Business
Six astounding ways Africa is paving the Way for the future of technology
In Kenya, an app called M-PESA allows people to store money on mobile accounts and make simple transfers via SMS messaging – you do not even need a smartphone to use it. Multiple sources in the venture capital investment community have told us that many Africans are simply stunned the United States does not have something similar.
The rise of M-PESA is largely due the dominance of mobile on the continent, yes, but also to the dangerous and insecure ways money was moving before they had access to mobile payments. According to the Next Africa, about 85 percent of Africans were carrying money in bags and asking bus couriers to transport money for them 10 years ago. As the Economist points out:
Cash can thus be sent one place to another more quickly, safely and easily than taking bundles of money in person, or asking others to carry it for you. This is particularly useful in a country where many workers in cities send money back home to their families in rural villages. Electronic transfers save people time, freeing them to do other, more productive things instead.
Because of M-PESA, Kenya is the leading e-commerce capital of the world. This one app moves an entire third of the Kenyan gross domestic product (GDP) among its 15 million, mostly rural, users.
3. Africa will never be cord-cutters because there’s no cord to cut
In the United States, we will probably spending the next few decades watching the aged titans of the media industry, such as Time Warner, Paramount and Disney, fight against the tide of Internet services like Netflix and Amazon. After all, we have businesses like cable, publishing and network TV that will not go down without spending the fortunes they amassed in the 20th century to battle against the 21st century.
Not in Africa. Africa does not have a robust broadband infrastructure, or continent-wide digital-rights laws and copyright regulations, so new startups like iROKOtv can rapidly become the Netflix of Africa, bringing Nollywood movies and shows to the continent. There are dozens of examples just like this – industries where Africa can develop robust tech solutions to local problems like entertainment delivery and payments without having to fight back a monolithic incumbency.
“One of our biggest headaches in the United States is that you do not own your medical records,” Aubrey Hruby, co-author of The Next Africa: An Emerging Continent Becomes a Global Powerhouse, told us. “But if you travel to another part of Kenya or South Africa, there is no one who has your medical records, so Africa can leapfrog to carrying medical records on their phones.”
4. There’s more money flowing into African tech than ever
In the United States, investments in domestic companies are slowing down for the first time in the past few years of venture-driven app startup boom. But in Africa, venture capital investments – many of which are coming from traditional Silicon Valley venture capitalists and telecommunications – are skyrocketing.
