What do you need to have in your locker for your African tech startup to scale across borders? The right mindset, talent, and business model, according to the experts.
Taking part in a discussion at the recent AfricArena event in Cape Town, panellists were asked what ingredients were needed for African tech startups to succeed at expanding outside of their home markets.
They concluded that it required various things, but the key point was that a startup should have expansion in mind from the very beginning of its journey. This means its team and infrastructure are set up for growth from day one, rather than huge changes in approach being necessary down the line.
Ryan Harrison, investment associate at the SA SME Fund, said it was a question of a team’s mindset.
“The difference between a startup that can scale and one that can’t scale is a culture mindset within the team. From the very second they are born they are talking about scaling. It is entirely subtle, but it allows excellent people to excel,” he said.
If that mindset is not imprinted from the beginning, it is very difficult to introduce later on. Iyinoluwa Aboyeji, co-founder of Andela and Flutterwave, and now an angel investor, agreed, saying that African tech startups needed to ensure they were ready to expand from the beginning.
“The best companies in Africa invest with a very long horizon in infrastructure,” he said.
“I am very intentional about finding customers for my business that are not in my country. We have to see an ability for the business to attract a global customer base.”
Other more functional ingredients are necessary, too. Aboyeji advised startups in the process of growing to ensure they understand the market they are expanding into, and employ the right people for the job.
“Talent is number one. When businesses are at scale in one country, the ability to bring the experience in can be the difference between remaining a local champion and becoming a global business,” he said.
He said he encourages his portfolio businesses to “hire up” as soon as they have reached some level of sustainability.