2016 could represent for Africa a peculiar year in what is called African Renaissance. Despite the current global economic crisis which slows the funding of the majority of startups around the world, prospective for African tech companies are far from being negative.
CB Insight released early this year its final report on global startups for 2015 which showed a clear decrease in the funding and deal activity during the fourth quarter, interrupting a constant growing trend started back two years ago as well as a drop to a level in deal activity in 2013’s first quarter.
For the past years, Kenya has been seen as a leader in the tech industry along with Nigeria and South Africa. In July 2015, Barack Obama’s visit to Nairobi gave a great boost to the country’s business industry as he opened the sixth Global Entrepreneurship Summit (GES): an appointment for entrepreneurs at all stages of business development and a call to action for global investors to finance new businesses and projects.
The GES has been a key element in promoting Africa’s business industry, which has indeed seen many high profile companies from all over the world. Microsoft and General Electric believe in Africa’s potential and chose Kenya as the world’s latest tech hub. “There is no doubt that GES helped raise the profile on Kenya” says Peter Ngunyi, President of BRCK Moja, a startup which produces BRCK, an innovative mobile Wi-Fi device. Furthermore, Ngunyi says the money raised in 2015 will go toward the development of new products and service.
As Kenyan startups have traditionally depended on US and European investments, there is no doubt in saying that this is a clear signal of improvement and inversion in the usual trend of grants and foreign donor funding which some say has inhibited local innovation.
Tom Jackson, co-founder of Disrupt Africa is very optimistic about Africa’s business industry as he says, “These are impressive numbers, showing real growth in the amount of funding available to African tech startups… In terms of demonstrating the development of the ecosystem, these figures are an excellent starting point. We expect to see further growth in 2016”.