Africa-focused US-based accelerator tiphub Africa recently celebrated its one year anniversary, marking the completion of a year of demo days, hackathons, and the launch of a prototype fund for software entrepreneurs. In this guest post for Disrupt Africa, tiphub co-founder Chinedu Enekwe reflects on the year, and sets out the trends to watch for in 2015.
The last 13 months have been amazing journey of learning, listening and, self-discovery and our team has organically emerged at the intersection of African technology and social innovation. With new challenges on the horizon we felt it was key to take the time to explore the insights that have helped to mold us an organization moving forward and the trends, social movements and technological breakthrough set to shape next year of African innovation.
1. The Startup Spotlight: The Rise of the African Startup Success Story– whether it be organic growth (think Konga or Everlytic) or more exits like Gyft or Saya Chat the ecosystem is starting to get to a critical mass with enough lessons learned with the African technology marketing marriage of necessity of online and offline marketing and logistics.
2. Re-Imagineering of Africa Technology Hubs/Co-Working Spaces – The sustainability and value add of tech hubs and reclassified SME centers is a much talked about chasm. Founders and funders of these hubs are wise on this fact and are actively retooling and rethinking their service propositions. Add that to the fact many of the funding institutions are either not allocating the same resources or demanding different models,the Tech hub boom is likely to see some tectonic shifts in the next few years…and that’s a good thing.
3. Mobile Payments Transform Transactions – The way the internet revolutionized business, civic engagement and communications is exactly what mobile payments will continue to do in Africa. The migration of consumer and governmental cash into digital mediums will fundamental change Africa. West Africa, despite the fits and stops, has experience in mobile payments and is ready to see a monumental shift, (see Ghana and Nigeria’s adoption of biometric ID cards with reloadable card features.)
4. Rise of Indigenous Corporate Venture Funds – One of the most exciting developments is the launch of the handful of indigenous corporate venture funds (see Safaricom, Interswitch) It’s a good start, even though local corporates could do a better job by creating open architecture that allows startups to layer services or distribute content through their platforms.
5. Silicon Valley Corporates Dip more Than Their Toes in The Market – Last year we saw Silicon Valley companies like Paypal, Evernote, AirBnb, and UBER enter Africa, while Facebook marked 100 million users in Africa. With Facebook staffing up its first African office and Paypal circling the waters in the mobile payment space, 2015 will see Silicon Valley corporates go head to head with indigenous players…(Sidenote: Alibaba is targeting Africa as a growth market for the next five to ten years)
6. More Capacity & Even More Capital – initiatives to support ecosystem. Companies like Market Atlas empower investors with more market data than ever before, thus improving the ability for more sophisticated investment decisions.
7. A Push into Bitcoin – Most people don’t agree with me, but I’m betting that companies like BitPesa, Gamerholics and the other mobile wallet integrations of BitCoin will see the rise of BitCoin in Africa. With the dollarization of most African economies, as consumers learn to exchange local currency for BitCoin and convert BitCoin back into dollar accounts within their mobile wallets…I see currency speculators finding a new unregulated space to play.
8. Increase of Diaspora Funders & Founders – If there is one thing the tiphub team has seen more than anything is the growth and interest of Diaspora founders and funders…in a real way 2015 will see more founders and organized funding circles develop as the market matures.
9. E-Commerce Continues to Grow and Learns to Pivot Away From COD – increased focus on logistics solutions to facilitate e-commerce fulfillment, beginning development of a credit class facilitated by mobile and online purchase activity.
10. Made in Africa Hardware & Software – 3D printing and the rise of hardware startups, as well as the heavy entrance and penetration of portable battery/power devices and companies in Africa.
11. Media Driven Startups Learn to Monetize Locally – Companies are beefing up their brands and using brand ambassadors to create and spread awareness of their services/products. By monetizing media content, content producers both on the continent and in the diaspora will find more interesting ways to collaborate and share their content with the wider diaspora community by bypassing traditional media channels.
12. Low Cost Smart Devices – Shortly Africa will be flooded with low cost smart devices from companies with names no one has heard of yet. Not only will we see the rise of local device designers with local content strategies like Solo Phone or Nerve Mobile, and the continued growth of brands like Tecno but all will experience heavy price competition as the commoditization of smartphones and tablets becomes a reality which will benefit the African consumer. Now if only we can see an increase in bandwidth and reduction in prices for data.
13. Recognition of Diverse Founders Groups – Experienced managers, women led startups, youth idea engines and diaspora returnees will be seen as key indicators and segments of investment evaluation metrics.
14. Government Policies Improve Ever So Slightly – Improved policy that is driving more incentives to start companies, technology companies, backed by industry, will make strides in regional integration forcing political leaders to catch up.