Ayilara Olatunde is founder and chief executive officer (CEO) of Nigerian e-commerce startup WaraCake. In this guest post, he details some ways entrepreneurs can use growth hacking to develop their businesses.
Lately, I’ve been reading a lot of articles around startups in Nigeria and Africa as a whole. One of my major concerns is centred around the lack of innovation among today’s entrepreneurs.
E-commerce is one sector that’s getting overflooded. I mean virtually everyone is going into e-commerce. You find “Nigeria’s No 1 online something something”, you know the rest of the story. Why is this happening ? Many entrepreneurs would rather work on a tested business model, everyone is carving a niche for themselves. Just like we at WaraCake did by focusing on cake retail and logistics. Even giants like GTB and MTN have dived into e-commerce.
Do you think it’s wise to now say most of the e-commerce businesses existing today will be MIA in a few years time ? Well, if it can happen to Nokia, then anything is possible.
We live in Africa, where raising US$10,000 is a big deal. If you operate an e-commerce store, the chances of you raising money today are close to zero. Nigeria, as a case study, has a population of about 180million people. This market is jaw-dropping. Even Ada in the village probably has a Tecno phone and can 2go.
Disrupt Africa says African startups received funds in excess of over US$180million in 2015. But if you look at the big deals being closed, they are mainly from international stakeholders. If it’s a deal closed at home, you’ll probably see “undisclosed amount of investment”. The high achievers in entrepreneurship in Nigeria and Africa as a whole today are becoming angel investors, so yes, I think we are getting there.
There’s still the likelihood a Nigerian investor wants to suck you dry, but can you really blame them? The economy keeps changing overnight, a vast majority of the consumers aren’t ready for all the new innovations. An example scenario is when we have more Nigerians in the diaspora using WaraCake than someone in Nigeria, who would rather call or WhatsApp. I met someone recently who said he’d never enter his card details on any platform. Can you blame him? No
I have digressed. What do you do as a young African entrepreneur with no strong financial backing? Would you quit or keep drinking garri and tweaking? Should you really drop the company just because it’s e-commerce and they are telling you it can’t scale?
My opinion is keep tweaking until you get it. Execution is what matters most. Any company that can make its first customer pay can surely get a million more to do the same. Growth hacking is a sure fire way to survive. Here’s a few ways I’d suggest:
Talk and listen
Take a break from that computer sometimes. You need to surround yourself with people who would love to share their opinions on your company. Even if you feel they are talking rubbish, be patient and listen. We once faced a very big issue at WaraCake, and I was at lunch with some friends and told them about the challenges we had been facing. Believe it or not I tried their opinion the next day, and it worked like magic. The solution to that problem you are facing probably lies in the hands of someone outside your team.
“In the end, whether you are profit-making or building a social venture, everybody wants to know where the money is coming from. If you say you are social and not out to make money, you need to figure out a long-term revenue model to sustain that company.
Instagram has really worked for us at WaraCake. We haven’t spent a dime on marketing via that channel since we launched. I’ve lost count of how many customers we’ve acquired from there. Something in your marketing must be working better than the others you’ve experimented with, figure that out and don’t take your finger off the trigger.
Product development over pitching
When I started WaraCake, I used to pitch to virtually anyone I felt looked boxed up. If you catch me at events today talking to someone, I’m probably be marketing cakes to them. I’ve approached an investor who said: “I’m hearing cakes too much, come back to me when you have a lot of other products on your catalogue”. Focus on your product development and helpers will come. You need investors who love your product and not how much money it can make them in the long run.
You need friends who support you
The power of friendships can’t be overemphasised. You can generate a lot of organic traffic and referrals. Paid traffic is now overly expensive. Even the giants with the big bucks are cutting down. Organic traffic mediums like SEO are more sustainable long-term growth strategies.
Go all out
Every startup needs someone behind the laptop and someone on the streets. I believe in this. If you aren’t outspoken, then get someone on your team who is and is passionate about your solution. You’d probably die or go slow if you don’t. If you are an all-rounder, then that’s 100 per cent awesome.
Never stop innovating
In the end, you need to have some competitive edges over anyone else out there. Action plans at the back of your head that would make you confident enough to go head to head with a Rocket Internet company.
In the end, let the positive energy surround you, some of the giants you see in the market have probably not even made close to what you have made. There’s no way you can manage millions of dollars efficiently if you haven’t survived with a zero budget. You wouldn’t “think” if the money came easy.