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How Capetown, Lagos, Accra And Nairobi became Hubs for Entrepreneurs

While startup cities are just emerging, there are smart and sophisticated steps being taken to develop healthy entrepreneurial ecosystems across the African continent. African countries continue to throw off their post-colonial cloak to become the

While startup cities are just emerging, there are smart and sophisticated steps being taken to develop healthy entrepreneurial ecosystems across the African continent. African countries continue to throw off their post-colonial cloak to become the world’s fastest-growing group of economies. The catalysts for much of this explosive growth are the mobile phone and the internet. According to analyst ABI, in 2012, 76.4 per cent of Africans owned a mobile phone; that’s 821 million out of a population of more than a billion people. this mobile penetration rate almost certainly surpassed 80 per cent in 2013. This revolution has created extraordinary opportunities. This has created new possibilities for African talent to start any project of their dreams.

 

Companies in the IT and telecom industries have proven to generate significant positive cash flow and profitable reinvestment opportunities for their retained earnings. High growth companies are also responsible for innovation, which is necessary for the development across the Continent.

 

Lagos, Nigeria

The Lagos tech scene is on fire. This city has seen some amazing things happen in its tech space in the last few months, with its tech neighborhoods and state-backed innovation hubs. The majority of entrepreneurs in the country are operating in Lagos, the former capital of the country and Lagos beats the rest of Africa with fastest new company growth despite it having major roadblocks with registering properties and getting electricity, according to the World Bank. Nigeria has 160 million people with more than 100 million of them using mobile phones daily. Nigeria is creating its own Silicon Valleys, thanks to Nigerians in the Diaspora who are moving back one after the other to support the growing industries in entertainment, technology and fashion. Clusters of start-up tech companies are also forming and are attracting big international investment. Technology has enabled a new generation of creators and innovators emerging from Lagos to come up with inventive ideas that solve local problems. Techpreneurs of iROKOtv and Nollywood fame, Jason Njoku and Bastian Gotter, also launched a Lagos-based company, SPARK, a one million dollar project created to support and develop aspiring Nigerian tech and internet entrepreneurs. Currently SPARK has seed-funded 13 companies in Lagos including: Hotels.com.ng, Christians.com.ng, Bus.com.ng, Giddimint.com.ng, Borro.com.ng, Insured.com.ng, ToLet.com.ng and Foto.com.ng.

 

Accra, Ghana

Ghana is one the fastest growing economies in Africa, experiencing strong growth over the past decade and forecasted to grow at 6% to 7% in the coming year. With a diverse and rich natural resource base, Ghana also has one of the highest levels of per capital GDP in Africa. Entrepreneurship is going to play a key role in Ghana’s future. The number of entrepreneurship education and training programs has multiplied in Ghana over the past decade, and a growing number of young people are pursuing entrepreneurship, with hopes of striking it big. The Accra entrepreneurial environment is vibrant and growing in comparison to its other West African counterparts. The Ghanaian business infrastructure is stable, and the government promotes business and entrepreneurship. Recently Hub Accra opened, a co-working space offering shared working spaces, dedicated desk spaces, private office space, and conference room rentals. Several young businesses, including the winner of the last Startup Weekend Accra, SliceBiz, has already located their offices in Hub Accra.The World Bank’s Doing Business project ranked Ghana 64th in terms of “ease of doing business.”

 

Kigali, Rwanda

According to the text of the government mission, Rwanda Vision 2020, Rwanda will attain the status of a middle-income country by simply skipping the industrialization phase and directly shaping an approach based on information technology and communications economy. One of the first moves of Vision 2020 is KLAB. Located in Kigali, KLAB– meaning “knowledge laboratory” – is a unique collaborative space for young entrepreneurs and other engineers to access free WiFi, participate in workshops and conferences, to compete in hackathons, or simply exchange code tips while playing table football. The center can also count on the experience of 21 mentors available to develop ideas or offer business advice to new businesses hoping to break into the technology sector. Today, the facility hosts 85 KLAB “tenants” and 11 start-ups, most of which have already launched products on the market. Foyo, for example, has developed an application that sends daily health advice and dietary tips to its users, while Torque is famous for its inventory system in the cloud for small and medium enterprises. One of the most successful companies is KLAB GiraICT, which manufactures tablets and smartphones, very similar to HP and Samsung devices, but accessible to the lower income population through monthly installment plans. Since its launch, GiraICT opened branches in Burundi and Ghana.

 

Nairobi, Kenya

If you haven’t traveled to Kenya lately, you may not be aware that a mobile evolution is occurring in Nairobi. The rapidly rising digital entrepreneurship scene has real promise to grow successful businesses, stimulating job creation, generating new sources of revenue for the mobile industry and delivering innovative services for customers. Nairobi, in the heart of Kenya, has already produced some notable success stories, such as Craft Silicon, a software firm that provides core banking, microfinance, mobile and switch solutions with software and electronic payments services for over 200 institutional clients in 40 countries. Craft Silicon’s market value is estimated at $50 million. Also a mobile money service set up in 2007, known as M-Pesa, accounted for more than 31 per cent of Kenya’s GDP across more than 19 million customers in 2012.

 

Cape Town, South Africa

Forget the business energy of Johannesburg, the city of gold. Brush aside Pretoria, the ‘sluggish’ capital city of South Africa, with its phlegmatic businesses and government buildings looking like monasteries. Here comes Cape Town, South Africa’s second-biggest city, which is said to be emerging slowly but surely as the country’s Silicon Valley. The city is emulating the world-renowned region in California which is home to some of the world’s largest technology companies and many entrepreneurial ventures. The consistent growth of small tech-focused businesses in Cape Town and the accessibility of educational institutions continue to create fertile grounds for entrepreneurial activity within the region. It is believed that the Western Cape provincial government and the City of Cape Town have invested over R150m in the city’s broadband infrastructure project. Another R500 million (about 5 million USD) is due to be pumped in, in 2014, to take the technology sector to greater heights.

Debo Folorunsho
Debo Folorunsho serves as CEO of Applause Africa Communications and Executive Producer of the African Diaspora Awards. He has worked in Visual Design at Music Creative Group, Warner Music Communications and Design Group, and Permission Data.
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