Africa’s thriving app economy

AppsThe mobile sector is booming across the continent, thanks to a new generation of start-ups and talented developers.

With almost a billion mobile connections, and smartphone shipments in Africa surpassing 155 million in 2015, you don’t need us to tell you that mobile tech is booming on the continent: Africa is the second biggest market for mobile after China. You’ve probably got a smartphone in your pocket already, and the apps that you installed on it and use on a daily basis are proof of that. What you may not realise, however, is that a growing number of those apps are home-grown. Many people think of Chinese factories when it comes to handsets these days, or Silicon Valley start-ups for smartphone software. Dig a little deeper, though, and you’ll see that Africa’s app economy is thriving, thanks to self-starting entrepreneurs every bit as driven as their Californian counterparts. South Africa is fast becoming a tech hub to rival the most enterprising scenes in Europe and North America, with mobile focused start-ups popping up all along its coastal cities. Kenya too has proved a focal point for innovation, with several services breaking out from the country, unique in their focus on solving specifically regional problems, not simply re-purposing popular American apps for a different audience.

The next big thing
Nowhere was this more obvious than at the AppsWorld Africa conference, hosted last November in Cape Town, South Africa. More than 10,000 developers, entrepreneurs and mobile executives gathered to talk shop, listen to talks from prestigious guests including Orange’s CEO Sebastien Crozier, and participate in panels on topics such as ‘Securing investment’, ‘Monetisation of apps’ and ‘User-friendly interfaces’, as well as workshops on security and hacking.

Many of those attending were nursing their own individual ideas, but they all shared one common goal: to be the next big thing. There’s a phrase in Silicon Valley to describe a breakout start-up – ‘a unicorn’. If the African app economy has one ‘unicorn’, it’s unquestionably M-Pesa. While not a start-up per se – it was established by Vodafone in Kenya in 2007 – it has nonetheless come to be seen as a tentpole for the industry.

The service, which lets people transfer money without the need for a traditional bank account, just a phone, has become an essential part of the infrastructure in a country where previously many were forced to send money back to relatives by hand on buses. Such has been its success that in the financial year 2013/14, revenues hit a massive US$300 million.

“M-Pesa proves that the potential for technology in Africa to be leveraged to create real impact while making a tidy sum is real,” says Eunice Baguma Ball, the founder of the Africa Technology Business Network, a support community for entrepreneurs and businesses looking to engage in technological opportunities in Africa.

In a recent blog post for AppsWorld Africa, she outlines a three-part formula for mobile app success on the continent. “Find a glaring need (this is the one thing there is no shortage of in Africa), determine that there is an existing, less-efficient solution to validate that need. Leverage whatever existing infrastructure there is and build on top of that. M-Pesa leveraged mobile phones which were already on track to reach almost every household in Kenya.”

It’s a common trope in tech circles that the best start-ups ‘disrupt’ existing business models. Netflix ‘disrupted’ bricks and mortar DVD rental stores, Uber ‘disrupted’ entrenched taxi services, Airbnb ‘disrupted’ the hotel trade, and so on. Yet, Baguma Ball points out, this model does not always hold true for African economies.

“Technology in Africa offers a blank canvas for the ambitious innovator,” she says. “In many sectors there is no legacy system to contend with and almost everything is up for innovation.” In other words, innovators can set straight to work – they’re not disrupting anything, they’re starting it.

M-Farm is another growing Kenyan mobile service that embodies this approach. Founded by Jamila Abass, a young computer scientist, the SMS service lets farmers get up-to-date trading prices on crops to put them in better negotiating positions with middlemen and buyers, some who may be looking to exploit their lack of an awareness of current market price. It also connects them directly with buyers; farmers can then use its secure money transfer system for a transaction.

The service has grown from 2000 users in 2012 to more than 7000 a year later, and has radically changed how farmers approach trade in the country.

Boom and bust
If you want a surer sign of the maturing app economy in Africa, you only have to look at the services that have fallen by the wayside, as other services have out-innovated them. Mxit is a prime example of this. At its peak, this South African social network designed for cheap feature phones claimed 7.5 million monthly users, but after numbers fell dramatically to little over 1 million last year, the service was shuttered.

While there’s a case to be made that the massive global success of chat app WhatsApp accelerated Mxit’s demise, there’s no denying that the company failed to move with the times, and adapt its services to cater to its growing smartphone, rather than feature phone, audience. According to South African tech analyst Arthur Goldstuck, Mxit became complacent.

If ever there was a sign that the app economy is booming, however, it’s that others immediately emerged to fill the void, with their own unique twists. Aweza is another rapidly growing South African start-up aimed at tackling the language barriers in the country using computer translation, while Awesome South Africa uses location tech to make travel easier.

Mxit’s own technology and IP meanwhile was sold to the Reach Trust, a foundation that solves education and health care challenges with mobile technology. Soon, a former Mxit employee appeared on the online forum Reddit to answer questions about the site’s shutdown and his own transfer to the Reach Trust. A South African student wanted to know if any jobs were available, and asked for advice on breaking into the industry.

“Internships are possible, we have some already,” the employee replied. “Always keep an eye out for gaps in the market. And mobile development is so big at the moment – I’m sure if you qualify yourself as a skilled app developer, you’ll never have trouble landing that job you want to have.”

It’s that ‘never say die’ mentality that will mean the app economy in Africa can only continue to grow.

The best African app alternatives

msafiri reviews some of the alternative home-grown apps to the most popular ones we use

Like WhatsApp? Try 2go
Texting is easy, but when your network supplier charges per message sent, it can also prove surprisingly expensive. If you’ve got a web connection on your smartphone, however, you can use a cross-platform messaging service to chat with all of your friends almost without limits, since text uses so little data. The most well known services – WhatsApp and Kik Messenger – are North American, and lay claim to hundreds of millions of users, but South Africa boasts its own alternative, 2go. You can talk with all your friends, meet new ones, and even play games with them in chat rooms together. With support for Android smartphones, BlackBerry handsets and even older Nokia phones, 2go is well worth your attention.

Just-Eat not available? Try hellofood
Take-away apps, which handle food ordering and delivery, have been flourishing for years. But, with the exception of the global Just-Eat, most are specific to a country. You’ll be pleased to know, however, that Africa has its own answer, in the rapidly growing hellofood. The app is available on Android, iPhone and Windows Phone, and lets hungry customers in Nigeria, Morocco, Kenya, Ghana, Senegal, Ivory Coast, Rwanda, Tanzania, Uganda and Algeria place an order, pay securely through the app, and have their food delivered hot and fresh in a matter of minutes.

Tired of PayPal? Try M-Pesa
Check out Kenyan app M-Pesa, arguably the most important mobile innovation to emerge from the continent. You don’t need a traditional bank account, just a mobile phone – you can then quickly and easily transfer money to friends or make purchases, and if you need to withdraw money, you can do so from a network of airtime sellers. All the major mobile networks in Kenya, including Safaricom and Vodafone, have embraced it. M-Pesa has more than 17 million accounts in Kenya alone. It’s the most successful mobile-based financial service in the entire world by some metrics, but it’s certainly not just restricted to Kenya. You can use M-Pesa all over the world, from Albania to Tanzania and India too.

Foursquare is out, NikoHapa is in
The Swahili check-in app of choice is not Foursquare – it’s NikoHapa. Originally founded as a means for business and restaurant owners to get feedback from shoppers via text message, it soon expanded to let them check in at locations instead, and see where friends are at. The app also gives local deals – a compelling proposition.

Can’t QuidCo? Try Snap’N’Save
South Africa’s next-gen answer to coupon cutting makes saving money easy. The concept is similar to other cashback businesses: brands work with Snap’N’Save to offer money back on products bought through the service. But Snap’N’Save marries analogue and digital tech in the smartest of ways, recognising that many of the daily essentials people buy still aren’t purchased online. Instead, you can simply snap a photo of your receipt using your smartphone’s camera and import it into the app – presto, money back online. Available on iOS.

WumDrop is Uber for South Africa
Okay, since it doesn’t offer low cost taxi rides, it’s not quite the same, but there’s no denying that South African start-up WumDrop meets you at the same intersection of mobile location technology and vehicles. The idea is simple – if you need to get a package across town, fast, you simply just summon a courier from your phone using its GPS satellite positioning. They arrive, pronto, deliver the package, and just for complete peace of mind, then message you a picture showing you the delivered item where you want it to be. Simple. WumDrop currently operates in both Cape Town and Johannesburg, but has big plans for expansion, and having just won the MTN Business App of the Year award, is showing no signs of slowing down. The app is available on both Android and iPhone.