YTread Logo
YTread Logo

Why Elon Musk And Jack Dorsey Have Big Plans For Africa

Apr 09, 2020
When Jack Dorsey, founder and CEO of Twitter and Square, told people he was moving to Africa for a few months in 2020, it surprised some in Silicon Valley. After all, tech companies

have

always looked to China and India when talking about reaching vast, untapped populations that are slowly coming online and in need of smartphones, cloud computing and mobile payments infrastructure. But it turns out that in 2020 that sounds much more like Africa than China or India. For years, it was disparagingly known as the dark continent, while colonialism and general ignorance about Africa's population distorted perceptions. Even today, if you listen to the American media cover Africa, you mostly hear about famine, Ebola, and violence from militant groups.
why elon musk and jack dorsey have big plans for africa
And while countries like Burkina Faso, Mali and Niger

have

had to deal with a recent wave of extremist violence. Africa is a large continent and much of it is open for business. Today, Africa has more than 600 active technology hubs, locally led organizations, facilities and support for technology and digital entrepreneurs. That's up from 442 in 2018. Big US tech companies have taken notice and are starting to increasingly focus on Africa as the next big market. Africa is home to 54 countries and a population of more than 1.3 billion people. And according to the UN's world population outlook for 2019, it is expected to explode to 4.3 billion by the beginning of the next century.
why elon musk and jack dorsey have big plans for africa

More Interesting Facts About,

why elon musk and jack dorsey have big plans for africa...

The African population also remains young, very young. The average age in 2020 is expected to be less than 20 years. In 2019, six of the world's top 15 fastest-growing economies were projected to be in Africa, according to Focus Economics. The list includes Ethiopia at one, Rwanda at two and Ivory Coast at five. Tanzania at 10th, Senegal at 12th and Ghana at 15th. Last year, African startups reached $2.02 billion in equity funding. This is a new milestone, according to global investment firm Partech Africa's 2019 report on venture capital funding for African startups. Ben Lynette is a venture capitalist in San Francisco. His company, Lynette Capital, invests in African startups.
why elon musk and jack dorsey have big plans for africa
One of Lynette's investments is in Flutterwave, which offers payment solutions for companies like Uber. I'm really optimistic from a general standpoint that tech startups can be the driving force that has historically been missing in building a lot of basic infrastructure, allowing people to enter the middle class. Last year, the African Continental Free Trade Area was formed with the aim of creating a single market on the continent and addressing current problems such as infrastructure and bureaucracy. The deal couldn't have come at a better time, as many believed the continent was ready to take off. According to London-based think tank Future Agenda, Africa's total GDP could reach 2.6 trillion this year and GDP growth is projected to accelerate to 4.1 percent by 2021, according to the African Development Bank.
why elon musk and jack dorsey have big plans for africa
With a growing middle class, that number could easily increase as the continent confronts its lack of critical infrastructure. Only 43 percent of the population has access to electricity and Internet penetration on the African continent is only 40 percent compared to more than 60 percent in the rest of the world. Infrastructure is one reason, but another is cost. American technology companies know this. But so does China. The country's Belt and Road Initiative demonstrates how serious China is about helping African countries develop the roads and travel infrastructure needed to grow business. In 2017, there were more than 200,000 Chinese nationals working under contract in Africa, according to the Johns Hopkins China Africa Research Initiative.
And they worked in ports, pipelines, power plants and railways. At the same time, several American technology companies are working to gain a foothold in Africa, and some local ones are trying to make it easier. David Osei is the CEO of Silicon Accra, a 60-acre technology park. It is building in Accra, Ghana. The park will include residential and commercial units, as well as recreational facilities. It will also house the African Institute of Mathematical Sciences. The park is set to open in 2022, but it is already talking to big American tech companies about the possibility of locating it there when it is fully completed in 2023.
Africans, we love Americans. because when an American associates with you, he leaves knowledge behind. They leave you experience, they leave you empowerment. I'm not saying we don't necessarily get that with the Chinese. But what I'm saying is that we haven't received that model from the Chinese yet. We see Americans arrive ready to participate, ready to train. So we want Americans to come to the party or else they will come and realize it's too late because Africa is growing exponentially. At the same time, companies need qualified workers to fill positions on the continent. But that is also improving.
Charles Laba is the director of GMEA, a Ghana-based technology group working with the fintech, manufacturing and oil industries. Laba has worked with technology giants such as HP and Cisco for the last 25 years. And he says that when he first got into the business in 1990, finding qualified people was difficult. However, that is starting to change. And in fact, there are quite a few other people in Ghana who have come, been educated abroad and returned to Ghana. The end result is a greater number of qualified people and a greater dependence on technology. The challenge of coming to Africa is really finding the right partners to collaborate with you.
They know that we still have challenges in terms of policy and in terms of creating a really enabling business environment, that really respects the rule of law. Big technology companies understand this and have already begun to maneuver. In November 2019, Twitter founder and Square CEO Jack Dorsey announced that he would be moving to Africa. Analysts covering Square weighed in on the move, saying Africa was underserved and underserved, that the region was the future of payments, and that Dorsey's move was forward-thinking. I think Jack sees Africa as a huge growth vector for the company. I think if you ask him, his perspective will ultimately focus on users and revenue.
And lastly, I think he has the opinion that he has to find some way to ease the hiring pressure here in San Francisco. And so, by creating a more remote workforce, he can lead by example. In fact, mobile payments and social media are the ways in which Big Tech hopes to gain ground on the continent. Online retailer Jumia offers a cautionary tale on opening a consumer-facing business in Africa. After much fanfare, it became the first African tech company to list on the New York Stock Exchange in April 2019. But the company has hit a rough patch and been forced to close offices in Cameroon and Tanzania.
After reaching a peak valuation of around $4 billion, Jumia's market capitalization has fallen to just over $440 million. American technology companies know Africa's potential and are well aware of the potential dangers. Still, many of them are making significant investments on the continent. Microsoft arrived in Africa in 1992, but it was not until 2013 that it launched the 4Afrika Initiative, its marketing and business development engine on the continent, from healthcare to agritech and fintech. There really has been quite a bit of investment across the continent, but also innovation, local innovation that is also taking off in different markets and different markets are different stages as we see it.
But the opportunity for scalability of some of these solutions is really there. Microsoft is looking to promote its cloud technology, which it says will deliver a number of benefits. Entrepreneurs will be able to offer new services to the market more quickly. Companies will become smarter and make more data-driven decisions. Governments will be more transparent, efficient and accountable, which will improve the local business climate. And all citizens will have access to key services. But it is necessary to have critical infrastructure, and more than one technology giant is focused on providing it. Facebook's biggest problem in reaching all its users is getting them to access the Internet at a low price.
So what do they do? They help enable new companies that are building cheap Internet. To that end, Facebook, Airtel Uganda and BSC worked to complete a 770 kilometer network in northwestern Uganda to bring mobile broadband to about 3 million people. In South Africa, the social media company worked with Vast to connect to underserved communities via Wi-Fi. And in Nigeria, it partnered with Main One to install 750 kilometers of fiber. Last year, the Wall Street Journal reported that Facebook was in talks to lay an undersea cable that would circle the entire continent and reduce the cost of bandwidth. The project is known as 'Simba' after the Lion King character.
Meanwhile, Google has its own plan, called Equiano, named after the Nigerian-born abolitionist and writer who was a slave as a child. The plan to connect Portugal with South Africa, the first phase of the project, is scheduled to be completed next year. Google also has a number of initiatives in Africa, including Google for Startups, which announced last September that it had started its first immersion cohort in Africa. It was a twelve-week program aimed at sharing experience with technology startups in Africa. One of the companies they worked with is called Kwara, which offers online and mobile banking services for financial institutions and members.
Amazon has been in Africa since 2004, when the company opened its development center in Cape Town. The center focused on networking technologies and customer service software. In 2015, the company continued to expand with an office in Johannesburg. Two years later. Amazon introduced AWS Direct Connect for Africa. Available in all African countries since 2016, Netflix now programs for its audience. Queen Sono is a crime drama series set to premiere in February 2020 and is its first African original series. It features South African actress Pearl Untili. More African shows have been commissioned from South Africa, Zimbabwe and Nigeria. In late 2018, African countries signed an agreement to develop the African Continental Free Trade Area, an agreement that the director of the International Trade Center called revolutionary.
Africa is taking off and it is a good time to participate in Africa's transition. Like 54 different countries for Africa, like a continent in trade. This year we are launching the African Continental Free Trade, which is very important because all 54 African countries have agreed to now have trade. Now, this is not just a trade agreement on paper. But it will be commerce that will transcend groups and services, intellectual properties. In November 2019, the African Union met in Ethiopia to discuss its goals for its member states. The AU. He also wants to boost continuing education in Africa by creating a virtual university that will allow students to access it from anywhere in the world.
And it has also adopted cybersecurity as a flagship program to ensure that these technologies are used for the benefit of African people, institutions and nation states, ensuring the protection and security of online data. African leaders also apparently know the importance of internet connectivity and are taking steps to improve it. Elon Musk, originally from South Africa, is not going to wait. In January 2020, Musk's company SpaceX launched another rocket containing 60 Starlink satellites. Musk hopes to have 700 in orbit by mid-year and create a mega constellation designed to provide low-cost Internet to underserved regions such as rural America and Africa.
Even the continent's demographics are changing. Consulting firm McKinsey projects that half of Africa's population will live in cities by 2030, helping to increase overall Internet access. My experience has been very positive in terms of how big technology companies interact with these startups. And as I said, they depend in many ways and it will be easy to paint the picture of Colonization 2.0. But the reality is that we are still at a very early stage and, as a continent, we need all the attention, energy and resources we can get at this stage. And we are very far from it being a competitive environment because there is a lot to do.
Africa is becoming perfect. Little by little, we have not reached that point yet. They have all these policies, just like youHe said, in force, where there will be open borders, open economies, open movements, and that is going to change the entire dynamic enormously. This inevitably has to happen. And in fact I believe that if we, Africans, do not intervene and make the best of what we can, we will get nowhere. And that's why I think inevitably, organically, we have to grow.

If you have any copyright issue, please Contact