Africa’s ICT entrepreneurs – On the brink of the long Summer of Love
For over a decade, Africa’s ICT entrepreneurs have struggled to make sense of how to innovate and make money on a continent that was largely connected to the outside world by satellite and extremely expensive fibre. Now with cheaper wholesale bandwidth and falling retail prices, the season is going from an unforgiving winter to perhaps a long Summer of Love. Russell Southwood looks at the changes afoot that are helping Africa’s ICT entrepreneurs stand a better chance of success.
When we started Balancing Act 12 years ago, Africa’s ICT entrepreneurs were talking about a whole range of services and applications but none of the basics – like bandwidth, a critical mass of users, transaction technologies and finance – were in place. Over the last 12 months, many different things have begun to fall into place under each of these headings. Launches like Eskimi and Spinlet have turned the usual entrepreneurial road map for Africa round a different way.
But what has been as impressive has been the growth of soft networks and hard, physical infrastructure like incubators and the way that these things have created links between Africa’s innovators and the rest of the world.
VC4Africa started in 2007 when Ben White went to a meeting of the African Venture Capital Association in Dakar. It became clear at this meeting that its members were all focused on the “big deals” and that there was a gap in small-scale, start-up finance. As co-founder Ben White of VC4Africa told us:”Micro-finance is very limiting. It’s just too small. So there’s a missing middle between it and the big deals.”
Rather than set out to raise that capital, White sought to create a platform that would create a community that would allow entrepreneurs to describe what they were doing (or wanted to do) and offered investors a place to come and see what was happening:”The investor can connect with a start-up in Accra but also the Ghanaian community in a city like Amsterdam might also help.”
What started as a hobby on the Ning platform went professional as Bill Zimmerman (of ActivSpaces in Cameroon) and white came together to launch the platform. It now has 4,400 members and is still growing:”We put the focus on getting quality. New members are screened and vetted through a registration form that acts as a background check.”
Members can post a description of their project and 2,000 of them have done so from 25 different countries. So where did most of them come from?”The top ‘usual suspects’ are Kenya, Nigeria, Ghana and Cameroon. The latter is because of Bill Zimmerman’s work with ActivSpaces there. There have been some nice surprises like an entrepreneur in Togo and some individuals from Ethiopia.”
What’s bad news for Europe has been good news for the continent:”The European investment community is looking at Africa because of the problems in Europe. But there’s also lots of members from the BRICs and south-south relations.”
The impact of these kind of soft networks are hard to track but White and Zimmerman give several examples:
• The entrepreneur in Togo teamed up with one in Nigeria after they found they had a shared passion for education and are now developing an Android app together.
• Members in the community lend their expertise through mentoring. Often there are daily exchanges through e-mail.
• The site has connected several businesses including etsy-online and Market Fleas with international investors from the USA, France and Holland.
• An American software company Next2.us was able to find a Kenyan partner through the site and able to pilot and launch services, starting in August 2011.
VC4Africa had a three year budget to be able to build a community, demonstrate how it can work and the ways in which it creates value. Going forward, its business model will be based on a Fremium model where members pay for additional services:”We’ll also be asking members that for any match made via VC4Africa that they make a 3% voluntary contribution.”
The next big development has been the creation of physical spaces for ICT entrepreneurs. BongoHive’s Hubs in Africa identifies 17 of these spaces that are a mix of technology hubs, business incubators, university tech labs and hacker spaces.
Indeed, Zambia’s BongoHive is one of the latest of these spaces on a road pioneered by Nairobi’s iHub. This started last year in Lusaka after a visit to iHub and a meeting of 25 people who wanted Android capacity building. The space is in the Ministry of Education and it has set up training programmes for its members in things like Java.
In September 2011, it got US$17,000 funding from a philanthropist called Brenda Davies for computers, testing devices and training. So the initial work was to build apps for her and VVOB, an NGO that the co-founder Lukonga Lindunda works for. As Lindunda says:”The aim was to give the developers an app to work through and to understand how to meet a deadline for specific projects.” That same month they also worked with Ushahidi on using their software to monitor elections. In December last year, Ushahidi and a Canadian developer ran an Android Boot Camp for members. The aim this year is to run a competition that will get some of the developers some recognition.
To put the cream on the cake, three African developers were shortlisted for the Mobile Premier Awards organized by Apps Circus at the Mobile World Congress in Barcelona last week: Ghanaian App Developer Robert Lamptey of Saya, Ugandan app developer Christine Ampaire of Mafuta Go!, and South African app developer Anne Shongwe of Moraba (see here for more).
The winner of the Ringmasters Award (given by the organisers) was Christine Ampaire of Mafuta Go!, which is an app that helps drivers find the nearest and cheapest petrol station.
App developer Christine Ampaire explains, “Our application was a product of a 48 hour hackathon called Garage 48. We are a group of students who are passionate about our country and the city we live in, and we wanted to address the daily struggle of rising petrol prices in our city.” Garage 48 is an Estonian organization that organizes workshops that allow developers to put a product together in 48 hours.
The Second Open Innovation Africa Summit supported by Nokia and infoDev is taking place in Nairobi from 29-31 May 2012.
To follow the exchanges about this news, you need to be on Twitter. Follow us on @BalancingActAfr
This week on Balancing Act’s You Tube channel:
Editor of Stuff magazine Toby Shapshak on the changes in the use of devices in Africa
Philippe Jacquier, Orange Business on the launch of its cloud-based service, Flexible Computing
Dare Okoudjou, CEO, MFS Africa on selling mobile life insurance and the potential for mobile health insurance
Johan Nel, CEO, Umuntu Media on the launch of Mimiboard, an online pinboard for Africa
Roukaya Kasenally, Director of Comms, AMI on its new mobile news apps incubator
Ofer Ronen, Sales Director - East Africa, Gilat Satcom on doing business in South Sudan