Nigeriastartup ecosystem

Following Mobile West Africa conference in LagosMay 2014

Innovation has no place in a global world, it’s everywhere

Startup ecosystems can learn from one another

Local context matters and should be a source for innovators

This is why…

We’re on a world tour of startup ecosystems!

We believe…

History & context of startups in Nigeria

“The India of Africa”

An insulated country until very recently

• Until 1994 and the “new nation” in South Africa, all the continent was pretty much totally insulated

• Africa growth remained stagnant until 2000, with small figures for intra-Africa trade (only $11m traded between NG and SA in 1997)

• Nigeria is no exception: no MNCs had a HQ there, except churches!

Nollywood and South African telcos started it all

• 1970-1980s: rise of Nollywood as the African scene for movie production. A Nollywood movie takes 10 days and $50k, 50 are produced every week, 1m people employed

• 1994: South African companies “take over” Nigerian economy, with telcos/TV (MTN, DSTV), supermarkets, construction works

Social innovation is the key, more than technology

• No patents, broken education system, brain drain: Nigeria won’t generate breakthrough technologies

• Lots of issues (law, environment, violence) need local answers with a focus on usage and social innovation: breakthrough usages

• Wecyclers = environment + gamification + $$$

Co-creation Hub as the step #1 of the tech scene

• 2011: launch of “CC Hub”, to “solve social issues with a business purpose”

• Settled in Yaba area, a student district in the center of Lagos• Challenges: don’t ask for money too soon!

Mobile West Africa to gather the tech community

• 2011: launch of Mobile West Africa, now the most proeminent tech conference in West Africa, 4th edition in 2014

• A conference + a Focus Day + A 1-day workshop

Heading for half a billion Nigerian in 2050

• Nigeria is now 170m people, will be 440m people by 2050• How to find 10m new jobs every YEAR• A demographic dividend or a time-bomb?

Solving the kleptocracy issue

• Africa’s biggest oil producer… but only about $30bn tax & royalties from oil each year (= size of higher education budget per year in France)

• Between 2004 and 2012, poverty rate went 52% to 61% of the population: 140m Nigerians live with less than $2/day

Electricity and internet infrastructure not there yet

• Power cuts abound, and electricity is available on average 5h per day. Back-up gas generators can’t cope and pollute a lot

• Broadband penetration is 6-8%, with expensive data plans. Successful ventures can’t bet on a data-consuming population

A nascent startup ecosystem for Nigeria

• Coworking spaces, investors and events pop-up in Lagos and a few other city (Abuja)

• Sub-Saharan Africa tops growth of tourism/travel

Startups from Nigeria

• Two different segments for startups: tapping the happy few (Rocket Internet: Jumia, Jovago, Kaymu…), local tech startups (Hotels.ng, Konga…), solving social issues (Traffic Butter, Wecyclers, Budgit)

• No middle-class yet or expected for a bigger and more stable market

Cab finding app Low-cost smartphones Mobile learning Media for the youth

Find a medic Community-based traffic E-commerce Online Booking

Nigeria startupscene today

Pros & Cons, Top Connectors & local best practices

Pros and cons of Nigeriastartup ecosystem

• A huge market getting even bigger of 10m new people every single year. Half a billion in 2050. A billion in 2100

• A cultural epicenter for African youth through Nollywood movies and online publications

• A young and English-speaking population (at least in urban areas, e.g 1/4th population) which represent a pool of possible talent and market

• Safety issues remain a constant issue over the years, overpopulation can’t make them easier

• Broken governance, education, tax system, widespread corruption

• A country cut in two parts: Lagos/Port-Harcourt (English-speaking, with some wealth) and 140m people with <$2/day

• Infrastructure is a variable, with power cuts and small broadband penetration

• An oil-rich country not diversified at all: not so many opportunities for startups to disrupt anything

PROS CONS

Top connectors in NigeriaMatthew Dawes (LinkedIn), the UK born organizer of Mobile West Africa, Nigeria’s main tech conference

on mobile technologies, also organizer of tech events in Africa, part of UKTI Sub-Saharan task force

Femu Longe (LinkedIn), cofounder of CC Hub, Lagos’ first tech hub. A diasporan coming back from the UK,

strong believer in social business opportunities in Nigeria, tech activist

Yomi Adegboye (LinkedIn) aka Mr. Mobility, early founder of a webhosting company in Nigeria, since then top blogger and speaker on mobile in Nigeria

Tomi Dee (Twitter), futurist techpreneur based in London and Nigeria, part of the angel investor

community in Lagos

Top connectors in Nigeria

Tayo Ogundipe (LinkedIn), founder and CEO of Solo Phones, a venture making affordable smartphones

for the Nigerian market

Yemi Adamolekun (Twitter), executive director at Enough is Enough (EIE Nigeria), an activist group

mixing technology & politics

Neal Hansh (Twitter), CEO of MEST incubator in nearby Ghana, living both in the corporate and startup world, with connections in Silicon Valley and UK as well

Olufunbi Falayi (Twitter), founder of Passion Incubator, an early stage incubator, and a social

innovator in the field of education

Best practices of Nigeria tech ecosystem

• Mobile West Africa organized as a participatory conference• Tables have limited seating to foster interaction between participants• All conferences and speeches include at least 20 minutes of Q&A + a MC to

invite participants to discuss questions together

Best practices of Nigeria tech ecosystem

• CC Hub User Experience Lab: The ground floor of the 5-story main tech building is dedicated to showcasing new phones

• Anyone can come and try everything to buy with better knowledge of the market• Brands also use the User Experience Lab for feedback sessions with users• It’s a clever and successful meeting point between end users, entrepreneurs and the corporate

world

Best practices of Nigeria tech ecosystem

• Towards a cashless economy. Nigeria government tries to get everyone to pay online with a series of sub-projects:

• The new Nigeria ID Card is also a Mastercard• 10% penalty for merchants bringing back cash to the bank• Banks must deploy over 50k+ payment terminals to make it digital

What’s next for Nigeria?

Solve the infrastructure issue: low broadband, power cuts can be constraints which make entrepreneurs creative but it impedes widespread use of technology

Increase help & support for social business: More than urban & consumer web startups, Nigeria needs social entrepreneurs who can solve issue in place of a broken government

Tap into Nigeria’s strengths: Demographic dividend + strong cultural production and influence should lead to projects and companies within the media field

Mobile West Africa 2014

Key takeaways from the conference

Key stats on mobile in Nigeria & Africa

• West Africa has 67% mobile penetration and 25% mobile internet penetration• 115m subscribers in Nigeria, 750m in Africa overall• About 8-10% smartphones in Africa, growing fast• 6-8% broadband penetration in Nigeria

Mobile marketing 101: Objectives & means

• Gamification? Go for an app• Online/Offline interaction? Go for QR codes• B2C interactions & push? Go for SMS• Brand awareness? Go for mobile ads• Full control on content & conversions? Go for a mobile website

Mobile marketing 101: Principles & KPIs

• Immediacy: always on with us• Mobility: always in our hands• Interactivity: through live data

APPSSocial currencyFunctionalityEngagement

rates

ADSReachCTRCPA

SMS MarketingRelationships

builtDatabase growth

Reply ratio

QR CodesVisit durationConversion

Database growth

Mobile marketing case studies from MWA speakers

Knorr South Africa (Prizes & Airtime for polls)

Carling Black Label (prizes for SMS engagement)

OMO South Africa (opt-in SMS for purchase reminders)

MyNeta.info India: transparency by SMS

2go, Eskimi: where Nigerians hang out online

• 2go: 10m monthly active users in Nigeria• Eskimi: 8.8m monthly active users in Nigeria • Lightweight all-in-one applications (chat, job search, music, news)

Solo Phone, a smartphone by Africans for Africans

• Commercial launch in Nov. 2013 with $80 and $150 models• A network of wifi hotspot to avoid expensive data costs for users• Music for free, video on demand as a source of revenue • For $1, one movie, downloaded in 30 seconds

Rocket Internet in Nigeria: a big lead within higher-income population

• Nigeria: 170m people, 2.4m mobile phone payments, +9.3% internet payments• Jumia: Amazon-like, 200 vehicles for delivery, 600 employees, 70% market share of

e-shopping• Kaymu: eBay-like, new features for fastest mobile upload of products• Jovago: Bookings-like, tapping 12% growth in Sub-Saharan Africa tourism

The future of mobile by Tomi Ahonen

• Still a lot of opportunities in mobile: healthcare, education, F&B, banking…• Behavior on mobile and tablet are completely different• Moore law for smartphone prices: they would cost $10 in 2019• After mobile, augmented reality will be the next big disruptive mass media

The power of voice-based apps in Africa

• VOTO Mobile (Ghana): polling and communication with rural population, often illiterate, through voice calls & apps

• Sterio.me (pan-African): pre-recorded lessons from teachers and homework by students through voice

Eager to learn about the other innovation ecosystems?

Documenting innovation through key events Hot posts, interviews, live-tweet, Google Hangouts

Identifying key connectors on & offline

Discovering alternative and emerging innovation ecosystemsBeyond the Silicon Valley, local innovation hotbeds

Tech, Social impact, Education, Life Sciences…

Increasing mobility of innovators and ecosystem enablersConnecting doers and thinkers through monthly Hangouts

Offering innovation ecosystem enablers to learn and exchange from peers

About our project A world tour of innovation ecosystems

Martin Pasquier

Entrepreneur in Singapore (social media

agency), long-time traveller

Mixes economics, politics and travels to analyze ecosystems,

reports on innovation

About our teamAnalysis, community & network

Anne Lalou

CEO of Innovation Factory & Web School

Factory in ParisTransfer knowledge of

ecosystems to new generation and to a

network of top French companies

Nicolas Loubet

Serial entrepreneur in Paris

with 3 companies, growth hackerManages and

nurtures creative communities on & offline

A world tour of innovation: 2013-2014

SUPPORT US! Travel & time of exploration isn’t free Custom reports on emerging markets & trends Workshops, talks on innovation trends Connection to key local players for VCs, brands, tech communities

• Meet The Entrepreneurs Behind Nigeria's Startup Revolution (Fast CoExist)

• Nationwide Cash-less Policy: Is Nigeria Ready? (Ventures Africa)

• E-commerce in Nigeria: how Rocket Internet’s Jumia, Kaymu and Jovago are taking over Africa’s biggest market (Innovation is Everywhere)

• An investor’s comparison between West & East Africa’s tech startup ecosystems (VC4Africa)

• Mobile West Africa 2014: wrap-up of Nigeria’s largest tech conference (Innovation is Everywhere)

• PEDAL TO THE METAL – SEVEN TECH STARTUP ACCELERATORS IN NIGERIA (TechCabal)

More on Nigeria startup & innovation scenesResources

Thanks!

Martin Pasquier, for Innovation is Everywheremartin@innovationiseverywhere.com