The African tech world has been greatly boosted by the arrival of mobile phones almost in every part of the continent. With a young population of early-adopters and an improving infrastructure from telecommunications to payments, investment in Africa in 2018 is likely to realize a record-breaking growth. Here are four trends that will influence the investor’s decision to join the African market in 2018.
Global tech brands adopt a local approach
Latin America, Asia, and Africa are a home to 85% of the world’s population. This makes it an ideal market for the global investments since it is good ground for the future of the world’s economic growth. However, it still poses a challenge to the European and American companies since most of the population prefer the local products over the overseas’ products. Google is an example of those companies that put their sight on the new products on the African growth. After it had realized that to build a strong African consumer base you need data optimization, in a world where 1GB costs 9.3% of average monthly income across the region. The company recently expanded its data-friendly YouTube Go app in Nigeria to enable consumers to save videos for online viewing. This comes after the launch in India. The company also launched Android app Datally, which helps consumers see which apps consume most data and provides suggestions on how to reduce data usage.
Blockchain drives solutions across sectors
The main usage of the blockchain that is commonly known by people is the cryptocurrency. However, the vast usage of the blockchain from land rights to cross-border payment to energy investments is a promising factor to increase quality and reliability of data across the upcoming markets like Africa. The fact that most Africans have much trust in informal institutions make it hard to gain confidence from the customers. Public ledger, blockchain decentralizes process helps people to exchanges without relying on a neutral central authority. The secure, uncorrupted technology not only tackles issues surrounding trust but also fills data gaps by doing away with unreliable information and increasing reliability.
Corporate investment in African technology increases
In 2017, a plethora of accelerators and incubators emerged in Africa. Ecobank launched a fintech challenge in January to identify innovators across the continent. In June 2017, French telecommunications giant Orange promised $56 million to the development of Orange Digital Ventures Africa. In July 2017, Alibaba founder and executive chairman Jack Ma announced the creation of a $10 million African Young Entrepreneurs Fund during his first official visit to Africa. In the same month, Honeywell collaborated with the African Economic Revolution fund, Nigeria’s Access Bank, Google and Facebook and announced their accelerator and community building grounds.
Africa’s informal economy goes digital
The informal sector represents 72% of the African economy and roughly 38% of African Gross Domestic Product GDP. For investors and entrepreneurs in Africa’s informal economy, opportunities are available for those capable of uniting divided markets and using data to improve productivity. Some companies will emerge to provide opportunities to tap an less utilized informal job market through digital platforms like Lynk or Max which provide access to larger customer bases.