Why African Entrepreneurs Should Build Software Products For The Global Market
October 8, 2013 Editor 0
I am Fritz Ekwoge and I’ve spent three years running a Cameroonian startup, carving my niche with B2C products for the African market. This is what I have to say: I think developing for Africa sucks right now for small to medium-sized companies. It had not always sucked. But right now it does.
A few years ago, the African market was a very lucrative market for the average zero-funded entrepreneur. The African market has always been plagued with poor infrastructure, corruption, limited skills, poor education, poor government support and many others.
But even with limited branding and advertising budgets, the typical African entrepreneur had the advantage of being local. Being local meant that we could carve our niche in a market that was not interesting before for our mightier competitors out of Africa. That was then. We’ve lost that local advantage for one single reason.
Africa is no longer invisible.
Now more than ever, foreign (tech) companies are facing difficulties growing in an already saturated developed-world market. Naturally, this has caused a situation where the foreign companies are paying closer attention to Africa and other emerging markets where growth potential still exists.
This is probably good news for the local consumer market, but bad news for the local entrepreneur. The foreign companies are coming in with bigger guns. You, the local entrepreneur, will be bringing a knife in a gun fight. You will eventually go out of business.
China’s solution to the problem is quite radical. China either implements blocks or imposes heavy restrictions that discourage foreign businesses from entering the Chinese market. China can afford to do that because of the sheer size of their market. It would be unreasonable to propose we try the same approach in our tiny African market. No. I have something else to propose. If the foreign companies are trying to enter our African market, why don’t we try to enter the foreign market ?
Developing FROM African rocks right now. Internet connectivity is getting better, skill sets are improving to acceptable levels, labour is cheaper, the food is better. There are more and more VCs interested in the African market which increases the probability of getting funded, or getting introduced to the right people. Now is the best time to build a product FROM Africa that you can sell to a bigger global market. India is probably the best example I know of where local entrepreneurs are increasingly selling their craft to the whole world.
I am not saying it is impossible to build a commercially successful (tech) product for Africa. However, past commercial success stories have shown that you need both patience and heavy capital (we are talking about millions of dollars). Branding and marketing in Africa still depend on expensive TV ads. Your aunt in Africa, who probably goes online once every month won’t find out about your product on Google AdWords. Payment still requires setting up many sales points. Government officials still need to be bribed.
The list goes on…
On the other hand, developing from Africa and selling to the whole wide world has become easier with the rise of AppStores, SAAS, online fashion stores, freelance websites, and global ad networks where your traffic can be monetized at global rates. Marketing to the world is getting easier with social media and search engine marketing/optimisation. The list goes on. There are so many ways we can get better at selling to the global market, where the money is. Yet, we spend so much time fighting with our brothers over this tiny African market.
Here is a counter argument I am expecting to hear. If the foreign market is already saturated, why do we think we can carve a sizable niche in such a market ? I believe building products FROM Africa puts us in a unique position to build most products cheaper, and sell them cheaper. Building FROM Africa also puts you in that unique position where you can look at existing solutions from a new perspective and come up with something that is radically disruptive.
What I’m saying is this: If you are a small African entrepreneur and you want to generate more cash for less unnecessary work, your next big idea should be one you can sell to the whole world. Sometimes we shy away because we think we can’t build products that have the minimum amount of quality that the global market expects.
We’re all using the same “brainware”, we too can learn how to produce quality. Target markets out of Africa. The diaspora, for example, is a good market out of Africa. 10 years later, you can use the money you’ve earned out of Africa to make Africa a better place.
Just remember who gave you this tip
This post first appeared on TechLoy and is republished here with Fritz Ekwoge’s permission.
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