Africa is a huge and diverse continent, and over the last few years, it has emerged as one of the world’s hotspots for startups. They might not be well-known names in the US, but the continent has many iconic entrepreneurs and investors whose stories can tell us a lot about success in business, such as Jason Njoku, Mzi Khumalo and Peter Munga. In fact, African startups secured almost a $1bn in investment funding in 2018.
Why has attention turned so quickly to African startups, and what can we learn from the continents’ successful entrepreneurs? Here are three lessons we should all take on board today.
1. Think and plan long term.
You’d be forgiven for thinking that because the African market is not saturated with startups that means it’s easy for entrepreneurs to create explosive growth with little forward planning. In fact, quite the opposite is true.
In Africa, entrepreneurs have serious, intractable problems that western startups don’t face. Poor digital and transport infrastructure, lack of skills and education provision, local and regional political instability, and sparse funding are just some of these big issues. To have a hope of success entrepreneurs need to overcome these before they can even get their startup off the ground.
For many African entrepreneurs, these serious fundamental problems concentrate the mind and reinforce the need for milestones, goals and a long-term strategic plan. For example, many African startups fall into two categories, those created to solve a hyper-local problem such as a lack of electricity in a village, or to solve a huge challenge that is faced by millions.
The agriculture technology sector, or agtech, in Africa is booming and its entrepreneurs think very long term and very big. Take Ndubuisi Ekekwe, founder of Zenvus. He grew up on his parents’ smallholding farm in rural Nigeria. He knew that the future of farming in Africa depended on technology, but he also knew that there was no point in starting an agtech business before he had the skills he needed.
Ekekwe went on to spend many years equipping himself with the skills and education to solve his boyhood challenge, founding various successful businesses along the way. One of these businesses, First Atlantic Semiconductors & Microelectronics, finally give Ekekwe the opportunity to tackle the problem and Zenvus was born. Zenvus aims to eliminate extreme poverty in the developing world by improving crop yield and overall farming productivity using electronics and analytics to empower farmers. This is long-term planning in action.
2. Believe in yourself.
Western entrepreneurs need to believe in themselves and their ideas, but in Africa if you lack confidence in your own ability to create a successful business you’ve likely already failed.
It’s hardly a surprise then that according to the Global Entrepreneurship Monitor, African entrepreneurs score very highly on the self-confidence scale. In fact, in some regions they have the lowest fear of failure of any entrepreneurs worldwide. In Uganda and Zambia it’s as low as 15% saying it would stop them starting a business, whereas in the US this figure stands at 34%. But why is this?
In the most disadvantaged countries in Africa the odds are already stacked against you when it comes to becoming an entrepreneur. Millions of people have no bank account or access to loans; internet and mobile telecoms access is patchy, corruption on a local level can see entrepreneurs bribed, and political instability can mean that basic services and utilities are constantly interrupted.
But it’s the fight for the things we take for granted in the west that gives African entrepreneurs their edge. They know that nothing is going to be easy, support is not readily available, and to survive and grow they need to believe in themselves. This drives African entrepreneurs on and gives them the resilience they need to keep going. Western entrepreneurs need to put their own challenges in perspective and cultivate the same determination and self-belief.
3. Don’t be afraid of risk or failure.
In the western world, risk-taking is seen as part of being an entrepreneur and there are plenty of safety nets available to catch you if you fall. If your business doesn’t work out, you can go back to the drawing board, refinance, use tech solutions and networks to help you change tack.
In Africa if you take a risk and it goes wrong it can have a far greater impact on you, your employees and community. But rather than this being a disincentive to take risks, it has created an optimistic, spirited culture that allows African entrepreneurs to take risks.
However, this capacity for risk and a lack of fear of failure is not uniform across the whole continent. In some countries, failure is a big psychological problem. In South Africa, 31% of entrepreneurs fear failure, close to the highest figures in the west, and Africa does lag behind when it comes to discussing business failure.
In Silicon Valley it’s great to fail fast; possibly even necessary to end up with a successful startup. But in countries like South Africa and Ghana entrepreneurial failure is seen by many as shameful. Society does not accept or embrace failure in the same way; as William Senyo, co-founder and CEO of the Impact Hub in Accra, Ghana says: “Your parents tell you, ‘Be a doctor; everything else is a gamble.’”
What we can learn from some African countries’ aversion to failure is that it’s real and it affects all entrepreneurs no matter where they are in the world. The key to success is to accept the fear, overcome it and push forward. Discussing, embracing and dealing with failure is a vital part of becoming a successful entrepreneur and leader.
Africa’s entrepreneurial spirit is fuelling a huge boom that no one can ignore. Last year startup numbers grew by a whopping 32% and investment by as much as 70%. That means it’s worth learning every lesson you can from African entrepreneurs.
Sharon Fishburne is a freelance marketing consultant who specialises in helping SMEs take their businesses to the next level. An expert at marketing strategy, she previously worked at a number of the biggest global consultancies, including PwC, advising multinationals on their expansion strategy. Sharon saw the value that smaller local businesses could take from that process too.
