Has Africa finished rising?

Cape Town

“Has Africa finished rising yet?” Someone asked me at dinner a few days ago. I am in Lagos and the only friends I have in the city are either entrepreneurs, work for startups or work in tech. This makes perfect sense, my re-introduction into my home country was through a journalist’s lens. The questions I ask are socio-political, they relate to infrastructure and the conversations I have with friends follow this trend. It is a small part of Nigeria, but it the part I know well and I am intimate with.

Four years ago, you couldn’t take a breath in Africa without someone telling you its on the rise. Africa is rising, our mantra to the West. We said to them: come, our continent is ready and we want to show you what we can do. Africa is rising multinationals chanted, they invested in a foray into the continent. This was it, Africa’s time. No one ever asked, who decided this, no one ever asked about the global roster that had Africa next on its list.

While Africa was supposed to be rising for the tech ecosystem, its creative industry that had always been on par and even exceeded global standard pivoted – building on quality and creating global appeal. Everyday people began experimenting with platforms that allowed them to be creative and have fun, YouTube, Instagram and Facebook opened up the world. African fashion and culture began permeating the West. The Ankara jungle of Nigeria proved its potential as a key global player, and the Jollof wars came in vogue with heads of states and celebrities wanting a say. African cities were the subject of sultry tales about young 20-somethings, destinations for world travelers and location for famous Hollywood moments. While we waited for Africa’s infrastructure to catch up with its entrepreneurs, its music, movies and dances graced the world stage and captured the world.

African entrepreneurs have had to force the ecosystem to match where their vision is. They have had to drag governments and users with them on a journey that required stepping back a few steps before achieving the intended beginning. Africa began to rise, then investors decided they weren’t sure it should. Then Starbucks, Burger King and Krispy Kreme, lacking more places in the Western world to go, came here. Then investors too, came back and brought with them the multinational’s renewed interest.

African startups haven’t been able to compete in the same way that counterparts in more established markets have. Africa rising put a spotlight and added pressure on a young ecosystem to deliver on impossible scale. When a business that worries about basics has compete with one that only thinks about scale, there is a disconnect. Still, the successes did come.

Africa is the next frontier, I suppose we had to come before space. The next billion users will come from here and the race is on to see who wins the continent. The battle is on between Africans and the West to see who can save Africa first. Who will solve the access problem, who will bridge the skills gap and who will reform the education and healthcare systems.

“Project Africa” is fully on the way and the objectives are set, get Africans on the global stage.

Has Africa finished rising?
Did the sleeping giant awake from its slumber ready to begin the long haul reimagining of a story that has long been told by hunters?
What does a risen continent actually look like?

African startup future: infrastructure and access

pouring water

Last week, I wrote about the future of the African startup. I tried to answer what our future in the tech startup space entailed, I am not sure there is a solid answer to that question. Something that does need to be discussed however, is the infrastructure and access problem that we are still battling to solve.

The ‘West’ has this romanticised view of Africa, the dark continent, the continent on the rise, the home of the next billion users. For those of us that live here, it is a completely different view, we see the daily struggle for basic necessities – the lack of electricity, water and access to the internet and information and basic education. I don’t mean admonish the African dream (something I firmly believe in) but I would like our friends in the West to understand that: Africa is not a project. It is not summer school. For us that live here it is our lives, our home and our future.

The above statement is very important if we are to understand and fix Africa’s startup future. It is no good for you to come here with grandiose ideas about problem solving in many sectors that, yes, need it, when we don’t have the basics right. If we begin at the start, and overlook the romance of the Africa we all desperately dream of, we begin to see the cracks for what they really are: laziness, lack of foresight and indiscipline. This might seem harsh but like I said we are going back to the beginning. Nigeria, Africa’s most populous country has oil – a decent amount of it. Nigeria does not have a refinery, it exports crude and imports petroleum. The price of crude tanks, Nigeria loses, the price of petrol goes up, Nigeria loses. You get the idea. For the first time its 50-year history Nigeria is building a refinery, why did it take so long? Crude is not that hard to refine, you can learn how on the internet.

Solving the access and infrastructure gaps are so fundamental to Africa’s startup future and the possibilities of what entrepreneurs can and could possible do. The damage that lack of infrastructure and access is creating is fucking everything up. For entrepreneurs and small businesses, the limited opportunities created by infrastructure absence creates unhealthy competition that limits potential for deeper product understanding and refinement. This creates rather ridiculous funding gaps and funders are now dictating where the emphasis should be because we rather see what is sexy and looks good in the press. Very little to no true innovation is happening Africa right now. The investor class in Africa is too powerful and it is fundamentally problematic and dangerous.

If we examine the many initiatives that have been started to tackle these problems, we have to wonder why are they working or why is it taking so long. We all know what the problem is – the current policy frameworks in play on the continent do not prioritise access and infrastructure. On the surface, sure, governments talk a good game, they all “understand” the importance of technology (no, they don’t). The capitalistic pursuits of corporations continue to leave the African people at a disadvantage. If we look at access, yes there are countries with long ways to go in terms of basics such actual cables. However, there are last mile solutions that could easily be employed with collaboration. A novel and maybe even simplistic view of this lies in the hands of mobile operators. Towers cost money, so operators hike up data prices to make up costs (at least that’s what they tell us).

Imagine, if all the operators in a country worked together to share the costs of towers and covered an entire country. Two things come from this: the user will always have connectivity and the cost of data would somewhat if not significantly cheaper. Tigo and Ericsson is a good example of this with their Tanzania partnership. Yes, we can agree that it is rather complicated from a business point of view. Take roaming for instance. The operator offering the roaming service dictates pricing, and with African telcos, and currency issues, home operators have little real negotiating power when it comes to price. The operating expense is very high and as many networks in Africa are still ‘new’ they’re still paying for suppliers and charge in USD. Then there is the skills gap, engineers cost money, good ones cost a lot. These factors are understandable in a growing economy and would be even more so, if there was significant effort from policymakers to encourage cut costing collaboration or if telcos where openly lobby for these.

It is too simple to think that a business’s purpose is for the benefit of the user not the business. How do you explain why data is perishable? Data expires after 30 days, gas for your car doesn’t, books don’t, education doesn’t but data does. A useful product that allows for access to information and help, expires. If we had better policy that made it easier for telcos to operate (South Africa is a mess) and encouraged innovation and competition that would go a long way to help in solving some of the access and infrastructure problems.

How do we build an ecosystem that engages corporations and governments, and that allows them to understand that there can be no innovation if the people we are innovating for can’t access or afford to use the products we are creating?

What is the future of the African Startup?

Jozi

What is the future of the African startup? This question was posed to me a couple of days ago and I have battled with the answer. The easy answer is somewhere between tech and agriculture, that’s what surface me would say. I truly believe in the power of technology to change people’s lives. Also, let’s face it if we fix some of the basic infrastructural issues that plague the African agricultural space, I think we would be aces.

This is too easy, tech is broad enough to be a non answer. Agriculture?!? This is a no brainer. So I started thinking about it more deeply. What is our future? How will African startups succeed and set themselves apart from the world? How will we as a continent truly scale (read: this is subjective)?

Some tech trends (thanks Deloitte)

Before I delve into all of that, I think it’s best to drill down on some global tech trends. We all know that machine learning, fintech (key emphasis on blockchain and the trust economy), everything as services, virtual reality (building of immersive experiences for users) and analytics (specifically insights into unstructured data) are making the rounds globally. Fintech alone is estimated to see over $150B in investment globally this year, according to PWC. Oh, let us not forget all the rage around 5G these days.

How does Africa factor into these trends? What does our trend future look like? I am sure all the abovementioned trends are relevant to the continent, but some are more relevant than others. Yes, Africans too, want nice things like 5G and VR but some people are still trying to get GPRS in these parts, while others are just making sure the electricity is on. Two key things are crucially important to this continent from the above trends: Fintech and everything as a service. Note, I am specifically avoiding access/infrastructure mostly because that deserves an entire post on its own. For the purposes on this post we will live the fantasy land that access and infrastructure will be solved soon.

Back to Africa

Shall we begin with Fintech? The meteoric rise startups in Africa playing in the financial services area has been Hitchcockian. Navigating interesting regulatory environments and heavy populations of the unbanked. The companies that are succeeding, of which there are many, are finding ways to make money easier. One of the biggest crisis in Africa is financial inclusion. This presents challenges to many of the unbanked who may have business ventures but aren’t able to take advantage of many of the resources that the financially included have. When we think about Africa’s future and more particularly its startup future, we need to think hard about fintech. One of the key challenges that will plague fintech in Africa is the trust economy, Africa still has low credit card penetration or people who are willing to handover their credit card information. If you think about the calibre of people who can afford ( I use this word loosely) to have a credit card – trust shouldn’t be too difficult. How do we expect to solve the trust issue in a cash economy? Before we can truly conquer the world of fintech in Africa, I think trust must be tackled. Yes, price and convenience will also play a big part but the consumer differentiator will be trust.

Everything as a service, this might seem a bit far-reaching but I think the success of Uber on the continent speaks for itself. Africans want services that work, if we can preorder our lives then we will, for a fair price. Even poor people like nice things and the simplification of their lives. I think there have been some success in Africa around service, SweepSouth and WumDrop on B2C side and Ongair on the B2B side. I am sure there are tons more, which you can Google for yourself. I think as we think of the future and what entrepreneurs do, we need to think about platforms that provide mundane services. Not just for the benefit of the users, which is critical, but for the impact companies like this have on unemployment.

Errant thoughts

I am very interested in the current funding landscape. I have a number of VC friends so you can see why. Yes, we can all agree that Lagos is the most valuable startup ecosystem in Africa now, depending on many variables – who you read, ask, who is willing to share funding numbers and who is getting a lot of press. Whatever you are reading, Africa is getting more money and more is still to come. Will they fund the right things? What impact will it have on the ecosystem?

Mobile-only internet users make up over 50% of internet users in most emerging markets, India, Indonesia and the Philippines being good examples of this. Africa is there, and chances are surpasses the Asia numbers. Startups don’t ignore them. I am not giving this too much attention because, it’s obvious.

Press, press and more press! This will probably get me booed, but I worry that we are all get off on the general hoopla about the ecosystem. I think about it as teens sitting on the quad, saying “OMG the African tech ecosystem is so hot right now. Hype is good, it brings investor attention and customer awareness. Overhype is bad, it creates one hit wonders, no names mentioned.

So what is the future of the African startup? As this dude put it…

Heck what do I know, I am just some girl that asked questions for a living.

These young Africans: finding a voice among the broken and angry

These young africans

I have been talking to a lot of people about young Africans. So much so that in my circles we have adopted the term, ‘these young Africans’ as a way to contextualize our conversations. The basic definition, young African professionals (25-40 years) who live in urban areas and making their way through the world. These are Africans determined to make a mark in whatever industry they are in, some of them are first generationers. First to get a college education, first to get a corporate job, first to live in the city, first to ‘make it’ as were. First to figure out life in a rapidly changing world.

There is a fundamental shift that is happening in Africa and the world in fact. While the past had parents determining the future of their children, especially in Africa, giving us a generation of doctors and lawyers. Something happened, perhaps we realized there were too many doctors, lawyers and engineers so parents decided their children needed to be business leaders and investment bankers. Then came the generation of Business School wunderkinds. Then something happened, a generation of Africans rose up and decided that their futures needed to be determined by them, enter the time of the artisans and the entrepreneurs – because let’s face it no African parent will encourage entrepreneurship straight out of college. This is where ‘these young Africans’ come in. Yes, they too have corporate jobs but it’s jobs that defy their parents understanding. Like that guy whose job is to manage the brand identity of shoe laces.

A generation of Africans as exciting, innovative, hardworking as it is problematic (stay your pitchforks, please). This is the generation that spends money as quickly as it makes it. This generation lacks basic education in wealth and asset building. This is a generation that knows how to be rich but not wealthy, just ask a Nigerian celebrity. This is the generation that would rather wear their wealth than think about tomorrow. While traveling across Africa, finding out what makes us tick, I learnt that the future isn’t really all that important. The common mantra, is life is too short and you might as well enjoy the fruits of your labor today. Makes sense, what happens if tomorrow does come? Do you start all over again?

The general consensus is that these young Africans are shit hot. Everyone wants us, all the multinationals want to see what we can do, investors are warming to our ideas. The world is both waiting for us to succeed and fail at the same time (haters gonna hate). The bulk of us aren’t prepared, no one told us that wealth and impact takes time. No one told us that credit cards are only good for the credit card companies. No one told us that liquid assets isn’t all that useful when a recession hits.

This is a generation that will work hard for their passion, we are excited about what we do and who we are. We like nice things and are willing to work for them. We dedicate ourselves to projects, companies and causing, we don’t easily fall for brand messaging. We want products we like and we are willing to pay premium for it as long as it is convenient. Our mobile phones run our lives, we work from it, play from it and connect through it. We like our Moet, Hennessy and Louis Vuitton.

This is a generation that often battle through the murky definitions of what it means to be African and what it means to live in a contemporary world. A generation of people defining equality where traditions dictate certain things. A generation finding their voice in crowd of broken and angry people. One that must take responsibility for its own future regardless of what is ahead. A generation intent of fixing an embattled legacy left to them. We are so desperate to prove that we can take control of our lives, pick our legacy yet when the time comes the shadow of our parents linger as we decide – that ever present hand of ‘guidance’. A generation that defies definition.

These are mostly thoughts in my head that needed to get out. I’m doing a series of talks in the coming weeks on the subject, likely there are more pieces to come, unpacking segments on this. Africa is a broken continent, let’s be honest. Our leaders haven’t given us much to work with and we are angry about it. Those of us that care anyway. There is potential here lots, but for the most part the same people who screwed things up for us make it hard for us to fix it.

Diversity in tech: time to check our privilege

CT-water

A couple of weeks I spoke to speak on diversity in the South African tech space at Net Prophet. The talk addressed issues around race (mostly) and gender in the tech space. How can tech solve some of the gender issues and race issues in the country and perhaps beyond? How are companies and the tech industry at large dealing with fact there aren’t enough women and people of colour in tech in SA and Africa at large? From an entrepreneurial point of view.

It is such a big conversation that I felt that I needed more time to discuss I feel about this topic and some of the ways we need to start addressing it. Also, the need for context. We automatically assume the lack of something means a lack of interest or a lack of trying by other parties. When it comes to race and gender and entrepreneurship, it is a bit more complicated than that.

People get very defensive and protective when diversity comes up in their industry or company. They needn’t be. I am going to tell you something no one else will. This problem isn’t a problem but an opportunity to build change and find solutions that don’t impose on people but help and support. It is a great and important challenge that is necessary.

Why diversity matters: McKinsey and Company study

Companies with a racially and ethnically diverse leadership are 35 percent more likely to have financial returns above their respective national industry medians.Companies with a gender diverse leadership are 15 percent more likely to have financial returns above their respective national industry medians.

McKinsey and Company makes the business case why diversity should be taken seriously by companies. But there is also the logically moral case. Businesses should be reflective of the society and industry that they exist in. If your company refuses to employ and empower women and people of colour how does it expect to succeed in a society where huge percentages are made up of women and people of colour?

The conversation around diversity needs to shift from what we would like to do what we must do. An entrepreneur trying to solve problems unique to people living in rural Nigeria will never truly succeed unless that entrepreneur talks to and even hires people from that part of the world.

Why are there not enough people of colour and women in tech?

Most people of colour don’t enjoy the prilivlege of being able to go home when it all goes wrong. In black communities there is the notion of “black tax”. Black tax undercuts whatever aspiration young black people have. It is the extra “tax” that the young professional back people are expected to pay to their family immediate and extended. The most publicized case of black tax is footballer Adebayor and the story of how his income was spoken for by family. Most black people don’t have the luxury of entrepreneurship due to circumstantial disadvantages. They cannot afford it. Even if they are not paying black tax they have no support system both financially of emotionally to indulge in starting a business.

There are far too many systematic and circumstantial disadvantages stacked up again people of colour in this country and women on this continent to truly engender an entrepreneurial culture. Culturally women are taught not to entertain careers in tech let alone start businesses in tech. When enough people tell you no, at some point you might start believing that is the right and only answer. The internet on its own has not been kind to women, strong talented women are often shamed and ridiculed by the same industry they are trying to break into. Companies barely recognizes female leadership with very little role models to look up it’s a wonder young girls are not clamoring at the door for tech education and jobs.

Education is also key. Most families find it difficult to support their girl child in a career path they no little about and are not sure it will provide security and life’s comforts. Gender transformation as it is in corporate South Africa and Africa at large is already dismal. Entry into tech can seem near impossible. The few women in real leadership positions are likely paid less than their male counterparts.

Things we can do to improve diversity

Tech companies need to offer better structured and paid internships. Paying intern is a great way to balance out privilege. We need to think about internships as systematically empowering. We need practical solutions for diversity transforms in tech. Companies need to stop choosing candidates algorithmically but more humanly. A diverse interview ensures that each candidate is given fair consideration and presents an opportunity to bust unconscious bias.

There are a number of entrepreneurs that have language barriers against them; vernacular translators could be employed at startup pitches. If not, investors need to make a concerted effort to incorporate what second language speakers are doing. English may be the language of business but Chinese entrepreneurs are not expected to speak English in their pitches are Africans?

Transformation in the tech entrepreneurial space needs to be thought about from a state level. Talented young black people will likely opt for a position in with the state a big corporate because familia responsibilities. Black tax as mention. We need a new form of empowerment to change this. Black Economic empowerment or affirmative actions are not enough, it is time for diversity entrepreneurial empowerment.

The unemployment rate in Africa is on the rise, there are not enough jobs for the people who need them. New jobs must be created and these new jobs will be created by entrepreneurs. It is up to the state to help empower those who will create those jobs.