Opinion: Building tech for Africa by Africans in diaspora? Here’s how not to fail

by Ade Olabode

Have you heard the story of the overseas returnee? Yes, I’m talking about the one we’ve both heard — where Kwame/Fola/Uche returns from “the abroad” with so much knowledge, connections, money, sets up a company, and makes a killing.

What’s the reality? Most people don’t do anything. Of course, there are good examples where people have moved back home from their sojourns in Europe, America, Asia or other African countries, and have gone on to do exceedingly well.But the focus here is not on singular outcomes but to shine a light at the missing piece of well-meaning concepts likeAfrica rising, reverse brain drain, come back home” etc. which tends towards a binary conclusion in that one must come home or do big things immediately.

My theory is that there’s no need to be lionhearted in ambition or expectation. Africa needs all the help she can get. Big or small — it all counts. And to provide that help, more people in the diaspora should indeed start companies and contribute — right from where they are and need not move back home before making an impact.

Which brings us back to the question — how do you build a tech startup so you can’t fail? Well, I hold to the premise that African diasporans need to make five simple assumptions:

The most successful companies will be built by Africans in Africa
Let’s start with a non-controversial point: The most successful companies in Africa will likely be headed or shaped by Africans in Africa. This makes sense as there’s arguably so much working against the success of any company that to think of starting one, without being on the ground is crazy.

This is an important bridge to cross. Because once you remove the shackles of aiming to attain the “most successful” company tag — there’s an immense space and opportunity for a lot of startups. What you will also quickly realise is that in loads of cases, you’re not competing against other firms, but instead, against customer apathy, chronic infrastructure decay, and low purchasing power.

However, we need to address the elephant in the room — our extreme love of copying “successful” ideas. This bandwagon effect is especially prevalent in the startup scene. Just look at the ridesharing craze. A new ride-sharing app launches every other week to the extent there are probably more than a dozen operating in Lagos alone. The same effects can be found in e-commerce and to a smaller extent, payments. One can argue that copying has its advantages as it signifies a validated space. And if that’s attractive to you — well, good luck to you.

True stories. No sermons. Whilst speaking on socioeconomic initiatives

On the other hand, you might be the adventurous type and if you consider looking further from “hot” sectors, you virtually have an unlimited selection of interesting things to do. Go do them!

Why does this even matter? The economist says it best in No rush — “the best new products are slow hunches”. And the rush to do important things can be an impediment to starting out.

Sometimes the African definition of success is interesting

Don’t judge a book by its cover

We definitely didn’t get the memo: In Africa, we judge each other by the outward appearance of success. This cuts across virtually all classes of society. Which leads to familiar but awkward examples such as; attending a meeting without a new car? You might not get that contract. Still using that old phone? Well, that waiter might serve you slower in the restaurant. Pitching your product while wearing your £8 Casio watch? You just might not seal that sale! When it comes to “success”, we’re like doubting Thomas — we must feel it and see it to believe it.

And talking of examples, let’s not forget the most relevant — you. Imagine how many people equate you to be successful simply because you happen to live elsewhere? I’m not calling you unsuccessful, but you’ve got to admit, that’s already a positive criteria that you’re judged by.

I don’t think there is any solution to this problem. It’s a cultural issue and the best we can do is to acknowledge it exists.

With that in mind, it makes sense that you might do a lot of awesome things like; build a product or offer a service, have paying customers, positively impact people’s lives by providing value to the society at large and still not be viewed as a success. There’s absolutely nothing wrong with you and it’s fine to not be worshiped. The point here is don’t let other people’s perception and opinions become an hindrance which stops you from starting your project.

There are things no investor can do for you.

Or maybe better put — there are things money can’t buy. Like making a product or offering a service people want.

I know — and I’m sure you do too — that funding is important. It’s validation of some sorts. I’ve heard (not seen it myself) from various anecdotal accounts that investors will fund someone from “the abroad” over local based (for various biases masquerading as reasons). The truth is funding is important as it helps to get your project off the ground, attract customers, employees, partners, press, etc. It’s also a great pointer to your parents (and ex-classmates) that you’ve not been wasting your time!

Nevertheless, the tried and tested formula of investor providing $XXX for an “idea” doesn’t quite work in diaspora. Is this the incentive you need to build a product, (and all it entails like getting a team together, launching v.1.0, etc), achieve product/market fit, show sufficient traction to prove the ‘idea’ works — before the next funding step? Maybe another way — which works better for the investor and you — is to actually build the product and be sure it works before taking someone’s money.

That’s hard. And it’s your job to figure it out. An investor no matter how well meaning — can’t do this for you. Some of the current attempts pushing the $ for idea concept, are surefire ways to prematurely kill a project.

Reid Hoffman and Tim O’Reilly recently had this captivating discussion regarding the need of venture capital. Mr. Hoffman who as a VC partner at Greylock partners is unsurprisingly in support of raising money. However, he had the following words of wisdom which are questions you need to ponder before raising;

  • When must you make the blitzscale, blitz-capital decision? Do you face actual competition? Potential competition? What is the availability of capital for you and competitors? Do you need to achieve critical mass for a valuable network product?
  • When can you build more carefully and deliberately? Establish a product-market fit and revenue model, limiting those risks carefully?

Nevertheless, creating an artificial cliff point where only the “best ideas” stand a chance is definitely in the investor’s interest. Not necessarily in the founder or the markets’ interest.

Be careful of experts’ opinions

Not because they’re wrong, but because they give themselves too much credit. They usually miss the mark in two crucial aspects:

  1. Relevance of past experiences on future performance: They’re overly confident on “what will happen next” based on their expertise and experiences.
  2. What makes you tick: There’s a cottage industry of people who know why and how diasporas act in almost any given situation. Their analysis are usually pretty, tidy and compact — as we’re viewed as one homogeneous group.

To be clear, you may well need the experts connections, insight, guidance, and tactics to avoid making disastrous mistakes. But the beauty about startups and especially startups in Africa — there’s a universe of unknowns.

And I don’t say this lightly — there are so many wrong assumptions on the thought process of a typical immigrant. Times have changed, so why do people assume the aspirations of African diasporas in 21st century will remain constant? What can be done? In this case — if you’re in London — I actually have a useful suggestion. Checkout BTNG (Building Things For Nigeria) which is a community of folks building tech products for Nigeria. Call me biased (I’m one of the co-organisers), but it’s by far the best way to meet like minded makers.

Expert free zone — brainstorming on improvements needed for SME’s in Nigeria
Happy BTNG crew at after event drinks

If you’re not in London, you should look for a similar community. Or start one — like we did from Radar. And if you’re indeed in London, you’re in luck as the 6th event is just around the corner. Register here.

We need more startups not fewer
This is what it all comes down to — we need more startups solving African problems! Some of these problems might not seem particularly exciting to the experts, investors, various gatekeepers, or make you appear smart. But Africa needs you today — even more than she needed you yesterday. In other words, today is the best day to start that project.

And whatever you do — remember you don’t need anyone’s permission — go ahead and be great.


 

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