Venture Partner at Flourish, a global fintech firm with portfolio investments across Africa, Mr. Ameya Upadhyay, speaks on the recent survey carried out on a particular set of digital skill workers as well as the challenge of startups development across Africa. Emma Okonji presents the excerpts:
Flourish recently released its 2020 survey report carried out on a particular set of digital skill workers known as Gig workers, with plans to extend the survey to more countries of the world. What was the overriding objective of the survey?
Flourish is a global Fintech investor committed to helping people achieve financial wellbeing. In pursuit of that goal, we want to better understand the financial impact of the COVID-19 pandemic on Gig workers, who are a group of specialised digital skill workers and how their livelihoods are changing, as well as how financial technology (Fintechs) developers can better serve this population. Through our findings, we hope to amplify the voice of Gig workers and inform decisions that improve their financial health.
What informed the choice of countries where the spotlight 2020 reports were carried out?
So far, we have completed research in Brazil and South Africa. Our next focus is United States and India, before going to other parts of the world. We believe that these markets provide a good sample for our survey owing to the robust nature of the gig economy in these markets. We hope our multi-country research will allow us to identify challenges that are common to Gig workers across national boundaries. Consequently, we hope to extract lessons that have a global relevance.
What was the outcome of the survey on South African Gig workers and what are the lessons for other African countries?
The survey revealed that Gig workers, who are online workers with specific digital skills that were employed on contract to serve the clients of a company for a period of time that the project lasts, largely live by borrowing to make ends meet. This is despite the fact that they are workers on monthly salaries. The South African survey is part of a bigger study carried out in May this year, tracking the experiences of Gig workers across the globe. The survey seeks to reveal the impact of COVID-19 on Gig workers and their experience across the globe. With each of its country-specific studies, Flourish aims to help Fintech entrepreneurs connect with the people most in need of aid and better understand their needs. The report tracks the experiences of Gig workers, including those who use digital platforms such as e-hailing or delivery apps, to learn more about how they are faring during the COVID-19 pandemic. By tracking Gig workers’ experiences in South Africa and elsewhere, we hope to open conversations about how Fintech companies can build lasting solutions for the vulnerable population of citizens.
What are the key learnings from the South African Gig workers’ survey that you think might also apply to their counterparts in Nigeria?
We need to emphasise that Nigeria and South Africa are very different markets in many respects. At the same time, we expect the disruption caused by COVID-19 in the gig economy to be similar across many countries in Africa, and for that matter across emerging markets. This is because people face similar risks to their safety and have responded in comparable ways. It is interesting to note that we discovered similar disruption caused by COVID-19 when we conducted a study similar to the one in South Africa and in Brazil. Therefore, we believe Nigerian Gig workers are also likely to face income contraction, lack sufficient financial cushion and be concerned about financial security in the future, like their counterparts in South Africa.
Flourish has vested interests in Africa, with six out of the 11 portfolio companies being Nigerian. Why Nigeria?
Nigeria is home to some of the world’s best entrepreneurs building solutions for a large and underserved population. This aligns well with Flourish’s mission to back entrepreneurs that have a bold vision for transforming the lives of millions of people. It is not surprising that over the last few years, we have seen the venture space in Nigeria take off with several promising startups and several global investors. We feel privileged to have backed some of the pioneers such as Paga and FlutterWave.
In your experience, what will you say is the major challenge of startups in Africa, with Nigeria as a focal point?
I believe the biggest challenge facing African and Nigerian startups is inadequate talent pool. We think Africa has some of the world’s best talents. However, because startups are still a young phenomenon, many capable individuals are understandably reluctant to join them. We think this situation will change as the venture space matures. In Nigeria, we have already seen the talent pool expand as a consequence of the success of pioneering startups.
What role can government policies play in sustaining and growing the digital ecosystem in Nigeria?
I think policy-makers have a crucial role in supporting the growth of digital infrastructure. Regulations need to strike a delicate balance between supporting innovation, while ensuring that dividend of technological growth accrue equitably and that individuals’ privacy and data ownership are respected. Creating forums for open dialogue between innovators and policy-makers is crucial in achieving this goal. It was with this objective in mind that we issued a seed grant to the Association of Financial Services Innovators, which, among other things, seeks to catalyze conversations between the financial regulators and fintech startups in Africa.
Most of your portfolio companies in Nigeria are tech companies. Is that the major criterion for your choice of investments?
Yes it is. This criterion is driven by the belief that technology offers the best route to reach the widest customer base and to deliver high quality, personalised services at the lowest cost. Most of our investments leverage the power of the cell phone to reach their customers. At the same time, we recognise the importance of personal interaction. Therefore, several of our investments combine digital and physical aspects to deliver the most effective service – a model often termed ‘high tech and high touch’.
What does your job as Venture Partner at Flourish entails?
As a Venture Partner at Flourish, I back and serve entrepreneurs with a bold vision to create economic opportunity for under-served individuals in emerging markets. I focus on our investments in Africa where our portfolio includes Pagatech, Flutterwave, Lendable, Lidya, Pula, SeedSpace Dar Es Salaam, FairMoney, Apollo and Association of Financial Services Innovators.