Solomon Elusoji who visited Yaba, Nigeria’s version of Silicon Valley, reports that although the Nigerian technology scene is far from hosting billion dollar companies, it has the potential to become the solution to the country’s oil addiction
On February 2, Snap Inc., the parent company of popular networking app, Snapchat, filed paperwork to raise $3 billion for its Initial Public Offering (IPO), valuing the company at $25 billion. Started by Stanford dropout Evan Spiegel in 2011, Snap, if its IPO is successful, will be the latest to join the league of uber-successful technology companies that has been the staple of Silicon Valley since the Dotcom crash.
This kind of success, where billions of dollars are involved, is a phenomenon that has not been replicated in Nigeria’s technology sector (there were rumours in early 2016 that Interswitch was inching close to a $1 billion valuation). This is not for lack of trying or ambition. Hundreds of technology products are launched locally every year, but they meet with little success, due to a plethora of reasons. The biggest successes have come in the form of e-commerce companies like Konga, payment gateways like Paystack and streaming services like IrokoTV.
But, like it can be said of everything in Nigeria, hope is not short in supply. When Facebook’s Mark Zuckerberg visited Lagos in August 2016, he spoke of a certain “energy” that characterises the city and its people. And he could not have been wrong, judging that he made the comment in Yaba, Nigeria’s version of Silicon Valley. Yaba is home to CcHub and iDEA Nigeria, two of the most prominent start-up incubators in the country, and also houses over 20 technology companies. It is the likeliest place where a billion dollar Nigerian technology company might sprout.
However, an obsession with billion dollar figures is unhealthy for start-ups in this part of the world. With barely 39 per cent of Nigerians having access to the internet (according to a 2016 Pew Research Centre report), the focus, instead, should be on creating products and services that solve the problems of the burgeoning market. The good news is that there are a growing number of young Nigerians who are doing just that.
Building to Solve Problems
William Nwogbo is the CEO of ChurchMember.com, a technology service that wants to redefine the communication aspect of church administration. “I’ve always wanted to build things that could make life easier for people. So everyday I look for problems to solve. Currently I am solving the problem of church management, trying to see how I can help strengthen the relationship between church administrators and their members,” he told THISDAY.
The service launched in 2016 and has experienced steady growth. “In Nigeria the adoption rate can be high for social applications, but when it comes to enterprise applications, it takes some time,” Nwogbo said. “We’ve had churches using the application, but I won’t say our expectations have been met. The market is still growing.”
A Software Engineer by training, Nwogbo, who is part of the Yaba community, is optimistic about the future. “I see a very strong future for tech in this country,” he said. “There are still lots of opportunities for people to tap into. For example, we don’t have server farms; we don’t have hardware products. In the next 10 years, I see tech being at the forefront of our economy. So we need to educate our political leaders on this, that tech is the way forward. It is an opportunity for us to liberate ourselves from being dependent on oil.”
On what keeps him motivated in his journey of running a technology company, he said: “You need to have the right set of people around you – people that share in your dreams and your passions; because when the road gets bumpy those are the people that stand by you. They are the ones who don’t second guess you and urge you to keep going. Then you need to have the right environment; places like CcHub and IdeaHub where you can come up with (and incubate) amazing ideas. Take Paystack for example; they’ve been successful largely because of the environment they set up in.”
Training the Ground Soldiers
In June 2016, the Chan Zuckerberg Initiative led a $24 million Series B round of funding into Andela, a company focused on training talented developers and helping them find employment at top technology firms. Venture firm GV joined the round, alongside existing investors Spark Capital, Omidyar Network, Learn Capital and CRE Ventures. “The goal is to cultivate the next generation of founders and CTOs of great companies across Africa,” co-founder and CEO, Jeremy Johnson said at the time.
But Andela is just one company and cannot possibly fulfil the growing demand for world-class developers from Africa. This prompted Mofesola Banjo, a Computer Science graduate of the Federal University of Technology to start DevCrib, together with some colleagues. “We’re putting up a tech garage to produce standard developers and solve the scarcity that has enveloped the tech ecosystem,” he said. “We intend to graduate at least 10 yearly.”
Banjo describes Planet Nest as a “more affordable” version of Andela for companies seeking to hire world-class developers. The novice developers undergo an intensive one year-programme before landing jobs where they build world-class technology products. At a time when unemployment rates are high and the continent is experiencing a drought in technical and engineering skills, DevCrib is meeting a solid need.
“I see a very bright future for tech in this country,” Banjo said, on his motivation for running DevCrib, which is privately funded, “tech itself is the future and nothing has changed man’s life so much since the discovery of fire. Nigeria can expect the shiny bright tech future; the foundations are being laid already with incubation centres all around, the increasing population that code, the fact that almost 50 per cent of the total population are youths, the 46 per cent internet penetration and, very importantly, the passionate tech-preneurs all over the country.”
A Promising Horizon
Nwogbo and Banjo are only just two of many young Nigerians doing innovative work in the technology sector today. The sensational success of Silicon Valley has provided motivation for hordes of young Nigerians to dive into technology and attempt to create their own future. From working on commercialising solar technology to re-imagining everyday payments, a revolution is quietly unfolding.
In September 2016 Michael Seibel ,the CEO of Y Combinator (one of the most successful early stage fund and incubator company from Silicon Valley) was in Nigeria to invest in start-ups, and he was swept away by what he found. “They are just great and passionate about developing solutions that work, and I see great potentials in them,” he told THISDAY at the time. “Since I came to Nigeria for the Start-up Friday show in Lagos, I have seen several start-up companies that have viable products and what they need is the push in terms of support and investments in their solutions and that is the reason we are in Nigeria to invest in the Nigerian technology start-ups.”
The onus is now on the government to provide the necessary environment and support for technology to thrive. It sounds cliché, but “Silicon Yaba” will not happen if those who hold political offices do not see the long-term value of investing in technology. A perfect demonstration of this kind of support was given by the Executive Governor of Lagos State, Akinwunmi Ambode, when he visited the Yaba tech cluster in January and promised to provide steady electricity to the start-ups operating in the area. But talk should be matched with action. For example, despite being the most populous black nation on the earth, Nigeria still placed 4th on the list of African countries with the most tech hubs in 2016, lagging behind South Africa, Egypt and Kenya. The country needs more tech hubs, not just in Lagos but spread across its vast landscape. It is mind-boggling to imagine the hundreds of potential Zuckerbergs that might be lurking in remote corners of the country.
