The current paradigm and the future of startups in Angola

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The Angolan business fabric is undergoing transformations so profound that the environment of the Startups e SMEs (Small and Medium Enterprises) almost resembles an arms race in a war for survival in an economic reality under constant pressure.

Nevertheless, the emergence of apps and services like (Tupuca, Kubinga, Manifexto, Wii-Connect, Soba e-store, Garson, Partner App etc. ) is a daily reality, although most of these solutions are concentrated in the country's capital, Luanda. Despite the various technical, financial and even legal constraints (in the absence of a legal regulatory basis for the segment) that affect the life cycle of companies, Startups e SMEs national, here are some reasons why I argue that Angola is ready to accommodate the growth of digital services:

  • Appealing population for Startups & SMEs:

For products originating in the digital sphere, it is important to have a population familiar with the technology associated with it, willing to experiment, flexible and tolerant of possible failures arising from new business models. According to the National Statistics Institute, Angola has about 31 million inhabitants and according to projections, it will reach up to 33 million inhabitants. The same projections showed that the national annual growth has been, on average, more than one million people (INE, 2019).

Basically, the demographic composition of the Angolan population is configured as follows:

  • More than 50% of the population under 25, willing to experiment;
  • More inclined to experiment with new services;
  • Longevity on the customer's subscription (young customers who increase their spending on services).

Assuming that the economic situation improves and that, subsequently, there is an increase in purchasing power over time for a significant part of the population, it is a safe bet to invest in this economy in the long run. It is important to note that education is essential to take advantage of the demographic composition, which translates into the fight against illiteracy as well as the promotion of digital inclusion - the latter being crucial.

  • Infrastructure availability

Although it may not be generally known, Angola has a privileged infrastructure, perhaps even providing (to sustain in the long term companies operating in the digital sphere), especially if we consider the current wave of Information Technologies that has been sweeping the continent in recent times. I will list:

  • 3 submarine cables guarantee the necessary connectivity to meet local demand;
  • At least 8 Commercial Data Centers - Multipla, ITA, MSTelcom with 3 own Data Centers, Angonap, EMIS, Angola Telecom and several banks and companies have operational Data Centers to support their operations;
  • Mobile network (with the obvious dominance of an operator) with national coverage - it is important to note that, despite the evident dominance of an operator, conditions are being prepared for a more competitive market, either through the entry of new operators or through the restructuring of existing operators ;
  • Capacity Hydroelectric - according to the International Hydroelectric Association of IHA, Angola is in 5th place in the world, with 668 MW of new installed energy capacity, with a total capacity of 3.083 MW, better than Egypt, which receives more investment for Startups than Angola.
Source: (https://www.hydropower.org/sites/default/files/publications-docs/2019_hydropower_status_report_0.pdf)

In short, the existence of infrastructure to support Startups and SME-related SMEs is reason enough to make investments in this growing scenario.

  • Opportunities everywhere

Basically, this means that there is a plethora of opportunities. If you have a good service, it is accepted and valued by the market, the chances of survival increase dramatically. In addition, the availability of current digital tools offers the opportunity to scale up and reach a wider audience.

Some of the sectors that can benefit are:

  • Transport;
  • Health care;
  • Education;
  • Trade and E-commerce;
  • General Services, etc.

Looking to the future

Even in a simplistic way, we can see that the pillars for sustaining innovation exist, are real and tangible. However, some needs persist, including:

  • Curious people - Usually, the dream of a Startup it is sold to younger people or to the technology segment, but this inspiration can come from the experience of seniors and from points beyond the technological day-to-day;
  • Educahereo preparehereo - Education is the key. Have the parts to solve the puzzle it is not enough, so people must be able to understand the parts and apply them in their environment;
  • Participateherethe corporate - The participation of all sectors interested in the first stages of the projects is necessary. There are many cases in which only private companies and state entities decide to participate. It is important to invest, dedicate time to productive meetings and get involved from the beginning, and not just appear on the cocktail presentation;
  • And finally, the standardsões, it is necessary to be demanding, not to settle, perhaps to think about the creation of an independent and robust agency to constantly evaluate and demand improvements in Startups, with improved services, market acceptance and the involvement of banks and other companies with capital to invest.

To conclude, there are many reasons for not believing in the Angolan market, but there are still those who, even in the face of economic crises, lack of external or internal financing, constant rejections, countless obstacles believe in this market and in Angola, I am one of them and maybe not I'm alone.

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