Our three takeaways from AfricaCom

November 29, 2016 | Ecosystem Accelerator | Middle East and North Africa | Sub-Saharan Africa | Maxime Bayen

On November 15th-17th, GSMA’s Ecosystem Accelerator team took part in AfricaCom, a tech and telecom focused three-day event that gathered around 10,000 attendees this year in Cape Town under the theme, “Economic Development and Social Empowerment through Digital Connectivity.”

Here are three takeaways from these insightful events we wanted to share with you.

1. For mobile operators in Africa, partnership is the new name of the game

Several mobile operators shared similar views on their future role in the digital value chain at AfricaCom’s main keynotes. It became evident that collaboration is the way forward since the question was no longer whether to partner, but how to partner effectively with digital players. We observed mobile operators such as Orange, Vodacom, MTN, Vodafone and 8ta already focusing their efforts on strengthening links with local start-ups. On the evening of AfricaCom’s first day, Orange held a ceremony to announce the winner of the sixth edition of the Orange Social Venture Prize for Africa and the Middle East. This year’s winner was Morocco’s MedTrucks, which was created to support patients and healthcare professionals through the deployment of mobile care units in “medical deserts” in Morocco and other emerging countries.

Similarly, in a fireside chat we had the chance to run with Manny Teixeira – Group Head for Digital Media and Service at MTN Group, it was noted that the South African-based operator has created a number of “touchpoints” with local African start-ups (like the MTN Entrepreneurship Challenge and the MTN-Nest Mobile Tech Bootcamp). MTN is now focused on the next step: building collaboration with the start-ups that have emerged through these channels.

“We, African mobile operators, have access. That’s our strength for partnering” concluded Manny Teixeira later on in the conference.
 

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2. African start-ups: investing in unpolished diamonds

During the three-day event, our team spent some time attending the “Ahub” track, which focused on African tech start-ups under the tagline “Don’t imitate, innovate: disruptive innovation in digital Africa”.

While the funding paradox in the African tech space is still real (i.e. there is a lot of capital available and deployed but start-ups are still struggling to access funding), start-ups funding is improving in the continent. According to Disrupt Africa founder Tom Jackson, there have already been more than 100 funding rounds of start-ups across Africa in 2016, including 17 multi-million dollar rounds. This will lead to a much higher figure than the $187 million point shared in their 2015 research. Unsurprisingly, while the solar segment was topping the chart in 2015, this year FinTech is ahead of the pack.
According to Andrea Böhmert, a seasoned investor across African markets, there is a way to accelerate this growth of funding rounds and hence reduce the “funding paradox”:

“There is definitely investment money around and good start-ups. What’s missing is the packaging. You need – as an investor – to not wait for the perfectly polished diamond. On the start-up side, don’t expect investors to pay the price of a perfect diamond if you are just a rough one.”

3. The crucial role of the African tech ecosystem

On the third day of the event, we took part in a panel discussion on African Tech Hubs; a topic our team researched earlier in the year. Most of the panel’s discussion focused on how African innovation hubs (particularly Cape Town’s Silicon Cape and Nairobi’s Silicon Savannah) compare to the actual Silicon Valley. Most panellists, including the author of these lines, didn’t agree the comparison should be made in the first place, partly because innovation in Africa comes from local entrepreneurs trying to solve local problems, rather than developers trying to challenge local tech giants. Africa has a distinct tech ecosystem which houses technology-driven innovation, many of which are aimed at tackling the social-economic challenges faced locally. Many of these innovations are housed in the continent’s 314+ local active tech hubs which play a crucial role in supporting start-ups in getting off the ground.

Facebook’s Africa Strategic Products Partnerships Manager, Emeka Afigbo summarised it very well: “Tech hubs in Africa provide basic infrastructure for people to innovate: office space, electricity, connectivity, and most importantly access to a community”.

We had the chance to see two illustrations of Emeka Afigbo’s statement alongside the events as we visited two local tech hubs: MTN Solution Space (hosted by the University of Cape Town) and Barclays’ Rise hub in Cape Town.
 

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