By Curt Hopkins / October 27, 2011
Over several days, I visited three incubators in Nairobi devoted to startups in the social space. Given the emphasis in Kenya on mobile – as many as 60% of Kenyans pack mobile phones but as few as 5% have Internet connectivity via laptop or desktop computers – the development also focused on mobile, though not exclusively.
If in the United States and other more conspicuously developed countries nerds are considered rather ridiculous – right up until they’re worth $10 billion – they are possibly even less well regarded in Kenya, where both government officials and the representatives of large companies largely downplayed their importance in the country’s, and Africa’s, future.
The two best known startups in Kenya are the crisis mapping outfit Ushahidi, whom we’ve covered a lot, and M-Pesa, the bank-agnostic mobile payment company. The development of the latter, though supported by the African company Safaricom (now owned by European juggernaut Vodafone, and managed by IBM) was actually developed by British tech consultancy, Sagentia.
After talking with Jessica Colaço of iHub and with John Kieti of the World Bank-funded m.lab east Africa, a mobile development lab attached to iHub, as well as Sam Gichuru of Nailab and Dr. Monica Kerretts-Makau of Strathmore University’s iLab, I’ve come to the conclusion that no one is waiting for the government to wise up. They all seem powered, to various degrees, by the nerd catechism of “think it, code it, build it, sell it – NOW.”
That is hardly to say that government interest in such a top-heavy country as Kenya is unimportant to these groups, it just seems they have little hope of great support anytime soon. And, instead of despairing, they have all created different ways of reaching out to, and beyond, Kenyan society. In fact, one of my primary impressions was how these developers, as focused as they are on their own markets and the needs of their own society, are nonetheless well versed in global development issues and best practices and are in constant contact not just with each other, but with their peers and with corporations as far flung as Finland and the Silicon Valley.
My driver Johnson looked around the parking lot of the iLab on the built-out campus of Strathmore and shook his head.
“I never even knew this part of the campus had been built,” he said. “You know this university? If you’re smart, you can get into the University of Nairobi. But this place is for the elite.”
It certainly had its share of Biffs and Betties. No one was wearing old jeans and cast-off t-shirts, that was certain. The iLab building itself was so new that it would be two more weeks before the rest of the furniture was in, according to Dr. Kerretts. The cube-shaped, multistory building had the openness and clean lines of a Scandinavian furniture store. There was none of the rotting brick and peeling paint you saw at the U of N. In fact, the whole cost of the building had been furnished by Safaricom and is full-on fiber-equipped. Samsung and other international high-tech firms have donated money, materials and expertise to the lab. But any fear that the iLab was a function of a new high-tech colonialism was quickly put in the ground.
“They have come to ask us to explain African markets and consumers to them,” said Kerretts. “The I.P. of any product or application developed here is retained by the student or faculty member.” The sponsoring companies can offer to license an app created at the lab, at favorable terms to the developer, but control is retained, she said, by the developers themselves. There is no liberty without owning the fruit of you own mind.
I sat down with three students at iLab – all of whom must be Masters candidates – to review some of their projects. All the projects were mobile apps, three focusing on medicine and one on housing. I asked why there was such an emphasis on social good, instead of, say, entertainment.
“Our teachers tell us, ‘focus on the needs of your society,’” said David Owino, a well-turned out grad student clad in a pressed purple dress shirt and loafers. Quick to smile but very focused, David was the de facto spokesman for the trio, which consisted, in addition, of John Kulova and Sammy Onkoba. “But it’s also about the market.”
You want to make cash, I suggested.
“We want to make money, too, for sure.”
It’s a significant step toward parity for African developers to be solicited for their own intelligence and intellectual property and for they themselves to set up a situation in which they retain the I.P. they produce.
Owino is currently shopping his app, a mobile-based pharmaceutical sales tool, to investors. The sales proposition is easy.
“We’ll sell it to large pharmaceutical companies,” he said. The tool avoids fraud by GPS tracking the sales staff and sending all orders immediately to the company’s database. No one can pocket cash or claim expenses for a trip to Mombasa they never took. Customers can be assured of reference to their orders with a phone call.
iHub & m.lab
If a Western geek knows anything about East African developers, it is probably in terms of iHub. Set up in March of last year by Erik Hersman and others involved in the creation of Ushahidi, it takes up most of two floors in the pleasant multiuse Bishop Magua Center on Ngong Road in Nairobi. The space is light with tall windows, balconies that let out over a sea of feathery acacias and open working space. The space was secured and renovated with funding from the Omidyar Network and Hivos, the lease is covered by Ushahidi and the Internet connection provided by local company Zuku.
Memberships are offered in color. White is virtual, green is resident and red requires a fee of $100, securing the member a reserved work space. Members are offered business mentoring, Internet access, the cross-pollinating presence of their fellow nerds and access to events and speakers. The events include barcamps (one of which ended while I was on the plane to Nairobi, unfortunately) and hackathons. The latest was focused on water resource issues. iHub speakers have included Google’s Marissa Mayer and Vint Cerf.
Perhaps the most important ingredient in the iHub recipe is Pete’s café located inside the space itself. Pete’s coffee, which he roasts himself, is sick.
On a separate floor sits m.lab east africa, the go-to-market side of iHub. Graduates of iHub whose developments seem the most marketable are offered residence there, for at least six and no more than 24 months. One of these is the Kuyu Project, which we’ve written about before. Simeon Oriko of Kuyu and John Kieti, manager of m.lab, said m.lab gives developed projects a chance at financial viability. The University of Nairobi, the World Wide Web Foundation and eMobilis work with iHub to sustain the World Bank-funded lab and its fellows.
m.lab provides subsidized office space, access to otherwise expensive market intelligence, business advising services and application testing services.
Nailab, led by Sam Gichuru, is just across the hall from iHub. Built on the Y Combinator model, Sam invites startups to compete three times a year and the winners are given space, connectivity and mentoring as they try to build their apps and find their markets.
“We can’t offer our residents money,” said Gichuru, “so we offer them space and access to excellent business knowledge.” Some of the residents have used that to make their own money. One group of animators was practicing world-class motion capture but Gichuru advised them to create more basic, but still stylish, animations for corporate clients. In the last six months they sold ten animations at $2,000 each.
“We are very concentrated on markets,” Gichuru said.
Another resident, Nyatha Githinji, had designed an app, SchoolsSMS Premium, that allows parents and school administrators to communicate with one another. The app covers school fees, attendance, sick days and more. So far he’s sold it to half a dozen school districts around the country and has amassed enough data from those trials to provide any potential user with proof of concept.
He also won a $2,500 prize from a development contest, ipo48.
“Here in Nairobi, that means he, as a single guy, can afford to pay rent and eat and do nothing but work on his product for three months!”
Nailab also offers more advanced-stage developers and startups with space and connectivity.
I can’t speak for the nerds I met and the nerdatoria I visited in Nairobi. But I can tell you what I saw and you can take it from there.
In a country with a disproportionate government sector, where a legacy of colonial control has made that government slower and less responsive than it could be, startup-minded propellerheads have no choice but to act. Well, they could wait around for government help, or, if they’re well connected, they might be able to mine those connections. But even if they’re plugged in, most nerds don’t want to yoke their wagon to an ox that slow, regardless of the power he brings to the plough. So they are seeking alternatives. And they are finding them.
Lone-wolfing it, creating and joining incubators, exploring alternative funding sources, both international and domestic, connecting directly with a global market, and setting up public-private partnerships are all things I’ve seen the Nairobi nerdoisie do, all while focusing on their own needs and their own markets. This urge to seek new avenues to success is part of the reason, along with a culturally entrepreneurial mindset, that there are so many of them and why they are going to be a big deal in time.
Sub-Saharan Africa is a region with 1 billion people, over 60% of whom are under 30 years old. High tech has been a primary driver of East Africa’s 40% growth over the last decade and small and medium-sized enterprises are poised to take over a great deal more of that growth going forward, according to a recent study, anyone who is not paying attention to the continent, and paying attention to it as a forge, not just as a market, is going to swell the ranks of the “if I had invested $100 in Apple in 1981 I’d be a billionaire” crowd. I fear that the government itself, as well as the large tech companies so avid for the continent’s growing purchasing power, may be among them. But that won’t matter to the Afro Nerd Superstars. They’ve got things to do.