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China’s role in developing Africa’s tech ecosystem

Exclusive interview with the Founder of Africa`s largest entrepreneur alliance

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{{{Olayemi Anifowose-Eso and Gian Marco Brizzolara}}}

Background on Okendo Lewis-Gayle and Harambe Entrepreneur Alliance

Okendo-Lewis Gayle is the Founder of Harambe Entrepreneur Alliance and Inaugural founder in residence at Schwarzman College, Beijing. Additionally, he serves as Chairman of the Harvard Vatican Leadership Summit and holds a Masters Degree in Public Administration from Harvard Kennedy School.

The Harambe Entrepreneur Alliance is a network of young African CEOs and entrepreneurs known as Harambeans, who are scaling social and business ventures across sectors in Africa. Since its inception in 2007, Harambeans have spawned a series of tech-enabled ventures across Africa, collectively attracting over $300 million from investors such as Google Ventures, the Chan Zuckerberg Initiative and Alibaba. The network aims to propel the continent forward by harnessing its entrepreneurial spirit, identifying promising young African leaders and giving them access to markets, education, capital and support networks.

Okendo Lewis-Gayle

1.Why is Africa the next big opportunity for tech investments?

First, it is very important to understand the stage Africa is in. It is clear to me that the continent is still in its infancy, in terms of the entrepreneurial ecosystem and there are many problems, which arise in a young ecosystem. There is a lack of entrepreneurs, investors, credible support and infrastructure. Yet, looking at China where an entrepreneurial ecosystem also did not exist a few years ago, the country shows that these drivers can develop very quickly. Africa is the youngest region in the world and if demographics is destiny, then clearly the continent of Africa will be the hub for many activities. The youth will soon become consumers and so there is tremendous opportunity for all kinds of companies to participate in this growing marketplace, just as China has demonstrated. However, we have to be conscious about the fact that we are in the early stages of this process and that progress will not happen over night.

Technology hubs in Africa

2. What is the role of Chinese tech companies and leaders to foster entrepreneurship in Africa?

Because China did not have a tech ecosystem just a few years ago, it is very clear to Africans that it is entirely possible to develop one quickly and effectively. It is that certainty, that knowledge and experience that is critical as we develop the African entrepreneurial ecosystem. The advice of people who actually help develop an ecosystem from scratch rather than people who just inherited an ecosystem is more valuable for us. I do think that as the continent begins to develop, China can share its knowledge and best-practices and thus accelerate that process. People like Jack Ma are absolutely indispensable. Through their believe in Africa they provide hope that the vision of an African tech ecosystem is very possible. In many ecosystems that is exactly what you need, champions who are saying I have seen it and I believe it. I was speaking to Steve Case (Former CEO of the online-services provider AOL), he founded an initiative dealing with the question how to develop entrepreneurial ecosystems outside Silicon Valley. I asked him how to you develop entrepreneurial ecosystems in Africa. He said: “Exactly the same way as you do it in Atlanta, in Detroit and many other places where they did not exist. Find a few successes and everything else will resolve itself.“ It is not rocket science and just because it is not there today, does not mean it cannot be there tomorrow. As China demonstrates, it is a process and people like Jack Ma absolutely help accelerate and validate it.

Africa VC Funds

3. How exactly do African and Chinese entrepreneurs collaborate today what will future collaboration look like?

I think Jack Ma is really a pioneer in this field. He just started a fellowship called the eFounders Fellowship. He gets folks from across Africa and tells them how he did it. What is fascinating is that in very developed markets, if you are a company like Uber you can just focus on the product, like the app and computation. If you try something like Uber in a developing market, you have to also develop many of the related services, like payments, training etc. For many African entrepreneurs it’s not enough to just facilitate trade, but you have to develop so much infrastructure for that process. If we are going to make these things work, you have to follow a broader approach as Alibaba showed. The next big step will be attracting investors who can fuel the entrepreneurial ecosystem. Jack Ma actually recently announced an annual pitch competition for entrepreneurs in Africa called “Netpreneur Prize”, where applicants compete for funding. Chinese entrepreneurs like Jack Ma have seen movements like this before and so he is best placed to provide expertise and capital having faith that the ecosystem will prosper.

4. What are the differences between Western and Chinese support for African entrepreneurs?

In my opinion, the potential is huge for China, because of the relevance of its experience. For many people in the West, who never created an ecosystem, they struggle to understand that process. The Chinese know what works and what doesn’t, and that is absolutely relevant for the process. That is part of the reason why Africa-China relations are very successful, because experiences are immediately applicable.

5. How can Africa avoid relying too much on China and other countries?

Remember that Jack Ma initially had to raise money in the US and Japan, but you do not see that happening anymore. He is now investing money in other Chinese companies, as is Pony Ma from Tencent and many other entrepreneurs. Once you create a few successes, which raise money and generate profits, you can recycle the capital and develop an ecosystem. The problem we have currently is that most of the capital invested in Africa comes from other parts of the world; this isn’t exactly what the continent needs. We need to develop more unique characteristics and core competencies, which need to be developed by the local entrepreneurs themselves. That is what every ecosystem needs. The ecosystem in Lagos is very different from the one in Cape Town for example. The only way to develop context specific solutions is by successful entrepreneurs funding future projects, reusing their networks and capital. China reminds us that we definitely can. For many people, the Africa-China relation currently is about infrastructure, oil and energy, very few would say tech is a dominant feature of the relationship. However, I think that in a couple years from now very few people will remember oil and energy and will say, “look at what China and Africa have done in technology”.

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