Tag Archives: startups

3.5 years later, what has the iHub done?

Becky Wanjiku sits on the iHub Advisory Board with me, and started a discussion on the iHub, asking “What has the iHub Achieved?“. Her main takeaway point being that the iHub is a platform, and it’s what YOU do with it that is important. T

he iHub started in March 2010, so it’s been about 3.5 years and a lot has happened here in the intervening years. Many people ask me, “so, what has the iHub done?” The best way I could think of to answer that is to just list as much as I could think of, so here’s a rather exhaustive list, though I’m sure that I’m missing some things.

Why Tech Hubs in Africa Exist

Nairobi tech community working at the iHub, circa 2011

Nairobi tech community working at the iHub, circa 2011


Before I get into that though, maybe a framing on why tech hubs exist is important. They’re not just there for startups, in fact our thoughts on incubation and products going back to 2010 was just pre-incubation and connecting to other businesses and investors. Places like the iHub exist to connect this community together, while we get involved in other gaps that exist in the market (UX, incubation, research, etc), these are just part of providing a place where serendipity happens for those who are involved across the network.

These spaces are more than just nurturing talented entrepreneurs, and to not see that means you’re missing the bigger picture on why they exist. They’re not only about entrepreneurs, though we have seen some of them grow from nothing to 40-person orgs that run across multiple countries.

The tech hubs in Africa are more than just places focused on products, much of what goes on is about connecting the people within the tech community in that area to each other and to the greater global industry. For instance, we started Pivot in East Africa, an annual event that does two things: First, it created a culture where the entrepreneurs learned how to pitch their products. Second, it gave a reason for local and global investors and media to come and see what’s going on. Both funding and media coverage have resulted.

Another example is the connecting of global tech companies to local developers, the training that comes out of it for everyone from network operators to Android devs. Google, Samsung and Intel all play strongly in that space.

Some work at increasing the viability and skillsets of freelancers. Whether they’re web designers or PHP software engineers increasing their understanding of how to setup a company, know what IP law is about, take training on project management or quality assurance testing – these all add up to a community that is evolving and becoming more professional.

Those are just a few of the things that tech hubs do across Africa. I can speak for the iHub in Kenya, but know that there are others such as ccHub in Nigeria, Banta Labs in Senegal, ActivSpaces in Cameroon and the other 19 tech hubs in the Afrilabs network are all doing amazing things that create a base for new innovative products, services and models to grow out of. There are new models for ecosystem development around tech in Africa revolving around these technology hubs that are, and will breed, more innovation over time.

New initiatives and organizations from the iHub:

m:lab – first tech incubator in Kenya (2011)
Mobile testing room – all the tablets and phones from the manufacturers (2011)
iHub Research – tech focused research arm (2011)
UX Lab – first user experience lab in East Africa (2012)
iHub Consulting – an effort to connect freelancers to training and businesses (2012)
Savannah Fund – a funding and accelerator program (2012)
Cluster – first open supercomputer cluster in East Africa (2013)
Gearbox – an open makerspace for rapid prototyping (2013)
Code FC – iHub Football Club
Volunteer Network team – the iHub internet network was setup, and is run by, volunteers

Startups who met, work, or started in the iHub:

BitYarn
NikoHapa
KopoKopo
M-Farm
BRCK
Eneza Education
Ma3Route
Uhasibu
Fomobi
Whive
Zege Technologies
Afroes Games
iDaktari
MedAfrica
SleepOut
M-shop
Angani.co
Wezatele
AkiraChix
Upstart Africa
Juakali
CrowdPesa
Elimu
iCow
Sprint Interactive
Lipisha
6 Degrees / The Phone book
Pesatalk
Skoobox
Waabeh
MamaTele
RevWebolution
Smart Blackboard – Mukeli Mobile

Not all groups start their company at the iHub, but they do meet their future business partners there. The Rupu founders met at an iHub event, and subsequently went on to grow their business, the same is true of companies like Skyline Design, and probably many others who we don’t even know about.

It turns out that serendipity is intrinsically hard to measure.

Larger events, groups and meetings:

One of the 120+ events that takes place at the iHub each year.

One of the 120+ events that takes place at the iHub each year.

  • Pivot East – annual pitching competition for East Africa’s mobile startups
  • iHub Robotics (now Gearbox community) meet-ups and build nights
  • EANOG – East Africa Network Operators Group
  • Kids Hacker Camp – 40 kids hack on Arduino, learn about robotics and sensors in a week long full-day hackathon, in partnership with IBM
  • NRBuzz – A monthly event on sharing research on new technologies and communication
  • Summer Data Jam – an annual 6-weeks training on Research and Data
  • Tajriba – month-long user experience event
  • m:lab mobile training – 22 students, 4 months, business and mobile programming (2 years to date)
  • Legal month – annual event with visiting legal professionals leading workshops
  • Barcamp Nairobi (2010, 2011, 2013)
  • Waza Experience – volunteer outreach initiative to expose Kenyan youth to technology and spur creative thinking, problem solving, and better communication skills
  • Fireside Chats – A session for VIP and seasoned speakers
  • Mobile Monday
  • Wireless Wednesday
  • JumpStart Series
  • Pitch Night
  • iHub Livewire – music concert by the iHub community
  • iHub Research Coffee Hour
  • We have a Policy Formulation Team which consists of Jessica Musila, Martin Obuya Paul Muchene, and Jimmy Gitonga. Each one of us sits or has sat through a policy formulation process, such as the AU CyberSecurity (Martin and Paul) and MySociety, Mzalendo (Jessica Musila) and National Broadband Strategy (Jimmy Gitonga).

Outreach events

Egerton University
Catholic University
Kabarak University (Nakuru)
JKUAT (Juja)
Dedan Kimathi (Nyeri)
Maseno University
Nelson Mandela University – Arusha
Strathmore / Intel
University of Nairobi – School of Computing and Informatics

Research-related activities:

Launching of the Data Science and Visualization Lab – 2013
First Summer Data Jam Training – 2013

Research published:

List of infographics created (PDF Links):

iHub-Research-infographic

Mobile Technology in Tanzania: 2011
Mobile Technology in Uganda: 2010/2011
Mobile Technology in Kenya: 2010/2011
Kenya Open Data Pre-Incubator Plan: 2012
3Vs Crowdsourcing Framework for Elections: Using online and mobile technology: 2013
How to Develop Research Findings into Solutions using Design Thinking: 2013
Mobile Statistics in East Africa: 2013
iHub Infographic: 2011
Crowdmap Use
Mobile Tech in East Africa: 2011
An Exploratory Study on Kenyan Consumer Ordering Habits

Tech hubs in Africa research (PDF Links):

ICT Hubs Model: Understanding the Factors that make up Hive Colab in Uganda: August 2012
ICT Hubs Model: Understanding the Factor that make up ActivSpaces Model in Cameroon: August 2012
The Impact of ActivSpaces model (in Cameroon) on its Entrepreneurs: January 2013
Draft Report on Comparative Study on Innovation Hubs Across Africa: May 2013
ICT Hubs model: Understanding the Key Factors of the iHub Model, Nairobi Kenya: April 2013
ICT Hubs model: Understanding Factors that make up the KLab Model in Rwanda: April 2013
ICT Hubs model: Understanding Factors that make up the MEST ICT Hub – ACCRA, Ghana: April 2013
ICT Hubs model: Understanding Factors That Make Up Bongo Hive, Lusaka Zambia: April 2013
ICT Hubs model: Understanding Factors that make up Kinu Hub Model in Dar es salaam, Tanzania: April 2013

Key partnerships:

  • Intel
  • Wananchi Group – ZUKU
  • SEACOM
  • Samsung
  • Microsoft
  • Nokia
  • Google
  • Qualcomm
  • MIH
  • InMobi

VIP speakers:

  • Michael Joseph, Safaricom
  • Joseph Mucheru, Google
  • Vint Cerf, Google
  • Stephen Elop, Nokia
  • Marissa Mayer, Yahoo
  • Bob Collymore, Safaricom
  • Larry Wall, Creator of Perl
  • John Waibochi, Virtual City
  • Mike Macharia, Seven Seas
  • Ken Oyola, Nokia
  • Isis Ny’ongo, Inmobi, Investor
  • The tweeting Chief Kariuki
  • Louis Otieno, Microsoft
  • Dadi Perlmutter, Intel
  • Susan Dray, Dray and Associates

The Need for Both Makerspaces and Incubators in Africa

Maker Faire Africa 2012 in Pictures from WhiteAfrican on Vimeo.

I’ve long been a proponent of getting more spaces set up for hardware prototyping and making of things in Africa. I wrote about it first in 2010 (Hardware hacking garages), then again in 2012 (Fab Factories: Hardware Manufacturing in Africa). I’m one of the founding organizers for Maker Faire Africa and the founder of AfriGadget. I’m not just writing about it either, as we have plans to open up a makerspace in Nairobi this year, which will compliment the FabLab that we already have at the University of Nairobi.

Well managed makerspaces are a missing component in the African technology ecosystem and we need more of them.

There’s a couple reason’s that we need more of them.

A urine powered generator

First is for youth and learning, like the urine powered generator story from the teenage girls in Lagos, that took the world’s bloggers by storm, is an example of this. Another is the young Kenyan who used a simple lighting mechanism to scare away lions. We need places where young people can get their hands into hardware earlier, not all schools are setup for this, and having places with good mentors and tools that they couldn’t buy on their own is important.

Ugali Cooker

Second is about a culture we already have of making things in Africa, specifically that we need to acknowledge our already present maker culture and then try to move it in the direction where it melds some of the more recent high-tech advances with the already low-tech inventiveness found locally. Examples abound, take the bladeless wind turbine out of Tunisia, or the mobile phone security system for your car in Kenya. Simply put, the more we get merge the hardware and software, the more interesting our products will be and they’ll have more global relevance at the same time.

A False Dichotomy

I just read an article titled “Close the Incubators and Accelerators, Open FabLabs and MakerSpaces instead” by Mawuna Remarque Koutonin. While overall it’s a good piece, the title does it a disservice by assuming a false dichotomy – that one is better than the other. It’s not an either/or, it’s an “and”. We don’t need to get rid of accelerators and incubators for software development, we need to add more makerspaces for hardware development and experimentation on top of what we already have.

First a quick list of assumptions that aren’t properly addressed in the piece, so are confusing:

  • There is a conflation of the terms “incubators” and seed-funding “accelerators” they are two different spaces and ways of growing businesses.
  • Makerspaces are collaborative incubation and experimentation spaces with a hardware prototyping focus.
  • Startups can be software or hardware based (or both).
  • Incubation and acceleration is not tied to just only one type (software or hardware) of startup.
  • Not all companies or individuals benefit equally from incubation, some not at all.
  • It can be argued that hardware startups benefit more from incubation facilities due to the heavy cost of getting started.

Other things to consider regarding software, hardware and ultimately the entrepreneurs and companies that come from them:

They’re different. Software startups are different than hardware startups, very different. I know this due to being involved with a hardware product internally at Ushahidi, it’s not the same at all and the needs for the two are completely different.

Having a space doesn’t take the place of personal drive and ambition. Incubators are no substitute for hungry entrepreneurs getting their startup going. Hackerspaces are no substitute for inquisitive hardware minds to experiment. Both require people driven towards a goal already, the space doesn’t matter if the person isn’t ready.

Both can help accelerate entrepreneurs. Both incubators and makerspaces give driven people a chance to move further, faster. The basics of fast internet, space to work with like-minded people, access to tools, inroads to mentors and/or business contacts, and government or university connections are all things that both can (should?) provide.

The conflation of what these spaces are is understandable, as they seem to be morphing all the time. Two good pieces to consider:

Hackerspaces as Accelerators

“It makes good theoretical sense to use a hackerspace as part of an accelerator. Incubators and accelerators are constantly evolving from models that provide premises, training and funding, that may or may not be part of a larger organization, to models that provide nothing but a cooperative community sharing resources. Some take equity, some ask for rent. Some take cuts at both ends. Some have sliding payment scales and operate in tranches, others have fixed programs. There are a lot of variations and not all accelerators/incubators deliver value.”

Evaluating the Effects of Accelerators? Not So Fast

“A business incubator in the purest sense refers to an office park or building complex that charges businesses, typically new businesses that cannot afford their own offices, some rent in exchange for space within the incubator and some administrative services and infrastructural support.”

“Accelerators are organizations that provide cohorts of selected nascent ventures seed-investment, usually in exchange for equity, and limited-duration educational programming, including extensive mentorship and structured educational components. These programs typically culminate in “demo days” where the ventures make pitches to an audience of qualified investors.”

Where should they be?

In short, not the universities in Africa. They’re mired in the 1970’s and have levels of bureaucracy that make it difficult for innovative products or companies to grow out of them. I’d like this to be different than it is too. When I look at what we’ve built at the iHub over the past couple years (the UX Lab, Research arm, supercomputer cluster), I can’t help but think that if Kenyan universities were doing their jobs, then we wouldn’t have to do a lot of these things.

The truth is, globally there are few universities that do a good job of incubation. There are few labs that do a good job of prototyping and taking products to market. There are few accelerators that do a good job of accelerating startups. It doesn’t mean you throw all intent of doing these activities away due to 90% being bad at what they do. That doesn’t mean all are bad. It just means we need to emulate the good ones better.

The best incubators and makerspaces I’ve seen, or have been a part of, are collaborative community environments. Caterina Mota provides an excellent talk describing why they work, and uses the stories of Safecast and Makerbot to underline her statement:

“Secrecy and exclusivity are not essential to commerce.” Catarina Mota

It’s important for us to have spaces that the community has built and runs, where the university, corporates and government can plug into, but not be in charge of.

Jonathan Kalan said it best in his recent article researching the tech hub boom across Africa:

“In a region with a near-total absence of true “3rd spaces”- physical spaces like coffee shops, libraries, and internet cafes, Africa’s “hub boom” has emerged to fill the gap, fostering openness, access, collaboration, education and sharing in Kenya’s tech community, while offering nodes for international exchange, where people like Eric Schmidt can drop in to get a sense of what’s going on.

Crucially, they address the ecosystem’s essential need to grow startups beyond ideas. There is no shortage of entrepreneurs with great ideas on the continent, yet many lack the knowledge and skills to build and scale companies. Through workshops, accelerator programs, incubators and mentorship, these hubs are helping to building local capacity.”

In the end, that’s what we’re all driving for. We’re looking to build and grow the spaces and investment vehicles that allow Africa’s tech community to expand and grow, whether it looks like a makerspace, an incubator or a seed-funding accelerator. We don’t need less of anything, we need more and we need diversification in the types of spaces as they help grow companies in different fields.

We Need More, Not Less

I was recently approached by a Kenyan journalist who was bemoaning the fact there was so much activity in the local tech scene, but that so many weren’t making a lot of money on their startups yet.

It was an interesting moment for me, as I looked at last year’s iHub Research study showing 48 new companies out in the past 2 years (I’ll need an update for 2012 numbers). I look at the numbers of say 30-40 new tech startups in Kenya each year and I think, that’s not enough. We know only 10-20% will make it. Personally, I’m not happy with 3-6 companies each year getting through, we need more. I’ll be a lot happier when we see 100+ new startups, working out of all the new incubators and getting the investment and users/clients they need to grow.

In short, we need more, not fewer startups in Kenya.

It might be uncomfortable for some of us, as we’ve seen the increasing amount of activity and we’re not used to it. However, a growth in this space is exactly what we need if we are to fulfill our own potential for being Africa’s tech innovation hotbed.

It’s also a bit hard to see so many companies fail. This is normal though, it’s what we should expect. As long as the entrepreneurs are learning from what went wrong, then it can serve as a good lesson that makes them more investible in the future. It’ll help us get used to a much more rapid ideation >> creation >> failure/success model.

Here’s the full infographic from the iHub, updated for 2012 (click for full size):

Swimming with the Hippos in Botswana

This week finds me sitting in Botswana. I’ve talked to a couple startup entrepreneurs; Pule Mmolotsi who is testing out an Oyster-like payment card for public transportation in the country, and Katy Digovich who is creating mHealth apps for the Ministry of Health. While only a small sample, they do a good job of representing what I continue to see around the continent; a new generation in Africa trying new ideas and taking to technology to cut the way forward.

Five years ago in Tanzania we had TED Africa, where George Ayittey coined the term “cheetah” to represent the new, younger generation of Africans trying to make a new path. He contrasted them to the “hippo” generation, the slow and often-times corrupt individuals, whose primary role seems to be stifling growth and filling their own pockets. In this context, they are the ones who were (and many still are) in power within government, NGOs, academia and big corporations. It was a captivating talk, and you can watch it here.

While somewhat melodramatic, it framed the conversation. It has provided a good lens through which to think about who is doing what around the continent. More importantly it gives us a frame to realize the rift between the old and the new, not necessarily best delineated by age, but by mindset and approach.

Tackling Transportation Payments

Pule is an inventor and entrpreneur who’s had most of his success come from biometric devices. His new product, Olekard, is very similar to what Google is trying to do with the testing of their Beba Card in Kenya. Anyone familiar with traveling London’s tube system or buses doesn’t need an explanation of how this works. Basically, you get a card that you load money onto, this card is then waved over a terminal on the bus/matatu/combi/train and you’re done, you can take your seat as you’ve just paid.

Benefits include it being safer for people, as they’re not walking around with as much cash on them. It’s easier for the transportion owner to track revenue and decrease theft by driver and tout. For riders, they get a discount on the price from what they would normally pay in cash. Incentives are almost aligned.

The one final bit is how do you incentivize the drivers and touts to not sabotage the device in order to force cash usage. Afterall, that’s how they make good money on the side, by skimming off the surface of what’s due the owner. I’m not sure how that will be handled, but I’m wondering if paying a “bonus” to these staff based on revenue would help.

It’s a good idea, needs a moderate amount of funding ($25k) to go beyond it’s currently small prototype stage, and best of all he already has signed relationships with a route owner with 40 vehicles and a major bank to provide the float.

It’s a tough job, where Pule has to spend most of his time bringing together disparate communities, large corporate entities and old power brokers in order to become successful.

Mobile Health Partnerships

Katy is from the US and has lived in Botswana for the last 3 years, she currently heads a non-profit called Ping that does mobile health apps and also Develo, which does for-profit type work. (side note: put those two companies together and you get Develo-Ping)

Like her counterparts in Kenya, Ghana and elsewhere across the continent, she was attracted to the opportunities in Africa’s tech space. Katy has built up a team of young, energetic developers and they’ve had a good amount of success working within the aforementioned hippo pools, such as the Ministry of Health.

Fortunately for Katy, she’s in Botswana, where there is more wealth and fewer people. The government here seems more intent on actually solving problems with new ideas, and they have both the willpower and funds to make that happen (healthcare is free to all Botswanans). In conjunction with HP, U-Penn and Clinton Health Initiative, they’ve had success in getting the project off the ground.

I didn’t get to see this app first-hand, but I understand it’s made for Android phones and uses the Open Data Kit (ODK). Doctors and nurses in more remote areas can send in pictures of some malady, and have an expert give feedback on the probably issue and remedy needed.

Like any young company, Ping has to figure out service delivery and maintain quality control on their apps, all while working within a much larger and more bureaucratic institution. It’s not easy, and it means more meetings, great communication on managing expectations and real scope change management.

Swimming with the Hippos

I don’t envy Pule or Katy’s their jobs, it’s not easy being an entrepreneur.

It’s in this space where government, large organizations and startups meet that hope can be found. The larger organizations have the cards stacked against them to innovate on anything. The small organizations with great new ideas, find it hard to scale without partnerships.

When large organizations are open enough to bring in outsiders and revisit old laws or rules in order for change to happen, there is hope.

When small organizations are humble and patient enough to work with larger ones, then big change and big money are both possible.

Pivot East: East Africa’s Startup Pitching Competition

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.

WERE2011_PIVOT25-1610

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/

MedAfrica Pitches at DEMO

Mbugua Njihia and Steve Mutinda were the overall winners at the Pivot 25 event earlier this year with their MedKenya app, which has since turned into MedAfrica. Their prize was a chance to pitch at DEMO, the big startup pitching event in Silicon Valley. Here’s their team last week giving the pitch.

MedAfrica is just the tip of the iceberg, as we see more startup spaces, pitching events and seed capital entering the continent.

IPO48 Nairobi Startup Finalists 2011

I’m at the final pitches for the 2011 Nairobi IPO48 event that’s been happening non-stop over the last 2 days. This year it’s being held at the iHub, with 12 companies working through ideas, prototypes, business plans and finally an investment for the winner. In total, they’re offering:

  • 25.000€ (3.3m Ksh) in funding after 48 hours
  • Mentorship from serial entrepreneurs and professionals
  • Great media exposure for your startup
  • Find talented people that want to join your startup

If you want a quick rundown of who the 12 finalists are, and what their apps do, check out Afrinnovator’s writeup. You can also watch quick 1-minute videos on each of them on YouTube.

The 2011 Winner: Tusquee Systems with their SchoolSMS app (which also won their category at Pivot25)!

Runners Up Ghafla! and 6ix Degrees will win an additional 15k Euro investment (more on Afrinnovator).

Kenya Startup Events


It’s only 2 months since Pivot25 and now we’re on another startup event with Human IPO back in Nairobi for the second year. The Tandaa $690k startup grants for techies have gone out to 15 companies. We didn’t have any of these events going on. None.

This is important for a number of reasons:

  • Kenyan entrepreneurs are getting experience in pitching their ideas.
  • Techies are finding out the hard truths about themselves as business people, and that technology alone doesn’t make a business.
  • Local and international mentors are giving the entrepreneurs much needed insights and wisdom.
  • Investors and international media are being catered to, they’re getting a chance to see the Nairobi startup scene up close and personal.
  • Design is being taken a little more seriously (though a lot more needs to be done).
  • It brings an angel and early-stage investment mentality to Nairobi that hasn’t really existed before.

In short, we need to continue with local startup competitions. The more people who learn how to think through, build and pitch their ideas, the more likely we are to continue our upward growth in mobile and web innovation. It’s only by a lot of practice, lessons learned and hard knocks that we’ll see more success stories.

The finalists in these competitions represent a small percentage of the people who apply, but don’t make it. It’s a pure numbers game, where we’ll see the 10-15% succeed and most fail. Again, that’s okay, it’s how the startup game works.

We’re only half way up the mountain, and startup competitions are only part of the equation. There’s a lot more work to do if we want to see more success stories. Thus we need the whole technology community in East Africa to continue supporting the events and the people behind them, but also get involved in the startups themselves, whether for mentoring, business or investment.

Broadening the Base of the Startup Pyramid

While in London at the RGS event I spoke about a different way that I’ve been trying to explain the startup and successful ecosystem needed in places like Africa. Specifically, in the major technology hubs for the continent, these are cities; Nairobi, Jo’burg, Accra, Lagos and Cairo. There seems to be enough funding available for SMEs. How do we get more of them?

It goes something like this.

We have a few good success stories in any one of these cities. There are a handful of great tech companies and organizations that have “made it”. This can be seen as a success in innovation or in business (or in both). Everyone wants to be at the tip of this, and these are the examples we hear of at international conferences and read about in the media.

In the middle we have everyone else, the guys who are still slugging away. They have some clients and revenue streams, but they’re not at the top (yet).

At the bottom, that’s what we deal with in places like the iHub and m:lab. These are those scrappy startups that might or might not have any right being in the place. They’re risky, probably don’t have a solid business model yet, and only a few of them will graduate into the SME space above them.

What to do?

To make the tip of the pyramid bigger, to have more success stories in the tech space, there is only one option: you have to make the base of the pyramid broader.

If your job is to see more innovative new tech companies come out of Africa, the recipe is quite simple:

  • Invest seed funds into local tech entrepreneurs.

(that’s my only bullet point, it’s that simple)

The Israeli vs Silicon Valley Models for African Startups

Everyone wants to compare any up-and-coming tech city in the world to, “The Next Silicon Valley”. That idea is dead on arrival, yet we’re seeing many a reference to it in the media for places like Nairobi and Cape Town.

Paul Graham’s essay states this best (please, read the whole piece):

“What it takes is the right people. If you could get the right ten thousand people to move from Silicon Valley to Buffalo, Buffalo would become Silicon Valley.”

A model for African startups

Yesterday I spoke at Mindspeak, a monthly meeting in Nairobi where people in the business and tech fields talk about what got them to where they are. During the Q&A session after I spoke there was the recurrent question and comparison between what we’re trying to do with the iHub and how we see the increased critical mass in the Nairobi tech space, and if that was going to make us the next Silicon Valley.

That’s the wrong model for us. Instead, we should look closer at the Israeli model.

“Very often, local high-tech startups can’t find the funding here,” Mr. Glaser said. “They get funding elsewhere and ultimately move their locations from here to be closer to their investors.”

Israel already has a culture of innovation and entrepreneurship, which leads to a strong startup culture. Due to geographical and political constraints, startups that create high-tech products and services are forced to look at their growth strategy early on. When a company starts gaining traction, they spin out their executive and parts of their operations to places like Silicon Valley, New York, Cambridge, etc, while maintaining parts of their operations in Israel.

We’ve seen the same with a South African tech firm. Yola (old name: Synthasite) moved first their executive team, then part of their operations, to San Francisco. Shortly thereafter, they raised an amazing $20m.

Of course, the Israeli Model, requires more than just up and moving half of your startup to Silicon Valley. That’s a simplified formula. However, it does serve as an indicator for what we should be looking at here. Instead of trying to grow the same ecosystem that took decades to develop in California, we should look at what works for us.

Key ingredients needed:

  • A network of investors, mentors and connectors in the bigger tech hubs of the world that help incoming African tech companies and help them take the next step. Most of these should be well-placed African diaspora.
  • A policy and legal framework in African countries that allow them to build and succeed/fail quickly so that they can take that next step globally.
  • Seed capital and incubation options for early stage prototypes and business testing in-country.
  • Teach entrepreneurship and leadership within the education system, especially at the university level.

You’ll note that none of these items can be done by just one entity, it takes a concerted effort by multiple parties, including investors, academia and government in order for both a high-tech startup culture to come into being and for success beyond a countries borders to take place.

Certain cities in Africa have the ability to pull this off, including Nairobi, Johannesburg, Cairo, Accra and Lagos. Others have a chance too, but these 5 have the critical mass that makes it more possible, though none of them are there yet.

Afridex: an Index of African Tech Startups

Jon Gosier and Paul Engulu of Appfrica has just launched Afridex, an index of African tech startups. Anyone can submit their website or mobile application and be added to the index. What an excellent idea, and really well executed as well!

Afridex - an index of African web startups

It’s still brand new, but I think it has a lot of potential – we should see a lot of mobile and web companies adding themselves to the index pretty quickly. As it grows, it becomes more valuable as a resource, thus feeding itself ad infinitum.

Why is it useful?

  • Persistent Search queries a search engine in combination with select keywords to track mentions of your company around the web as they occur. When any new information about a group appears online it appears here.
  • Blogstream syndicates the ten most recent posts from a company blog. People can also use to follow company blogs by subscribing to the RSS feed.
  • Comments allows consumer feedback and comments about a group or organization. Get instant feedback from your customers, crowd source a product review, or offer public customer service.
  • Brand Watch is a feature that allows users to monitor mentions of a company across various social networks, blogs and websites. Like persistent search, Brand Watch scans all the popular web portals in africa and abroad for mentions of a company name.
  • Embed allows users to export standards compliant code that will allow them to embed information related to a company in their profile. This allows data from the Afridex to be portable. This information can be used as a quick citation tool for blogs, news articles, email and reports.

If you click on any company’s name, you will be taken to the detail page on them. On that page you will find a bunch of publicly available information, including everything from contact information to blog and Twitter posts. It’s really quite impressive.

Afridex - Company Detail Page

In the lower-right corner you’ll notice the “embed” code that will allow you to add a widget to the sidebar of any website with basic information about that company. The one for Node Six looks like this:

NodeSix

[Map]
URL – http://www.nodesix.com/
Email – sales@nodesix.com

Node Six began life as a division of Elemental Edge, a leading multi-media and visual communications solutions provider in Kampala, Uganda.

Information Provided by the Afridex

Summary

The only problem that I’ve found so far is that I can’t find a way to either “get listed” (it’s currently a dead link), or create a login so that I can submit a couple companies. I’m sure this is because it’s so brand new, and I’m sure Jon or Paul will leave a note here when that works.

I’m not surprised that this excellent idea came from Jon Gossier, I’m starting to expect this type of top-class work from him. I’m sure we’re going to see even more of this in the future. Brilliant.

Want to help out with this cool project? Get involved on the Afridex wiki