Two factors are reshaping the African corporate environment: cloud digital natives and the budding startups. Companies that are cloud digital natives were created on cloud computing platforms and make use of the scale and flexibility that the cloud provides. On the other hand, emerging startups are brand-new businesses that use technology and innovation to challenge established markets and develop fresh business strategies. These two tendencies are fostering development and innovation within the startup ecosystem in Africa.
The African Development Bank observed interesting trends in the number of startups in Africa and reported consistent and quick increase in recent years. An estimated 5,000 startups are expected to become functional businesses in Africa by 2023, with a sizable part of them in the technology and innovation industries. According to the Bank’s survey, South Africa, Egypt, and Nigeria are home to the bulk of African companies, with Kenya and Morocco also emerging as significant startup centers. One of the key drivers of this growth in African startups is the increasing availability of funding. In 2022, venture capital (VC) investment in African startups reached an all-time high of $7 billion from $1.3 billion in 2020 and $1 billion invested in 2019. This increase in funding is helping to support the growth of new startups and the scaling of existing ones.
Due to their ability to simply and swiftly scale their enterprises to meet the needs of their consumers, cloud digital natives are especially well-positioned to benefit from this funding.
A number of advantages enabled by cloud computing platforms, including worldwide reach, flexible pricing, and on-demand scaling, are responsible for the emerging narrative. These advantages are especially crucial for African businesses, who frequently struggle with issues including a lack of local knowledge and restricted access to infrastructure.
Flutterwave, a Nigerian fintech company that offers a digital payments platform for both enterprises and people, is one example of a cloud digital native startup in Africa.
Since its establishment in 2016, the company has raised more than $20 million in capital.
Flutterwave has become one of the top fintech firms in the region by fast expanding its services to additional nations in Africa and Asia by utilising the cloud. M-KOPA, a Kenyan firm that offers off-grid inexpensive solar power options, is another digital native success story. M-KOPA has developed a digital platform that enables clients to pay for their solar power systems in a series of manageable, inexpensive sprints by utilising the cloud. Simple, but effective, the company has reached more than 1.4 million customers in East Africa expanding its services to other countries in Africa and Asia – an incredibly timely idea when sustainability is a focal need to keep the planet going.
African emerging startups are also having a big impact, especially in the technology and innovation fields. These firms are using cutting-edge technologies like AI/ML, IoT, Web3 and blockchain, etc. to disrupt established markets and develop fresh business strategies. For instance, a Kenyan business called BRCK uses its ruggedized, cloud-managed routers to offer connectivity solutions for remote places in Africa and other developing countries. BRCK uses
IoT and blockchain to create a robust and secure network infrastructure in these regions, which is great for the local economy and society.
Startups in Africa are also using e-commerce to reach customers in far-flung locations and to open up new business prospects for small companies. Jumia, a Nigerian e-commerce business that operates in 14 nations throughout Africa, is a good example. Jumia is utilising the cloud and digital technology to give clients a simple and safe online shopping experience while also giving small companies a platform to sell their goods online. In conclusion, two trends that are altering the African corporate scene are cloud digital natives and the burgeoning startup.
Africa’s time for development is here. Technology is no longer a nerd’s playground but a global economic enabler.
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About the author – Uche Nwaukwa is a DevOps, SRE, and Senior Cloud Architect with 15+ years of experience having played strategic roles in global fintech, banks, ISVs, telecommunications, and OEMs including Microsoft, IBM, and Google. He has been privileged to advise execs and techies alike on architecture best practices in the financial services industry, dominantly. He has served as an Enterprise Architect and also, a CTO driving bespoke architectures to meet stringent SLOs and SLAs. Uche is an avid learner, a father, and a husband, and likes to relax with a good chess game and cycling. Please follow us on LinkedIn #techie
