To bypass the need for infrastructure, African tech companies are creating innovative solutions that are attracting global attention and investment.
It may come as a surprise that seven of the 10 fastest-growing economies in the world are in Africa, where an explosion of technological innovation is under way. At its epicentre is Nairobi, the regional base for such heavyweights as Google, IBM and Intel. But the Kenyan capital is also home to a slew of start-ups, earning it the moniker Silicon Savannah.
Consider M-Pesa, a money transfer and micro-financing app that replaces many of the services of a bank. That’s a significant accomplishment, given the high percentage of people who live in rural areas, with little or no access to credit. Less than a decade after it debuted, M-Pesa is now considered a global contender for a cash-free future, and over half of adult Kenyans depend on it.
In 2011, a team from M-Pesa launched M-Kopa, which leases solar batteries to households living off the grid, which have an income of less than $2 a day. The charger is sufficient to power up two lamps, a portable lantern, a radio and a phone, essentially meeting the electrical needs for people who once relied on kerosene lamps and batteries. Conveniently, the system can be leased via the M-Pesa app.
Nairobi isn’t the only city in Africa that’s connecting technology to the masses, erasing the need for a power grid in the process. The Tanzanian city of Dar es Salaam has released M-Paper, an app that distributes magazine and newspaper articles through text messages. It, too, leapfrogs the need for infrastructure by going straight to digital.
Venture capitalists are taking notice. Despite a 30 per cent drop in funding to tech start-ups globally during the last quarter of 2015, annual financing of new African tech companies has surged to over $185 million in recent years, proving that innovation can thrive where limitations exist.