Simple.
Shitty Governments/Leadership -> Inadequate infrastructure -> End of story.
Ask PG: Why do you think Africa cannot produce global scale start ups?
31–40 of 90 posts
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#32Every third order my company receives from Nigeria is a scam. The cheap, effective and over reaching solution to this issue is to simply stop shipping to Nigeria. This is the path I chose and the one that most small business owners will choose. Perhaps we're missing out on some money but the cost in time and effort to capture that little bit of money isn't worth it relative to other projects. I'm in business to ship…
Very interesting, but a few questions:
1. Really one in three orders was a scam? How big is the sample -- how many times did you ship to Nigeria? How long ago did you stop?
2. You list two problems: determining if a customer really can pay, or as a startup, having customers trust you with financial data.
In both cases, the problem is trust & reputation. Foreign customers do not trust Nigerian businesses or customers. So the missing piece of the puzzle is either better police enforcement and government regulation, or some kind of third-party who can engender trust and verify identity to and from African businesses and customers.
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#33There are some success stories like http://softtribe.com from Ghana. This story gives some of the http://spectrum.ieee.org/computing/it/the-african-hacker background. The opportunity that SoftTribe went for was unique. In Africa every country has different pay roll taxes, and it is too expensive for the likes of the multi nationals to keep up with each country, SoftTribe fills this niche.
I worked with them for a year. I was the only non African. There where challenges like fending off kind hearted westerners who had less skills then the Ghanains and wanted to come over and be boss. Competing against NGO for staff (Western NGO's have the highest salaries).
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#34It's not question of can or can't. The probability is just low, at least for the near future.
The dynamics of the economies and governments are just not aligned with that outcome.
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#35If you're anxious to start a startup, you should probably move to the US, Europe, or East Asia. There is simply too much infrastructure to replicate. That's also true of starting a startup in Oskaloosa, Iowa, too. If that's a problem, it would be interesting to know why.
Well, it's rather challenging to immigrate to the US, for one.
Which is easier: moving one programmer from Nigeria to Silicon Valley, or moving the Valley to Nigeria?
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#36A lack of objective rule of law defending property rights.
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#37Earlier quoted context omitted.
As someone watching from outside, it seems to me there is a need for better solutions in the "monitoring elections" and "disaster response" spaces in the US, too..
Of course these services are needed, but in developed nations, they usually fall in the purview of the government, who is unlikely to hand it off to startups.
Especially startups in foreign countries.
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#38I don't think africa is alone in being behind the 8-ball in the creating a global scale company (which I take it you mean world-wide adoption and not just huge locally). Even with the greatest talent and product, it would still be hard.
No one is looking to africa for the next big thing - this is a huge problem for any company - how can you get to critical mass if no one is paying attention to you.
I am sitting in a beijing starbucks writing this and thinking about the global brands; there aren't that many of them.
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#39Economic Evolution:
Agrarian -> Manufacturing -> Service
Web-apps are Service sector. African countries need to start displacing Asian ones as manufacturing centers before we can even start talking about foreign venture capitalists wanting to invest in African tech-service startups. If the company targets a global audience because there is not enough local demand for web services, then why is it based in Africa?
Re: Ask PG: Why do you think Africa cannot produce global scale start ups?
#40Every third order my company receives from Nigeria is a scam. The cheap, effective and over reaching solution to this issue is to simply stop shipping to Nigeria. This is the path I chose and the one that most small business owners will choose. Perhaps we're missing out on some money but the cost in time and effort to capture that little bit of money isn't worth it relative to other projects. I'm in business to ship…
Very interesting, but a few questions: 1. Really one in three orders was a scam? How big is the sample -- how many times did you ship to Nigeria? How long ago did you stop? 2. You list two problems: determining if a customer really can pay, or as a startup, having customers trust you with financial data. In both cases, the problem is trust & reputation. Foreign customers do not trust Nigerian businesses or customers.…
1. Before we stopped completely, we would get two kinds of orders:
a. Orders over $1000 to Fancy Sounding Expediters Co XYZ Address Nigeria
b. Smaller orders to Nigeria
I shipped one and only one of type a. This happened in ~2001. I took this hit as a business 101 tuition fee and stopped shipping this kind of order.
I continued to ship to people on compounds working for Shell/BP/etc. During this time, I got my rough sample size. For every 3 of this kind we would get, we'd get one of type a. It was years ago and it could have been 2:1 or 5:1. It was not 10:1.
After a few months of this, the "type a fraudsters" figured out the pattern and we started seeing smaller dollar orders to "compounds" come back fraud. At this point, I just shut the whole thing down.
The way this works now is that someone in Nigeria in a big oil compound will order to their home and have someone forward it. No USA address, no shipment over.
2. Exactly so. If government won't fill the trust gap, perhaps a private enterprise can. They would face a steep challenge. There has to be enough money in Nigeria seeking to buy goods internationally but unable to because of people like me for it to work. Is there enough "domestic pull" to make it viable?