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Beyond Silicon Valley
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By the digits
480: Number of startup hubs worldwide
10%: Proportion of unicorns located outside Silicon Valley, and outside major locations in Europe and Asia
93,500: Job openings for data scientists in India, representing 10% of the world’s total
$2.3 billion: Size of Brazilian fintech PagSeguro’s 2019 IPO. At the time, it was the biggest IPO on the New York Stock Exchange since Snapchat in 2016.
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Where to watch
Here are four start-up hubs you can’t see from California:
- Minsk is the software outsourcing capital of Europe. The Belarusian city has built a $3.1 billion tech sector, but political repression threatens to squash the budding startup scene.
- Shenzhen is the smartphone-maker of the world. Home to Tencent and Huawei, the city has China’s largest consumer electronics market—and influence over Africa’s mobile market.
- India’s ‘80s IT capital is now the “Silicon Valley of India.” Bengaluru houses the third-highest number of tech startups globally and has secured 57% of India’s startup funding.
- A Lagos neighborhood is ground-zero for Nigeria’s $2 billion tech ecosystem. Several startups, including the Chan Zuckerberg Initiative-backed Andela, first set up shop in the Lagos suburb of Yaba.
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One big number
639 million: Estimated number of internet users in India, a figure greater than the entire populations of the US and Western Europe combined. The country has the world’s second-largest internet user base after China, even though just half of its population has access to the web so far. As smartphone penetration extends into smaller cities and rural areas, tech startups are racing to make the internet accessible by translating websites, apps, and voice assistants into all 22 official Indian languages.
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Charting Africa’s digital boom
Internet use across Africa skyrocketed from 2.1% in 2005 to 24% by 2018—the highest growth rate globally. That growth has seen global tech companies from Facebook and Google to Uber and Netflix expand their digital services across the continent. The hype isn’t just to capture the current market; tech giants are strategically positioning themselves for the future, bearing in mind Africa’s young demographics and expected population boom. African governments are racing to update their tax codes to keep up.
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One $1 trillion question
Who will win the battle for India’s $700 billion retail industry?
Two of the world’s richest men are wrestling for control of the lucrative market, which is expected to grow to $1.3 trillion by 2025. In one corner stands Jeff Bezos, who has already spent $5 billion building out Amazon’s Indian e-commerce operations. In the other: Asia’s richest man, Mukesh Ambani, the scion of the Reliance Retail group and the owner of 10,000+ brick-and-mortar stores. Though Ambani has the bigger footprint and more political clout, Bezos is counterpunching with legal challenges to limit his rival’s growth.
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Person of interest
At 29, Iyin Aboyeji’s CV already includes building two of the continent’s best-funded startups. In 2014, he co-founded developer outsourcing firm Andela, which has since raised over $180 million from investors that include the Chan Zuckerberg Initiative, Serena Williams, and an investment firm co-founded by former US vice president Al Gore. Two years later, Aboyeji moved on to start Flutterwave, a payments processing firm that has since grown from operating solely in Nigeria to enabling payments in over 40 African countries. Today, Aboyeji is an investor himself, providing fast-growing, early-stage African startups with crucial funding.
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Commonly held question
What ever happened to Trump’s TikTok ban?
In the summer of 2020, then US president Donald Trump gave ByteDance, TikTok’s Chinese parent company, an ultimatum: Sell its US operations to a “very American” company, or face a nationwide ban. After much hand-wringing—and a vague partnership between ByteDance Oracle—neither outcome happened. Trump’s deadline came and went, and in June 2021 president Joe Biden formally revoked the bans on TikTok and Tencent-owned WeChat. Biden did, however, order a security review of both apps by the US secretary of commerce.
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- Silicon Valley is no longer the global model. Instead, look to “the frontier”—entrepreneur clusters largely in emerging markets that operate with far fewer resources and networks.
- Nigeria’s startups need government support to beat Covid-19. Africa’s largest economy is working to protect the future of its promising tech sector.
- A forgotten Indian smartphone brand is trying to cash in. Onetime market leader Micromax failed to compete with Chinese rivals such as Xiaomi, Vivo, and Oppo; now it’s staging a comeback with some nationalist vigor.
- Data scientists are trying to make the internet accessible in every language. Roughly 3.5 billion speakers of around 7,000 non-dominant languages don’t have access to AI-powered translation tools—shutting them out of the internet’s most powerful benefits.
- A local music download service is taking on Spotify and Apple Music in Africa. Mdundo, which has signed up 80,000 African artists with a collective catalog of 1.5 million songs, raised $6.4 million in its 2020 IPO.
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“In this time of coronavirus-fueled uncertainty, startups should strive not to be like Silicon Valley unicorns, but rather like ‘camels’ of the frontier: ventures that capitalize on opportunity, but also focus on sustainability and long-term growth, i.e. surviving droughts and pandemics from the get-go. —Alex Lazarow, a Bay Area-based venture capitalist, academic, and author who argues that the tech world should look to centers outside Silicon Valley
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Chinese regulators stymied what could have been the world’s largest IPO from fintech Ant Financial, thwarting the ambitions of majority shareholder and Alibaba founder Jack Ma. Quick-witted observers marked the occasion with a classical-style proverb that turns the company’s name, Ant Financial Services Group (蚂蚁金服 or Mǎ yǐ jīn fú), into a four-character homophone (马已今服) with a rather different meaning: Jack Ma has now been tamed.
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Coined by venture capitalist Aileen Lee in 2013, a “unicorn” refers to a private tech startup valued over $1 billion. While Lee’s point was that such companies are supposed to be as rare, and as special, as this mythical creature, today there are nearly 600 unicorns worldwide, with China and the US dominating the space.
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