West Africa saw a boom in its population through the course of the twentieth century, leading to the rise of huge cities and businesses. Although this led to a closer integration into the world economy, the region remains poor when compared to most other parts of the world. While corruption, political volatility, high rate of
West Africa saw a boom in its population through the course of the twentieth century, leading to the rise of huge cities and businesses. Although this led to a closer integration into the world economy, the region remains poor when compared to most other parts of the world. While corruption, political volatility, high rate of unemployment, as well as infrastructure deficits remain serious challenges, the region’s burgeoning youth population have not been hindered. There has been a growing entrepreneurial drive in the region, as a number of fast rising tech startups have emerged and upcoming entrepreneurs are on the search for prospective business opportunities.
With successes stories seen amid the West African Startup scene including Jovago.com, Jobberman, iROKOtv(dubbed the “Netflix” of Africa), Lagos Angel Network, e.t.c, a number of international foundations have worked towards providing support for West African startups that show potential for growth and innovation, while being committed to social change. The effort of these companies such as Indigo Trust UK, as well as the Bill and Melinda Gates Foundation, have helped West African entrepreneurs share information, receive funds, and find mentorships that allow them to further develop their companies. Also, some tech giants such as Google set up annual competitions to select brilliant brains in the region with an aim to drive their innovative ideas and West African agenda. Many of these bright minds contribute to the development and innovation when they return or via the internet.
Regardless of the attention given to Africa’s successful entrepreneurs, many African startups still have setbacks that impede on their success and productivity. To ensure a higher rate of success in West Africa start-ups, such challenges must be tackled. While Marek Zmyslowski, Managing Director of Jovago.com will be providing intel on ensuring a higher rate of success in West African start-ups at the 2015 Mobile West Africa Conference today, here are a few points to consider:
- Venture capital
West African Entrepreneurs across markets do not receive early-stage tech venture capital funds and for the few who do receive these funds, they fail to obtain later-stage growth capital when needed. In leading markets like Kenya and Nigeria, entrepreneurs usually succeed in raising the first $100,000 from external investors, but raising subsequent funds becomes an arduous task. As a result, they give up their business after a few years because as they are discouraged by the struggles attached to maintaining operations as well as navigating the brutal reality of founding a company. To tackle this problem, long-term support in terms of evaluating and monitoring their business growth should be provided by tech hubs, foundations and other related organizers. These long-term support should not only come from foreign investors, but also from local and regional investors. In addition, a platform through which start-ups can launch and announce developments and products to Africa and the world should be created. This platform will give startups opportunities to meet VCs, investors, tech acquisition specialists, IT buyers and media from across the region and around the globe with great these investment chances.
- Government Policies
Government policies play a vital role in expediting the smooth operations of technology entrepreneurs in their respective locations. However most government policies in West Africa today are not very promising to startups. For Instance, there are no policies that allow founders to capitalize on global trends. The Government should amend sub-clauses in certain policies in favor of startups. Policy makers can help drive the market in several ways, including promoting infrastructure sharing, providing rollout incentives, and, potentially, reducing rural license fees..
- Internet Penetration and Infrastructure
Almost every startups in West Africa face structural obstacles. The estimated percentage of population connected or with access to the Internet is sublimely low, implying that the region has low internet penetration and so, user base is already quite limited from the onset of developing a startup. West Africa’s tech sector lags in terms of prominence and investment, it needs better and cheaper internet access and broader adoption of smartphones. Infrastructural and power deficiencies also play major roles here. Internet-backed technology startups will only develop successfully and kindle economies across West Africa when the right structures are in place.
- Operating and Marketing models
Most start-ups do not know how to fully utilize their operating and marketing models as they cannot properly brand and advertise their products to compete with already established brands. This directly affects their sales and thus their revenues. An example of effective and affordable marketing model is the social media. However, if the startup business is geared toward the public at large, then traditional marketing models, such as TV, radios, billboards and even hand bills, would suffice.
- The Market and Integrity
Understanding the market and attaining integrity are prerequisites for the success of businesses, particularly start-ups and most founders fail to appreciate this, leading to the failure of their start-up. Finding the right people to work with is always another major challenge as some founder rely on knowledge from partners.
In general, understanding the challenges faced by start-ups in West Africa is crucial as these challenges are not problems but rather opportunities to do more and ensure a higher rate of success for West Africa Start-ups.