#AfricaNow #3: Tech, talent and social impact: hands-on feedback from the African continent
It wasn’t only keynotes, Africa Now hosted two diverse panels to help pick apart the opportunities within Africa both from a startup point-of-view and a corporate’s. The first panel was facilitated by Georges Desvaux and brought together Frank Legré, Senior Vice President Africa at Air France KLM, Yann de Nanteuil, Deputy Head for Africa & Overseas at Société Générale, and Ruke Awaritefe, Co-Founder of TradeDepot.
Georges Desvaux (GD): How do you see the opportunity in Africa, is it now?
Frank Legré (FL): Of course it’s now, but for us it’s always been from the beginning. We say that we were born in France but we were born in Africa. There is a growing need for air travel in Africa, growing 5% a year, every year. What’s important to remember when talking about Africa is the 54 countries within the continent. Different countries have differing growth in different places and face different challenges. Manage risk and carefully plan before going to Africa.
GD: Have you seen the growth happening? How fast is this opportunity in Africa?
Yann de Nanteuil (YN): It’s happening now. We have always been on top of it at Société Générale having been on the continent for several years. We have 17 subsidiaries in Africa and are always signing deals and partnerships to try and make a difference. We saw an acceleration of growth in the last 20 years, with the banking industry growing 10% a year. There are now huge demands in health, energy, retail, infrastructure and agriculture. All these different sectors require a lot of financing. Tech revolution eats the banking industry. The banking industry has been sleepy for many years, we need to wake up to these emerging opportunities. We want to be part of the growth of this continent.
Ruke Awaritefe (RA): The market is a 1 trillion consumer market, but how does distribution happen, no one really asks about it. It’s all informal, 90% of that 1 trillion. To put it into context, offline retail happens only through 1 million retail outlets in the US, but in Africa there are 14 million. How do you address distribution on this scale? Have they run out of stock, what promotions should I run etc.? Theses things are difficult to know, so how have people done it up until now? Well, they guess. Using data to help but mainly just guessing and getting it 60% wrong. Businesses are suffering because they have no guarantee. By creating symmetry and a channel of distribution, we can create opportunities for people to join the continent and help create change.
GD: How do you see technology playing a role ?
FL: For us, tech plays a massive role. We try to communicate with Africans by pushing social media, addressing the number of mobile Africans. It’s a great way for us to be closer to and more in touch with the African market.
RA: Technology means you can achieve quantum leaps. These challenges that you have because of lower internet and access can be solved. Fundamentally if you have only 50% internet penetration, there is such an emphasis on offline tech but we can solve more problems with digitization. To do this you have to leverage tech.
GD: What are the other challenges that you see in Africa, what still needs to be solved?
YN: If you look outside the banking industry and finance, the main challenge is training. We need to help develop the skills and competences of uneducated Africans. Another problem is tax policy, but the increasing number of banked Africans, particularly in Kenya, is beginning to allow this. Also, there’s a need to securize and develop the energy sector. Financing is what links these challenges. On the financing view, we have to be better.
GD: What are the other challenges apart from technology?
RA: Obviously, access to capital. To combat problems on the continent, you need capital. But there is not enough capital chasing these problems to get solved. A lot of companies lack capital or access to capital to grow their business. When they do, the interest rates are phenomenal and stunt growth. Capital is essential for growth on the content.
GD: So what’s the solution to this?
YN: We could be better in giving people skills in finance. Teaching people about managing budgets etc. Responsibility of the Finance industry is not just capital, it’s about being financial advisors. Development banks are good ways of pushing financing to these small companies. Taking securities on small assets is crucial to growing a business, more secure in credit and more credit when repaying.
FL: It’s not just about capital, you have to spend your money. Online payment is still an issue for us. When people by tickets, ⅔ of people are paying cash. How can you (the banking sector) help us with this?
YN: Well there’s an obvious need for a revolution within the payment industry which is happening at an incredible rate. The cost of managing cash is between 5 and 10% in all industries, operational risks, fraud etc. A lot of costs will be cut with a revolution of the payment industry. Future African development will go through these changes as they are crucial for all industries.
GD: Let’s talk about talent, is it as big of a problem as people think?
RA: Yes it is less of a problem than you think. 100 higher institutions in Nigeria, there’s quantity but it’s a question of quality. There is potential but it is all about channelling it in the right direction. You must also remember 60–70% of informal retail entrepreneurs are women. They are running successful businesses at 120% interest rates, exceptional entrepreneurs. We do have the talent on the continent.
The second panel was based around Tech for Good. The panel was hosted by Mathieu Planchard, Head of Southern & East Africa / Asia of Social Impact Fund INCO. It featured three startups that helping to shape the African landscape in terms of education, farming and healthcare; Amira Cheniour from Seabex, Asmae El Hila from MedTrucks and Temitope Ola from Edacy.
MP: How do you achieve social impact?
AC: At Seabex, we help achieve efficiency in farming in terms of water and produce. We are creating the next generation of farmers, connecting them with agriculture experts to help make their farms more efficient and profitable. This includes things from monitoring soil to automating process within farming. The added value with technology is to help farmers produce more with less. Scaleable and monetizable. We are helping governments provide adequate resources for the growing population.
AEH: MedTrucks was born in Morocco. It brings healthcare to remote areas, particularly within Africa. Access to healthcare should be a human right but unfortunately access to it is a prevalent issue. We use technology to locate the patient, the healthcare needed and facilitate the care pathway.
TO: We have heard a lot about talent and skills in Africa, but there are only 600 universities across Africa yet 4000 in the US. Africa needs 2 million engineers to meet its development goals. We often underestimate the need for skilled talent to deliver on these promises but by 2035, there will be 260 million young disenfranchised Africans. They have enthusiasm and willpower but not the higher education required. We are not investing enough in it. How do we use technology and bring it to education? Well at Edacy, we are helping governments to solve this problem by meeting the digitization needs of businesses. We train employees in technical and behavioral skills to provide highly trained talents able to be more productive and more responsive to future market expectations.
MP: Do you think there is a push for these types of initiatives in Africa by the governments?
AC: We can’t do this alone, you have to make people trust and use the technology. And then provide the financing to use and implement the technology. We see governments giving grants and relieving parts of the cost of the agritech we are implementing. Tunisia, for example, are deploying it in two regions. It’s also important using big corporates to help influence governments to take action. If you bring people to trust it, the government will play more of a role.
AEH: In Morocco, the government is becoming a lot more focused on this. We see incubators with governmental backing as well as big corporations. Morocco is starting to be more dynamic in governmental investment.
MP: Do you see a trend and a growth in women taking the leap in launching impactful tech startups?
AC: In Tunisia, there are many more opportunities now for women to enter the tech industry. You have to think more about whether you have the skills to create a successful business or help leverage change, regardless of gender. It has changed on the wider scale.
TO: We were surprised that we were gradually hiring increasing amounts of women, so we looked into it and conclusively we are now seeing a lot more women often drawn towards social impact tech.
Want More? Check out our other wrap-ups of the #AfricaNow event:
- #AfricaNow #1 : How tech is driving Africa’s growth, with Tidjane Dème’s insights and his interview with Cina Lawson, Minister of Posts, Digital Economy and Tech Innovation for Togo;
- #AfricaNow #2: How to thrive in Africa, advice from Georges Desvaux and Marc Rennard;
- #AfricaNow #4: How Google is bringing Internet access to emerging markets
- #AfricaNow #5: The vital role of AI & tech in transforming Africa, with Moustapha Cissé
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