According to s recent Fortune Magazine survey, 42 percent of Startups say that they did not evaluate the market needs for their various products, solutions and services before launching into the market. Unfortunately, this keeps recurring and adversely affects the acceptance as well as the profitability of such products in the market. It is interesting to note that, the failure rate of about 95% of Startups within 5 years of commencement of business because of this and other extraneous factors.
I recently had a chat with Bolaji Finnih, CEO, TechPreneur Africa, who is passionate about building growth bond companies in Africa. The topic of discussion centered on how African Startups can scale up, using technology as the launching pad.
Bolaji believes, and undoubtedly too, that our primary strength in the ecosystem is our entrepreneurial spirit. “I think, having studied different ecosystem across the world, it is difficult to find any ecosystem that has the type of entrepreneurial spirit that we have here in Nigeria”, he observed. He stated that many people, both young and old people in this clime, are either into one entrepreneurial project or has a business idea that they are waiting to get out there.
It is Bolaji’s belief that people are always trying different stuffs with a view to growing their businesses, but he will not call that a lack of focus. He observed that, in their attempt to scale, these business owners try different things. “Yes, there are lots of people doing early stage Startup businesses. It will be great for them to focus on one and help it scale, but I believe that the answer is in scaling successfully that will lead into a type of focus,” he said. He observed, therefore, that it is lack of scale that is making people to lose focus and not that they outrightly lack focus.
When asked if Startups needed funds to scale up, Bolaji answered in the affirmative, however, he added that funding is not the primary need when it comes to scaling a business. He stated that there are some basic requirements in order to scale up a business. “You need to have the skills, you need to have the proper business plan and business model to know what you’re trying to do. You need to understand your market as well. Funds are also needed, but not the primary requirement,” he noted.
Bolaji recommended that in Nigeria, we should have a decentralised clusters of ecosystem, which are organically grown are what other climes are using to grow their ecosystem. “When I say organic, I mean we don’t necessarily have to identify one place from the outside and say, you know what? We want to make this a cluster,” he noted. In his opinion, we should allow clusters to evolve, stating the example of Computer Village, which was not initially planned to be identified as a cluster, but evolved naturally. Bolaji also observed that the academic clusters around Yaba has a gravitational pull towards a certain type of entrepreneurship, hence, we should allow the various clusters to evolve.
On the notion that, countries like Kenya, Rwanda and South Africa are taking technology more seriously in Africa, Bolaji said that he thinks that, based on the fact that we have a lot of young TechPreneurs across the African continent, great deeds are being done in Kigali, Nairobi and even, Accra in Ghana, Cape Town and Johannesburg. He stated further, that, why it seems that we are not taking technology serious in Nigeria is that we always tend to follow what is reigning at a particular point in time, such as Oil & Gas, Telcos, etc. “Right now, technology seems ti be making its waves and if you look on the basis of investments in Startups in the last couple of years, you can see that Nigeria is here to stay, because it is the number one destination for foreign investment in Africa.”, he observed. He noted that, even though, other countries have started well ahead of Nigeria, it will still scale in the technology field.
On a final note, Bolaji is of the opinion that the ecosystem needs government support to grow and scale our tech Startups, although, it is not a prerequisite. He emphasized that tech Startups will still scale if it does not get government support, because it is an open, coordinated and global economy.
This article was written by CFA