When 2016 has been a hit (back to back) for some (Africa startup founders), it has been a punch in the face for others.
For many of us, we still got some issues to ruminate on, and it seems 2016 isn’t going to end soon enough. Whether it’s the NCC proposed data hike price, Chartered Institute of Entrepreneurs of Nigeria bill, the MMM freeze, and the Lake rice saga.
Nevertheless, it has also been a year of crowned effort for major tech companies in Africa; lots of funds raising and clashes with policy makers. And just as we believe the Christmas is going to end in a good shape, we still got some “Jerico wall” to deal with. These are some of my thoughts on how Africa tech ecosystem had fared in year 2016.
Tony Elumelu Entrepreneurship Program
As we are building the future of our nation, let’s not forget Africa is a continent and not a nation. Tony Elumelu is a man betting on the future of Africa entrepreneurs. His foundation has pledged a sum of $100 million with the mission to identify and grow 10,000 Africa entrepreneurs for the next decade. So far, 2000 Africa entrepreneurs have benefited from the investment. The second face of the investment has been concluded and application is set to open for the third round of Tony Elumelu Foundation Entrepreneurship Program early next year.
The company had a good time. From raising $19 million, a round led by French premium cable company Canal+ and Kinnevik to partnering with Canal+ Group in expanding to francophone countries in Africa and launching IrokoX. Jason Njoku, founder and CEO of iROKO has more to say here.
We’ve seen more startups hubs or tech incubators birth in easing, and providing the required/needed facilities and ambience for entrepreneurs. It was a big year for Cc Hub, iHub and Ventures platform. These hubs were brought to limelight with Mark Zuckerberg’s first visit to Africa and Ventures Platform leading the race of incubator in Northern part of Nigeria. Bankole Oluwafemi (Editor-In-Chief) of Techcabal noted the creation of CcHub pivoted his journey into technology and media. And I couldn’t agree more when he said there should more incubators. Though Steve Jobs and Steve Wozniak didn’t started from Hubs. But what can one make from a garage that looks more like an incubator?
The re-invention of Iyin Aboyeji’s (former co-founder of Andela) passion in building the future of Africa has been one of the reason I got stuck to his story. The creation of Andela is a typical example of make lemonade when the world throws lemon at you. Iyin knows the work. It was indeed a good year for Andela. The company became the pointer of the enormous opportunity embedded in Africa tech ecosystem with Chan Zuckerberg Initiative fund of $24 million, along with a mission to now invest in Andelans’ and continued effort in bridging un-even talent distribution gap.
The race to solve payments problem in Africa really got a boost especially in Nigeria. The birth of M-Pesa, a mobile phone-based money transfer, financing and micro financing service in Kenya and Tanzania has arguably pivoted the ease of mobile money transfers in east Africa.
Tayo Oviosu founder of Paga, an end-to-end payments company which combines enabling online commerce with offline components secured a $13 Million series B financing led by Adlevo Capital, with participation from Omidyar Network, Goodwell West Africa, Acumen Fund, and Capricorn Investment Group.
New entrants were also not left behind. The likes of Iyin Aboyeji latest venture (Flutterwave)- got accepted into Y Combinator (one of the Silicon Valley’s giant accelerator program), Akinlade and Ezra Olubi (Paystack founders) backed Y Combinator has also got a seed investment of $1.3 Million from Chinese investment holding giant Tencent, Comcast Ventures, the venture arm of the US largest cable company and Singularity Investments. Initially, I was wondering why we got more startups in fintech, what differentiate them to each other and why fintech is such a huge problem that needs urgent solution? However, Yomi Kazeem of Quartz Africa said “For merchants, the payments problem is one that needs to be solved urgently as young, mostly bootstrapped, start-ups struggle to turn cash positive. It isn’t just an e-commerce problem either as regular people simply want the convenience of paying bills and making transactions without having to stand in long lines at the banks or have to visit a physical business address”. The challenge of getting payment right brought (e-Commerce giants) Konga and Jumia into the Fintech scene with the launch of KongaPay and JumiaPay. Seemingly, it paid off. “KongaPay recorded 300% more transactions than its other payment channels which it still retains” Shola Adekoya, CEO of Konga noted.
With the milestone achieved in the Fintech space in Nigeria, are we still doing the wrong Fintech like Victor Asemota stated?
Early birds in the AgTech scene such as WeFarm, a knowledge and information sharing platform for farmers raised a seed funding of $1.6 Million from LocalGlobe and coming second place with a sum of $ 200,000 at Chivas Regal The Venture Competition. It’s also been a wonderful year for Angel Adelaja, Founder of FreshDirect. Her company represented Nigeria at the Chivas Regal Venture Competition, an Aso Villa Demo Day Finalists and also emerged the winner of She Leads Africa Accelerator Program winning 2 million naira. FarmDrive of Kenya is another AgTech startup promoting and increasing the livelihood of farmers in Kenya. They emerged the overall winner of Thomas Reuters Africa Startup Challenge, winning a sum of $10,000. Disrupting agriculture through agri-tech in West Africa presents numerous opportunities to create efficiency and increase food production, however transforming this traditional industry is not without challenges — Paul Adepoju said. It’s been a wonderful year for AgTech startups.
The Bottom Line
As we continue this journey of building the future of Africa. I beseech Nigeria policy makers to make policy that won’t be detrimental to innovators and innovations come next year. There’s been a lot of funding, sure we going to be having more of that come next year. Hoping to see an improvement in hardware company, AgTech startups, EdTech startups, alternative energy, effective and efficient Africa digital music services, and Africa startups becoming a unicorn.
Merry Christmas and a Happy New Year in Advance.