When analyzing progress in Africa’s startup scene, attention focuses on the startups solving user problems and the investors who fund them. But for the past decade, one of the ecosystem’s most active players have been tech hubs.
The earliest examples, like iHub in Kenya and Co-creation Hub in Nigeria, started as spaces for developer meets and hacker communities, to foster creativity and collaboration. But from 117 hubs in 2015 to 618 in 2019, the number and model of tech hubs in Africa have changed to a point where it is no longer enough for hubs to assist the birth of innovation by merely offering co-working spaces or so-called incubation programs. Hubs need to actively drive startups towards scale and success.
As the organization that helps coordinate collaboration between tech hubs, AfriLabs has a central place in African tech. Founded in 2011, it has 320 hubs in 51 countries in its network, and undertakes programs and funding initiatives to benefit member hubs. It is currently developing an Africa-focused hub management curriculum in partnership with Strathmore University in Kenya, and recently launched Catalytic Africa, a project to co-invest in startups with African angel investors.
Quartz spoke with Anna Ekeledo, the executive director of AfriLabs, to get a sense of how far tech hubs have come in Africa, and what lies ahead. This interview has been edited for clarity and length.
What do hubs in Africa offer at the moment?
All AfriLabs members have physical spaces that offer basic infrastructure like electricity, internet connectivity, and corporate real estate. But hubs also offer services like business advisory and legal services, including access to mentorship and investors.
Obviously these happen in various degrees; hubs in more mature African ecosystems like Nigeria, Kenya, South Africa, Ghana, and Egypt, and the ones in major cities are better able to offer access to venture capital funding to their startups. Quite a number of them increasingly run cohort-based programs that last between 12 and 16 weeks depending on the stage of the startups. Other services include support to the ecosystem such as policy advocacy, and tech talent development.
These seem like important needs, but can it not be said that what businesses really want is to get money and figure the rest out by themselves?
I will beg to disagree. If you are a well-educated startup founder from a mature ecosystem with access to a support system in your industry that can guide you through the way, and the right policy environment, then yes it may be easy to launch.
But in other instances, it will be incredibly difficult. For example, launching a fintech startup is easier in Kenya than in Botswana because the latter still has to develop its support structures. If you speak to startups that succeed in Africa, they speak of the support they receive from the ecosystem along the way, by direct funding but also in gaining connection to global accelerators like Y Combinator or guidance in product development. So money is absolutely needed but there’s more to what hubs offer beyond money.
Speaking of Y Combinator, is it a problem for local tech hubs that the typical African startup wants to get into YC as soon as possible?
Some of the hard questions we need to ask ourselves now in the ecosystem is about who owns the startups. One of the main advantages of getting into YC is access to global investors for increased funding. Answering the question of ownership means we need to increase the amount of funding into African startups by African startups.
At the end of the day, the competition between global and African accelerators revolves around funding. We should be focusing on increasing the amount of investments by angel investors and incubators. AfriLabs is driving this with our capacity building programs like Catalytic Africa geared at helping hubs set up their funds and connecting to African investors.
It sounds like this problem may not be solved anytime soon?
I’m quite optimistic that it will be solved, if we are calling it a problem.
What are hubs doing to have more women-founded startups come through?
Africa has a few women-only hubs, like AkiraChix in Kenya founded in 2012, while other hubs run cohorts specific to women. At AfriLabs, we award about 15,000 euros to about 10 to 15 hubs every year. One of the award categories last year was for women support. 7 of the 15 hubs we supported ran women support programs, and some collaborated with each other.
We haven’t gotten there yet in terms of women founders in Africa as data show, but I’m glad that we have funds like FirstCheck Africa that are focused on finding women founders at the idea stage.
And what about the Francophone region? Any dedicated activities for it?
AfriLabs has members in practically all Francophone countries, from Senegal to Madagascar. Yes, a lot of support programs from development organizations or funding opportunities focus largely on the Anglophone region. But for all our programs, we ensure that the francophone region is covered. For example, our hub management curriculum is available in French but certain modules are specific to the region because business operations are different under the OHADA corporate law system.
One thing we plan to do with Catalytic Africa is to have a pool of funds specific to Francophone startups. We plan to ensure that no more than two startups from the same country benefit from the Catalytic Africa funding project so that we don’t keep funding the usual countries.
Will tech hubs as we know them today still be relevant in Africa in five, ten years time?
Our hope is that tech hubs will evolve as infrastructure improves. If the entire continent is wired with fiber cables, people will probably not need hubs for internet access but the collaborative element will always be valuable. I really do hope that in 10 years time, tech skills will be part of every university curriculum to close the current talent gap, so that hubs can focus on extremely advanced technologies and not basic skills.
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