Africa is a land of immense opportunities and this is quite evident in the number of startups springing up daily and the level of success being recorded.
From technology, fintech, edtech, to healthtech and insurtech, African startups are increasingly recording incredible milestones and breaking records through foreign direct investments (FDI).
According to reports, startups in Nigeria and other African nations raised a total of $3.1bn in the first six months of 2022. This is despite the mass layoffs and bankruptcies that have been recorded within the global tech space for a while now. This shows quite a performance for these startups across Africa.
5 startups in Africa with incredible success
According to the Financial Times’s inaugural list of the fastest growing African companies, compiled in association with Statista, the five fastest growing startups in Africa include:
Wasoko (formerly Sokowatch, Inc.) (Kenya): This Kenyan startup basically helps cut the cost of doing business in the informal service sector by helping to deliver goods to traders.
Flocash Ltd. (Kenya): Flocash helps businesses expand across Africa by providing expertise along with a strong geographic footprint across the Middle East and Africa.
Africa’s Talking (Kenya): Helps businesses build superior two way communication channels with their customers through a plethora of channels such as USSD, SMS, and voice.
eAdvance Ptyn (South Africa): The startup trading as Spark Schools is an edtech focused on providing students with a blended education model that will enhance their learning. It also offers educational consulting to public and private schools.
Yoco Technologies Pty Ltd (South Africa): Yoco is a payment solution provider that helps businesses in South Africa to collect payments through its card machines, and gateway.
Others are IT COnsortium Ltd (Ghana), Opennetworks Pty Ltd. (South Africa), and M-KOPA Holdings Ltd.(Kenya).
So what exactly makes these startups popular and what is their success formula? Let’s take a dig at some pointers to these startups’ success stories.
An eye for solving challenges peculiar to Africa
The first thing that can be deduced from the success stories of these startups is in their offerings. These startups have been able to hack the code of what is needed by Africans in this age of digitisation. Africa is a burgeoning market for digital solutions that help solve some of its most glaring challenges even as it makes efforts to keep on par with other parts of the world digitally. As such, their stories point to the fact that one good way to hit it big is basically to look around and solve a problem digitally.
Building at scale
One of these startups’ secrets is that they can build at scale. This is made possible with funding sourced via venture capital and angel investors. An example of this is Wasoko. It raised $125 million in a Series B funding round in March. Such funds go into expansion and allow the startups to penetrate and build for the numbers which Africa is blessed with. As such, they can declare huge numbers in terms of service sign ups and volume of transactions.
Focusing on niche markets
These startups can explore and provide unique services with little to no competition by focusing on niche markets. And even where there is competition, given that the market is large enough, the few players have enough room to explore.
If there is anything these startups have shown, it’s that there are huge opportunities on the African continent. By looking out for specific problems and challenges and developing solutions around them, anyone can own a successful startup.