I see huge opportunities here. There are people all over the world solving the same local problems, shared across disparate areas. Furthermore, there are resources, ideas, talent, and real solutions being developed in certain areas (even the US and Europe) which I feel should be collaborating with groups like this to better understand their needs and great a more global technology community. Likewise, there are no doubt some incredible, innovative solutions coming out of lesser-known technology centers with which the right localization could make a huge impact here in the Western World.
I'd be very interested to see a group acting as a "liaison" between these communities to help solve problems more efficiently. Example: You're developing a sensor network to measure rain levels across cell phone towers? I have an algorithm that can measure this data effectively and correct for error so you don't have to. We already do this today with the overload of SaaS startups -- you're building some monitoring platform? Use Librato to capture the metrics. You need a disaster response application that can aggregate data and display the most severely affected areas? Use Parse for the backend and OpenStreetMaps for the geo -- no need to do it yourself. If you're solving a problem, there is a 70% chance that somebody either solved it already, is currently trying to, and/or has a good idea about how to solve it. Increase the collaboration to a more personal, local level, and you've got something big.
Man, the tenacity (on the part of both parties) demonstrated in this statement is amazing:
"When he came home for the holidays, he would haul his entire workstation in the car back with him — the monitor, the CPU, the keyboard, the mouse — and set it up in Oguya's living room. Oguya was 15."
I'm guessing you didn't drive on dirt roads or carry all of the fuel for the trip with you in jugs, all while hoping you had enough bribe money for anyone who might turn up with a rusty AK-47 and a barricade to keep them from taking said computer from you along the way.
Dude, not every country in Africa is Somalia. Kenya is a moderately wealthy and largely-stable country. Paved roads are common and gas stations are plentiful, for christ sakes.
Not sure if you are kidding but I am pretty sure Kenya wasn't THAT bad. It's actually a fairly stable country, even with the high level corruption scandals and occasional election violence.
This would likely have been around 10 years ago. Perhaps longer. Today's Kenya is less violent but according to the New York Times corruption index, its still one of the most corrupt nations on earth.
The point is that throwing your Alien-Ware in the back of your Volvo to go to a lan party across town is a ridiculous (to the point of being non sequitur) comparison.
It has enjoyed relative political stability but it's not as safe as you think. My exes father lived there for many years. One night his compound was raided, his guard killed and he and his family were trapped in the house. In the morning the raiders left but he still shudders when he thinks about it.
As a matter of fact, I did drive on dirt roads and many times after dictatorship enforced curfews. No jugs of gasoline or bribe money though. Anyway, the point I was making that carrying a CPU tower, mouse, keyboard and a monitor (no alienware or volvos, btw) is not such an effort by itself, as people did it just to play. The story is remarkable but for other reasons, like the ones you mention.
Kenya is a fascinating place - incredible hardships, but such a will to persevere. I love that they aren't satisfied getting jobs freelancing or anything like that, they are solving their people's issues where no one else will bother. Awesome to see.
Complete with what looks like a Kanban board on the wall. There is going to be plenty of competition in a decade or so! But then there are plenty of local problems to solve...
Fantastic story. I would love to hear some first-hand accounts / comments from any Kenyans on HN. Is there anyone here currently in Kenya and involved in startups?
I'm Kenyan. The scene mostly revolves around the incubators in Nairobi, the iHub, Nailabs and the 88mph Garage being the most vibrant. The iHub is closer to a typical hackerspace than the others, which are more concerned with startups actively seeking investment than meetups and such. I'd wager that half of all Kenyan startups are building mobile apps of some sort. The stack is quite varied. SMS is king here, but J2ME, Symbian and Android are also fairly popular. Some of the more interesting startups I've interacted with:
There are many more, but those are the ones that immediately came to mind.
There's something of a running joke that every second startup is an M-something, presumably due to the runaway success of mpesa, a mobile money service by one of the telcos, Safaricom.
Some more established players, not startups in any sense, are Craft Silicon and Seven Seas technologies.
Kenyan startup guy here. In three years, my company has developed two top Kenyan websites. In 2009, we developed the largest lyrics site in Kenya, and now we run the largest blog in Kenya: http://ghafla.co.ke with close to 500,000 monthly uniques.
On consumer-facing startups, which are my expertise, I can say that the problems currently facing Kenyans online are basic content issues(online news, classifieds, downloads etc). If you stick to the basics, it's really easy to get some traction going.
Revenue-wise, HNers would love Kenya. The absolute best internet revenue model in Kenya is to charge your users one-time monthly subscriptions. Paid classifieds like cheki.co.ke and eatout.co.ke are making hundreds of thousands of dollars annually with this model. Ad-based revenue follows an extreme power-law. The digital budgets flow mainly to Google and Facebook. E-commerce is there, mainly in the tourism and daily deals spaces. Skimming commissions off the top of transactions is not very lucrative right now, haven't seen any success stories. All in all, the online space is more of a land-grab right now, than a gold-rush.
On acquisitions, there are VERY few. Most big companies would rather partner or compete. Most acquisitions are done by private equity companies or high net-worth individuals, and they only buy startups that absolutely kill it on each and every front(user growth, revenue growth, profit growth, brand awareness etc).
PS: My company shares the same investors with the M-Farm team.
I'm not Kenyan, but I've been based in East Africa for the last two years and have been living in Nairobi and running a startup there since March. Happy to answer questions. (I'll be on and offline today because of the holdiay)
It's fantastic to see Sue and M-Farm getting this kind of exposure.
Projects like this make me hopeful for the world, but fretful for America. Not because of the increased competition or outsourcing or anything like that, but because by and large we've created a political climate where large infrastructure developments are nearly impossible to implement. We eschew any sort of tax-funded large digital infrastructure projects while at the same time we do our best to keep regional ISP monopolies in place, killing any meaningful competition.
The fact that Kenya now has hundreds of miles of fiber optic cable is awesome. The fact that most of the internet I use in the USA ends up last-mile-ing over coaxial lines laid in the 1970s is terrible and unlikely to change in the next 10 years.
(Of course, our non-digital infrastructure is crumbling for largely the same reasons, so that's even more stuff to worry about).
Second, are coaxial lines really that bad? You do need literally bundles of fiber for backbone activity, but last-mile? DOCSIS 3.0 is 42Mbit/channel, with as many channels as the endpoints can support. Comcast has already offered 305Mbit. We will need fiber last-mile one day, but not nearly any time soon.
I suspect the real limitation is a grab-bag of things like:
- Increasing speeds highlights damaged coax, which would then require repair
- Slowing the growth in speed means they can continue to charge a lot for service that is easy to provide
- The true bottleneck is probably somewhere in the ISP, for example routing infrastructure, which would need to be upgraded
Eh, Fiber is expensive. It's getting better, though; a big part of the expense is the skill required to splice fiber, and they are developing better and easier ways to splice all the time. I betcha the last mile is going to suck for most people for a long time. And you know? I don't think it matters as much as we think. If it does matter for you (It matters for me, certainly) you will move to the places where fiber is available. Yeah, google fiber gets all the press, but surewest has been doing fiber to the home in Sacramento for close to a decade now. (I mean, fiber matters a lot to me, but not enough for me to move to Kansas... or Sacramento, for that matter. Ugh.)
Here in silicon valley, both the city of Palo Alto and the city of Santa Clara (see http://svpfiber.com or email me if you want to get in on an in-progress project) have municipal fiber rings. It's aimed at businesses, and /only/ does the last mile (which is to say, once you get to the data centre you will still have to pay someone for transit to the internet. And you will have to pay to trench to your house, so you are probably looking at $500/month minimum and maybe $10K one time to trench in to your house. Still, worth it to not live in Sacramento. Ugh.)
I mean, what I'm trying to say is that there are really good tubes, here in America. I, myself, have 12 gigabits of burst capacity (a 6.2 gigabit commit) Yes, our last mile for most people is shit. But the last mile for everyone, everywhere is shit. Just like in Africa, I personally predict that it's going to be wireless, for most of us. And for most of you? wireless is just fine. I mean, yeah, cheap fiber for everyone like they are said to have in Japan, or in Kansas or in Sacramento would be super great, but I don't think that only having that in a few places will cripple us. I mean, when it really matters, even here in America, if fiber matters to you, you can get it by paying a small (compared to developer salaries) fee, or by moving somewhere unpleasant.
My job is to invest in companies like this, so I can offer some insight into the process. I manage a seed fund for digital media startups in frontier markets and spend a lot of time in countries like Zimbabwe, Jordan, and Indonesia--and work closely with local subject matter experts. The one thing to be aware of when looking at potential investments in frontier markets is that many of the companies that are getting international press coverage are spending more time on marketing themselves to foreign correspondents than on building a scalable business; often times the technology doesn't really work or traction really isn't there. There is a lot of smoke and mirrors to cut through because there is so much grant money/NGO activity out there; the access to free, dumb money distorts the funding process for legitimate, high-growth startups. Investing in these markets is very different from the types of deals you read about on TechCrunch.
I'm still wondering how someone like ph0rque or myself could invest in some of these companies. Deciding which one to invest in is part of the process, but what next?
This is my suggestion:
1. Find many people who want to invest in these markets. You don't really need many people, but you do need a good bit of cash. The only way to make this work is by having a portfolio approach; it's extraordinarily difficult to pick individual winners. Let's say you (the investor collective) are investing $50,000 per company. My advice is to invest in at least 10 companies.
2. Find a local subject matter expert; someone who is plugged into the startup community and understands what the context is like. This person may need to get paid, but not much (it's a limited amount of work). You really should have a contact in each local market (not that hard to find).
3. Set up weekly calls with your collective and assign individuals specific verticals to monitor/research. For example, you take e-commerce, your friend takes UGC, and a third person takes marketplaces; similar to the way that conventional fund operates.
4. Find local counsel--even if you insist that the companies be re-incorporated in Delaware.
5. Schedule monthly calls to go over deal flow. Spend more time (virtually is fine) with those companies that receive approval from the collective. Make sure you have had enough time to verify that the founders do what they say they do. Look at traction and budget.
6. Review the docs and disburse funds. Monitor the investment.
As you can see, it's not a complicated process, but it does take time and energy. Do you have that (as well as sufficient capital to put at risk)?
You don't need to go to Africa to get involved. You would be surprised how many people in this community are African or women - or even both! It's just a case of not engaging in too many discussions where gender and/or ethnicity come up.....
It was a little easier as the founder was from the US and I met him here, and then he returned to Africa to continue running the operation. Wish more African founders had the opportunity to raise money here.
Hi, I was too at the unreasonable institute with Michael and had the same opportunity. Great exposure and we are closing our second round with investors we met through the same channel in March.
If your sentiment is common, then there is an opportunity for someone to arrange introductions and bring African entrepreneurs to the United States for fundraising.
I believe that instead, the opportunity is to guide US investors to invest in African companies. An organization to vouch for the reputability and asses the risks of these companies to allow for greater, less risky foreign investment.
I personally would love to start such an organization.
I understand the difference. Either way, though, personal connections and legwork would have to be done both in the US and in Africa.
It's been on my mind since I made the comment; if you've interest I wouldn't mind discussing it with you if you'd like to e-mail me at the address in my profile.
I don't recommend investing in tiny enterprises in developing countries, because you're heading for shakedown street at that point. But if you think it's a growth sector, go for it.
Help small scale farmer market and sell their produce at better prices than the brokers at farm-gate. And give them market information on their produce through sms.
I'd be very interested to see a group acting as a "liaison" between these communities to help solve problems more efficiently. Example: You're developing a sensor network to measure rain levels across cell phone towers? I have an algorithm that can measure this data effectively and correct for error so you don't have to. We already do this today with the overload of SaaS startups -- you're building some monitoring platform? Use Librato to capture the metrics. You need a disaster response application that can aggregate data and display the most severely affected areas? Use Parse for the backend and OpenStreetMaps for the geo -- no need to do it yourself. If you're solving a problem, there is a 70% chance that somebody either solved it already, is currently trying to, and/or has a good idea about how to solve it. Increase the collaboration to a more personal, local level, and you've got something big.