“I will see within the next 5 to 10 years’ African start-ups that are going be Unicorns.”
Why? “Look at our market, we have a market that is just economically pre-disposed to be consumers. We have everything that it takes to have unicorns in Africa or African-tech start-ups becoming unicorns because of the products they are offering to the world.”
These are the words of one of the tech entrepreneurs that I’ve interviewed in Cotonou, during my African tech tour at the beginning of the year. Senam Beheton, co-founder of TEKXL, a combination of incubation, acceleration and venture investment, predicted that the next African unicorns, those enterprises valued at $1bn or more, could even appear in the next couple of years.
Then, in March, less than two months later, African Internet Group, AIG, has joined the club of global Unicorns on CBInsights list, with a valuation of $1.04 bn. The first African unicorn was born.
AIG is the mother company behind Jumia, an ecommerce site which is booming in Nigeria and in 10 other African countries. The internet company has raised an additional €300 million ($327 million) from four investors, the US investment bank Goldman Sachs, African telecom giant MTN, the French insurer Axa and German-based Rocket Internet.
Senam identifies three pre-requisites to accelerate the birth of African unicorns: “What is most important is connection, investment and trust,” he says. “If you take UBER or any unicorn right now, first of all these valuations are based on a system of mentoring, on a system of network, and on a system of investment.”
“What we need to do is work towards this combination, so the day that African start-ups are going to have access to serious investment, good networking and perfect mentoring, then that is the foundation for good unicorns really soon.”
As an Economist, he analyses data, looks at metrics which show that what it takes is to combine those three factors that have propelled AIG to the top. The founder of AIG, Jeremy Hodara, ex McKinsey, is a well-connected man and has access to mentors who have been there before; he has a powerful network with corporations that have deep pockets to back the start-up and trust him to execute his project successfully.
While it’s good news to see Africa join the rank of unicorns, the next step is to ensure that the tech revolution truly benefits the continent and solve real problems rather than becoming a race to bigger valuation and large market shares owned by foreign investors.
African tech entrepreneurship need to be encouraged, incubated, accelerated with access to optimal infrastructures and ecosystems needed to thrive and fulfil the continent’s potential.
There are rumours that other ‘Made in Africa’ baby unicorns are coming very soon.
Watch the full interview with Senam Beheton to find out:
- What motivated him to start tech starts-up in Benin
- The main challenges he faced to get things off the ground and the lessons learnt
- How to transform challenges into opportunities
- The best ways to approach the African environment to succeed
- How tradition can prevent women to get involved in tech and his original approach to deal with it
- How western businesses and individuals can get involved in Africa tech
- Why multinationals are increasingly using tech talent based in Africa
- Why unicorns will emerge from the continent very soon
- Why African diaspora should pack their bags and go now or find ways to help the local entrepreneurs
- And much more …
In a hurry? skip to 17”30 to hear the conversation about unicorns!
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About Francine Beleyi
Francine Beleyi is a digital content strategist, entrepreneurial journalist, and change agent who helps businesses to produce engaging content for their audience and thrive in the digital age. She spends her days speaking with and studying the most successful entrepreneurs in the new economy, and sharing her findings with those who are open to new ideas and want to increase their results.
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For more information, visit http://www.francinebeleyi.com/.