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While the tech industry stutters across much of the world, Africa’s booming sector is bucking the trend.
Africa still faces problems, such as a historic lack of investment, and some parts of the continent are still plagued by patchy infrastructure – but the barriers are disappearing. Investment is skyrocketing, tech is becoming cheaper, and African governments are moving to create a more tech-friendly policy environment.
This has opened the door for serious growth throughout Africa’s burgeoning tech market, which will be supercharged by the rapid take-up of new products and services that have little pre-existing technology to compete with. The time is now for Africa to become a leader in the tech world.
In an exclusive feature by Business Insider Africa, Bassim Haidar, one of the leading business leaders in Africa, highlights five critical signs that Africa will be a tech leader over the next decade.
According to him, Silicon Valley will soon learn from the African tech ecosystem and its talent within. There is a rich bench of entrepreneurial expertise in Africa; however, more needs to be done to encourage forward-thinking minds seeking to drive development in the continent to step forward.
The digital-first population
Africa’s population is booming. The average age on the continent is under 20, and one in six of the world’s internet users will be in Africa in 2025. Africa is fast becoming the world’s first truly digital-first society.
This youthful population is increasingly tech literate. They learn with tech, work with tech, and continue to use it more and more in their daily lives.
Not only is this driving huge demand for new tech and spawning innovative new products and solutions, but Africa’s digital-first generation is also breeding a new wave of world-leading entrepreneurs ready to grab the world tech sector by the horns.
Tech is a necessity, not a convenience
In the West, tech is often taken for granted. In the developing world, it is a necessity. People rely on it for essential services that might otherwise not be accessible, and this is driving rapid growth and innovation throughout Africa on a scale that can’t be seen in developed regions.
The number of tech startups securing funding in Africa rose by an average of 46 per cent annually between 2015 and 2020, compared to a global average rise of only eight per cent. Furthermore, Africa’s tech market is expected to grow from $115 billion to $712 billion by 2050. To put it simply – the continent is on an unprecedented upward trajectory.
The number of highly successful tech companies coming out of Europe is dwindling, whereas the industry-transforming tech companies emerging in Africa truly showcase the incredible talent the continent has to offer. A large factor in their success is that they offer solutions that change lives that truly embody the ‘tech-for-good’ movement – not convenient but ultimately futile ‘add-ons’. African firms such as mPharma and Kuda are providing accessible solutions to the real-life problems of expensive medicines and lagging financial inclusion.
The massive unbanked population
Africa is a hotbed for financial innovation and is the second biggest banking market globally by growth and profitability. But around 350 million adults in Sub-Saharan Africa still have no access to any banking services. The fintech industry can do so much more.
Mobile banking services will be one of the largest drivers of social development and economic growth across the continent over the coming decades by providing lending, savings, and money transfer services to millions.
Africa’s fintech success is driven by mobile money, but a lack of access to mobile phones has held the industry back. The increasing accessibility of cheap mobile devices will continue to drive financial inclusion throughout the continent.
Furthermore, the industry is adapting fast. More sophisticated AI and big data-led technologies and better practices such as improved data-sharing ensure more products continue emerging to meet evolving consumer demands.
Mobile banking is still relatively new to the continent, but already half the world’s mobile money users are in Africa. The continent has become a ‘sandbox’ for fintech innovation and will guide the international mobile money industry.
Africa is the only continent where venture capital investment is growing
Africa is already the most entrepreneurial region in the world. Yet, its startups only account for 0.2 per cent of the global value startups. But as the rest of the world suffers a slowdown in VC investment and tech innovation dries up, Africa is experiencing record levels of injection from venture capitalists. Tech startups on the continent are seeing a growth in funding at a rate six times higher than the global average. Fintech in Africa alone saw an almost four-fold increase in 2021. This is a massive show of support for African tech firms from the world’s investors.
This is helping Africa as an incubator for tech ideas. Startup networks are developing, increased competition for customers and investment is driving further innovation, and training and upskilling programmes are better funded.
A ‘clean state’ sector
Historically, the continent’s tech scene has been severely underdeveloped and largely kicked to the sidelines in conversations throughout the tech world. However, this means the industry isn’t bogged down by loyalties to outdated technologies or dominated by a handful of tech giants. It is a ‘clean slate’, ready to soak up innovative new startups and embrace game-changing ideas.
Consider how Africa has leapfrogged traditional tech developments, such as bypassing landlines, moving straight to mobile phones, and embracing digital-first banking providers instead of relying on branch-first banks that still dominate the Western market.
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ABOUT BASSIM HAIDAR
Bassim Haidar is a Nigerian-born Lebanese serial entrepreneur and philanthropist. Haidar founded his first company at 20 years old and now leads a multi-sector conglomerate with operations across Africa and the Middle East, with revenues exceeding $1.6 billion. Amongst the companies he founded is Optasia — it currently serves over 650 million customers in more than 30 countries, engineering solutions for financial inclusion. In 2003, Haidar founded telecoms business Channel IT to cater to Nigeria’s rapidly growing connectivity needs; today, the company operates in 19 countries and provides crucial infrastructure across Africa and the Middle East. Haidar’s latest venture is the South African-based medicinal cannabis company, SafriCanna, which funds extensive R&D, undertakes clinical trials, and exports to several countries across the globe, including Germany, Israel, and Australia. Haidar is the co-founder and Chairman of the venture capital firm Knuru Capital, which pursues equity and credit opportunities in the technology sector across the GCC, Africa, and Southern Europe. He also co-founded Intercomm Ltd in 1991 and co-founded GMT in 1995, which grew to become the leading integrated procurement, finance, and logistics provider in West Africa. Haidar undertakes a range of philanthropic and CSR activities, having been previously involved in the work of the World Economic Forum and the Africa CEO Forum. In 2016, Haidar was appointed to the Global Council of Amnesty International.
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