Just 16 percent of Africa's one billion people have internet access. Microsoft's new initiative is committed to turning the continent into a booming tech ecosystem by empowering local startups.
No local database existed before. It's a basic, real problem that one African startup, Africa 118, is solving. And until now, it wasn't possible for them to grow the business how they wanted.
On Monday, Microsoft announced five African startups that will receive funding as part of the company's 4Afrika Initiative. Kenya-based Africa 118 is using the money to develop their call-in search service into a website and mobile application by the end of the year and expand into Uganda, Ethiopia, and Tanzania.
"We're a small team, and getting this recognition is exciting," said Ezana Raswork, founder and CEO of Africa 118. "They are helping us develop our mission. It's no strings attached, and we can talk to their tech resources and build a roadmap."
Just 16 percent of Africa's one billion people are online. The Internet sector (iGDP) contributes only 1 percent of the economy's gross domestic product. But in the continent's major cities, more than half of the population has mobile devices and 3G, and that number is rapidly increasing, according to the McKinsey Global Institute.
The institute predicts that by 2025, Africa's iGDP should grow to 5 percent, but if Internet spreads as fast as mobile devices did, this contribution could reach 10 percent. The main obstacle is reliable wireless broadband access and funding. But, the continent doesn't need to adopt solutions from more developed countries—it can create its own innovations and become a growing technology hub with the proper resources.
"Some of the barriers facing developers in Africa include finding the right technical support, sometimes it's the lack of understanding of the market demand," said Amrote Abdella, director of startup engagement and partnership for 4Afrika. "At times, it's simply the financial support to help get these startups to bootstrap their operations."
Through the initiative, Microsoft will also offer technical support and mentorship. The Center of Expertise, a group of Microsoft technology enthusiasts who use the tools to solve business problems, will work closely with the startups to develop solutions and better their products.
The five winners of the 4Afrika awards were:
Africa 118, based in Nairobi, Kenya, is a mobile directory with service that partners with Safaricom, a local mobile operator. People can call the hotline with a request to locate a business and receive a text with the location information they need. Without the service, they would have to call neighbors until they found out--and that's resulted in major frustration for communities. Africa 118 plans to expand to a web platform and mobile app by the end of the year in four different markets. In three years, they want to be in 10 African markets. Their recently deployed agent program pays local people to gather accurate information about businesses in these areas.
In Uganda, access.mobile LLC offers technology solutions for enterprises in the healthcare and agriculture industry. The startup offers training and support, and helps these businesses integrate technology and expand their reach through mobile devices.
Kyatbu, based in Kenya, is a textbook subscription app for low-cost tablets. Through a mobile money platform, students can rent all or part of textbooks hourly, weekly, or monthly, saving them 60 percent of education costs.
Nigeria-based Save & Buy was founded last year and offers a mobile and web app that helps users create a savings plan for specific products. The company wants to expand to more countries and work with better servers for more secure e-commerce.
Nigeria-based Gamsole is a mobile game production company that develops Windows games. Road Blaizer, a car racing game, has had more than 300,000 downloads since April 2013. Other popular games include Mega Chicken, Kazoo, and Birds Republic. Eleven weeks after its launch, the company had more than 1 million downloads total. Now it has more than 4 million.
The five were chosen based on certain criteria, including uniqueness, viability, and business plans. Specifically, Microsoft made sure the companies had an addressable market, relevant solutions, and solutions that can grow in scale.
"We hope to scale our work in 2014 by providing additional support for African startups from being local to regional and eventually global competitors in the marketplace," Abdella said.
Created in February 2013, 4Afrika is a strategic initiative to help Africa become more connected. By 2016, the company wants to get millions of smart devices in the hands of African youth, get one million African businesses online, and help 100,000 graduates with employable skills, 75 percent of whom Microsoft will help place in jobs.
One of the first devices the company launched was the Huawei 4Afrika, a Windows smartphone preloaded with applications designed specifically for Africa. They also partnered with Kenyan service provider Indigo Telecom Ltd. and the Kenyan Ministry of Information and Communications to provide low-cost, reliable wireless broadband to rural parts of the country. The idea is to provide education and agriculture apps to work on devices so that organizations can utilize the services. The first deployment uses "White Space" broadband, which is the unused portion of wireless in television spectrum, and solar power stations. A large part of implementing these projects begins with this grant that will empower local businesses.
"We were very humbled that they recognized us, its really added a bounce in the stride of the team," Raswork said. "In many ways it gives us a launchpad to move much faster and the confidence to do so."
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