What foundational parts of the technology ecosystem do we own, and what are we reliant on others for?

What I’m talking about here are the items deeper down the stack, the core components that allow a country to own its own technological future. Here are some examples:

• Do we build our own software, or are we importing it?
• Can we prototype and build our own hardware, even if not at the scale of China?
• Are we investing in our own startups, or is that being done by foreigners?
• Do we have our own researchers, or are we okay with people parachuting in from abroad to do that for us?

It’s quite difficult for me to do much about any of this beyond Kenya, so I focus on what I can do here and hope that it works and the model can transfer elsewhere. The iHub, m:lab, iHub Research and Savannah Fund are examples of this, where our efforts are focused on local software, startups and funding.

The newest additions are the iHub’s UX Lab and a new high performance computer cluster, both filling a void not just in Kenya but in the continent as a whole. Both of which will come online this Summer. Beyond that, we’re looking at hardware, thinking about what it would look like to have our own hackerspace and TechShop, in a model suited for Kenya.

The iHub UX Lab and Supercomputer Cluster

We are fortunate to have excellent corporate partners at the iHub, one of which is Google, who provided some funding to get two initiatives off the ground.

Creating a UX Culture in Kenya
In the software space design is one of our weakest points. This isn’t just web or mobile design, this is product design and it’s rooted in a lack of understanding or desire to provide a better user experience. Core to providing better products is doing research on what users are looking for and how they are using technology in the first place.

Shikoh Gitau has worked closely with the iHub Research team for the past year, in fact the core ideas that presented the challenge for that space to come into existence was from a paper she wrote, where she showed how little of the technology research done in Africa was by African researchers. Shikoh works with the user experience teams at Google, and started talking to us about the UX Labs that they run around the world.

I had also had the chance to do a workshop with Andy Budd at Tech4Africa, and then chat again in the UK later on. First hand, I got to know Gabriel White through some work he did for Ushahidi. Both of them helped me get to a better understanding of the value of UX research in the product design process.

All of this led to us deciding that the iHub should create a UX Lab, a resource that would serve the region. A place where companies and startups learn about and begin thinking about user experience as they develop new products. We’ll do this through masterclass training on skills, partnering with the top UX experts in the world, and by providing the resources for this to happen.

Mark Kamau has joined the team to lead this initiative.

The iHub Cluster

At the end of 2011 I was approached by one of the iHub Green Members, Idd Salim, about an idea of building our own supercomputer. Why?

Outside of South Africa, there is little to no capacity for cloud computing on the continent. This means that few of the programmers in this region have the skill sets necessary to work and build out this infrastructure. We have a severely limited foundation on which to build future services in an increasingly cloud-based computing world.

Some of the use cases where we see the need for this:

• Research and training opportunities for super computer enthusiasts and university students
• Training people capable of being SREs (Service Reliability Engineers)
• Power-Computing service for local content [video editing and production]
• A host for parallel and resource-hungry applications such as weather prediction, draught prediction and real-time information dispatch.

The initial funding for a small HPC deployment has been funded by Google Africa Inc. Intel have further added to the project a Intel MultiFlex® Server for use as the “master” component of the HPC cluster.

Bob Aman works at Google here in Kenya, and has become a staple at the iHub where he runs his office hours twice per week. He, along with Idd Salim and Jimmy Gitonga are building the first 4 nodes of what we hope to be a 24 node cluster. The most I had done before this was build my own gaming rig, so I’ll be honest in saying that I’m the noob in this group, where most of the conversations are beyond me.

As with the UX Lab, the iHub Cluster will be for people to learn what goes on under the hood of HPC’s by building it, and to learn how to use the power in it to solve big data problems. It will also be made available to the animation and ad agencies in town for rendering services.

In Summary

The UX Lab and iHub Cluster will come online this summer. Both projects have the leadership in place to run them and the resources to build them out. They’ll both be located in the same building with the iHub, and both are being built with the greater Kenyan tech community in mind. Like all of the iHub initiatives, they only work when people from the community are a part of them.

If you would like to get involved in either, reach out to the respective leads: Mark Kamau for the UX Lab, and Jimmy Gitonga or Idd Salim for the Cluster.

Pivot East

East Africa’s mobile startup pitching competition is just a month away. We announced the top 50 a few weeks ago, and now the 25 Finalists are named as well. Don’t miss this event, June 5 & 6th at the Ole Sereni hotel in Nairobi.

Google Releases “Insights Africa”

This truly deserves a blog post of its own… Google spent a lot of money and time gathering information from over 13,000 people across 6 African countries (Ghana, Kenya, Nigeria, Senegal, South Africa and Uganda) to determine why, and how, people use the internet. This data is all openly available, with an outstanding visualization tool to see what the information really means, and compare it, at InsightsAfrica.com. My chart below is just one example, showing how people access the internet across these 6 countries:

Donors prioritized “industrial policy” in Asia, but “social sectors” in Africa. Why?

Kariobangi writes a compelling blog post on the difference between the aid that was prioritized for Asia versus that for Africa.

TeleRivet: An Android SMS gateway

Similar what Ushahidi offers at SMSsync, TeleRivet is a tool that allows you to use your Android phone as an SMS gateway. It’s more robust, offers an API, and makes it easy for people to get started on SMS and USSD apps. Mbwana Alliy writes up a blog post on why this is important, and the business prospects involved in utilizing this type of service.

WEF: The Global Information Technology Report 2012

The World Economic Forum’s annual report on IT has some good information on emerging markets. You can read it online here. Here’s the video:

ForgetMeNot and the rise of Africa’s Smart(er) Phones

BizCommunity has a good article on ForgetMeNot’s Message Optimizer service’s growth on the continent. This service delivers internet content to users who can only access that information via SMS. Here’s how it works:

“First, a mobile phone subscriber sends an SMS to a given short code. The message is received in the mobile company’s message centre, which then forwards to ForgetMeNot Africa’s internet servers. The servers process, route and deliver the message to the subscriber, who can then respond.”

Kenya study, impact of venture capital on small and medium sized enterprise

VC4Africa reviews a report on VC’s in Kenya. This isn’t just tech, but it is interesting and surfaces some great information. [PDF Download]

“The minimum profit before use of venture capital was Ksh 34, 866. Upon use of venture capital, the minimum profit increased to Ksh 600, 000. This shows an increase in minimum profit of 94%. The maximum profit respondents reported before use of venture capital was Ksh 38, 567,951 which increased to Ksh 62, 864,152 an increase of 63%. The average profit also increased by 69% (from Ksh 7,204,653 to Ksh 12, 202,775)”

Mpesa, a 5 Year Infographic

Just how big has Mpesa become? Take a look [PDF version].

Jason Njoku, Funding and Nigerian Movies Online

In Nigeria, Jason Njoku is at it again, raising $8m from Tiger Global Management, a US-based PE and hedge fund. Here’s an interview with him on Forbes. Iroko Partners is the world’s largest digital distributor of Nigerian movies and African music. The firm is YouTube’s biggest partner in Africa, boasting over 152 million views in 2011.

Some takeaways:

Using the What’s There
There are a number of tech hubs and labs coming up across the continent, and each have a different focus as we all try to experiment in our space to see what works. Michael works at MEST in Ghana, which is a very focused 2 year program on training entrepreneurs, where they then invest in some of the ideas that come out. This varies greatly from the iHub model where we’re primarily trying to connect people rather than train them, which is also different from what ActivSpaces in Cameroon or ccHub in Nigeria are doing.

The Funding Gap
We’ve seen that the biggest gap in funding comes at the early, risky stage. How can we get more local angels involved in tech startups in Africa? New seed funds are starting up in some of these spaces, and it’ll be good to see how that continues to grow and if we can create a true base, a true foundation, to the startup ecosystem in the African technology hub cities.

Social Impact Investors
We’ve heard some grumbling about the social impact investment circle, that it takes a lot more effort and has a lot less return going after the money in these circles than it does just going after more traditional VCs or other investment vehicles. At the end of the day, what’s needed is to build a business, something that is sustainable and can generate revenues. That takes time, connections and capital to make happen, and the question is whether the social impact investors can keep up with the normal investors in Africa.

Due Diligence
When an investor comes into a new country it’s difficult for them to get plugged in, and hard for them to know who to trust. They need trusted intermediaries to do the initial introductions, and then a way to figure out if the companies that they’re potentially investing in are legit. This can come at a higher cost than where the investor is coming from, as the legal and business structures can differ quite a bit.

From the outside, it also looks like most people invest in people that look like them, which would explain why more of the social impact investment money being directed at Africa seems to go to people who come from Europe or the US. I’d like to see more of the social entrepreneur programs (schools like MIT and Stanford, as well as the big Fellows programs) doing more work getting out into the Asia and Africa. It seems to me that there are just as many people who come from these countries who know the real problems, and the cultural issues there, that could use some time overseas in the US/Europe, not just the other way around.

The event really starts now, where my colleague Patrick Meier at Ushahidi will be taking the stage for the opening plenary session with Judith Rodin CEO of Rockefeller Foundation, Roger Martin, Dean, Rotman School of Business, University of Toronto and Soraya Salti, Senior Vice President of Middle East/North Africa for Junior Achievement Worldwide, INJAZ Al-Arab.

“More than half of the speakers at TED2013 will be selected through an ambitious experiment in crowdsourcing: the TED Worldwide Auditions.”

Speaking on the TED stage is hard. It’s hard to get to. It’s hard to speak from. It’s hard to stand out enough to make it to TED.com. For all of these reasons, it is also one of the most coveted speaking engagements in the world.

Africa Locations and Dates

If you’re in Africa, this is your chance to get there, to be heard. The auditions are coming to the following 3 cities on the continent, and my sources tell me that Chris Anderson, the curator himself, will be there to screen you.

• Johannesburg, South Africa – applications open on February 24 and close on March 15. Auditions are on May 3.
• Nairobi, Kenya – applications open on February 26 and close on March 17. Auditions are on May 5.
• Tunis, Tunisia – applications open on February 29 and close on March 20. Auditions are on May 8.

What TED is looking for

Anyone can apply to audition, so long as you have not spoken at a TED Conference, TEDGlobal or TEDActive, and do not have a talk posted on TED.com/talks. We’re especially looking for:

THE INVENTOR … sharing an innovation with world-changing potential
THE TEACHER … sharing valuable knowledge in a memorable way to teenagers or adults
THE PRODIGY … young talent ready to break out
THE ARTIST … who can showcase their work in a compelling, new way
THE PERFORMER … music, dance, comedy, drama … or something entirely different
THE SAGE … wisdom the world needs from those who have learned it the hard way
THE ENTHUSIAST … with an infectious passion about a topic they can share
THE CHANGE AGENT … helping shape the world’s future with work that matters
THE STORYTELLER … vivid, original, meaningful … with a talent for connection
THE SPARK … with a powerful idea worth spreading

My TED Story

In 2007 there was a TED Africa, held in Arusha, Tanzania. Looking back, this might have been one of the most important events for our generation of “cheetahs“, we learned the importance of story and a firestorm brewed over the trade vs aid debate.

I was fortunate enough to be selected as one of the Fellows for that event, and it was there that the most of what would be the Ushahidi core team met. Seven months before we built it, we knew and trusted each other more because Juliana, Ory, Daudi, and myself were there.

It was also the first place that I stepped onto the TED stage to talk. I did a short 3-minute talk on AfriGadget and the types of innovation found on the side of the road in Africa. To be honest, I psyched myself out on it, and didn’t do a great job. I don’t remember much about it, but the fact that it never showed up on TED.com means that it was underwhelming (and I’m glad that it didn’t see the light of day). This is also when I swore to never get worked up over a simple speech again.

Fast forward to 2009 when the official TED Fellows initiative was launched. I had another chance to talk, this time on Ushahidi and our plans to build the next generation curation tool, which we call SwiftRiver. This time it went much better, and my talk showed up on TED.com. It’s now been translated into 31 languages and watched by thousands around the world, taking myself and Ushahidi to another level.

If you’ve done something remarkable, have an amazing talent and are able to speak or perform well, then there isn’t a better stage than TED. Make sure you get your application in on time, so that you get a chance to audition, and take the first step to the TED stage.

Then there’s the tendency toward what I initially saw as excess diversification. My think-tank colleagues and I were stunned to see how many concurrent businesses the typical entrepreneur owns and manages in Africa. One famous waste utility entrepreneur had about 66 different businesses. On the whole, the businesspeople we studied appeared to run an average of six businesses.

Twinpine: Nigerian Mobile Ad Network
Forbes does a piece on a startup that I hadn’t heard about yet from Nigeria, Twinpine, who is setting up a successful mobile advertising network.

Re-inventing Finance
There’s a good talk by Sean Park from Lift 2012 called, “Reinventing Finance: an Emerging (Digital) Reformation” where he talks about the changes in the money space, with examples of who to look out for.

Infographic: Mobile Web East Africa
Interesting numbers, quotes and data from the Mobile Web East Africa conference.

30 Brilliant Startups Across Africa
If you’re looking to find some startups from many different countries across the continent, Memeburn has an article, selecting 30 companies that are doing cool, new things in tech in Africa.

African Domains
I’ve been having fun following a Twitter handle @AfricaDomains recently, and the Africa Domains blog is worth a read as well.

Kenya: Big vs Small
Big international firms (think IBM, Dimension Data, etc.) are beating out smaller local firms to lucrative government contracts, which makes up a significant portion of the annual tech spend in the country. The Nation opened up this debate with this article, that then went on to have a real face-to-face debate by the end of the week.

InMobi Mobile Media Consumption Research Q4 2011 – Global Results

Regardless of the reasons why they do it, what this has created is a culture of innovation.

When you have a problem in Africa, there isn’t another option, you either improvise, adapt and overcome, or you die. You don’t give up, you figure out a way to make things work.

This environment has bred a generation of problem solvers: people confront immense challenges and keep at it until a solution is found. It might not always be the most beautiful solution (usually the finishing isn’t up to par), but it works and that’s what matters.

Concurrently, we’re a net importer of fabricated products from around the world. We might make some of our own software now, but we do little to nothing with hardware. How can we be the masters of our own future if we don’t do any meaningful levels of fabrication?

A while back I wrote about the need of “hardware hacking garages” in Africa, a place where the innovation and inventions that deal with things you can actually put your hands on happens. I think this is our next frontier to explore: fabrication and manufacturing.

Moving from FabLab to Fab Factory

The one place that we do do some type of fabrication, at least where we explore and invent, is the network of FabLab’s across the continent. They are very much university focused (and constrained), but they have had a great amount of innovation coming out of them as well. In Kenya, Kamau Gachigi runs the one in Nairobi, and it has been a model of both invention and innovative revenue streams to keep itself going and to bring in funds to the engineers working through it.

The FabLab is small though. What would happen if you put it on steroids and made it 10x larger? What if we were talking about a Fab Factory instead?

A Factory
A space that has all the machines needed to fabricate prototypes and manufacture pieces in at least small quantities. It would need machine tools, laser cutters, 3d printers, wood working tools and more. A place that you could rent time on the machines, rent a workshop, and get training on the machines you don’t know how to operate. Something that looks a lot like the TechShop in San Francisco, but tweaked to work in Africa.

A Warehouse
Take the Factory model, and layer on a warehouse. There are some items that we will not make on our own, namely computer chips. Having a warehouse would allow group buying to happen, where economies of scale could be reached for supplies to be brought into the country, as well as serving as a central facility for distribution of these items to the community.

A Nodal Network
Having a central “factory” and “warehouse” provides many benefits, but it’s not enough. As we know from 3 years of running Maker Faire Africa events, many of the most interesting inventions come from rural areas, mainly due to the fact that they have strong commercial upside. In this case it makes sense to take the original FabLab model and export that to the major cities around the country, making these types of capabilities much more accessible to a wider user base.

A Tech Store
Beyond building and inventing, there’s a gap where the people creating things can take them to market. Providing a space for these people to sell their products (and services), provides a bigger target for buyers, both consumer and b2b buyers to find new items. It also provides a much needed stream of income for the small-scale inventors, with the potential to put them on the map for efforts to commercialize and scale their work.

Ideas and Examples

A couple examples of things that could be built locally, while at the same time keeping the money in-country and increasing technical capabilities in the market:

• In Kenya, the local energy company is moving to pre-paid meters for home electricity. These are simple boxes, imminently hackable, and all made in China. Why? These could be fabricated right here in Kenya, and made better, cheaper.
• The Kenya Wildlife Service needs UAVs for tracking poachers and remote viewing of the parks. They’re currently spending large amounts of money on imported ones. We can build those here too, to the standards needed, and for a lot less.

Emeka Okafor, my organizing colleague for Maker Faire Africa, has been on this fabrication thing for years. He has even more examples of small scale manufacturing on his blog at Timbuktu Chronicles.

I imagine a place like that would get immediate use in certain markets; namely Kenya, Ghana, Cameroon and Nigeria, though others might line up quickly as well. It certainly makes sense for the governments in these countries to invest in this future, or at the very least to incentivize this type of ownership of our own technological future.

What I’m wondering is what other models are there like this?

If building the iHub, m:lab and Ushahidi have taught me anything, it’s that getting something going is the most important thing you can do. Do something, even if small. Get traction. Get started.

The answer isn’t to wait on the government, even though we all see the argument for them being involved here. I imagine the next step is to raise some money, find a space and get a few fabrication machines in place. It will grow from there. Standby for this in Nairobi soon. It has to happen, and it will happen.

This will take money. Anyone interested in getting involved?

(On a sidenote, I’m finally getting to visit the TechShop as I’m in San Francisco this week. Very excited about this!)

“Nearly every start-up working in payments is simply creating a new front end for your credit card. That’s not a small thing; we need new ways to use our credit cards. But we shouldn’t forget the true winners in this new marketplace—whatever innovations we see in payments over the next few years, there’s a very good chance that most of the rewards will flow to Visa and MasterCard.”

This is true… if you live in the US or Europe.

It’s also why Mpesa is so important, as it represents a new form as well as a new source.

Mpesa destroys the paradigm of payments as we knew it

It’s a good thing that Mpesa happened in Africa. It offered a new way of thinking about money and payments, without the legacy baggage of banks and regulations meant for another century. The powerful banking interest were held at bay, not by great power, but by indifference – this is Africa afterall, who cares about this market?

With Mpesa, and without a bank account:

• People can send and receive money.
• People can store up to $1000 in the system, creating a pseudo-savings account.
• There are no credit card companies involved.
• There are no banks involved.

Mpesa is big now too, big enough to garner a lot of attention from the the credit card companies and banks. M-PESA has over 14 million users in Kenya, 9 million in Tanzania, and hundreds of thousands in Afghanistan and South Africa now too. It now processes more transactions domestically in Kenya than Western Union does globally, somewhere in the range of 25% of Kenya’s GDP is transacted on it.

The banks actively lobby against mobile-based payment and money systems now, globally, as it constitutes a massive competitive threat that they are unable to compete with due to a multitude of reasons, one of which is simple transaction costs. The credit card companies are watching closely too, and moving. Mastercard and Visa both are working on mobile offerings, seeking to link with mobile operators in order to bypass a would be competitor.

Mpesa isn’t perfect – we need a payment system that works across mobile operators and can be synced (easily) with any bank, if needed. While it could improve, it’s still worth pointing out the really big missed opportunity here is by Vodafone. Like I’ve said before, if Mpesa was rolled out at as an independent company led by Michael Joseph, it could battle the credit card companies of the world and unseat them in many markets.

What’s interesting to me is that in the arguments in the US and Europe on “the future of payments” the real innovation, with real numbers, isn’t being mentioned.

Update. some new blog posts on this topic:
Could we live without cash?
Payments, the more things change…

Mark your calendars, buy your tickets, submit your applications!

We’re ramping up to the Pivot East pitching competition, where the best startups in East Africa come to show what they have, pitch their startup to investors, media and the judges for a chance to win the prize money.

Pivot East will be held at Ole Sereni Hotel in Nairobi, June 5th and 6th. Last year we had over 100 applications for the 25 slots, and we’re expecting even more after seeing how well Pivot25 did last year (writeups by TIME Magazine and CNN). Last year we saw startups from Kenya, Uganda, Rwanda and Tanzania, and this year we’re hoping to see some from South Sudan and Somalia as well.

Categories

As last year there are five categories, each of which will have five startups that will pitching in them. If you think you have a prototype, a deck and a business plan to wow everyone with, let’s see it. Applications are open.

1. Financial Services
2. Business and Resource Management
3. Entertainment
4. Mobile Society
5. Utilities

Getting more information

Pivot East is put on by the m:lab East Africa, an incubator for startups in the mobile apps and services space. All profits go to support the facility. This year support comes from Samsung, and we’ll be announcing a few more big names in the coming weeks. If you’d like to be one of them, contact us.

If you have any questions, we’re having a meeting a Baraza at the iHub on Monday the 6th of February from 2.30pm to 3.30pm. If you’re a startup wanting to know more, or are media or an investor, come by and talk to the organizing team.

[Note: for more on last year's here is my blog post retrospective.]

UPDATE:
The Pivot East Team will be coming to Uganda on the 20th February 2011 at Makerere. You can book your tickets for the event on the link below:

http://pivotuganda.eventbrite.com/

The iHub Research team has worked up an infographic on Tanzania to match their past ones on Kenya and Uganda. We’re looking at 50% mobile phone penetration in Tanzania, with about 22 million connected, where Vodacom has the largest market share at 42%.

The crazy stat is online: In Tanzania, only 2.5% of the population has access to the internet, 80% of those on mobile phones.

Hats off to Patrick Munyi (@ptrckmunyi) for the great design!

THE MOBILE WEB from Duniamedia on Vimeo.

Dunia Media, out of Switzerland, has put together a good video showcasing this change.

Interestingly enough, this video showcases iCow and M-Farm, both providing agricultural data to farmers, not in a browser, but as text or voice messages. One could think the title to be a tad misleading, as the “mobile web” term is largely applied to web interaction on a browser on a phone.

What I like about this take though is this; the internet allows for a paradigm that doesn’t care what device you have, whether PC or phone, as long as you have a database and a channel you’re in the game. As long as the device has some type of text or voice communication it is suddenly a read/write platform.

What we’re seeing in applications coming from Africa is a way to stretch the use-case of “old” messaging technology like SMS, USSD or voice into new ways of data transfer that challenge Western conceptions of what the internet is.