Wednesday, February 3, 2016

The mobile revolution continues to spread to all corners of the globe and remains a significant presence in Africa. The African continent was once considered a huge risk on the business front, but that idea is changing daily thanks to mobile technology. Africa is currently the second-largest mobile phone market on the planet, with African companies focusing on the growing demand for mobile services, cloud computing, and digital entertainment.

From South Africa to the Rest of the Continent

Back in 1998, there were fewer than 2 million mobile subscriptions in Africa. Most of those came out of South Africa, according to data from the African Development Bank (AfDB). This quickly changed as mobile technology gained popularity, and subscriptions increased by 2,000 percent over the next decade. As of last year, Africa had more than 700 million mobile subscriptions.

The Initial Leader

MTN South Africa was the first company to harness the power of mobile. Known as M-Cell in 1994, the company acquired mobile operator licenses in Swaziland, Uganda, and Rwanda in 1998. It obtained a license to operate in Nigeria in 2001 and subsequently became the largest mobile operator on the continent. MTN South Africa had 231 million subscribers by the end of 2015, which accounted for a third of the total market. It was Africa’s first multinational company, and proved that creating a profitable business on the continent was very possible.

Today’s Leaders

Numerous other mobile tech companies have emerged in the wake of MTN South Africa’s success; and like their predecessor, these companies are changing Africa’s economic landscape. PesaPal is one fantastic example. The Kenyan company provides consumers with the opportunity to purchase mobile phone credit, pay bills, shop, and complete school fee transactions online. PesaPal is known as the African version of PayPal, and expanded to Malawi in 2014 to target some 400 million consumers in Ghana, Nigeria, and Zambia. Its success demonstrates how convenience-driven technology is shaping the habits of African consumers.

MXit is another prime example. It launched as a simplistic messaging app, but evolved to become a successful social media platform with 27 million users so far. It’s even a viable Facebook competitor, especially in developed South African markets.

Other excellent examples of tech company success in Africa include Wyzetalk, iROKOtv, and Ushahidi.

Secrets of Success

If you’re still wondering how tech companies gained a serious footing on a continent not exactly known for such developments, there are numerous secrets to success at work. They include a deep understanding of economic and geographic trends, and catering to local demographics. For example, more than 70 percent of the sub-Saharan population is under 30 years old, and young people are the driving force behind consumption patterns.

Other secrets to mobile success in Africa include creating products capable of keeping up with consumers’ ever-changing needs, and addressing daily socioeconomic challenges. The most successful, sustainable tech businesses on the African continent are those that work for the social good, such as M-KOPA Solar, a company that connects solar energy sources to low-income homes in Uganda, Kenya, and Tanzania.

Africa, at last, presents a viable investment opportunity for many tech companies looking to capitalize on the continent’s growing market.