* If you don’t know who these people are above, ask somebody. ENTERPRISE54 – Last week I was at the residence of the British Deputy High Commission in Ikoyi. Entrepreneur Country held a lovely dinner and round table event to promote the digital economy in Nigeria. To say titans were at the table is an
* If you don’t know who these people are above, ask somebody.
ENTERPRISE54 – Last week I was at the residence of the British Deputy High Commission in Ikoyi. Entrepreneur Country held a lovely dinner and round table event to promote the digital economy in Nigeria. To say titans were at the table is an understatement. Although I can’t name the folk who where there, leaders from banking to telecoms to private equity to tech giants were represented. Although I came late (big product push due soon) the small ~20 group didn’t hold it against me (I think). As usual, I was the youngest person in the room. I don’t usually attend these things but I was intrigued. It’s not every day you get to dine with the Deputy High Commissioner.
There was the usual chorus of ‘Nigerians are so entrepreneurial’, ‘our future is technology’, ‘the future is the youth’, ‘the next big tech company can come from Nigeria’ – blah blah blah. I found a few kindred spirits but largely disagreed with ALL their other assertions. Why?
Nigerian technology is starving. And the boys are not happy.
There is no innovation without capital. Yes, you can create some nifty technology at a small scale. But try creating that into a company without capital. In the West, it’s tough. In Nigeria it’s nigh on impossible. It just doesn’t really happen. Yes there are examples. Outliners. But the internet industries we see today globally from Facebook, Google, Twitter, Amazon, Netflix, Tencent, Alibaba, Rakuten et al were built up over many years with cold hard cash. Bucket loads of the stuff. Billions of dollars of ventured capital. Same in the US. Same in India. Same in Russia. Same in China. Same story. Different language. I don’t understand why people think it will be any different in Africa. History is a great teacher. Africa – let’s begin to learn.
I have been to the same conferences and read the same responses over the last 4 years and am now a little bored. Yes of course you can create an enabling environment. Yes there are a myriad of challenges on the ground in Nigeria, but most of those problems are solved with capital. What every internet company does (globally) when it has money, it pulls people from established companies, brands or industries to staff up its early ranks so you can build awesome. Ideally locally. If not, we have an educated elite diaspora who are only too willing to return. Strangely, the music industry in Nigeria can teach us.
Angels and the Music Millionaires.
More money went into brand ambassadors sponsorship in 2013 than angel investments in internet companies in Nigeria. With MTN and Glo going loco, signing cheques left right and centre, it was a great year to be an A-list musician. But it wasn’t always this way. Over the last 10 years, Nigerian entertainment, both movies and especially music, have transformed massively. They built an industry, from the ground up, in hostile climates and against all odds. As the popularity improved, the money improved and investments (reinvested in better sound, music videos and performances) started flowing, turning themselves into millionaires in the process. The untold story is that before most of the musicians we knew today got their start, they had angels. They had private individuals who used whatever money they could get their hands on to nurture the careers of today’s superstars. Once upon a time in Nigeria, if a child told their parents they wanted to ‘go into music’, their parents would immediately begin to cry, fear that ‘the person’ in the village who is ‘doing’ them had come again, then swiftly call in the prayer warriors (or Babalowo) to save thy soul. Today, an A-list artist can get any from $20-100,000 per show, and when I say show, it’s usually a couple of hours of work. That wasn’t always the case. Hence you see their new found love for Bentleys and Rolexes. Life is good.
And yet our internet boys are starving. [not the Yahoo ones – they’re just fine]
Nigerian musicians all had their angels. Whether it was family money support [think P Square, Naeto C, Davido or Lynxx]. Record company investments from the likes of Don Jazzy and D’Banj with Mo Hits [Wande Coal, Dr Sid], Kennis [Tuface], Segun and Banky W with EME [Wiz Kid and Banky W], Audu & Co at Chocolate City [MI and Ice Prince] Ubi Franklin [Iyana] and Obi Asika with Storm Records, these here individuals built the music industry in Nigeria with their bare hands. And I have no doubt it was brutally difficult. The shows, corporate events, the weddings, the radio stations, the TV networks, Alaba, YouTube. All these things weren’t readily available. Today they have super charged their talent globally. But it started with the talent. There were countless angels who invested in the industry early. Unsung heroes who as a collective probably didn’t get an ROI. The ones above are the ones who succeeded, yet today there is more money going into investing in music acts than internet startups. I literally see hundreds of them annually. I always used to wonder where the money was coming from. Politicians? Wealthy business men? Fans? children of wealth? Whoever they’re throwing millions of dollars investing to create the new Wiz Kid. Doesn’t matter. The investments are being made.
Yet our internet boys are still starving. Our future is still uncertain.
Strangely, many people disagree with me that the most important thing to build out the Nigerian ecosystem is cash. There are always ‘softer’ things. I don’t buy it. I can’t see it. I worked in a low cash environment for 6 years. It’s a horrible place to be. Dreams turn to ash. Quickly. The ecosystem needs liquidity. Boatloads of the stuff. What we have done with CChub is awesome, Spark is cool. Leadpath is cool. 440 is tremendous. We just need all these efforts X10. With millions of dollars at its core.
We need 1,000 funded startups per year. And when I mean funded, I mean like $10-50k as a first step funded. Then this ecosystem will grow beyond the hand full of companies we all end up talking about.
Then the boys can start smiling.
* definition. <30 = boy. 30> = man.
* I am smiling. I am an old man.
Editor’s Note: This post first appeared on Jason Njoku’s blog