m to $1.7m. Earnings before interest, taxes, depreciation and amortisation (EBITDA) improved by 3.5% from last financial year to minus $1.1m.

Despite strong growth, Mdundo was affected by a significant weakening of the Nigerian naira late in the financial year, and by an approximate 25% weakening of the Kenyan shilling. In terms of cash position, the company has $2m in the bank, which corresponds to 43% of the total net proceeds from its listing on the Nasdaq First North bourse in 2020. In the year under review, the company’s cash position was reduced by $962 000, with Mdundo working towards a positive EBITDA by June 2025.

Mdundo says it remains on track to achieve its ambitious 2025 strategy, which centres on reaching 50 million MAUs and achieving the above-mentioned positive EBITDA. It said focus would remain on Nigeria, Kenya, Tanzania, Ghana and South Africa, as these key markets encompass a combined population of 422 million people, approximately 35% of sub-Saharan Africa’s population. This offers substantial growth opportunities due to high internet penetration rates and robust economic development. In June 2023, these markets accounted for 15 million of Mdundo’s 26.6 million MAUs.

The company will also concentrate on driving value per user through telco and premium products. Mdundo has already established music packages in collaboration with prominent telco providers, including Vodacom in Tanzania, Airtel in Nigeria and MTN in Nigeria, Ghana and South Africa. These partnerships collectively reach an extensive customer base of 185 million people, enabling Mdundo to address the low usage of payment cards in Africa.

Mdundo is placing a strong emphasis on providing locally relevant services and content, acknowledging the significance of cultural diversity and local preferences. The platform curates a diverse range of music from various genres and local artists, ensuring an engaging and relevant experience for its users. The company previously announced that approximately 80% of all music consumed within the focus markets is from its Africa catalogue and that the service is approaching 500 000 African songs directly uploaded to the service by more than 140 000 local creators.

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