Starting Up Africa

African entrepreneurship 

While startup cities are just emerging, there are smart and sophisticated steps being taken to develop healthy entrepreneurial ecosystems across the African continent. I take a look at one such collaboration, LIONS@FRICA, that promises to set a new example of how the willing can better help in Africa.

Despite substantial global investment over the years in developing Africa’s economies, a general consensus lingers that foreign investment there is not delivering as much as it could. One relatively new effort is making its mark by capitalizing on the tools and energy of tech startups to foster smarter entrepreneurial ecosystems.

LIONS@FRICA is an innovative partnership mobilizing the knowledge, expertise and resources of leading public and private institutions to encourage and enhance Africa’s innovation ecosystem and to spur entrepreneurship. The partnership includes an impressive array of partners including the US State Department, VC4Africa, Microsoft, Nokia, DEMO Africa, Global Entrepreneurship Week, and more.

This will be an important year for entrepreneurship in Africa. For example, in Morocco alone we will see: a Startup Weekend every month for a year; a twice as big Global Entrepreneurship Week celebration in November offering among other things the finale of the Startup Cup; leadership by one of Morocco’s major employers, OCP, in systematically setting up a collection of programs to fill gaps in the existing ecosystem; and finally, the State Department’s annual Global Entrepreneurship Summit being hosted by the Kingdom of Morocco. With so much activity, it becomes even more important that all these actors take a systematic approach to deliberately build systems for nurturing new firm formation that can be sustained even if the public attention diminishes.

There has been a lot of literature recently about what it takes to develop strong entrepreneurial ecosystems. One recent report by the World Economic Forum and Stanford University that uses data from 1,000 entrepreneurs suggests that the three most important pillars of the entrepreneurial ecosystem are human capital, accessible markets and funding / finance. I took a look at what LIONS@FRICA is doing in all three of these areas.
In terms of human capital, from my visits to startup hubs in Africa, I know there is plenty of potential for developers in Africa. It was exciting to enter iHub in Nairobi and be told that there is plenty of developer talent on multiple platforms—but fewer entrepreneurs leveraging their skills. LIONS@FRICA partner CoderDojo decided to build on this emerging opportunity with an African initiative called afriCoderDojo that teaches young people to code, develop websites, apps, programs, games and more while having fun. The partnership is based on the global CoderDojo movement and relies on a volunteer network of implementers and mentors to teach youth the basics of coding anywhere there is a computer and an internet connection. The program, which will be launched on February 22, is first being piloted in Tanzania and Nigeria with plans to roll out widely across the continent. afriCoderDojo is one to watch.

Also identified in the World Economic Forum report was the role of large companies in accelerating the growth of early-stage companies. In this respect, LIONS@FRICA has partnered with Microsoft and their 4Afrika initiative. Last November, Microsoft announced the expansion of the Microsoft Ventures partnership program into Africa by selecting 88mph as its first African accelerator partner. 88mph was chosen for its proven model of helping launch and secure funding for innovative African startups. Together, Microsoft and 88mph will work to provide startups in Nairobi with mentorship, technology guidance, seed funding, joint selling opportunities and more. This is in addition to their BizSpark program, through which they have already helped support 625 African startups by providing access to Microsoft tools and technologies.

While I personally think funding has been exaggerated in terms of how much of a barrier it is to startups, most entrepreneurs say otherwise, including those surveyed for the World Economic Forum report. I am not surprised therefore to see LIONS@FRICA with a strong partner focusing on capital. VC4Africa is making significant strides in boosting angel investing in Africa through a blend of mentorship, investor preparation and deal screening. By providing this package, VC4Africa is making it easier for outside investors less familiar with the African continent to get involved. In the words of angel investor Jerome Kisting, “I don’t have staff working for me, so if VC4Africa can do that initial screening and select entrepreneurs that actually have coherent business plans and it looks like the model can work, that is really useful.”

Both Microsoft and VC4Africa have been big supporters of DEMO Africa, one of the LIONS@FRICA flagship programs. DEMO Africa, affiliated with the world famous DEMO pitch sessions, was brought to Africa and was hosted in Nairobi for the first time in 2012 and has now seen more than 70 entrepreneurs pitch onstage to a global community in two years. In 2014, DEMO Africa will make the move across the continent to the West African shores of Nigeria, opening more doors along the way. Not only does DEMO provide opportunities for African entrepreneurs to link with potential funders, it also gives these growing companies a huge opportunity to reach new markets, something emphasized in the World Economic Forum report.

Collaboration and cohesion is vital to the LIONS@FRICA approach. For example, to further identify and bolster what are very different ecosystems across the African continent, the LIONS@FRICA partnership is now launching a bold goal of mapping the ecosystem of all 54 countries. We hear a lot of talk about mapping these days, but too often these initiatives result in a static document that is quickly out of date. LIONS@FRICA is partnering with Startup Genome, which has been working on a curator-driven model of ecosystem mapping that provides a real-time picture of the environment. The platform has already taken off in the United States and while it has more than 85,000 startups mapped there is very little penetration into the ecosystems of Africa. Using its wide range of partners led by GEW Global’s network on the continent, LIONS@FRICA will help bring curators on board to begin mapping these ecosystems, thereby enhancing communication, improving efficiency and providing a cohesive tool for the continued growth of entrepreneurship in these countries. This effort is set to move forward in the first quarter of 2014.

The LIONS@FRICA approach is also global. It recognizes that the actors supporting entrepreneurial development might come from anywhere in the world and of course that markets for African startups are on every continent. Not only is LIONS@FRICA the brainchild of the U.S. State Department which is developing a strong reputation for putting backbone from outside the continent behind supporting entrepreneurs in developing economies, it also engages with the Global Entrepreneurship Congress (GEC) which has emerged as the world’s big tent to talk shop about global entrepreneurial development. LIONS@FRICA will have a session at this year’s GEC on March 17 in Moscow, offering leaders in the ecosystem a chance to share knowledge with their counterparts from 140 nations. Among them, policymakers from Africa and other developing economies will coordinate on emerging research, innovative policy ideas and leading edge programs to support entrepreneurs making sure their countries have access to the best ideas emerging from the world’s hottest startup communities. The event will also offer entrepreneurs a chance to find best-in-class ideas for scaling their nascent startup.

This new approach is breaking old models for development throughout Africa and bears watching. If you are not planning on being in Moscow or on visiting one of the LIONS@FRICA projects in 2014, be sure to stay up-to-date by following @lionsafrica on Twitter.

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