REGIONAL ROUND-UP
AFRICA APAC EUROPE MIDDLE EAST NORTH AMERICA
AFRICAN REGIONS SET TO BECOME LEADING START-UP AND INVESTMENT HUBS
On the back of Cape Town being recognised as the tech capital of Africa , topping international rankings for foreign direct investment strategy , Ian Lessem , Managing Partner at HAVAÍC – investors in early-stage , high-growth technology businesses – said several other African cities are quickly emerging as leading start-up and investment hubs to watch .
“ Start-ups in Nigeria , Kenya , Egypt and South Africa raised a total of US $ 625 million last year . Of those , Kenyan startups raised US $ 191 million , the most of any other African country , according to Disrupt Africa ’ s African Tech Start-up Funding Report for 2020 . Distinct start-up geographies are emerging in Africa , each with the potential to become its own powerhouse ,” he said .
In addition , the World Bank predicts that two thirds of the world ’ s GDP growth will occur in cities over the next 50 years . Lessem said Africa ’ s rapid urbanisation is a welcome development as cities foster greater economic potential , business collaboration and technological innovation needed to leapfrog traditional
Ian Lessem , Managing Partner at HAVAÍC infrastructure , which can result in creating thriving tech ecosystems .
“ HAVAÍC sees Southern Africa , dominated by South Africa ; Anglophone West Africa , led by Nigeria ; Francophone West Africa , dominated by Cote d ’ Ivore and Senegal ; East Africa led by Kenya ; and North Africa dominated by Egypt , as key African geographies to pay close attention to . Each are quite different , with some of them tackling more regional challenges and others offering globally scalable solutions ,” said Lessem .
A diversity of businesses are emerging in critical sectors such as e-health , FinTech , security and education , as African startup investment continues its upward trajectory , having increased year on year for the past five years . “ West African hubs like Lagos have benefitted hugely from locals being skilled abroad and returning home where a young , bourgeoning middle class are open to new FinTech propositions as we have seen from the likes of Flutterwave .
“ While in Nairobi , an influx of foreign direct investment and financing from national development finance institutions , coupled with international skills transfers , have
contributed to creating a flourishing start-up environment ,” said Lessem .
He added that Cairo ’ s access to favourable funding and product distribution from the Middle East is unique on the continent . “ Egypt ’ s large local customer base and proximity to major international hubs in the UAE , Qatar , Oman and Saudi Arabia make it a strong B2B ( business to business ) and B2B2C ( business to business to consumer ) regional player . Of course , South Africa ’ s strong blue chip corporate base and financial and digital infrastructure have ensured the country ’ s start-ups have been able to enter developed markets with their seamless tech competing toe-to-toe in international markets .”
HAVAÍC ’ s own investment thesis is centred around investing in local African tech businesses that have the ability to scale and service both regional and global markets .
“ Our ability to invest locally , strategically nurture and help internationalise our portfolio is what sets us apart . More than ever before , investing and supporting local , growing innovation with the potential for global elevation is a smart investment decision at the heart of Africa ’ s future ,” Lessem said . x
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