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Young entrepreneurs and business people in Kenya and Rwanda were excited this past week with the visit of Jack Ma, the founder of e-commerce giant Alibaba. Ma, who was on his first visit to the continent, seemed to be inspired and excited to be visiting. His audiences seemed to feel the same way about him.
In particular, it is Ma’s backstory to which many African entrepreneurs can relate. Ma comes from a modest background in a China that wasn’t the economic world power it is today. His willingness to share the stories of his failures and setbacks is particularly appealing for young entrepreneurs in a continent where poor infrastructure and weak institutions can be major obstacles to getting anything done.
But Ma argues this is why African entrepreneurs should see more of the promise than the obstacles. ”If the government does not have a solution to any problem, it is an opportunity,” he said in Nairobi. “If people complain, it is an opportunity.”
Failure for startups, particularly under the harsh spotlight of today’s high-profile tech ecosystems in cities like Nairobi, Lagos or Cape Town, can be particularly challenging. Yet, Ma insists startups should learn from their failures, not their successes.
African entrepreneurs in the startup world will have to ready themselves for the very real possibility of disappointment, especially when it comes to raising capital. The odds of success in this environment are particularly tough as shown in startup investment data this week from VC4Africa. Looking at 600 startups and over a hundred investors, it found only 42% of the startups received external funding and around 96% of the ventures that secure funding get less than $250,000. This means only a very small number are able to reach larger rounds of follow-up funding.
Yet, on the plus side, the funding ecosystem is evolving with more local syndicates of early stage investors forming to help get startups off the ground, notably in Lagos, according to VC4Africa. The amounts of money are still small at around $12,000 each on average per round in syndicates of five to 15 investors, yet it’ll improve those bad odds and see more startups getting to the next stage of growth.
Yinka Adegoke, Quartz Africa editor
Stories from this week
African mobile operators want to fight back against WhatsApp. Despite a fast-growing subscriber base, mobile revenue growth has been declining across sub-Saharan Africa since 2013. They claim one of the main culprits is the increased use of “over-the-top” messaging and voice apps like WhatsApp, Facebook Messenger, and Skype which they say hurt operators’ ability to make a return on the investment in building out mobile networks.
The South African start-up using bitcoin to turn digital pirates against each other. Custos company embeds imperceptible bitcoin keys in the advanced copies of a movie or an e-book. The private keys, writes Joon Ian Wong, allows for the detection of the digital files, but also helps rat out the origin of a leak using the cryptocurrency.
The fascinating details of the corruption scandal involving Nigeria’s ex-oil minister. Diezani Alison-Madueke, the former Nigerian oil minister, is currently engaged in a corruption case filed by the US Department of Justice. Reviewing the court files, Yomi Kazeem finds a case with an expensive Manhattan property, a luxury yacht, multimillion-dollar home furniture and no honor among thieves.
The Pokemon Go-like game tracking the real movement of animals. Conservationists usually rely on GPS data to understand the resource needs and patterns of animals living in the wild. That data is now going into a mobile game that will allow players to track real animals in their natural habitats, with in-app purchases revenue going towards conservation causes reports Lily Kuo.
Why Nigerians really love Donald Trump—or at least some of them do. At home, president Trump is facing very low approval ratings than most of his predecessors. But in Africa’s most populous nation, his nativist and Islamophobic rhetoric has resonated with some Christian “indigenes” and Biafra nationalists, explains Matthew T. Page.
Ushahidi fires accused sexual harassment executive after victim goes public. Angela Kabari, a former capacity development officer with Ushahidi, identified herself as the former employee at the center of the sexual harassment case that has shaken up the company and Kenyan tech community in recent weeks. Kabari revealed damning details about her encounters with executive director Daudi Were who was suspended then fired by the board this weekend.
CHART OF THE WEEK
Kenya is set to hold one of Africa’s most expensive elections. On Aug. 8, almost 20 million Kenyans will go to the polls in a tightly-contested general election. But as Abdi Latif Dahir writes, the government electoral expenditure and campaign spending could top $1 billion in aggregate spend—making the 2017 elections one of Africa’s most expensive on a cost-per-voter basis.
Other Things We Liked
China’s relationship with Africa may be complicated, but it is no colonizer. For a decade, China’s relationship with Africa has been the subject of debate, with some labeling it neo-colonial. While Chinese presence in Africa is far from benevolent, Hannah Ryder argues in Project Syndicate that it’s misguided to call it colonial.
Some of Africa’s problems are actually “civilizational.” French president Emmanuel Macron caught heat last week for labeling Africa’s problems “civilizational.” The implications of using that word are rooted in a painful history. But it shouldn’t disqualify discussions identifying key issues on the continent such as overpopulation, writes Remi Adekoya in Foreign Policy.
Craft beer is coming to Nigeria. Kevin Conroy started Bature Brewery to challenge the dominance of Heineken and Diageo in Nigeria. Conroy, a Scot who works in international development, believes he can persuade Nigerians to join the craft beer revolution, writes Paul Carsten for Reuters.
Keep an eye on
Kenya’s presidential debate on TV (July 24). On Monday Kenya’s presidential candidates are due to go head to head for a second and final televised debate, ahead of the general election on Aug. 8.
Atlas for Africa trainings in Cairo, Johannesburg and Nairobi (July 22—Aug. 1). As part of our ongoing training to bring Quartz’s chart-building platform to newsrooms and organizations across Africa, we will be conducting trainings in Egypt, Kenya and South Africa. Cairo (July 22 to 26); Johannesburg (July 25 & 29) and Nairobi (Aug. 1). Interested participants can email us at: email@example.com.
Our best wishes for a productive and thought-filled week ahead. Please send any news, comments, suggestions, South African bitcoins and Nigerian craft beer to firstname.lastname@example.org. You can follow us on Twitter at @qzafrica for updates throughout the day.
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