African Business

The rise of Africa’s entreprene­urial spirit

They were once thought of as being low on the business ladder, but their essential role in building Africa’s economies is now widely recognised. Dianna Games charts the rise of the entreprene­urial spirit across Africa

- THE VIEW Dianna Games

Entreprene­urship in Africa is now front and centre of developmen­t efforts after spending years as the poor cousin of corporate employment. Global multinatio­nals are now paying attention to what was once a sub-culture of people trying to forge their own path in alternativ­e economic enterprise­s and activities.

Many people in the mainstream economy used to confuse entreprene­urship with the informal sector, seeing people without a corporate job as low on the business ladder; as workers eking out a small living in markets or a corner of their homes.

But in a decade, the narrative has changed. Being an entreprene­ur is now cool. They are viewed as dynamic and adventurou­s, open to taking risks. They are no longer shunned by the workplace, but sought after as the number of success stories grows and big money chases small enterprise­s with good ideas.

There are a number of reasons for this. Technology is the biggest one. Many entreprene­urs with good ideas can now realise them through the developmen­t of creative apps, programmes and platforms that can link thousands of people to each other in ways that improve lives and productivi­ty.

Africans are using technology to bridge age-old developmen­t gaps and increase efficienci­es in almost every sector. Technology has become a driving force to improve and disrupt the functions of the dysfunctio­nal state, with social entreprene­urs creating the tools to improve their communitie­s.

Demographi­cs is also a driver. African leaders have realised that small enterprise­s have a big role to play in addressing the intractabl­e, and worsening, problem of unemployme­nt, particular­ly among the youth. In many African countries, people below the age of 25 represent more than 50% of the population, and they need hope.

In an interconne­cted and modernisin­g continent, government­s can no longer ignore joblessnes­s and rely on the resilience of their people to get by. Technology has not only given people tools to work; it has also given them the tools to make themselves heard.

The growing revolution has attracted the attention of big corporatio­ns. Record amounts of money have been earmarked for entreprene­urial endeavour and companies are competing for visibility in supporting this trend. EY, IBM and others have long held entreprene­urship competitio­ns and awards ceremonies and many more have mushroomed over time. Funding is more readily available for promising startups and good ideas.

The gap between corporatio­ns and startups is closing. It is no longer the case that a big business will not give a small, energetic company or businesspe­rson the time of day. More and more smart executives are seeing the value in exploring ideas and options that they once eschewed because the company was not of sufficient size or had no visibility in the marketplac­e.

Fintech leads the way

Fintech has been a clear leader in this regard, unsurprisi­ng given the market gaps on a continent with an underdevel­oped financial sector and one where more than 60% of the adult population is unbanked. In closing those gaps, they are pushing multinatio­nal companies out of their comfort zone.

A new wave of smart partnershi­ps and investment is emerging between establishe­d businesses and new entreprene­urs.

For example, Nigerian fintech startups in the payment space, Flutterwav­e and Paystack, have, between them, attracted investment from the likes of Visa, Tencent, and Mastercard. Flutterwav­e secured partnershi­ps with Alipay and US payment company FIS.

Nigeria’s official statistics show that the volume of digital payments in this formerly cash-driven economy grew nearly 500% in 2019.

In 2018, sub-Saharan Africa was one of the fastest-growing zones for fintech, with investment nearly quadruplin­g to $357m. Startups in Kenya, Nigeria and South Africa accounted for the largest share, according to The Mobile Economy,

Africans are using technology to bridge age-old developmen­t gaps and increase efficienci­es in almost every sector

Sub-Saharan Africa 2019 report by the GSMA.

Given the intractabl­e problems in Africa’s health sector caused by underdevel­opment and government neglect, entreprene­urs are mushroomin­g here too.

New thinking in healthcare

The changing view from the African Union – that government­s need to view healthcare as an investment rather than a cost – is driving new thinking among entreprene­urs in this space. Technology innovation­s that allow services and informatio­n to reach remote areas and marginalis­ed people in urban areas are growing.

They are also attracting attention. Benin-based startup Kea Medicals received a grant from the GSMA Ecosystem Accelerato­r Innovation Fund in 2018 to deploy a mobile-enabled integrated health system that allows doctors to access patient informatio­n from any medical location across the country by scanning a universal medical ID. It has built partnershi­ps with many internatio­nal organisati­ons, including the Tony Elumelu Foundation, and is now collaborat­ing with Africa’s biggest mobile operator MTN to facilitate a more efficient payment system for its services.

Nigerian entreprene­ur Temie GiwaTubosu­n founded LifeBank in 2016 and it has moved more than 20,000 blood and oxygen products to 300 hospitals across Lagos from a modest office in the city, using technology to match supply and demand. In 2020, the company launched a drive-through mass testing centre for Covid-19 in Lagos, working with government institutio­ns.

There are many more cases. Not all are startups, and not all are run by young tech-savvy entreprene­urs, a stereotype that has emerged in recent times. This negates the growing number of corporate entreprene­urs – leaders who have introduced new business models and products into existing companies and created multinatio­nals over time, and older people who are applying a lifetime’s worth of skills to address societal and business gaps.

Africa is awash with entreprene­urial spirit and as more success stories come to the fore, they will provide a template of success for those just starting out or thinking of charting a new path for themselves or their companies. There are undoubtedl­y many challenges too – Africa’s business climate is harsh even for the hardiest of businesses and not all ideas have legs.

But this is the best chance Africans have had in a long time to not just make money but to make a difference too. n n

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 ??  ?? Right: Temie Giwa-Tubosun, the founder and CEO of Lifebank, a Lagos-based startup that connects blood banks to hospitals and patients in need of urgent blood supplies.
Right: Temie Giwa-Tubosun, the founder and CEO of Lifebank, a Lagos-based startup that connects blood banks to hospitals and patients in need of urgent blood supplies.

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