Samuel Okocha reports from the Mobile West Africa 2014 conference in Lagos, Nigeria. “Until we get those valuable ideas that solve real problems because we understand the market… looking for money is like putting the cart before the horse.”
If you ask why small businesses can’t start, the answer always comes down to funding. In reality however, that’s often not the case, especially with start ups in Africa.
This was the position of Femi Longe, co-founder of Nigeria’ Co-creation HUB at the ongoing Mobile West Africa 2014 conference in Lagos. The event which kicked on Tuesday has brought together leading innovators and thinkers in mobile from Africa and around the world.
“Most times when competition about the ecosystem happens there is always a strong focus on funding because money is the hard thing you can see,” Femi Longe tells VC4Africa. “But the truth is, what is slowing the growth of the ecosystem in Africa, and in Nigeria particularly, is not the funding.”
Longe says talent and ideas remain the key to the growth of Africa’s startup ecosystem. In his words: “It’s more around ‘do we even have good ideas? And do we even have the talent that can even bring these ideas to life?”.
“So until we move to the conversation around ‘what are the problems and opportunities for which technology can play a role? And how can you build an innovative tech organization and how do you get access to technical talent to eventually build it. Until we have those conversations and put strategies in place for that, chasing funding will just be distracting ourselves from what we really need to do.”
Building the talent and executing the idea
Femi Longe admitted that Nigerian universities are not building talents that can support and grow the tech startup economy. Many people VC4Africa spoke to agreed.
Longe suggested building what he called practical schools. “And practical schools doesn’t necessarily need to be a formal education institution,” he explains. “It could be an existing company or existing startup that’s actually churning out people who understand the thinking around what it takes to build a technology business.”
Nigeria’s online retailer Jumia recently launched a training school for future entrepreneurs who want to grow their own startups. The Jumia academy currently caters for employees of the company.
“We need more of that,’ Longe says. “We need to build more talents practically. Then we need to teach people a systematic way of generating good business ideas.”
Generating tech businesses and ideas that get funded
Longe says there are plenty areas in Nigeria where there are gaps begging for technology solutions. According to him, the biggest money spinners will be tech solutions that actually focus on those gap areas and are able to build successful start ups around them.
Dr. Ernest Ndukwe, former head of Nigeria’s Communication Commission and pioneer of Nigeria’s telecoms revolution said something that’s very practical: Money would follow a valuable idea that solves a real problem.
Longe agrees: “Until we get those valuable ideas that solve real problems because we understand the market, the needs and the gaps.. looking for money is (like) putting the cart before the horse.”
African startups need money, but…
Tech start-ups need funding at different stages. According to Longe, these stages cover the early stage money, middle stage money, and later stage money. For him, West Africa needs funding in the early stages.
“You have a few people that come in and looking for later stage ideas without anybody sufficiently investing in the earlier stages of the ideas. But I think that’s where we need to move the conversation of the narrative as far as funding is concerned”.
Advice to investors
For potential investors interested in for example the Nigerian startup scene, Femi Longe suggest looking for ideas that are solving genuine local problems. “Don’t look for ideas that are solving problems from other climes because the local reality defies any such logic.”
“If you find an idea solving a genuine local problem, investigate if these problems are real. If they are real, put your money in them.”
Photo: From left -Gustav Praeket, founder and MD Praeket Digital; Femil Longe, Co-Founder Nigeria’s Co-creation Hub; and Tomi Davies, CEO TVCLABS.