African mobile operators have traditionally been poor when it comes to innovation, M-Pesa aside.
Primarily, operators have fought the idea they are “dumb pipes”, merely platforms upon which more innovative services can run and prosper. Yet in the last few years there has been an acceptance that they are in fact pipes, even if not “dumb” ones. And this realisation has seen a change in approach towards African tech startups.
Here are five operators, whether through VC funds, competitions or partnerships, that are backing tech startups on the continent.
Kenyan giant Safaricom made waves towards the end of 2014 by launching a US$1 million investment fund for local tech startups. Though things have been a bit slow on the funding front, with e-courier startup Sendy the only company to have received investment so far, chief executive officer (CEO) Bob Collymore said last week more investments were imminent.
Safaricom’s support of startups goes beyond just the fund, however. The company runs its AppWiz challenge every year, offering prizes to successful applicants. It has also launched a revolving fund aimed at assisting youth-owned businesses, and partnered local startups Dynamic Data Systems and Eneza Education. A black mark on its record, however, is its ongoing legal battle with Kenyan bitcoin startup BitPesa.
Another operator willing to back African tech startups, through its early-stage investment programme named Orange Digital Ventures, Orange has invested in money transfer startup Afrimarket and subscription video on demand (SVOD) services Afrostream in the last couple of years.
The operator also runs a host of competitions offering support and finance to local tech entrepreneurs, including the “I make 4 my city” challenge, the Social Venture Prize, and a developer challenge. Orange also recently launched the Entrepreneur Club, an online platform providing entrepreneurs in Africa and the Middle East with a variety of forms of support.
Mostly, the operator has focused on partnerships with innovative African businesses, such as Ghanaian fintech startup Zeepay, Nigerian matchmaking service MatchUP, and delivery app Yuzah. It has also run an app challenge for startup developers.
Millicom, which owns pan-African mobile operator Tigo, launched the Millicom Foundation, aimed supporting support digital innovators in Africa and Latin America through its US$10 million budget and mentoring programmes.
Not too much more has been heard of the initiative from an African point of view, but the company has been active in Rwanda with its think accelerator programmes, the last of which was held last year. It remains to be seen if that initiative will be reprised, however.
Compared with their counterparts in East and West Africa, South African operators have been pretty cold when it comes to supporting local tech startups. MTN is the one that bucks the trend, however, recently holding a Pan-African Entrepreneurship Challenge in partnership with Jumia in Cape Town.
The company, which financially backs the Solution Space incubator at the University of Cape Town (UCT) Graduate School of Business GSB), has been active elsewhere too. It has launched a startup incubator in South Africa, runs an annual app awards for startup entries, and hosts the MTN Challenge. In Zambia, MTN sponsors local tech innovation hub BongoHive.