Top tips for African start-up success
Helping African start-ups achieve exponential growth was the focus of a panel discussion on the opening morning of Africa Tech Week, taking place in Cape Town this week.
According to Zachariah George, co-founder and chief investment officer at Startupbootcamp, a big issue for start-ups is around understanding what customers want. With this knowledge, it is then essential to pivot business models to address these needs.
"We spend days and weeks trying to understand what pain points African businesses face. Way too many of them fall in love with their products and with the solution they've created, but the ones that find exponential success are the ones that fall in love with actually solving the problems their customers face," he explained.
Francisco Palao Reines, vice-chairman at Open ExO, believes African start-ups are actually at an advantage because they can use the successes and failures of the businesses that have come before them to minimise the hurdles they have to face.
Nowadays, everyone has access to technology, he noted. But it's not only about technology; it's about applying technology in the right way and using the right methodologies to come up with real solutions to solve real problems.
The panellists all stressed the value of sharing ideas and noted that open technologies and open data sets are key to exponential growth.
There is no denying your advantage is in your knowhow, the ability to move quickly and capture as much of the market as possible, noted Brett Commaille, founder and lead partner at AngelHub Ventures.
However, he pointed out that if wanting to be a fast-moving company, you're not going to be building everything yourself, you're using other people's ideas as well.
When attacking a large problem, it makes sense for different minds to come together to develop a solution that helps everybody, added Yusuf Khan, CEO of MCX Technologies.
Any conversation around start-ups would be incomplete without mentioning funding. George advised that start-ups explore different approaches to funding. It's about changing our mind-set and looking at customers, suppliers and clients as backers for your ideas.
As a funder of many businesses, Commaille explained that if giving a small business a lot of money before it has done a proof of concept and shown the endeavour can scale, you aren't upping its chance of success. It will still make exactly the same mistakes, it'll just cost more money, he quipped.
Local businesses need to step up to the plate when it comes to taking risks and they also need to get comfortable with hustling, concluded George. Entrepreneurs have to show potential funders, customers and backers that they have invested in their idea and are willing to do whatever it takes to succeed.