Archives For Business

2014-06-11 13.46.08I was invited by the World Intellectual Property Organization (WIPO) to be a panelist during the 2 day UN Global Compact Conference in Addis Ababa, Ethiopia.

The UN Global Compact Conference, held on June 9 + 10, 2014,  convened 300 public and private sector players from across the continent to facilitate knowledge sharing for local, regional and continental planning.  The organizers did a great job in accomplishing something that is no small feat, bringing together U.N. agencies, NGOs and various companies from the private sector  (such as consulting firms, BoP technical assistants and regional financial institutions) to discuss ways to come together to discuss the problems facing small and medium size enterprises (SMEs) in Africa.

The setting was the rather impressive: The UN Economic Council on Africa building is housed just minutes away from the Palace. The building, like much of the city of Addis, was partly under renovation, but that did nothing to take away from the feeling I had once we stepped onto the grounds: the people who worked there meant business. In fact, Addis Ababa is home to other convening bodies in Africa like The African Development Bank and the African Union.  The city’s air of power, influence and rebirth is evident by the people who live and work there.  And for the first time, The UN Global Compact decided to have their conference in the very place where it mattered the most: on the continent.

It was great to see so many different players committed to exploring how we can strengthen public-private partnerships.  As I see it, there are two distinct challenges that have to be overcome to deepen the impact of these discussions.

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The Main Challenges 

First, we need to be clear about the specific ways our organizations want to support economic development, whether a company or organization has specific country, regional, or Pan-African goal they are trying to accomplish. The goals of a company like Coca-Cola has around investing in a local business will look very different than a local UNDP office trying to bring more services to local entrepreneurs.  The question then to ask ourselves and our colleagues is:  exactly how do we want to impact the communities we serve?  Where are we lacking?  How can we partner with an organization that has had success to close our gap?  How can we pool resources together to accomplish a single mission?

Second, we need to have the mindset of open and inclusive knowledge sharing with local experts. To accomplish this we need to find more robust ways of working together to create environments to which foster economic growth and equitable opportunities.

Supporting Technology Hubs, Long Term

There were two panels I spoke on.  The first was about strengthening public-private partnerships to support SMEs. One of my big points, was that we need a coalition of public and private supporters to pool resources to support entrepreneurship and training hubs.  I am convinced this is one of the most overlooked ways to drive economic growth AND job development for youth.

What could this look like?

Think of what could be done if, similar to the Virgin Entrepreneur labs, multinationals committed $20 million USD to fund technology hubs that provide skills and training for youth?  With $100,000 committed to each hub, say, in the AfriLabs Network, this could mean 3 years of organizational support for over 60 similar hubs across the continent, with $2 million to spare for a yearly convening event and small M+E team.

There are nearly 100 innovation hubs in Africa most of which are struggling to survive.  I’ve spoken with many their managers who share the same concerns and struggles, lack of finance opportunities and their inability to come up with sustainable models. Their fears are often the same: “How many more months can we keep our doors open and provide consistent programming for our communities?”

If a public-private consortium came together with a larger operational grant, similar to but on a larger scale as Hivos and Indigo Trust’s recent TECH HUB INITIATIVE, we could scale up opportunities for youth to have consistent access to vibrant innovation hubs where staff salaries, internet connectivity, and space is stable.

Tech Hub sustainability will rely on committed partners, mentors and managers to determine what services they can provide their market that will add value to local businesses.  This doesn’t mean renting desks or holding events.  It means harnessing the power of the tech developers and organizers within the hub to provide expertise that companies are lacking.  Until those gaps are filled, tech hubs will have a difficult time staying alive.

 

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Strengthen Intellectual Property (IP) resources across the continent

For the second panel discussion, WIPO hosted a trip outside the city to the rather impressive Oromia Coffee Cooperative, where the Ethiopian organization has successfully licensed the use of coffee for the world market. As most of you may know, Ethiopia is the birthplace of coffee.  The Oromia team welcomed us with a facilities tour, special coffee ceremony and presentation about the growth of the cooperative and how their model has helped increased economic growth for the region as well as health and training services for the workers (most of those in the factory were women).

 

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The market for coffee globally is massive and it’s Ethiopia’s primary export.  Ron’s team assisted the Ethiopian government in receiving a fair share of that profit, and getting fair trade coffee retailers such as Green Mountain Coffee and Starbucks to agree to paying Ethiopian exporters for these licenses.  My other panelist, Ilmari Soininen from Sanaa Consulting, spoke on the importance of these type of IP initiatives in strengthening trade relations on the continent.

From a technology perspective, I spoke about registering and protecting the IP of young African entrepreneurs- something that WIPO is keen to work on in the coming years.  The point here is, if technologists can’t protect their IP, then they cannot reap the type of success and growth that their American and European counterparts have.

As we concluded the conference, there was a strong feeling of commitment to work together to create the type of equitable and stable environment for economic development that other regions have enjoyed.

It’s up to us keep working to make this happen.

-Bahiyah

 

 

A few weeks ago I had the pleasure of speaking at Rollins College in Winter Park, Florida about the changing business landscape of Africa the opportunities that exist on the continent. I shared about the general market trends of the African continent as well as specific examples from the tech sector, from startups to companies worth over $100 million that are still Africa based and African owned. The slides I used can be downloaded from Statfrica.com or here on Slideshare.

For those looking for information on Africa’s internet penetration, visit the deck below…

Africa’s experiencing a bit of a boom in startup activity right now. What’s driving it? Who’s helping to grow the ecosystem? This graphic explores the topic.

Africa's Entrepreneurial Ecosystem
Infographic available from Statfrica

White lines represent the monetary support organizations like Indigo Trust and Infodev are proving to the innovation hubs of the continent which in turn support entrepreneurs with non-monetary services represented by the gray lines. Mentoring, workshops, events, conferences, investor meetings etc. are the types of things these hubs are responsible for organizing. Meanwhile, Local governments have mostly been responsible for enable policy decisions. Can they become direct financiers of entrepreneurs and/or the network of hubs? The fact that this ecosystem has emerged mostly without their intervention certainly presents that opportunity.

For a more in-depth analysis on startup entrepreneurship as a driver of economic growth in Africa download our latest report New African Business.

On July 16th, 2013 Appfrica CEO Jon Gosier had the pleasure of sharing information about the history of Appfrica and business opportunities in Africa with summer fellows at Temple University’s Urban Apps + Maps Studio.

Appfrica Temple University Urban Apps + Maps

Slides from the presentation. Business opportunities across the continent…

On Appfrica and our role…

Those of you interested in entering the Apps4Africa competition have a few extra days, our deadline has been extended to Dec 31st at 11:59pm EST! All entries past that date/time will be automatically deleted. Make sure you enter by that time!

Liz Ngonzi (CEO of Amazing Taste, LLC)

Thus guest post was contributed by entrepreneur, Liz Ngonzi. Born in Uganda and “raised” at the United Nations, Liz Ngonzi is an international entrepreneur, educator and speaker committed to facilitating relationships between organizations that “do good” with those that “do well”, with a goal of meeting their mutual strategic objectives through marketing and fundraising campaigns, and educational activities.

Liz has consulted to and advised organizations in the US and in Africa, focused on gender rights, youth development and public health, along with higher education institutions.

Based on her 20-year career in marketing/sales and ten of those as an entrepreneur, Liz also teaches nonprofits how to meaningfully and efficiently engage their stakeholders using digital media, and budding social entrepreneurs how to develop compelling value propositions for investors.

Liz currently serves as a 2011-2013 Entrepreneur-in-Residence at Cornell University Pillsbury Institute for Hospitality Entrepreneurship, is on the adjunct faculty of New York University’s Heyman Center for Philanthropy & Fundraising and is the Africa Adviser to Syracuse University iSchool.


Ten Ways to Improve Your Pitch

Among the most common fears in the world is that of presenting in front of others – in the digital age in which we live where our ideas and correspondingly ourselves, could be delivered to countless and faceless people around the globe, that anxiety is most likely amplified a thousand-fold.

Even for me, with 20 years of pitching under my belt, many years teaching and presenting at conferences — I still have some anxiety when having to pitch an idea. The good news however, is that my years of experience — both winning and losing pitches — and subsequent analysis of losses and wins has enabled me to develop strategies that I’ve summarized for you below.

If you only remember three things from this post, here they are: (1) do your research to understand what will get the buyer(s) to say “yes”; (2) always put your best foot forward by realizing that while content is important, presentation can be even more so; and (3) be open to learning about how you can improve for the next pitch, assuming that you have what it takes to keep moving forward in the face of adversity. For everyone else, here are my 10 points to consider in improving you pitch:

1. Research, Research, Research. Understand Your Audience

Generally speaking, you will most likely know the names of who your assessors are. Armed with that knowledge and a simple Google search (here are the results of my Google search on Jon Gosier, Founder and CEO of Appfrica), you can learn about who they are, glean information about what drives them and possibly what you need to do to win them over. In this day and age of information, failing to research and understand the people to whom you’re presenting your ideas is a HUGE mistake that could ultimately result in your loss.

2. Understand Your Battlefield – Know Your Competitors’ Advantages and Weaknesses

Anyone effectively going into battle knows the importance of understanding who their opponents are. Again, a simple Google search about the opposing parties enable you to understand how to manoeuver against the competition. Such results provide you with insights into strengths and weaknesses in terms of marketability of their product, team strength, etc. If you don’t have information about current competitors, you can still research those whose ideas won in the past, along with those who were less fortunate. You can learn a lot from those who were successful…and even more from those who were not!

3. “The So What Factor” – Think About What Differentiates You and Your Business From Others

I know that you believe you’ve come up with the next best THING. However, in order to make certain that you have, you need to make certain that you understand and more importantly, convey what’s unique about your offering. People come up with great ideas all the time, however what takes a great idea to a great product/service, requires a bit more work.

Does your idea save people time or their lives? Have you found a way to help them make more money? Does your business have the ability to make people happier? Whatever you are offering, make certain that it does so better, faster or cheaper than other competitors in your target market. Most importantly, make certain to convey that in your pitch.

4. Content is King, But Sizzle Sells – Showmanship Can Make All the Difference

You can have a great idea or even be the most brilliant person, however if you do not know how to package it in a way that sells…you will fail to attract investors. If you do not currently have that talent on your team, I strongly suggest that you bring in someone who understands how to make your pitch “look and feel” more attractive to the potential investors.

This can include graphic designers, stylists (if you need to pitch in person or have photographs taken of your team) and great photographers / videographers who can capture your team and its business in the most attractive manner. For those on a tight budget, I suggest finding someone with a camera/video-enabled phone to capture your story through photos / video, even if they’re not professional ones…just do your best to make them look so!

5. Curate Your Digital Brand – Don’t Let Your Facebook Posts Kill the Deal

As much as we all love to share all of the happenings of our lives on Facebook, Twitter, Instragram and other social media, I suggest that you review what you’ve posted online thus far and consider removing anything that would make your grandmother blush and even more importantly…make a potential investor re-consider whether or not betting on you or your fellow team members would be wise!

For additional information about how to curate your digital brand, review this link and check-out this link about how to manage your digital footprint. Another great resource you can use to improve your digital image is brand yourself, a service that aims to improve your Google search results.

6. Practice, Practice, Practice – Never Go in Cold

We all spend a lot of time getting everything ready for the pitch and sometimes forget to visualize success and practice toward that goal. As much as you may be incredibly busy getting the demo or power-point presentation ready, you have to take the time to practice for the pitch (if you’re fortunate enough to do it live or in front of the potential investors). If the pitch has to be done via postings, then you should consider recording it. You’ll definitely want to have a script that you follow for taping. I always tell people that YouTube is a great resource if they are trying to find how to do something. Here is a link to various Youtube videos for those trying to pitch to investors online.

7. Social Media is Just That….Social – Engage Others to Support Your Brand

Many entrepreneurs believe they have to do it all themselves, however, the good news is that through social media, they can leverage others to support their ideas. When my team and I were trying to get votes for our Africa, Tech & Women: The New Faces of Development panel at SXSW (a major US technology and music conference), we took to social media to get that much-needed support.

We even bombarded our email and mobile phone contacts with messages seeking support of our panel. The result was that our panel was selected from 3,200 entrants and one of 600 talks, not an easy feat, given that Africa still doesn’t have the reputation for tech innovation, and women are still definitely in the minority when it comes to tech.

8. Mind Your Manners – Personalized Thank You Notes Go a Long Way

I’m pretty “old school” when it comes to acknowledging others and have a preference for hand written notes. However I know that it is easier to send a thank-you notes via email, particularly when you’re doing so in/from Africa. Whatever the format, my experience has shown me that it makes a great deal of difference to send individualized notes to all those whom I’ve met following a pitch.

To do so, you have to make certain that you ask each of them for their business cards at an appropriate time during the pitch (if it’s in person) or work hard to find their email addresses if their contact details are not not posted on the site where you register (if online). I can tell you from experience that those who receive thank you notes from you following the pitches will remember that gesture, because most people seldom do so.

9. Seek Feedback – Why Did Your Pitch Rock or Bomb?

Alongside sending out thank you notes / emails, requesting feedback from investors / judges is a rarity. Those who take their responsibilities seriously (barring rules against doing so by the organizers of the pitch) will most likely provide you with feedback on why your pitch failed and possibly pointers on how to strengthen it. Whether or not they respond, it always makes sense to seek feedback in the event that you get it…it only makes you better if you do!

10. Be Your Best Cheerleader – Celebrate Having the Courage to Do What Most People Can’t

At the end of the day, the fact that you were brave enough to come up with an idea and present it to folks who could potentially bring it to fruition through their time, talent and resources – means that you’re a winner. Take the time to celebrate that!
Even if you did not make it through this time, if you take the time to obtain and review the feedback (post mortem included) and commit to pitch other people, if you do so armed with the aforementioned knowledge and have the confidence your ability to work through disappointments, you’ll eventually get better.

Follow Liz on Twitter: @LizNgonzi

Cheetah Trailer 45 from Jon Gos on Vimeo.

Why aren’t there more of a focus in books or film, about African innovations in business?

Not about its colonial history, its artists and musicians, its Dictators and tribes, its poverty and wars, its animals and wildlife…but work simply about doing business in Africa?

That was the question I asked myself before undertaking THE CHEETAH CODE. After spending several years living and working in the continent, it dawned on me that there were few resources available to those interested in doing business in, or with, the continent.

THE CHEETAH CODE is the culmination of several years of research in my time as a technologist, small investor, and activist. The book is about Africa’s young creative class, its expanding technical capacity, and entrepreneurs.

It is not a about philanthropy, poverty, or scapegoating foreign corporations. It is about contemporary business, economics, societal trends, and technology that happens to be told from the African perspective. It will be made available as a documentary film, and book.

==

If you find the above concept compelling, you can help make this project a reality by backing it on KickStarter.com! Those of you interested in the project who live abroad, email me privately at j.gosier@appfrica.org

BACK THE CHEETAH CODE

Investors Don’t Get African Opportunities – here’s why.

African Businessman

The Business of VCs

Very quietly, over the past few weeks the word ‘bubble’ has crept back into the English language as it relates to the investment/silicon valley/tech scene. This is because there have been some staggering valuations, startling exits, and incredible hype for companies that seem to defy common sense. Well, they seem to defy common sense because they do.

In a recent article published by the New York Times entitled “Disruptions: With No Revenue, an Illusion of Value“, Nick Bilton makes the argument that startups that have revenue (meaning they actually add value to someone who’s willing to pay for what they offer) are at a disadvantage when it comes to getting funded. The reason being, he argues, is that investors prefer to build valuation metrics on less tangible things like hype, user traction and perceived market opportunity. This is validated by serial entrepreneur/investor Paul Kedrosky who states, “It serves the interest of the investors who can come up with whatever valuation they want when there are no revenues. Once there is no revenue, there is no science, and it all just becomes finger in the wind valuations.”

Those ‘finger in the wind’ valuations tend to skew high for startups with the right network of investors and individuals involved.

Value vs. Venture

So getting back to my point, this investment thesis is in direct conflict with investments needed in developing nations where the only thing that matters is real value and hype is utterly irrelevant. So why would an African tech entrepreneur expect interest from these types of VCs? They probably shouldn’t.

In the ‘Global North’ (as Western nations prefer to refer to themselves) where GDP growth remains all but flat it’s the opposite, investors know there’re only a few ways to create real value for society. But those ways are tough, big problems that the State frequently intervenes in solving. For instance, alternative energy markets and clean transportation. We’ve already established that GDP growth is relatively flat here, so actually in Western nations the easier game to play is not to add value to society, but to either create the illusion of value for shareholders, or to simply disrupt other industries (essentially moving value from one place to another).

If you don’t believe this, let’s do some simple math. What would the GDP of America be if Facebook didn’t exist? After all, Facebook only has around 1000 employees and about $2 billion dollars in revenue. Yet, it has a $150 billion valuation. Alternatively, the collapse of General Motors almost sank the USA’s economy and it employs over 75,000 people operating on $150 billion dollars in revenue. One produces a lot of ‘likes’. The other produces a lot of physical product that in turn enables other industry. One employs those with a highly specialized skill honed at elite universities with a starting salary of $60k at the lowest, with the vast majority of non-executive making at least $80k or more. The other, General Motors if you aren’t following, employs people with less specialized skills that could be acquired at any US university, at a starting salary of $30k, with the vast majority of non-executive staff making in the realm of $60k. So the answer to the question of ‘What would the GDP of America be if Facebook didn’t exist?’ is: pretty much the same. Again, the faltering of GM nearly caused the implosion of the American economy (given how much revenue it accounts for and how many industries it touches).

But aside from the net worth of the millionaires and billionaires that run and work for it, Facebook doesn’t directly produce anything that can be commoditized by anyone, other than Facebook. Alternatively, if you buy a GM car, ride it for a few years, and sell it, although you may not have completely commoditized what they produced, their products have in effect added value to the world multiple times. First for the company that made it (General Motors), then the car dealer that sold it to you, then you, then whoever you sold it to, and whoever they sold it to, and so on and so on.

The Circle of Wealth

Tangible goods have finite value, which although may diminish over time, will never hit absolute zero. I can go to a landfill tomorrow, dig up some random junk from 1932 and sell it to ‘someone’ for ‘something’ – an antique dealer, a flea market, groups that recycle waste for profit etc. But what can I do with my five years of Facebook history? I can’t commoditize it any way, even if Facebook can. A few companies like Klout and Kred have figured out ways of commoditizing social activity, but it’s debatable how sustainable their models are.

This is not to say that intangible value is completely worthless, it just means that companies that commoditize intangible value largely rely upon investors to fuel growth until they get to a point where they are acquired for a multiple of what those investors have put in up to that point. This is what makes intangible value seem like it creates real value, when in fact all that’s occurred is a redistribution of wealth – from one company that has excess of cash – to a smaller company that has an excess of shareholders.

When you look at companies like Google, they are incredibly good at turning the actual value they offer other industries into healthy profit margins. When you look at companies like Facebook, Twitter, Instagram, and Pinterest, they are incredibly good at turning a steady traction of users, attention, and coverage by the press into actual value for themselves, by getting investors to pump more and more cash in to fuel growth. When these companies go public, there is increased pressure to either keep growth (and thus hype strong) or to actually start generating the kind of revenue that justifies the valuations of investors. Those investors control funds that have been created by a few wealthy individuals, but mostly other companies, usually companies that produce something of actual value seeking return on their investments.

So in a really odd way, the holy grail of investment is creating things of perceived value over things that have actual, measurable value, because it allows said investors to essentially move wealth back and forth without diluting their market. Occasionally there’s a rare moment where there is an absolutely massive exit that makes it all worthwhile (ex. Andressen-Horowitz cashing out at $78 million on a $250,000 investment into Instagram). But that money didn’t come from thin air, it came from venture capitalists. Those VCs got it from their funds, and their funds got it from companies that produce tangible goods or services seeking to maximize profits by putting money into such funds. As you can see it’s not that difficult, it’s brilliant, but very much circular in terms of where value comes from and where it ends up.

A Simple Science

So why don’t these types of investors take risks on African market opportunities? For starters, there’s the usual explanations: there’s not enough money to make it worth their while, the political and legal environments aren’t reliable enough, or the societies themselves aren’t stable enough. Then there’s other excuses like: there’s not enough talent to sustain growth, the cost of doing business is too high, or locality – they like to keep investments close and these countries are simply too far. But the real reason, it seems, is that in developing countries nothing is more necessary than something they’d rather avoid – absolute, measurable value.

When it comes to profit, many modern VCs simply aren’t interested unless that profit comes in the form of their exit from the business. For those who don’t know, ‘to exit’ means to sell the stock acquired through their investment in a company to another party. This usually comes in the form of someone else either buying them out directly, or buying the company they’ve invested in, effectively buying all the stock at a new price – when the investor bought it at an older (cheaper) price.

So if investors from the Global North are used to playing a game where the only things that matter are perceived value, why on earth would they ever enter markets where everything has to be measured in terms of actual value? It’s a simple science: stay away.

The Inverse Problem

NGOS, Charities, and traditional Philanthropists actually compound the problem immensely. With most of the wealthiest investment funds in the world looking to keep up a game of illusions and ‘wealth remixing’, Philanthropists are playing a different game.

For one, they are largely funded by thier governments (groups like USAID). The ones that aren’t are funded by private foundations and individual donors (groups like the Bill & Melinda Gates Foundation). Both types of Philanthropists (Governments and Donors) think in terms of absolute value but for them that value equates societal impact. These types of investors (after all Philanthropists are investing in something too) are looking for results like reduced infant mortality rate, improved test scores at schools, and a greater standard of living for the poorest.

They tend to measure success using globally understood milestones like the Millennium Development Goals, or relative measurements of progress like ‘reduced corruption’. Thus, the value they seek by is the inverse of what Venture Capitalists seek – societal impact versus and intangible (perceived) impact.

What’s missing is that neither of these groups (VCs or Philanthropists) are interested in the actual, measurable, impact created by businesses that maybe don’t have any direct social impact but that do create actual jobs from revenue. Even the few investors who claim to be interested in investing in African businesses make the mistake of looking for either: a quick exit based on intangible value (ie. selling the company quickly to someone else), or societal impact that may or may not be tied to a sustainability model. There’s nothing wrong with either scenario, great companies are built and invested in from both spaces. But there is a gap, and it lies with those companies that simply want to to be great, long-lasting, bottom-line focused companies.

Where do they find capital to scale to keep doing what they do? In Western societies this gap is filled by banks who offer debt (loans or lines of credit) to consumers. In developing countries, this is still a problem for small business owners. Local banks don’t operate with enough liquidity to make such investments profitable and foreign banks find the markets to risky (in comparison to their less risky, highly profitable investments abroad) to even consider it.

I suppose you might be thinking that ‘microfinance’ was going to be the silver bullet that killed this beast? Well, microfinance certainly gives access to capital to the very poor, which has immeasurable positive economic impact on society. But there are negative impacts as well. Since debt is such a foreign concept (funds accessed through microfinance methods are almost always loans) the costs of taking such loans are quantifiable, while defaults have consequences (as they should). Some societal norms make it the case that women taking out loans are put at risk by envious husbands who simply take the money and spend it recreationally. Still, however helpful or detrimental micro-financing is, at loans of an average of a few hundred dollars, it doesn’t reach the most important business class of the population: local SME’s that increasingly employ the burgeoning African middle class.

Local Investors Remain Silent

You would think that given the failure of foreign investors to see the opportunity that relatively small amounts of cash could have on these societies, and the failure of Philanthropists to see the business opportunity, that local investors would be well-poised to fill the gap. Not so.

Local investors are so desperate to cling to their wealth that they tend to give their money to foreign funds for management. Or in the scenario where they feel guilty about their success or maybe philanthropic in their own right, they donate to non-profits to help acheive social impact. In that regard the local African multi-millionaire is no more knowledgable about these issues than any foreign investor would be!

Et tu, Diaspora?

Make no mistake, the African diaspora has 100% filled this gap for decades. A businessman working on wallstreet hears from his cousin in Nigeria that they need a few thousand dollars to grow their company, so he sends it; a brother who’s expatriated sends money to his younger sibling to help them start up a hair salon; the parent who works for a foreign embassy pumps money into their child’s aspirations of building the first Pan-African social network. I’ve witnessed each of these stories first-hand, they aren’t anecdotal. Remittances are great, for some people. What they aren’t is systematic and scalable, and so they are almost irrelevant.

The power of the Venture Capital industry, and likewise the Philanthropic/Non-Profit industry, is that they are in fact industries. They have been orchestrated to create jobs and wealth for huge portions of society. While the ephemeral diaspora is a great thing, it is unorganized, haphazard, and unreliable at scale.

In an article published on The Sojourner Project, A. Conerly Coleman writes, “Diaspora aid has surpassed international aid on the continent of Africa.” She then goes on to make the case that Africa ‘doesn’t need international Aid.’ Until someone can organize remittances into something that looks more like a Venture fund or even more like a Multi-national Aid agency, I’m afraid to say such thoughts are simply wishful thinking.

Whether you’re for developmental aid, or against it, at least we mostly understand how it’s distributed and it’s also non-tribal. Remittances are useless for someone starting a business in Lagos, Nigeria when they have no family who’s ever moved abroad. And they are even less likely to be successful in finding money if they start asking other random families from, say, Kampala, Uganda.

I do have huge hopes that someone will crack this problem. Companies like VC4Africa, Afrilabs and MYC4 have come close but we’d all be incredibly naive to proclaim the problem as solved.

The Middle is Still Missing

Five years ago all of this was as much of a problem as it is now. There is still no fund (that I’m aware of) that invests in African companies which lack an obvious social focus, or that that won’t result in relatively quick exits. The idea of patient capital popularized by Jacqueline Novogratz couldn’t be less-so when it somes to African SMEs. It’s often the opposite – more like a strict, catholic nun waiting with a yard stick to smack the hands of any African venture that should dare to do anything…well…normal.

Disclosure: I’ve been working for years at this problem through my ventures Appfrica and Apps4Africa, as well as the projects with others I’m involved in AfriLabs and HiveColab. As a result, I have made or participated in several investments into African SMEs professionally. However, I as an individual don’t command the kind of wealth that a fund would. The challenge is to make such things happen on a larger scale, in order to spread such opportunities around to more than just a few.

In the American and European tech space there’s a growing problem. There’s so much funding available for early stage startups that everyone and their college dropout buddy is starting-up, leaving no one out there to hire.

It’s one of those first world problems: “We just raised 4 million dollars for our social network for redheads but we can’t find any developers…frowny face.”

If Silicon Valley is having trouble hiring top tech talent, then it means that there’s also a drought in the NGO space. Even the biggest non-profits are suffering from the same lack of technical resources.

If you’re an African developer, this is a huge opportunity. Focus on acquiring (or maturing) some of the following skills. Talent in these areas is elusive even in the U.S. and Europe, being good at them will make you far more employable (or fundable if you want to start a company), globally as well as locally:

For Technical People

  • Ruby on Rails A lot of web startups use RoR because it’s a great language and it also impresses investors. However, they quickly realize that it impresses because Rails developers regularly command high salaries due to such high demand.
  • Python and or Django The Jan Brady to Ruby’s Macia. Actually, Python is probably more in demand these days simply because more developers are competent in it. It’s also great for mobile app development which makes it useful for all those SMS apps local firms are dying to build.
  • iOS – the iPhone continues to dominate the smart phone arena. It’s less relevant if you’re targeting a local audience (there go with Android or stick with Java), but if you are building apps that you want to sell internationally then there’s no app store with a richer economy for developers than Apple’s.
  • Data visualization All that ‘open data’ out there is irrelevant. What’s relevant is data that can be used by anyone at any organization, with minimal fuss. Visualization makes it easy to relate complex datasets to those too busy (or too lazy) to analyze them. Data vis goes beyond any specific programing language, but it is a skill and it’s one that Africans can find a great deal of opportunity in.
  • Math/Statistics Before one can visualize anything they need the components to visualize. If you’ve got a strong grasp of statistics and analysis, distilling information so that it’s actionable for others (who usually don’t share this skill) is a highly lucrative path to pursue.
  • Semantic Analysis Despite what everyone thought, the semantic web is here to stay. It hasn’t become a ‘new web’ like some once thought it might, but semantic technologies (sentiment analysis, natural language processing, text parsing) have become the methods that are routinely used to power some of the web’s most popular applications. These skills are incredibly lucrative. The growth of the ‘Big Data’ industry is fueled by them.
  • NoSQL & NewSQL Modern web apps require a great deal of backend engineering to deal with and keep track of all the byproducts of social, sharing, and content creation. There’s two schools of thoughts on this: one is that by doing more of the work on the application side (on request), applications can scale faster while handling more operations from more users. That’s the non-relational approach. The other school of thought is that there was nothing wrong with the old way of doing things, which stores data with the values the application uses for retrieving them later. The challenge was that this created a bottleneck at the database level which often lead to slow or stagnant apps. The new thinking around NewSQL is to keep the relational model and simply build better database software that allows for more throughput. Entire companies are being built of each type of database (see: Cloudera, Vertica, 10Gen), pick the one that makes sense for you. Also, this is the fuel for the Big Data/Open Data rocket ship.
  • jQuery/Javascript/Ajax Modern web apps do most of their processing on the front-end. As I mention above, this often means the application side is where most of the logic for the web app lives, while the database becomes a place to store and retrieve. For these types of web apps, front end logic is critical. Given the rise of the Jquery framework this is probably obvious, yet solid front-end developers are few and far between.
  • Hardware Engineering The ‘maker’ movement amplified by Afrigadget and Maker Faire Africa highlights another opportunity on the continent, the localization of manufacturing. Whether it’s bicycles or mobile devices, companies local to the continent that design and build things are scarce.

For Less Technical People

  • Design Look at the majority of African websites. Most websites made by African developers still look like they were made in 1999 using the GeoCities default templates (translation: Fugly). Blegh. There is a bounty out for good African designers. The mistake a lot of programmers make is they assume design is about technical know-how. It’s not – it’s about a sense of aesthetic and attention to detail. If you are a lazy designer, you’re not a designer. If you are a programmer who thinks design is superfluous to your application, then you’re doing it wrong. There’s also a dearth of design talent in the U.S. and Europe and a good designer can command the salary of a top programmer. Where are the African designers?
  • Writing You would be surprised at the number of people who can’t string together a well-written, cohesive, consistant thought in written form. Coupled with the rapid proliferation of social media (which, by the way, consists of mostly written messaging) the ability to write and write well has become incredibly important. I say this because you are not at a disadvantage if you are a non-native speaker. Example: Ariana Huffington is a non-native english speaker and she built a highly influential and powerful new media outlet that rivals old-school powerhouses like CNN and FOX on the web. It’s about being able to convey your thoughts cohesively and convincingly. It takes practice, so keep blogging!
  • Project Management Being the person who can cultivate the best traits from your team of peers is a huge asset that has always been rare. Many people manage, few excel at it.
  • Videography – We’ve all heard that there isn’t enough local content being produced for African audiences. One of the reasons is the lack of local producers. However, this is changing. More countries are becoming home to an African creative class who are producing film, television, and web shows locally. Can this be lucrative? I think so. As bandwidth falls in cost, eventually the demand for local content may not come from international viewers but the pan-African audience.
  • Critical Thinking/Problem Solving Deductive reasoning. The ability to deduce conclusions and the reasons why they have occurred. To do this, you have to be able to consider all sides and all aspects of a problem…even the ones that you don’t like. You have to be able to challenge assumptions, this includes your own. It is a skill to be able to analyze the intricacies of why things happen or if someone’s argument isn’t grounded in reality, and to be able to explain your conclusions to others. This will make you a better anything.

There are companies all over the world looking to hire people with aptitude in these areas, but being in Africa puts you in a position of power because there will be as great a demand for you at home as there is abroad. Does this mean you’d have to relocate to another country? Not necessarily, many of these skills can be outsourced to you or your company.

In 2012 learn the things that are in demand so you can build firms (or offer services) that capitalize on these global trends.

Photo Credit: Ahmed Maawy & Apps4Africa.org

The other day I responded to a student who was seeking advice on relocating to start a venture in East Africa. I thought I’d share the email here since it’s likely relevant to others.


The first thing I’d recommend when starting a new business out of the country is to try to find a local business attorney who comes highly recommended from other professionals in that country. You want someone who can help you register your company in a timely fashion, but you also don’t want to get ripped off by paying too much.

The reason to do this is because doing it yourself will likely be incredibly frustrating. You’ll have to learn the intricacies of the local legal system and that can prove challenging, so finding a good (reasonably priced) attorney goes a long way.

Secondly, learn the local labor laws before hiring anyone. You’ll need to know what’s required to hire someone (paying local taxes and benefits) and, if it comes to it, how to terminate employment.

Whether you are based in-country or not, spend time on the ground with the people who you will be working with or who will be working for you. It’s hard to judge people’s character in only a short time but the best way to do it is to work with them while you’re there face-to-face, to build a relationship.

Finally, make connections with the management of other local businesses. For the most part, the business community looks after each other and will be keen to make friends. To accomplish some of the above tasks (like finding a lawyer), you may have to do a bit of networking anyways. Whenever I have a problem in business, it’s usually other business owners who are the most sympathetic because they’ve likely had to deal with similar challenges.

Here are a few blog posts I and others have written on the subject –

Capacity versus Competencyhttp://appfrica.com/2010/05/13/capacity-versus-competency/
Reaction to the NYTimes Profile on African Startupshttp://appfrica.com/2009/09/10/reaction-to-the-nytimes-profile-on-african-startups/
Keep the Fish (ProjectDiaspora.org)http://projectdiaspora.org/beta/2007/12/08/keep-the-fish-ill-take-the-fishing-pole/
The Experience of Starting a Business in Africa (VC4Africa)http://www.vc4africa.com/profiles/blogs/the-experience-of-starting-a

Photo Credit: Sarah Mccans