For the fifth consecutive year VC4A has produced annual research and analysis to improve the understanding of Africa’s startup movement. For the 2018 research cycle, with the support of the Mastercard Foundation, VC4A publishes a pan-African study including 6 country specific deep dives. VC4A conducts this research to share the progress of the VC4A network and to help document the journey of the African startup community.
Last year the research looked at different factors that determine venture success. The 2018 effort looks at how startup ecosystems add value to successful venture creation. Based on inputs from local experts and face-to-face interviews we aim to answer the following research question: ‘How does the startup ecosystem add value?’
Kenya ecosystem analysis
A vibrant startup ecosystem is essential for many reasons, firstly it makes the path to entrepreneurship a much easier one to take for those who want to take the dive to build their businesses. Secondly, through the work done by entrepreneurs and government institutions, service delivery becomes more effective and efficient. Technology-based businesses have transformed various services: M-Pesa with its money transfer and payment system, the online platform ‘Kenya Law’ with its provision of legal information, and mobile platforms that offer agricultural information and prices, among many others.
Nigeria ecosystem analysis
VC4A research on 3,360 ventures registered in the country shows a clear relationship between venture performance and the support these ventures receive from the Nigerian startup ecosystem. For example, companies participating in ecosystem support programs are 23% more successful in securing investment, and are more likely to be generating new jobs.
South Africa ecosystem analysis
The South Africa startup ecosystem is one of the most robust and developed on the continent thanks to several strengths, including significant consumer and business markets, sophisticated entrepreneurial talent, and strong corporate sector. South Africa has access to local capital and ties to a growing number of international investors. High tech startups thrive in the midst of a growing number of startup support organizations active in the ecosystem.