How to build global technology companies from Africa

During a relaxed and informal panel discussion at the Tech4Africa conference in Johannesburg entitled “Building for the Global Market. Lessons and learnings from the coalface”, Leila Janah of Samasource, Sheraan Amod of Personera and Malcolm Hall of Open Box Software spoke about the challenges of building tech companies while being based in Africa. The discussion was facilitated by Toby Shapshak of Stuff magazine.

ON BREAKING INTO THE AMERICAN MARKET
Leila Janah: The biggest challenge we face is that Africa has a damaged reputation in the service sector. And being a non-profit doesn’t exactly help us either. There is a perception that people in Africa can’t do this kind of work. Many educated people in the West don’t even know that there are PC’s in Kenya, let alone that there are over 2 million Kenyans on Facebook. You need to overcome bias at the start and the best way is to get results. We did many trial jobs for free to build a relationship and people were pleasantly surprised. You can’t compromise on quality when you’re a non-profit, especially when you’re from Africa.
Sheraan Amod: In the US, there is a lot more energy and innovation than there is in Europe or anywhere else, and people are willing to speak to new businesses. To succeed, you need to stand out. I preach 2 major actions if you want to build a product business that can scale to the US. Firstly, your product needs to be something they have never seen before. If it’s unique, they will see it and they will take it seriously. Secondly, you need to get a solid introduction to the people who matter in Silicon Valley. That introduction is like a stamp of approval. We are lucky to have Vinny Lingham as an investor, and he is very well connected in the San Francisco tech scene so he setup a few crucial introductions.
Leila Janah: We have to work as hard as a “for profit” company, because leads come in because of who we are, but no one will sign on the dotted line because of a good story. There is a lot of anti-outsourcing sentiment right now because of the crisis in us. We want people to understand we’re not in to screw American workers.
Malcolm Hall: The key differentiator is the quality of your product. I don’t believe that it matters where you are. If you deliver something good, then people will use it, no matter where its from.

ON MAINTAINING A PRESENCE IN THE UNITED STATES
Leila Janah: There’s a benefit to understanding what your customers are doing so it makes sense to have part of your business where your customers are. You need to have a great product/customer fit and living amongst them is so important. Whether it’s from casual conversations or more formally, you have to get feedback from your customers.
Malcolm Hall: Certainly it’s important to have a sales and marketing presence in the larger markets. That then allows you to have developers back here at home working comfortably in T-shirts and slip slops. And getting paid in rands.
Sheraan Amod: If you haven’t lived where your customers are, then probably don’t start. It’s critical that you understand how they live.

ON FINDING THE RIGHT MARKETS FOR YOUR PRODUCTS
Leila Janah: Outsourcing requires pretty mature markets. Our market is definitely in the Fortune 500 companies. But if you can monetise many tiny transactions, like M-Pesa has done then perhaps your focus is different. But at Samasource, when we talk about technology companies, we gravitate towards the United States.
Audience: The BRIC countries are very interesting markets for South Africans. We are in a unique position of being comfortable in transitioning between 1st and 3rd world environments in the same country. We can navigate all of that very easily and should take advantage of it.
Toby Shapshak: My contention for a while has been that Africa is the next China, the next Russia and Brazil. So it’s very important to grow your market right here in Africa and South Africa is going to be the springboard to all of that. It’s an exciting time. I always say that South Africa’s best export is South Africans.