The excitement in Kenya’s vibrant tech community was palpable when, within the space of a few weeks in April, several big tech firms made moves to significantly increase their presence in the country.
Microsoft launched one of two Africa Development Centre (ADC) sites in Nairobi and is looking to hire at least 450 full-time employees. Google announced it was hiring over 100 employees for its upcoming Product Development Center in Nairobi, the company’s first such facility in Africa. Visa had just launched its Innovation Hub, one of six in the world. Amazon’s plans to launch an Amazon Web Services (AWS) local zone was disclosed.
For Kenya’s tech talent pool—ranking fourth on the list of African countries with the most professional developers with 58,866, behind Nigeria, South Africa, and Egypt—increased competition for talent is resulting in higher compensation and fueling growth of the larger local ecosystem.
Not everyone is winning though in Kenya’s battle for tech talent. Even as Kenya added an estimated 2,000 new developers (pdf) to its tech talent pool in 2021, startups in particular are facing an uphill battle to retain talent. Major telcos and banks, long considered the best-paying organizations for techies in Kenya, are also losing their best talent to big tech.
Silicon Savannah has renewed interest from global tech
The renewed confidence in Kenya as a tech hub for the continent is reminiscent of a similar boom a decade earlier that earned Nairobi the ‘Silicon Savannah‘ moniker. Back then, what led the firms to set up shop here was increased public investment in internet infrastructure, the meteoric rise of mobile money and a fast-growing economy.
Today, one of the biggest factors attracting big tech to Kenya is the engineering talent. A quick spot-check of tech-related job openings in Nairobi reveals multiple vacancies at Google and Microsoft for engineers, designers, and researchers.
Increasing competition for Kenya’s tech talent has companies rethinking their talent acquisition and retention strategies. It calls for a deeper look at Kenya’s talent development pipeline and what the future looks like.
For those welcoming big tech, the prevailing school of thought is that their entry will be a catalyst for development of Kenya’s tech ecosystem. They expect a more lucrative, vibrant marketplace that benefits not just the giants but also startups and emerging talent in Kenya.
“Technology transfer and pipeline are very important to be able to grow a local ecosystem. That is what has allowed all major global talent and innovation-focused countries to grow. India, Singapore, China, Japan, Estonia etc…all of them grew that way,” writes experienced tech executive Sheilah Birgen, maintaining that their entry could only be a good thing.
Jack Ngare led the fintech arm of Kenya’s largest bank by assets, Equity Bank, until 2019 when he joined the then newly-announced Microsoft ADC as managing director and led a major recruitment drive that saw startups among other firms lose some of their best engineers. He left Microsoft for Google shortly after the launch of a massive new Microsoft ADC site in Nairobi in April 2022. He too believes increased investment in Kenya by big tech will spur the local ecosystem on.
“The ecosystem effect is a driving force in our industry and we are seeing something similar in Kenya,” Ngare told the Financial Times back in October last year.
Is it a win-win for big tech and Kenya’s tech ecosystem?
Proponents point at Africa-focused initiatives being undertaken by big tech. For instance, Google’s $4M Black Founders Fund for early-stage, Black-founded startups in Africa, or Microsoft’s involvement in the development of a coding curriculum for primary and secondary schools in partnership with Kenya’s Ministry of Education.
Startups in Kenya are being forced to improve their offers to employees to keep up with big tech. Those who invested in training their own engineers are especially feeling the pinch. To attract and retain talent, they’re also banking on giving staff equity and the promise of greater responsibility in startups compared to big tech firms.
The scramble for talent has, however, sparked renewed interest by firms both big and small on investing in talent development. Coding schools and tech mentorship programs are announcing more partnerships with tech firms and job placements for their students.
KamiLimu is a Nairobi-based tech mentorship program equipping students with the skills they need to thrive in the industry. In the last year, six of their mentees joined big tech firms including Microsoft as engineers and program managers.
This is indicative of the market’s growing appetite for refined tech talent. For the likes of Microsoft and Google who are plotting billion-dollar investments in Africa, having the best local talent is a requirement, not an option.
The increased flow of venture capital investment to African startups also means that the pool of potential employers for the continent’s tech talent is growing larger, especially in key markets such as Kenya, Nigeria, South Africa, and Egypt.
The Africa Developer Ecosystem Report 2021 (pdf) says that 81%of venture capital funding in Africa went to the top four countries with the highest population of software developers—Kenya, Nigeria, South Africa and Egypt.
“Led by Nigeria and Kenya, Advancing Countries secured more funding than ever in 2020, and this success has allowed their startup ecosystems to grow faster than ever and take advantage of digital transformation spurred by the pandemic,” the report says.