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5 African Tech Startups Creating a Buzz

African tech startups received a total amount of funding in excess of $185.78 million in 2015, according to data compiled by Disrupt Africa. – Disrupt Africa

In January 2016, many experts predicted a slowdown in the level of startup funding around the world. Indeed, a drop-off in startup funding did occur, with the first quarter of 2016 finishing 25 percent lower than the fourth quarter of 2015.

Perhaps not so surprisingly, African tech-based startups bucked this trend with investors seeking to back promising young companies throughout the continent. Of all startup sectors, tech companies is helping lead the charge. Five technology startups in particular are creating a not-so subtle buzz—and attracting potential investors in the process.

Here are five of the most promising tech startups in Africa:

DabaDoc

dabadoc logoDabaDoc is a Morocco-based company that was established by two siblings. The company’s website allows users to easily search for a local doctor or dentist and book an appointment online for free. One of DabaDoc’s missions is to improve access to health care in Africa.

The company quickly expanded to Algeria and Tunisia, with operations beginning four months after startup. The result was a listing of doctors in 72 specialties across 50 cities. DabaDoc is now the largest medical appointment booking platform on the African continent.

To date, the company has received several recognitions, including a handful from prominent industrialists in Silicon Valley. The company recently expanded to Nigeria, South Africa, and Pakistan, and expects to roll out in other countries as well.

Giraffe

giraffe logoSouth African startup Giraffe is a recruiting platform with a focus on low- and medium-skilled positions, such as waiters, cashiers, call center workers, drivers, receptionists, and retail supervisors. Launched in February 2015, the site signed up over 70,000 users in just 10 months.

Job hunters and employers can sign up for the service via SMS or through the website. Job seekers create an account, then answer a series of simple questions that produce a finished, customized resume at no cost. Employers log into the system and submit a short form, specifying their staffing needs. Giraffe utilizes an algorithm to match the request with appropriate job seekers, who are notified via text. According to its own estimates, the company is able to match employers with qualified workers 10 times faster and 10 times cheaper than traditional recruiting methods, as it is able to provide job candidates for a position in less than 48 hours. Giraffe also performs background, criminal, and reference checks to verify candidates’ qualifications.

The company has won numerous awards for innovation and plans on expanding operations into nearby countries.

Yaoota

yaoota! logoFounded in Egypt, Yaoota is a shopping search engine that enables users to compare prices on hundreds of thousands of products across a variety of retailers. Shoppers can find the best prices on electronics, apparel, furniture, toys, sports equipment, books, jewelry, and much more.

Originally self-funded, Yaoota attracted investors’ attention through its simple interface, which is aesthetically similar to Google’s search engine. Yaoota only provides search results from qualified online stores that meet minimum standards, and most retailers accept cash on delivery for payment. The company primarily serves shoppers in Egypt, but has expanded outside Africa to the United Arab Emirates as well.

M-KOPA Solar

mkopa logoOne of Africa’s most successful startups, M-KOPA Solar received two rounds of funding totaling $31.45 million in 2015. The company is using this money to expand its already-impressive line of home solar energy systems, which have powered hundreds of thousands of homes throughout Kenya, Tanzania, and Uganda. The company estimates that in Uganda alone, there are still 5.5 million homes that aren’t connected to the power grid; most of these very low-income households still rely on kerosene for lighting. M-KOPA is tapping into this market by offering an affordable mobile installment payment plan.

M-KOPA’s growth has been steady. The company was founded in 2011 and has since amassed 757 full-time staff along with 1,251 contracted field agents. The company was awarded the New Energy Pioneer Award by Bloomberg for its “patented technology platform that combines embedded GSM and mobile payments” and its emphasis on developing markets.

Paga

paga logoBased in Nigeria, Paga has worked to improve the accessibility of banking services for a wide demographic of Africans. The company offers a mobile banking platform that operates via SMS, making the application available to mobile users on any network. The company’s primary focus is its money transfer service. Additional services offered by Paga include purchase and transfer of air time credits, retail and bill payments, and small business payment collection services.

Having recently secured a round of series B funding totaling $13 million, the company is planning to further develop its payment offerings for small businesses while continuing to expand its staff. Paga has also continued to expand upon it SMS banking platform, adding transactional capabilities via a website, mobile application, GSM, and interactive voice technology.

 

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entrepreneur

What You Should Know about Entrepreneurship in Africa

In Africa, where many struggle to find employment, an increasing number of people are creating their own businesses, pursuing ventures that interest them and providing new job opportunities for others.

The World Bank Group completed a survey in June of 2015 regarding entrepreneurial activity around the world, and many African countries appeared on the list. Botswana, for example, registered 16,850 new limited liability companies (LLCs) in 2014. In the same year, Nigeria registered nearly 72,000 LLCs. Other nations showing entrepreneurial growth included Sierra Leone, Gabon, and Algeria. The boost in enterprise activity is having a positive effect on the entire continent. Read on to learn more about entrepreneurship in Africa.

Women have a strong presence.

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Image courtesy Overseas Development Institute | Flickr

In 2014, Africa had the largest presence of female entrepreneurs in the entire world. In fact, seven out of 10 countries with the highest number of female owners/managers of a new business were located in Africa. Nigeria and Zambia led the rest of the continent for its number of female entrepreneurs, followed by Ecuador, Ghana, and Malawi. In an article published on CNN, Global Entrepreneurship Monitor Executive Director Mike Herrington stated that more African women are becoming entrepreneurs in order to pay for their children’s education.

The United States supports African entrepreneurs.

Supporting global entrepreneurship has been a steadfast initiative of the United States. In 2010, President Obama hosted the inaugural Global Entrepreneurship Summit (GES) at the White House. The purpose of this gathering, which he outlined in his “A New Beginning” speech in Cairo, is “to identify how we can deepen ties between business leaders, foundations, and social entrepreneurs” around the world. At the 2015 GES in Nairobi, Kenya, an estimated 1,000 entrepreneurs and investors came together to learn about African-based businesses and discover how foreign and domestic entities can collaborate.

In addition to instigating the GES, President Obama committed hundreds of millions to Kenya’s Equity Bank Group, which will focus on giving loans to young people and women entrepreneurs. Other American support comes from the United States Agency for International Development (USAID) and Department of State. The latter provides aid to African entrepreneurs, especially female business owners, in the science and technology sector. USAID recently guaranteed a crucial loan portfolio to support the Essential Capital Consortium Fund, which lends to social enterprises worldwide, including in sub-Saharan Africa.

Uganda leads the continent in entrepreneurship.

At the end of 2015, Uganda topped the list of countries with the most entrepreneurial activity, according to the Approved Index, an organization that focuses on business development and smart solutions to build efficiency. To qualify as a new business, enterprises had to have paid salaries for between three and 42 months. Uganda’s startup rate was 28 percent, which placed it ahead of Thailand and Brazil.

African entrepreneurs are changing their societies.

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Image courtesy Overseas Development Institute | Flickr

Analysts predict that business owners between the ages of 18 and 34 will change local economies by creating jobs, thus helping to reduce crime and radicalization.  These new employment opportunities will also add to the growing middle class.

The continent’s entrepreneurial success is fueled by several factors, including in-school business training, which produces more competent business owners. A culture of fearlessness in regards to entrepreneurial risk is also contributing to a rise in new ventures. In fact, less than a quarter of respondents to a 2012 survey involving in excess of 20,000 Sub-Saharan African adults stated that fear would keep them from pursuing their own business. Fortunately, entrepreneurship is viewed in high regard, thus making it that much more enticing.

The South African government stands by new businesses.

Despite large budget cuts and restrictions on capital distribution, the Department of Small Business Development in South Africa does not plan to stop supporting entrepreneurial programs. In fact, it intends to launch several new initiatives through 2019 in an effort to improve export readiness.

It will also contribute to the Black Business Supplier Development program and implement the Youth Black Business Supplier Development Programme, which benefits youth and female entrepreneurs. Further, it will allocate funding for entities such as the Small Enterprise Finance Agency and Small Enterprise Development Agency, as well as grant opportunities provided through the Department of Trade and Industry. Micro-franchising incentives, the Informal Traders Upliftment Project, and Co-operatives Development Agency development are also at the top of the department’s list of priorities.

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How to Prosper as a Startup in Africa

The startup environment in Africa is thriving. Investors have channeled hundreds of millions throughout the region in recent years. However, funding is just one of many variables impacting a venture’s long-term success. Ensure your business survives past the startup stage by following these tips:

1. Get startup experience first.

officeYou will be more successful launching your own company if you have a strong background (at least five years) working in a high-level role at a startup. During this time, you can learn how startups operate and hone your employee and management development skills, both of which are critical components that ensure your company runs optimally. These skill sets will also affect your standing with investors. To them, your achievements at prior startups are a sign that future businesses under your guidance have a high potential of garnering profit.

2. Give people what they want.

Your targeted audience determines what product or service you should sell. No matter how much you want to make something unique and different, your goal is to grow a profitable business by fulfilling a demand that has not been met. If similar products or services already exist in your sector, focus your efforts on producing something that is better than what your competitors are offering.

For instance, the founders of Kenya-based startup Sendy recognized the need for a cost-efficient and speedy delivery service. Because of the congestion in bustling cities like Lagos and Nairobi, it takes more time to transport packages, which results in higher expenses. The Sendy team addresses this problem by utilizing motorbikes to deliver packages locally through a system much like Uber. The company’s solution has positioned them to grow into other areas of Africa and pitch its service to Amazon and other companies that require delivery services in new markets.

If your target customers are new and growing businesses, for example, you could offer employment agency services. Many African startups need help hiring qualified employees. Similar a professional recruiter, your company could connect qualified individuals with firms offering jobs that require their talents. You absorb the responsibility of acquiring prospects, interviewing, and completing other hiring responsibilities.

You could take your business model one step further by offering prospective employees training. One African company, Andela, which matches developers with global employers, identifies raw talent to undergo training. After they finish training, the graduates possess vital knowledge to fulfill their roles as developers.

3. Be confident.

african womanBusiness failures are inevitable, but you should use them as a learning experience and not let them deter you from trying. You can increase your chance of launching and running a successful enterprise by taking risks, despite what you or others fear may happen.

Consider IroFit’s journey. The Nigerian-Finnish company’s founder sought to create an app that allowed users to utilize mobile payment services without the need for Internet access. Established in 2014, the company did not wait to launch its secure payment app to garner financial support. Its founder knew it had a viable business plan and product that would answer the problem of limited Internet connectivity in emerging markets. As such, it shared the idea with investors to acquire additional funding to further develop the app and pay for an official rollout in Nigeria. The company raised $600,000 before introducing the app to the public.

4. Avoid borrowing more money than necessary.

Opening a business requires capital, and the level of debt you incur will depend on where you obtain your money. Do not rely only on financial institutions; you should also consider other means of funding, such as venture funding, that require little to no repayment.

In 2014, African venture funding totaled nearly $500 million, primarily supporting entrepreneurs in the e-commerce sector. Noted investment groups, such as Seedstars Africa and Investment AB Kinnevik, gave money to clean technology, financial services, and e-health companies in Africa. Foundations and government programs also exist to help start new businesses, and the Tony Elumelu Foundation recently launched an entrepreneurial program that utilizes $100 million to mentor, train, and fund startups.

In the United States, the African Development Foundation, an independent federal agency, connects eligible business owners with capital and technical support. Other organizations making it possible to launch a business with less debt include the Acumen Fund, African Women’s Development Fund, and 88mph. You should also consider crowd funding and microfinance opportunities.

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What You Should Know about Asoriba

asoriba logoRecently highlighted on CNN, Asoriba helps people connect to their churches and practice religion and spirituality through a mobile app. The company, which was named Africa’s best startup at the Seedstars World event in April 2016, has more than 380 participating churches. Considering the app launched in a country that contains 700 Christian sects and approximately 71,000 congregations, it is expected to thrive. The following are other interesting facts you should know about Asoriba.

The Brains behind the Invention

Asoriba, supported by Techstars and its Barclays Accelerator, was founded by Ghanese entrepreneurs Nana, Saviour, Jesse, and Patrick. Both sons of pastors, Nana and Saviour are experienced in software development. Nana dedicates his time to strategic initiatives, such as market research and financial modeling. A certified network engineer, Saviour offers expertise in user interface design. Also a software developer, Jesse takes interest in open source technologies and is knowledgeable in application development for web and mobile platforms. He is the point person for solving organizational challenges. Patrick’s experience dates back to college, when he designed software for large enterprises. He offers extensive knowledge in server-side programming.

Goals Shaping the App

The company values family, respect, integrity, and action. Its app focuses on improving engagement between churches and congregations, thus enhancing the bond among Christian communities. As a result, participating churches experience growth in membership and have the opportunity to positively influence more lives.

Tool Capabilities

Church representatives reach followers by sending sermons and devotionals via video and audio files through the app. It is also useful for notifying people of special engagements and delivering news on behalf of groups and ministries. Additionally, parishioners who cannot attend a service in person may watch a live stream.

By using the app, churches can reduce the amount of funds allocated toward print material and other expenditures related to communication. Promotional efforts and correspondences can all be fulfilled using Asoriba. Further, the development team integrated a digital collection box to receive tithes over mobile devices. The app accepts a variety of card payments, including MasterCard and Visa, making it convenient for followers to show their support at any time and location, so long as they have access to the app. Once a user completes a transaction, the funds are immediately credited to the selected church. This plays a pivotal role in the continuation of educational and health care programs.

Supplemental Resources

analyticsThe app gains additional support from web applications that focus on managing membership, leadership, groups, communications, calendars, branches, and financials. The financials feature will launch in December, but interested clients can currently request to try it. It will also serve as an accounting platform and give administrators the ability to send pledge reminders and collect welfare dues.

Moreover, the web platform will gather analytics that evaluate overall performance. Previewed on a dashboard, analytics presents data, ranging from church growth to offertory. It tracks tithing transactions and gives perspective on attendance. As an added bonus, users can automatically create reports, as necessary.

Compatible Devices

The app is available only on Android devices, but as of May 2016, the Asoriba team is working on making an app that is compatible with the iOS operating system. Once complete, owners of Apple devices can download and begin using the app.

Pricing

Churches that wish to join the app must become an Asoriba client. The company allows smaller churches, ones that have no more than 100 members, to utilize the app for free. Churches that cater to a larger congregation should visit http://www.asoriba.com to obtain a price quote. An Asoriba team member will work individually with organizations to determine a fee structure that best meets their needs.

Customization

For a more branded look, clients can request customization services to produce a professional app that attracts target audiences. In addition to traditional contact information, customization options include a high resolution icon, photos, and graphics. An option to upload a promotional video or graphic may be submitted in JPG or PNG format.

Areas of Service

Asoriba caters to ministries throughout South Africa, Ghana, and Nigeria.

Future Initiatives

The team aims to supplement the app with a virtual space for social networking. The platform will encourage people to engage in conversation with those of the same religion. Discussions on faith will be the primary focus.

Because the platform does not require in-person interaction, the development team hopes the feature will make it easier for people to bring up sensitive topics, such as marriage. As a result, they will learn how to make challenging decisions that are in line with their faith’s teachings.

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Improve Business Success with Backing from these Organizations

For more than a decade, the continent of Africa has experienced robust economic growth. One of the reasons driving this positive change is the greater availability of support for the African startup community. Both public and private businesses have benefited from venture capitalists, who have invested time and money into new ideas, thus helping to sustain more local businesses, boost economic activity, and create jobs. Businesses in the agribusiness and ecommerce industries have gained considerable traction, as have those in the financial services and computer software sectors. Likewise, enterprises in the media, Internet, and professional services industries are attracting interest from African entrepreneurs and their backers as well. If you are looking for funding and business support for your venture, consider the following organizations.

Tony Elumelu Foundation Entrepreneurship Programme

tony elumelu foundation logoNamed after its founder, the Tony Elumelu Foundation Entrepreneurship Programme supports businesses across the continent through training and mentorship. The $100 million fund, which has a goal of working with 1,000 entrepreneurs annually for the next decade, also offers crucial grants to help business owners see their concept through fruition. These funds do not need to be repaid. In order to be considered for funding, participants must complete a 12-week program and a two-day boot camp. Additionally, successful completion of the three-day conference, the Elumelu Entrepreneurship Forum, is necessary to receive funding. An additional $5,000 in second-stage seed capital is also available for qualifying companies that demonstrate progress beyond the program.

Investment AB Kinnevik

investment ab kinnevik logoSweden-based Investment AB Kinnevik commits approximately eight percent of its $7 billion in assets to African ventures. The company takes primary interest in entertainment, financial services, ecommerce, and communications businesses and has been a crucial supporter of Jumia, Konga, and other African companies. Recently, the investment firm made a statement regarding its performance in 2015. Many of the companies in its portfolio delivered strong performances over the past fiscal year, which helped increase Kinnevik’s dividend per share and share price by three percent. Additionally, the company sold its interest in Avito, which provided exponential returns against its initial investment. To continue its success, Kinnevik looks to add to its existing portfolio by identifying companies that provide innovative solutions for consumer needs and demonstrate the ability to create repeat customers. Prospective investment targets must also have a strong leadership team and a sustainable business model, and they must demonstrate flexibility in managing risk to optimize returns.

88mph

88mph logoLaunched in 2011, 88mph is a business accelerator that provides seed funding. It operates in three countries in Africa, and technology ventures are its sole focus. Predominantly, the organization backs entrepreneurs with viable web and mobile solutions. As of 2016, the accelerator has allocated seed cash in excess of $1.5 million to a variety of companies, ranging from Baby Group, which offers products for new parents and their babies; to Byte Money, a startup focused on serving the insurance industry through a mobile payment platform. In 2015, 88mph took a break from funding new ventures. Having already invested in 36 companies, the accelerator transitioned its focus to helping its portfolio companies grow and further develop. The company will continue to monitor promising ventures in emerging markets.

African Development Foundation

USADF logoAlso known as the USADF, the African Development Foundation operates in the United States as an independent federal agency. The organization offers seed funding and technical support to African entrepreneurs who are helping their communities alleviate food insecurity, improve human development needs, increase income levels, and create sustainable employment opportunities. USADF has touched the lives of millions of Africans through an active portfolio of more than 320 grants exceeding $50 million in total.

The organization is currently accepting grant applications from ventures that focus on agriculture and assist low-income communities. Additionally, it is looking for entrepreneurs who are working to provide greater access to sustainable electricity, as well as those who are striving to advance democratic governance and peace in their nations. To these respective groups of entrepreneurs USADF offers the Power Africa and Young African Leaders Initiative (YALI) grants. To be eligible for a grant, companies must be completely African-owned and managed. Applicants must also show documentation that states their company operates as a legal entity in the country in which they are based. Other criteria include demonstrating an ability to efficiently use funds and having a clear process to use and manage USADF grant monies.

African Women’s Development Fund

AWDF logoSupporting African women-owned businesses and entrepreneurs, the African Women’s Development Fund (AWDF) has awarded grants to organizations in 42 countries since its inception in 2001. The fund has extended grants of up to $50,000, totaling $26 million, to more than 1,200 organizations to date. The grant program is made possible through partnerships with prominent global organizations, including Match International, Carnegie Corporation, and the Ford Foundation. Private and public foundations as well as bilateral and multilateral organizations, such as UN Women and the UK Department for International Development (DFID), also provide support. AWDF awards grants to organizations operating in six thematic areas, ranging from women’s human rights to economic empowerment.