According to risk consultancy experts Control Risks and independent global consulting NKC African Economics, in its fifth edition of “Africa Risk-Reward Index“, Advance that investment in technology in Africa reached record levels in recent years.
In 2019, stock financing in the technology sector in Africa reached a record $ 2,02 billion, divided into 250 businesses involving 234 digital technology startups, the report says. It was a 74% growth compared to 2018, an increase of 108% compared to 2017.
Experts highlight an October 2019 study by Briter Bridges and AfriLabs, which found that there were 643 technology centers across the African continent, where Egypt, Kenya, Nigeria and South Africa were private access points. “Digital technology has been the fastest growing sector in Africa, driven by investments in infrastructure, from submarine cables to local hosting solutions ”.
The most successful technology startups are those that have recognized that industry in Africa is not driven by Silicon Valley's “disruption” credo, but out of necessity, experts say. According to the report, startups did not try to succeed despite the challenges in the business environment, but by directly addressing those challenges.
“The worldwide development of African technology mobile money, for example, was successful because it addressed an existing problem (lack of financial inclusion) and did so in a way that was aware of restrictions (does not require a smartphone).”
The report's authors noted that much of the funding for African technology has so far been from foreign sources in companies led by foreigners in search of new ideas, but investors can be better served in search of solutions developed by those with local knowledge. problems.
The sector is likely to lose some of these gains in 2020, a consequence of both the recent high profile sector struggles and the impact of COVID-19 on external finances. “However, any such decline should be seen as an opportunity to redefine expectations and approaches, not as an indication that affected sectors are becoming less attractive."
Experts say the pandemic has served to emphasize the need for technological and digital solutions across the continent. This sparked the development of health apps to help fight the pandemic, new payment systems and e-commerce to make life in quarantine easier.