by Said El Mansour Cherkaoui – TRI CONSULTING KYOTO TRI CK USA – Landmark Legislation: California Facing the World of Artificial Intelligence TRI CONSULTING KYOTO TRI CK USA – A California lawmaker will file a bill seeking to make generative AI models more transparent and start a discussion in the state on how to regulate the technology. California Senator Scott Wiener (D) has drafted a bill requiring “frontier” … Continue reading
A California lawmaker will file a bill seeking to make generative AI models more transparent and start a discussion in the state on how to regulate the technology. California Senator Scott Wiener (D) has drafted a bill requiring “frontier” model systems, usually classified as large language models, to meet transparency standards when they reach above a certain quantity of computing power. Wiener’s bill will also propose security measures so AI systems don’t “fall into the hands of foreign states” and try to establish a state research center on AI outside of Big Tech.
The bill, which is classified as an intent bill and needs further development before it can pass, will also mandate AI labs to test models for safety risks and disclose to the state if safety risks are found. Wiener’s goal, per a statement sent to The Verge, is to start discussions on regulating AI.
California and Artificial Intelligence: To Be or Not To Be Meaningful Regulation?
California Weighed in below!
California AI safety bill blocked:
California Gov. Gavin Newsom has vetoed a controversial artificial intelligence safety bill that would have “laid the groundwork for how AI is regulated across the U.S.”
In a statement, Gov. Gavin Newsom said SB 1047 is “well-intentioned” but doesn’t consider whether AI is deployed in high – or low-risk situations, and would have applied to only the largest and most costly models.
AI Bill SB 1047 faced opposition from tech companies large and small, who warned that it would strangle innovation.
Newsom said he’s now collaborating with researchers including Fei-Fei Li to create more effective legislation.
Read more Naturally and Intelligently:
California legislature passes AI bill SB 1047: https://www.linkedin.com/news/story/calif-legislature-passes-ai-bill-6144228/
An artificial intelligence safety bill was overwhelmingly approved by California legislators on Wednesday, September 25, 2024 and now heads to Gov. Gavin Newsom for final consideration. If enacted, the “fiercely debated” bill would require tech companies to safety-test AI programs before release and empower the attorney general to sue AI companies for any major harm caused by their technologies.
The bill earned cautious support from the likes and here are some of these reactions:
Elon Musk: “This is a tough call and will make some people upset, but, all things considered, I think California should probably pass the SB 1047 AI safety bill. For over 20 years, I have been an advocate for AI regulation, just as we regulate any product/technology that is a potential risk to the public.”
This is a tough call and will make some people upset, but, all things considered, I think California should probably pass the SB 1047 AI safety bill.
For over 20 years, I have been an advocate for AI regulation, just as we regulate any product/technology that is a potential risk…
Governor Newsom announces new initiatives to advance safe and responsible AI, protect Californians: Sep 29, 2024
What you need to know:
Governor Newsom announced that the “godmother of AI,” Dr. Fei-Fei Li, as well as Tino Cuéllar, member of the National Academy of Sciences Committee on Social and Ethical Implications of Computing Research, and Jennifer Tour Chayes, Dean of the College of Computing, Data Science, and Society at UC Berkeley, will help lead California’s effort to develop responsible guardrails for the deployment of GenAI.
Governor Newsom also ordered state agencies to expand their assessment of the risks from potential catastrophic events.
The bill, introduced by Sen. Scott Wiener (D-San Francisco), would have required developers to submit their safety plans to the state attorney general, who could hold them liable if AI models they directly control were to cause harm or imminent threats to public safety.
Additionally, the legislation would have required tech firms to be able to turn off the AI models they directly control if things went awry.
Said El Mansour Cherkaoui – Originally published on June 18, 2023 6:48 am
Give me that High Five, We Got the World to Believe in Our Fine TechShow – Dreams of Rolling the Mechanics and the Dice over Silicon Valley and the World of “Incredulous Investors.” Babe, Let’s Buy an Island and Go Around the World
Global Fintech Funding and Rounds from Q1 2022 to Q2 2023
EMEA Fintech Funding takes the largest dive YoY in H1 2023, compared to other regions
Africa has over half a billion mobile money accounts and it is the largest and fastest-growing fintech segment on the continent
Egypt, Iran, and Saudi Arabia technically have the largest addressable market sizes for fintech across the MENA region
African Startups Not Celebrating the New Year 2024
How many startups fail in USA? Approximately 10% of startups fail within the first year. According to the United States Bureau of Labor Statistics, the startup failure rate increases over time, and the most significant percentage of businesses that fail are younger than 10 years. Over the long run, 90% of startups fail. Startup ★ Stars … Continue reading
African Startups Not Celebrating 2024
The companies are well positioned to benefit from the growth of Africa’s tech but they must address the needs of African users
Kampala, Uganda | THE INDEPENDENT | Last year, Google’s Equiano undersea cable began conveying terabytes of data per second to and from African shores. Valued at $1 billion, Equiano stretches from Western Europe to South Africa and has 20 times the capacity of the previous cables that served the continent. According to Google projections, the new cable has the potential to transform Africa’s economy by creating millions of jobs, reducing data costs by nearly 20%, and enabling a fivefold increase in internet speeds.
Other prominent US-based tech companies are also investing heavily in Africa. Amazon is in the midst of constructing its African headquarters in South Africa, while Microsoft recently launched an initiative to bring internet access to 100 million Africans by 2025. Meanwhile, Meta (formerly Facebook) is building 2Africa, an undersea cable expected to be the world’s longest when it is completed in 2024.
The impetus for these investments is the growing recognition that the future of America’s technology industry hinges on expanding its African customer base. Today, a little over a third of Africa’s 1.4 billion people use the internet, representing a small fraction of the world’s internet users. But the continent’s population is projected to reach 2.5 billion by 2050 one-quarter of the global total. The vast majority of Africans are expected to become internet users by then, offering tech companies opportunities that no other region can match.
Still, there is no guarantee that the investments made by Google and other US tech companies will pay off. In recent years, foreign competitors, particularly China-based firms, have also recognized Africa’s immense potential for the technology sector, leading to intense competition for market shares.
Currently, no single actor dominates African markets. Whereas Chinese companies lead in some sectors, such as telecommunications hardware, US companies prevail in software platforms, operating systems, and search. Meanwhile, African-owned fintech companies and startups are growing rapidly, and the continent’s undersea cables and data centers are managed by a diverse set of local and remote enterprises.
The most persistent challenge facing Big Tech firms in Africa is their ignorance of and disregard for Africans’ preferences and needs. For example, some US analysts have expressed concern about the rise of Chinese companies such as Transsion, which manufactures nearly half of Africa’s smartphones. But the main reason companies such as Apple and Google struggle to compete is that their products are priced as luxury goods and are ill-suited for consumers in low-income countries. The base price of the iPhone 14, the top-selling phone in the United States, is $799, nearly half of Sub-Saharan Africa’s GDP per capita. Transsion’s phones, by contrast, sell for as little as $20.
Likewise, data localization is widely supported by African governments, researchers, and citizens. But Big Tech companies vehemently oppose efforts to store data on African citizens within their countries of origin.
To be sure, data localization is not always cost-effective and could be used by governments to undermine civil rights. But studies commissioned by the Internet Society show that efforts to localize internet traffic in Nigeria and Kenya have reduced prices, decreased latency, and fueled the growth of the local tech ecosystem. Conversely, as Nima Elmi observed, Big Tech’s approach effectively perpetuates African countries’ status as consumers of “foreign tech innovations that are developed using their own data and then sold back to them.”
Big Tech firms’ labor and recruitment practices are another example of their disregard for Africa’s needs and interests. At the top end of the pay scale, African policymakers are concerned that tech giants’ tendency to poach top talent will undermine the growth of their domestic industries. Meanwhile, these companies face legal action for subjecting content moderators, many of whom are based in Nairobi, to traumatizing experiences and inadequate wages.
Moreover, the proliferation of disinformation and incitement on social media has severely eroded the reputation of US-based platforms like Facebook, which has fueled violent conflict in Ethiopia and provided fertile ground for extremist groups such as the al-Qaeda-backed al-Shabaab. For years, Facebook ignored organized criminal groups’ use of its platform to lure Africans into domestic servitude. The company finally acted only after Apple threatened to remove Facebook and Instagram from its app store.
Given Big Tech’s record of ignoring and neglecting Africans’ needs and concerns, it is no wonder that African governments have begun to explore alternatives. Nigeria, for example, imposed a seven-month ban on Twitter in 2021, lifting it only after the company agreed to open a local office, pay taxes, and cooperate with national-security agencies. Other countries, such as Kenya, have threatened similar bans.
With their unparalleled expertise and world-class technology, US companies are well positioned to benefit from the growth of Africa’s tech market. But to maximize this opportunity, they must address the needs of African users. Moreover, establishing stronger partnerships with the burgeoning African tech industry could greatly benefit these companies, enabling them to tailor their technologies to the preferences of underserved users and mitigate the impact of disinformation. By fostering relationships with Africa-based researchers and civil-society groups, US tech companies could support the creation of a healthy digital ecosystem that promotes prosperity, security, and accountability for all users.
Over the past few years, Big Tech firms’ failure to address privacy concerns and combat disinformation has prompted a growing debate about the apparent conflict between their professed values and their bottom lines. But to succeed in Africa, US-based tech companies must recognize the falseness of this dichotomy. While investing in African businesses may yield financial rewards, investing in African citizens is the key to unlocking the continent’s vast economic potential.
***** The Independent June 13, 2023 Business, In The Magazine – Source: Project Syndicate.
AFRICAFRIQUE TECH ECOSYSTEM
The Reality of Digital Network and Startup / Tech Hubs in Africa
During the first quarter of 2020, Africa has 522 million internet users representing 11.5% and was ranked third in the global tally. The first one wa Asia that accounts for more than half of the global internet users. Data gathered by Learnbonds indicates that during the first quarter of 2020, the Asian continent accounted for 2.3 billion users representing about 50.3% of the global users. From the same data, Europe has the second-highest number of internet users at 15.9% which represents 727 million users.
With 453 million users, Latin America and the Caribbean region comes fourth. The region accounts for 10.1% of the worldwide internet users. In fifth place is North America with 327 million users, which represents 7.8% followed by the Middle East at 175 million users (3.9%). Oceania and the Australian region account for the least global internet user globally at 29 million which represents 0.6%.
The rise of Africa is a confirmation of a trend that compared to all regions, the strongest growth has been reported in Africa, where the percentage of people using the Internet increased from 2.1 per cent in 2005 to 24.4 per cent in 2018, according to ITU data. … The theme, “Boosting Africa’s Digital Economy,” recognizes the key role of digital technologies in the modern economy. May 27, 2019
Africa Needs to Think Big and Think Fresh
According to certain indicators, Africa is hosting only 11% of the world’s Internet subscribers and only 35.2% of the African population are accessing the Internet and mainly trough the mobile phone.
In response, efforts were made by the African governments to increase the development of fiber optique as network. Taking the example on the American, European, Indian and Chinese markets, African regulators are trying to implement policies “that encourage network sharing and access to ducts, thus facilitating the roll out of networks and reducing deployment costs. This trend is actually happening in Kenya, Nigeria, Ghana, Tunisia and Nigeria.
However, some people in Africa have been abandoned along the way in recent years as technology and robotisation have reduced the wages of some communities “of workers, says Christine Lagarde, the director general of the IMF.
On the other hand, the Director of ITU’s Telecommunication Development Bureau, Doreen Bogdan-Martin said: “Africa cannot afford to think small or act slowly, and at the current rate of progress, hundreds of millions of African children will still be denied the opportunity to realize their potential. Without more rapid digital transformation, Africa will not succeed in creating the huge number of new jobs needed to match its population growth.”
Building a solid digital economy will require a focus in key areas, such as: digital infrastructure, digital literacy and skills, digital financial services, digital platforms, and digital entrepreneurship and innovation, says Ms Bogdan-Martin.
“Can we attain the goal of universal and affordable access to broadband for all Africans by 2030? Not without a paradigm shift,” says Ms Bogdan-Martin. “Africa’s digital transformation is going to need all hands on deck. We need to work together more effectively; engage old and new partners more effectively; innovate more effectively.”
“We need a coordinated effort to push forward the digital transformation of Africa through shared vision, policies and measures to support pan-African digital integration,” says Ms Bogdan-Martin. “Digital transformation will provide the springboard for a leap into the African Century. Africa’s youth are ready and waiting to make that leap. We must not let them down.”
Startup and Tech Trends in Africa
In a challenge to Uber’s (Dara Khosrowshahi) dominance in South Africa, Estonia-based ride-hailing app Bolt (Markus Villig) to double its service there after having raised more than $200 million from investors since its launch in 2013. Reuters
While you’re at it, check these picks for 2016, 2017, 2018 and 2019.
For the Disrupt Africa team, it has been another fascinating year of conversations and meetings with hundreds of inspiring, innovative African tech startups.
But which of these companies do we think have the brightest futures ahead of them? Here is our pick of the top 12 African startups to watch out for in 2020.
NORTH AFRICA
Trella
Egyptian trucking marketplace Trella is our first rising star of 2019, having raised more than US$600,000 in a pre-seed funding round; selected for Silicon Valley-based accelerator Y Combinator; and concluding the year by acquiring local competitor Trukt.
Founded last year, Trella operates a B2B trucking marketplace, connecting shippers with carriers in real-time, to make the entire supply chain faster and more reliable while reducing slack and exceptions.
This year’s impressive list of successes comes from a team that told Disrupt Africa they are taking growth “step-by-step”, and not making any hasty moves – so we’re eagerly anticipating the next set of well-planned moves the startup makes.
Eksab
Also from Egypt, we’re betting fantasy sports platform Eksab will keep up its winning streak in 2020.
Eksab is looking to tap into the MENA region’s love for football by providing users with exciting and engaging mobile games, to become the leading fantasy sports site in the region.
In its first year, the startup processed more than five million predictions, and in June secured a six-figure seed investment from 500 Startups to help it scale its product across the region.
With such a solid start to the startup’s growth plans, we’ll be keeping a keen eye on Eksab over the coming months.
Kaoun
Tunisian fintech Kaoun is tackling the epic question of financial inclusion. The company’s first product, Flouci, is a mobile and web app that allows users to create free bank accounts remotely; facilitating the process through an innovative Know Your Customer (KYC) system via smartphone.
A critical component to any startup’s success, the team behind Kaoun is top-notch: co-founders Nebras Jemel, Anis Kallel, and Rostom Bouazizi put their studies in the United States – at Harvard University, University of Rochester, and Columbia University respectively – on hold to come back to Tunisia and build a fintech startup.
Launched in 2018, Kaoun has already raised funding from two angel investors, and secured key partnerships with two Tunisian banks and the country’s National Digital Certification Agency. This startup is worth watching.
SOUTHERN AFRICA
FlexClub
Here at Disrupt Africa, we’re interested to see how FlexClub fares in 2020, after a solid start since launching last year.
The South African startup allows users to purchase vehicles which are then matched with Uber drivers who pay a weekly rental charge to the investor.
With a solid founding team – including two former Uber employees; the startup raised US$1.2 million in a seed round led by CRE Venture Capital and also featuring Montegray Capital and Savannah Fund in March, amidst plans to grow its team and expand into new geographies.
Intergreatme
Regtech startup Intergreatme can be credited as one of the first crowdfunding successes of Southern Africa; securing a whirlwind ZAR32.436 million (US$2.19 million) from 406 investors via the Uprise. Africa platform in May. Within six days it had already raised ZAR28.5 million (US$1.98m), with the startup limiting the raise to ZAR32 million which it managed in 2 weeks. The raise was marred slightly by the fact the startup later decided to reject a bulk of it after some investors failed compliance processes.
The fact still stands the startup is an attractive proposition, however, and we get what all the hype is about. Intergreatme has developed a web and app platform that digitises verified personal information for over 25 million credit-active South Africans; for streamlined use across businesses and other organisations.
We can’t wait to see what the startup does next, as we’re sure 2020 is going to be an immense year.
Pineapple
Insurtech startup Pineapple is the third South African venture to make our watch list for 2020.
Founded in 2017, Pineapple allows users to get quotes and insurance on items with just the snap of a picture.
The startup has been going from strength to strength since launching, raising seed funding, and taking part in Google’s Launchpad Africa accelerator and the US-based Hartford Insurtech Hub’s accelerator.
Then in 2019, it won the single biggest prize at the annual VentureClash challenge in the United States (US), securing US$1.5 million from a US$5 million prize fund. With the milestones rolling in, we’re sure 2020 will be a stellar year for this startup.
EAST AFRICA
Exuus
Rwandan fintech Exuus has had an exciting year; in particular, it has been busy honing its pitch to perfection.
The startup is taking traditional savings groups online in a bid to smooth processes and help low-income communities become more financially resilient.
In February, Exuus was one of 10 startups selected to pitch live to an audience of over 600 attendees at the annual Africa Startup Summit, held in Kigali; picked from more than 100 applicants from around the continent.
The startup was also named winner of Seedstars’ Rwandan event, securing a place in the global final, at which Exuus will pitch for up to US$500,000 in equity investment. We think they stand a good chance of coming out on top of the contest.
MPost
Launched in 2015, it has taken Kenya’s MPost a while to get going, but recently things have started hotting up.
Simple but effective, MPost has developed a platform that enables the conversion of mobile numbers into official virtual addresses, which allows notifications to be sent to clients whenever they get mail through their postal addresses.
The startup participated in the Startupbootcamp AfriTech program held in Cape Town in late 2018; and this year raised a US$1.9 million Series A funding round to finance its expansion and further development of its proprietary platform.
We’ll be keeping our ears glued to the ground for more news from this exciting venture.
RideSafe
Take motorbike taxis, affordable emergency response, and blockchain – mix them with a bucket of innovation and you get RideSafe. The Kenyan startup offers an emergency response service for public motorcycle taxis, that utilizes a micro-insurance financing model running on a decentralized blockchain application.
The startup has had quite the year – having raised US$100,000 in funding from æternity Ventures after taking part in the Bulgaria-based æternity Starfleet Incubator for blockchain startups; as well as being selected to pitch at the Africa Startup Summit in Rwanda in February.
We know we’ll be seeing big things from this company in 2020.
WEST AFRICA
OKO Finance
It’s not every day a startup from Mali makes the list of the continent’s top 12 startups to watch – but OKO Finance has.
Founded in 2017, OKO develops affordable mobile-based crop insurance products to provide smallholder farmers with the financial security they need, regardless of unstable climate trends.
The startup raised pre-seed funding of US$300,000, but is now looking to raise US$1.5 million in order to grow more quickly. We feel confident they’ll get the backing, and we’re looking forward to seeing them scale their solution to more farmers and more markets in 2020.
Yobante Express
At Disrupt Africa, we’re really excited about Senegalese startup Yobante Express, which has developed an innovative relay-based way of tackling last-mile deliveries.
Founded in November 2018, Yobante Express is an online marketplace that connects local couriers with local commerce; combining the gig economy and machine learning, to optimize domestic, cross-border, and last-mile delivery.
Already delivering over-delivering 8,000 parcels and generating more than US$50,000 every month, Yobante Express expanded to South Africa in November, and we have a feeling this startup will be pan-African before long.
54Gene
Nigeria’s 54Gene means serious business: it is building the first African DNA biobank.
Just six months old, 54gene is a product of Stack Dx, which raised funding from early-stage VC firm Microtraction to develop the platform in January. Since then it has been selected to take part in the Y Combinator and Google Launchpad Africa accelerator programs, and in July, raised a US$4.5 million seed round.
The startup is now positioned to build the largest database of genomic and phenotypic consented data of Africans. And for us, there’s no doubt that this startup merits a spot on our must-watch list for 2020.
Ahmed Benjas, MBA Finance Director | SAP | IFRS | SOX | US GAAP | Middle East & North Africa regions |
“When I see these figures, I wonder what makes us believe that we are a country where the economy moves.” -: studies overly paid by the State (McKinsey, Roland Berger …) and we do not have not got the thread to start yet? – Incubators that ultimately serve what? – too many startup events …. !!!! – CoWorking Spaces where we only display the signs of laid-back startups …. – business angels who are not ready to play the game … In my opinion, the failure is total, and our ecosystem is unattractive ” end of the quote.
Raising Capital Funding for Start-up in Africa 2017 (in Millions of dollars)
Google launched a network of free Wi-Fi hotspots in Nigeria on Thursday, August 9, 2018, as part of its effort to increase its presence in Africa’s most populous nation.
The U.S. technology firm owned by Alphabet Inc has partnered with Nigerian fiber cable network provider 21st Century to provide its public Wi-Fi service, Google Station, in six places in the commercial capital Lagos, including the city’s airport.
Internet penetration is relatively low in Nigeria. Some 25.7 percent of the population made use of the internet in 2016, according to World Bank Data.
We are rolling out the service in Lagos today but the plan is to quickly expand to other locations.
The poor internet infrastructure is a major challenge for businesses operating in the country, which is Africa’s largest oil producer. Broadband services are either unreliable or unaffordable to many of Nigeria’s 190 million inhabitants.
“We are rolling out the service in Lagos today but the plan is to quickly expand to other locations,” Anjali Joshi, Google’s vice president for product management, told Reuters in Lagos.
The company said it aimed to collaborate with internet service providers to reach millions of Nigerians in 200 public spaces, across five cities by the end of 2019.
It said it would generate cash from the service in Nigeria by placing Google adverts in the login portal. Google did not disclose the amount invested in the new Nigeria service.
The technology firm said it planned to share revenues with its partners to help them maintain and deploy the Wi-Fi service but did not disclose the expected advertising revenue split.
Africa’s rapid population growth, falling data costs, and heavy adoption of mobile phones have made it an attractive investment prospect for technology companies.
Nigeria is the fifth country to launch Google Station. Similar services have been launched in India, Indonesia, Mexico and Thailand.
The service is aimed at countries with rapidly expanding populations. The United Nations estimates Nigeria will be the world’s third most populous nation, after China and India, by 2050.
“A lot of people who found data to be too expensive for them to use, are using it,” said Joshi. “In India, we have tens of millions of users, and close to a million in Mexico.”
However, many do not disclose how profitable the continent’s markets are, or if they make the companies money at all.
Last year, Google announced plans to train 10 million Africans in online skills within five years. It also said it aimed to provide $3 million in equity-free support to African start-ups.
Nigerian Vice President Yemi Osinbajo visited Google’s Silicon Valley headquarters this month to meet the company’s chief executive, Sundar Pichai.
REUTERS
The average size of the deals struck in Africa by startups also increased year-on-year at every stage of investment, with Series A funding, for example, increasing to around $3.7m. Series A refers to a company’s first significant round of venture capital financing. At the same time, the number of tech hubs in Africa has risen to 310, with 173 accelerators and incubators recorded in 2016, according to the World Bank. There were 117 in the previous ye
For Startups: High Priority Should be given to Assembling Founding Team
While it is true that an entrepreneur needs to be very disciplined hence the 24 steps in Disciplined Entrepreneurship taught by Prof Bill Aulet, I cannot hide my eureka moment when I become more and more convinced after conforming: the number one skill that an aspiring founder must prioritize is FOUNDING TEAM ASSEMBLY – choosing co-founders, splitting equity, recruiting advisors, managing a board.
Interestingly, Prof Matt Marx of MIT Sloan elaborated carefully in his class “Dilemmas in Founding New Ventures (a full semester in 80 minutes)”. In it he gave examples from Smartix, Segway, Wily Technology, and Zipcar.com that could have been conducted better during the founding team assembly stage. He outlined some observations that the Skills and Networks of the founders must complement each other, but objectives must be similar among the founders. Skills is easily observed. Networks is also rather easy if you probe. However, the raison d’être of the co-founder is not observable.
Cherkaoui Journal, Morocco Digitall and African Start-Up Expo – Oakland California by Said El Mansour Cherkaoui is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License. Based on a work in English and French Languages at https://www.africanenterprise.com and https://fr.triconsultingkyoto.com. Permissions beyond the scope of this license may be available at http://www.triconsultingkyoto.com
In Tribute to Nass Al Ghiwane and Moroccan Popular Culture and its Human and Artistic Pillars
Approximately 10% of startups fail within the first year. According to the United States Bureau of Labor Statistics, the startup failure rate increases over time, and the most significant percentage of businesses that fail are younger than 10 years. Over the long run, 90% of startups fail.
All but the most promising and well-run VC-backed startups struggled to raise funding as venture capital investors became much more selective than they were just a few years ago. As a result, startups that weren’t yet able to sustain their operations without additional funding ran out of money and closed up shop.
Africa Dismay and Startup Going Down
VC funding in the African startup ecosystem has steadily declined in 2023, causing experts to worry about the future of the once fast-growing sector.
With fewer investors willing to bet on the continent during the tech downturn, the funding crunch has triggered mass layoffs, slashed valuations, and the liquidation of several African startups.
Recent news reports of mismanagement and fraud have impacted investor perception, leading to increased scrutiny and demand for credibility from local and global investors.
The funding crunch has already caused several casualties. Since the beginning of the year, at least 10 African startups.
2023 has been a difficult year for African startups. The global economic downturn has led to a decrease in venture capital funding for startups worldwide, including African startups. Funding for African startups has dropped significantly, with estimates suggesting a decline of 50% or more compared to 2022.
Other reasons for the shutdown of African startups in 2023 include:
Fewer investors willing to bet on the continent
Mass layoffs
Slashed valuations
Liquidation of several African startups
Fund mismanagement
Unfavorable market conditions
Challenges associated with certain business models
Lack of liquidity in the market
Difficulties startups use to regularly raising capital
Inability to convince investors
Other challenges that impact the success of startups in Sub-Saharan Africa include: Infrastructure deficits, Regulatory obstacles, Limited mentorship, Frugality issues, Inadequate marketing and branding. The absence of internet connection is also a factor in limiting the expansion of E-commerce and other business online transactions. This is not just in the rural areas but also in the cities.
Some notable African startups that shut down in 2023 include:
HytchA Nigerian B2B logistic platform that shut down because it “couldn’t raise [funding] and couldn’t sustain the business with just the money [it was] making”
OkadaBooksA Nigerian digital publishing platform that shut down due to unspecified “insurmountable challenges”
DashA Ghanaian payments startup that folded in October amid allegations of financial impropriety and false reporting
TOP TEN African Startups Not Celebrating the New Year 2024
Sub-Saharan Africa faces unique challenges that impact the success of startups. An article published on Medium in April 2023 outlines these challenges, including a lack of funding, infrastructure deficits, regulatory obstacles, limited mentorship, frugality issues, and inadequate marketing and branding.
Sendy: In August, Kenyan end-to-end fulfillment startup Sendy shut down operations and announced a fire sale of assets (it didn’t call it that), with reports saying reduced order volumes and fuel price hikes meant it was making deliveries at a loss, and had a monthly burn rate of US$1 million. Sendy raised US$20 million in capital as recently as January 2020, but in the current climate further funding was not to be found.
54gene: 54gene, a genomics research company that had raised US$45 million across three funding rounds, revealed in September that it had started winding down its operations. 54gene, which has had three CEOs in the last 12 months.
Dash: Ghanaian payments startup Dash, founded in 2019, had raised a whopping US$86 million, but folded in October amid allegations of financial impropriety and false reporting.
WhereIsMyTransport: South African mobility startup WhereIsMyTransport, bankrolled to the tune of over US$27 million by investors such as Naspers in recent years, announced it was closing down in October after failing to secure more investment.
Lazerpay: In April, Lazerpay, a Nigerian crypto and web3 company, confirmed it was shutting down operations after failing to raise additional funding. The startup had laid off some employees last year after the proposed lead investor for its seed round withdrew due to the “market conditions and disagreement on terms”.
Zumi: Kenyan B2B e-commerce startup Zumi announced in March it had closed down after failing to secure the necessary funding to continue operations. Launched in 2016, Zumi began life as a female-focused digital magazine, before pivoting into e-commerce in 2020. According to co-founder and CEO William McCarren, the startup achieved over US$20 million in sales, acquired 5,000 customers, and built a team of 150 people, but closed after failing to secure investment.
Zazuu: Last month, Zazuu, a London-based marketplace for African remittance companies that and raised more than US$2 million in total funding, also shut down, citing a lack of funding.
Hytch: In February, Nigerian logistics startup Hytch confirmed it had shut down barely nine months after launch.
Okada Books: Nigeria’s Okada Books, founded in 2013 and a pioneer in digital publishing and bookselling, closed down last month, citing rough macroeconomic conditions.
Pivo: Formed by Ijeoma Akwiwu and Nkiru Amadi-Emina in July 2021 and launched in public beta in September, Pivo offered banking services to small supply chain businesses, and raised a US$2 million seed round a little over a year ago. It, too, has now closed its doors, though by all accounts founder conflict also played a part.
Copia: Kenyan e-commerce company Copia, which raised US$50 million Series C funding last year, announced it was pulling out of Uganda, “consistent with many of the best companies in Africa and across the world which are responding to the market environment and prioritising profit.”
MarketForce: Another Kenyan retail-tech startup, MarketForce, is also facing challenges. The company raised US$40 million in funding in February of last year, back in the boom times, but stunningly, certain VCs that had committed funds backed out. In all, US$8 million of that capital was never wired. MarketForce has struggled to raise more capital, announced a bunch of layoffs, and recently turned to crowdfunding to get some cash in the bank.
Twiga Foods: Twiga Foods, a platform that connects Kenyan farmers to food vendors, recently secured undisclosed funding as part of a business refinancing process, just weeks after facing a KES40 million (USD 262,000) debt collection lawsuit. Twiga secured the new funding from Creadev, Juven, TLcom Capital Partners, and DOB Equity, investors that participated in the US$50 million Series C round it raised in 2021.
Paystack: Nigerian payments company Paystack, acquired by Stripe in 2020, has been steadily growing its geographical presence since then, but is now taking a step back. The company announced last month it had reduced its operations outside of Africa, cutting its workforce in Europe and Dubai.
Various sources and documentation were used in this article. Corresponding references are listed in the text of this article as links to connect to for further indications.
U.S. Finance Policy Facing High Tech Clouds October 3, 2022, For the U.S. Financial Regulators, the Limit is NOT the Sky of the Financial Space, It is the Crypto Cloud Platforms Next the European Central Bank will follow the Course #cloud #bank #cryptonews
Mercanteo was the initial name and I have suggested the name Ambient given the French consonance coming from Ambient et Ambiance, a place where you can feel a sense of beatitude and comfort. The Founders of this Startup had no clue about how to make this company the reflection and the expression of such metaphors.
The basic idea of the operation of this Startup was to have the purchase made by any business transferred to the Accounting Software and registered as a receipt with the amount of money spent. This will allow also not only to trace the expense but also to know through the receipt which credit card or method of payment was used.
I developed this research to be included in the existing website that had absolutely any study or pamphlet or even a kind of brochure presenting the product and its specifications or the value proposition that Mercanteo-Ambient was developing or offering as a service. The website had only a generic presentation of more dreams than realities and a summary of what McKinsey had taught to the Founders of this Startup given that the consulting firm was their first and last job before landing in this startup.
Build the first layers of prospective clients to be approached to enroll in the Mercanteo Program. So I launched a strategy of reassessment and reevaluation of the documentation and presentation of the Value Proposition and its Validation to enable Mercanteo-Ambient to have an identity based on the definition of the areas where the solution is proposed and what this solution is as a service and facilitation for further inventions and adaptation to the needs and demands of the clients and other companies offering synergistic operations that can complete our offering of services in the areas of reporting and documenting the Return on Investment and the allocation of Budgets of the operational expenses and to the financing of all purchases and acquisitions.
The Founders of Mercanteo-Ambient were more interested in attracting funds and investment than building the products and services or even the company. A table with a Chair facing the wall was the Technical Department: A guy who would show up only to upload what was made of this application by inserting in the potential client the Microsoft Excell.
The rest of the technical were the Untouchables from Calcutta were 4 to 5 individuals of Indian origin who were brought and under the supervision of the Vice President of Operations, a Lady of Indian origin, a former McKinsey employee, and Cofounder of an empty shell called Mercanteo-Ambient.
These 4-5 individuals were also under the spell of another Indian who was their Boss and who was hanging outside of the office smoking cigarette after cigarette going back and forth to the Fridge for drinks. They were all taciturn and they responded only to the Indian Lady, the Vice President. I tried to engage them about their work and the progress they made or just to explain their inputs and the value they are adding to the company with their daily fixing and staring at this wall as a curtain for the secretive reason of their presence and transparent action that is not explained to all of us, neither how they arrive every day to sit in front of this white wall.
They did not own cars or drive BMWs, so it must be the smoking Indian who Signed their presence and their absence, so he is the one who drives them to the office and takes them out of the office in his BMW, not the one parked outside as the symbol of elite belonging and success story in the making [See pic below].
They did not own cars or drive BMWs, so it must be the smoking Indian who Signed their presence and their absence, so he is the one who drives them to the office and takes them out of the office in his BMW, not the one parked outside as the symbol of elite belonging and success story in the making [See pic below].
If I dared to ask the Untouchables from Calcutta about the work they were doing, the content of their work, and their progress, all the Pack of Indian Techies panicked and all of them had a wide smiling face and answers while they desperately waited for the Vice-President or their Boss to come to their rescue. They had nothing to say or to communicate about. From that moment, the Indian Lady no longer said a word to me and had done the best job of her life to avoid eye contact with me.
Return on Investment by Beamer Boomer Boys
Bimmer in Empty Sunny Parking all Day Long – Sign of Success and Precious Horse in Chinese – “bao-ma”
The BMW Wheel of Fortune at the Silicon Valley
The BMW brand new car parked in the empty parking was the magnet for the first real funding of Mercanteo and Ambient which I learned later on. This BMW was like the “Idol made of Metal” to be adored for its blessing. The Sales Manager at the largest BMW Dealer in Silicon Valley who became part of Mercanteo’s Board of Directors and was responsible for stuffing the Fridge every afternoon Wednesday with beers and all kinds of beverages and premade food ready to be microwaved and swallowed. This Foody Man was also the one who persuaded and sold the idea of Mercanteo / Ambient bringing Lawrence Joseph Ellison of Oracle as an investor and member of the Board of Directors.
The hook was the BMW sale made to the Founder of Mercanteo / Ambient, the one sitting in the empty parking under the Sun of Redwood City, and the sale of BMW to Lawrence Joseph Ellison of Oracle of many other BMWs. Silicon Valley employees have their badges and allures as well as their reputations as successful StartupperS is the owning and the driving of BMW: The New Generation of BEMMEEERS.
It was not what you know but who you know – she or he who is driving a BMW.
The End of the Beemer Adventure
The 2 co-founders of the Company were an Indian Lady as Vice President and a Ukrainian as CEO who folded the Company when the number of employees became only himself and another Dreamer who made the big mistake of leaving Visa Card Corporation of San Mateo to come to crash at this moving sand startup.
The Vice-President got her tail behind her legs and rund before the moving of the BMW, she drove the Honda SUV to join Yahoo missed an offer by Microsoft for a deal of $44 billion, and ended up being rescued by Verizon for a sale of less than 4 billion dollars while Yahoo was accused of inflating the number of subscribers. After that magic fading, she is now a Vice President at Credit Evaluator and Provider after being rejected by Yahoo, the company she works in today is named Karma, What goes around comes around and back to the Future thanks to the Indian Connection in Silicon Valley
It is no more just being Beemer owner, it is more than that it is who you know from now on, Back to the Old Fashion Culture Future of American Corp.
The latest news on the Immigrant CEO from Ukraine who wanted to use BMW to be with the success makers became a Director of a Bank in Ukraine at the turn of 2000 and the BMW had magically disappeared from the Parking and the sight of the 101 exit of the Freeway.
My take on a high-tech startup in Silicon Valley: Dot Come, Dot Gone in Late Nineties
Said El Mansour Cherkaoui was Executive Director of Business Development at Amient/Mercateo Redwood City, California during the Dot Come – Dot Gone era. He witnessed how the money was spent left and right by the former McKinsey consultant who converted his ins and outs into a startup that never took off but received funding even from the founder of ‘Oracle.
A brand new BMW was parked in the parking lot while I had to drive the CEO of this Startup from his apartment to the office. This BMW was bought just to please the owner of the BMW dealership who in return organized a meeting with the Founder of Oracle who invested in the Mercateo. The name of Mercanteo Startup was changed to Ambient following my suggestion to have a softer French connotation.
Mercanteo’s product was supposed to remember all purchases made by online businesses at stores like “Computer USA”, Office Depot, and other outlets. Once the payment is made by credit card, the transaction is supposed to be recorded and transferred directly to the accounting system as an expense with details of the product purchased, date, place, and amount and who made the payment.
The person who was in charge of the corresponding software, a close friend and colleague of the CEO of McKinsey was of Indian origin and had brought 4 Indian individuals who passed the time staring at a monitor and the wall behind while a fifth Indian trotted along outdoors smoking cigarette after cigarette.
This lady of Indian origin (actually with good Karma dealings), whom I called COP – Chief Operating the Product, acted as the gate advocate for those Indian “engineers” to whom we could not speak or ask anything if she was not there. It is she who must give the authorization to fix a meeting. The excuse is that these engineers were hired and paid by the hour and the guys outside smoking cigarettes were their clock for the time they spent staring at their computer screen and the money that they cash in exchange.
This team of 5 taciturn Indians was like a parade of Madame Tussaud Wax Master of Disastertech showing off just to impress visitors and potential investors to show them that Mercanteo has employees conducting in-house research and development of the product, which in reality never existed apart from a modified version of Microsoft-like Excel Spreadsheets patched with an Oracle database, a hybrid product that “the COP” tended to present as “Ownership of Inputs versus Ownership of Outputs ” according to the McKinsyniene strategic approach.
On the technical level in terms of setting up and management, this time it was a single person, an “American “Toubab” by stock” and with a bohemian tendency on the edges, who has no desk or even a chair and had to be called to accompany me when I visited a potential client in their office. This Tech Support was a person who looked more like a mechanic who changed the spare part than a System Engineer or Network Engineer, so he did not provide a solution to the problem and worse the product was not at all ready to detect the problems or define the solutions.
On the other hand, the Fridge was always full of American food, Hotdog, Burger, Macaroni, Donuts, Soups, Chicken and Fish Nuggets, Corndog, Wings, Cheese, Pizza everything that is mechanically separated and prepared, a cold museum of stuffed with top-notch artificial and chemical products. The drinks were of the same quality especially the beers for weekends. It was the Fiesta, what was missing was a Country Band or a Mariachi Group to make the atmosphere more ambient than the new name of the Startup Ambient.
The other employees who could be counted on the fingertips were always in a pleasant mood and individuals capable of being helpful given their attitude and their presence which remained of real kindness. Young people aspired to make a difference around them and among them, but the rest were not at the level of this human quality that could also be identified in innocence and the desire to volunteer to do good. These people were part of my team and were chosen by a human relations class manager. One of the best I have had the opportunity to work with in all my professional history in the USA.
This lady, responsible for human relations management and therefore a talent recruiter, is a Caucasian American who was the reason for my arrival in this Startup from Sprint Corporation.
Ms. Black was the one who convinced me to join Mercanteo and had a knack for recruiting the best. When she was put aside during the recruitment of a Vice-President for Business Development, Mercanteo became Ambient began to show the cracks I mentioned above which became more gaping with this crash landing of a Caucasian rogue from the North who drove an old Buick, wrapped in a buttonless suit and spoke like a former clandestine site manager of tree cutters in the Amazon. I understood what he was made of when I invited him for lunch in a restaurant to assess his knowledge of the field of application of the product we were looking to develop. All he brought up with me was what he had done before and laid out names and companies that I had no reason to know about.
I felt like I was sitting opposite a veteran of wars lost in memory and thought and worse first on battlefields that we would be more likely to listen to and see on the Screen of ‘Money only on the actual geographical or historical ground. These places and these encounters were shooting from all sides as if a deposit of fireworks had been lit by accident, there was around this guy an opaque smoke from his cigarettes whose tirades on the cigarette made his lips shine with all fire soaked in beer foam. I had the impression of being in front of a dancer in a trance incensed by the smoke of joints and incense exotic and distant in time as in space.
This future Vice-President drank and smoked excessively with his belly protruding from his belt and his unbuttoned vest making him like Santa Claus dressed on the sly for an interview at a Startup delivering gifts without address or recipient, he was in the vaps and I, who had never tasted a beer in my entire life, could talk about European beers and my stay in France and Germany and my visits to all of Western Europe and Romania when he did not even know not the origin of the beer that was right in front of him. To my great surprise, he thought it was German when it was founded by a Czech family that has a Germanic-sounding name.
At that time, this Bud for You, an unusual slogan that was the pride of Americans, and when he realized that I could give him such knowledge of his own choice of drink that he considered a symbol of American nationalism, that at deep inside, listening to a guy supposed to be from the Middle East. For him, Morocco was synonymous with Monaco and Casino, another Las Vegas somewhere lost in Western Europe that Sean Connery and Grace Kelly, who became the Princess of this Principality, had put on the radar of geographical knowledge for the Middle American.
In addition to my identified ethnic stereotype in Terro-Palestinians, I was conversing with an American Englishman with a cross-hatched accent but eloquent in definition, expression, and substance as I unwittingly conveyed to him a profound knowledge of the intricacies of popular culture and history. American that even he did not have given his intellectual and educational limitations.
So I was before him magnified but all of this made him as suspicious and wary of me as his booze could only make the length and breadth of my knowledge of Made in USA populism and Only in America.
How come I knew all those beers and wines and I didn’t share a drink with him at the time?
Such a question ran through his brain polluted by alcohol and the smoke of exotic vapors and he was neither the first nor the last to ask it. A question that cost me several positions, several jobs, and several opportunities in business, private jobs, and positions in the Academy in the United States.
You didn’t have to go far either in the conversation or in the exchange to realize that my account was settled in this interaction at the level of ignorance that only the smoke from his cigarettes could hide from the gaze and not from human understanding. For that, I remained calm and I knew that my situation did not last long in this company whose CEO hired such an individual and forced him to parachute between us without taking into account the opinion of the first interested person who is the manager of human relations, nor of myself since I was second in the business development department. It was as if all the transactions concerning the hiring of this individual had been carried out under the table while serving us artificial alibis and complicit silences without any other transparent approach, “the fact. , “le fait accompli – the accomplished fact”: Take or Leave it.
All the team members of my department understood such manipulations and began to disappear one after another from the panorama, including the mechanic guy. Only the Indian “engineers” were still there looking at the wall and the screen of their computers, while the visit to their meter became more spaced out and only took place when this new Vice-President went out to bang a cigarette butt with another guy who was his buddy and he moved out and brought in his luggage.
More Twitter execs quit Share LinkedIn News Updated 58 minutes ago More Twitter executives headed for the exits as new CEO Elon Musk warned … Continue reading
This buddy walked like a gorilla, a former adventurer without adventure, and served as a bodyguard for this New Vice-President. I never understood what was the contribution or the role of this individual whose only approach made it clear that he is a go-getter with his head down like a bull in this new bullfight that this arena has suddenly become Mercanteo – Ambient where the swords are now hidden under muleta camouflaged under the cheap suits and the jackets of these new invaders which exceeded their shoulders with crumpled pants like scrap paper. European elegance had yet to conquer or be embraced by these new dot.com startup cowboys.
The cool allowed all deviations in dress and justified the lack of quality both in terms of the look and the food offered, there was neither Haute Couture, nor Haute Culture, Nor Haute Cuisine while High Technology remained in the margins of Buzz-Words and Jargon and nothing on the table of creation or innovation at the level of these Startups which were still far from even Alpha level.
Sharing research findings on ROI, IT, and CRM
RETURN ON INVESTMENT, INFORMATION TECHNOLOGY AND CUSTOMER RELATIONSHIP
Sharing research findings on ROI, IT, and CRM
This research and publication were part of my initiative to enhance the image of my position and responsibilities as well as the work I was conducting as Executive Director for Business Development at Mercanteo and Ambient before its acquisition by Oracle. Our startup focused on duplicating the ledger with the purchase receipts as the lead to trace the payment method and to transfer it to the Accounting software used as an expense. That is what the CEO has told us given that Ellison was a member of the Mercanteo Board of Directors and one of the investors and all this was driven thanks to that BMW sitting in the parking as a trophy of success for a Startup on the edge of the waterfront of Redwood City. Larry Ellison was known for surrounding himself with trophies figuratively and properly, and it was not astonishing that from playing tennis, he became one of the top sailors around the world bringing even the America Cup to the Bay Area.
In 1997-1999, just before the initial burst of the first bubble with Dot/\com-Dot/\Gone, as Executive Director of Business Development at Mercanteo – Ambient, Innovator and Pioneer of NetSuite (acquired by Oracle) and as an Adjunct Associate Professor at the School of Technology at Golden Gate University in San Francisco – California, I conducted multiple research ranging from technology, business management, and international development [European Economic Community, NAFTA, Technology in China and the United States] and this within the schools and departments of this University. Among these research publications, I made this pioneering thematic presentation.
Dr. Miro Costa, as Department Head and Associate Dean of the School of Technology at Golden Gate University, San Francisco, has also encouraged this research given his direct interest and theme of his own on technologies of information.
My study has been reprinted by many publishers given the soundness of my analysis which since then has been confirmed by the development of IT and the implementation of an ROI-based CRM, here is a copy of – an excerpt from my research:
Return on Investment, Information Technology, and Customer Relationship Management
By contrast, entrepreneurship is developing a new venture outside an existing organization. The traditional entrepreneur shall now act as an innovation hunter to proactively be able to set up new smart businesses; ideally from the beginning, till the end of any business life cycle. The term entrepreneur, etymologically originates from the French word entreprendre meaning “to begin something, undertake.” During medieval times, this word was used to describe an active working person.
In economic theory, it was Richard Cantillon (1759), – an Irish economist of French descent – first, who first used the term entrepreneur. According to Cantillon, the entrepreneur is a specialist in taking risks.
Risk-taking is one of the famous attributes of entrepreneurs which is also frequently emphasized in the literature. Spiritually, some people are observed to tend to behave extra-ordinarily. As Jobs addresses; “You have to trust in something—your gut, destiny, life, karma, whatever—because believing that the dots will connect down the road will give you the confidence to follow your heart, even when it leads you off the well-known path, and that will make all the difference.” Taking the risk phenomenon and the spiritual reflections into consideration; it can easily be summed up that entrepreneurship has something to do with inner-journey.
Another emphasis on entrepreneurship is its presentation as a mindset. “Entrepreneurship is first and foremost a mindset. To seize an entrepreneurial opportunity, one needs to have a taste for independence and self-realization,” said Olli Rehn, a member of the European Commission. Understanding the entrepreneurial mindset requires a certain threshold of empathy. First of all, entrepreneurship is the story of ambiguity. An anonymous supporting quote is likely to highlight the gist of entrepreneurship. It’s as follows: “Anyone, (can be an entrepreneur) who wants to experience the deep, dark canyons of uncertainty and ambiguity; and who wants to walk the breathtaking highlands of success. But I caution, do not plan to walk the latter, until you have experienced the former.” In this regard, as Schumpeter also points out; entrepreneurs seem to have some heroic vision. Schumpeter focused on high-level entrepreneurship and larger businesses. On the other hand, Marshall examined smaller businesses, partially. It was Hayek and Kirzner, who examined the entrepreneurs as middlemen hoping to profit by buying cheap and selling expensive.
When it comes to defining entrepreneurship; it can easily be discovered that various people have defined entrepreneurship differently. Despite this fact, the most common classification follows the mainstream of Collins and Moore; who claimed two types of entrepreneurship, differentiating due to the context of entrepreneurial activities undertaken. These are, firstly, independent entrepreneurship and independent entrepreneurs (similar to entrepreneurship/traditional entrepreneurship and entrepreneurs/traditional entrepreneurs in this paper), implying the process whereby an individual or a group of individuals, acting independently of any association with an existing organization, create a new organization
Stopford and Baden-Fuller considered entrepreneurs as opportunists even in chaotic situations, and they also metaphorically approached entrepreneurship. According to them, entrepreneurs are like Olympic athletes, long-distance runners, symphony orchestra conductors, and top-gun pilots…These metaphors underline the entrepreneurs’ being ambitious, determined, self-challenging, and talent for synchronizing [12]. [Source: Mehmet Çağrı Gündoğdu / Procedia – Social and Behavioral Sciences 41 ( 2012 ) 296 – 303].
San Francisco the Hub of Innovation and Leadership
The First Muslim Moroccan Entrepreneur-Investor in the History of Morocco Starting Transportation Operations Toutes Directions
First Moroccan Muslim Contractor of Public Transport in Early 1920 – Twenties of 20th Century: Moulay Ahmed Cherkaoui at 24 was the First Muslim Transporter in Morocco By Dr. Said El Mansour Cherkaoui Son of Moulay Ahmed Cherkaoui Father of Moulay Ahmed Cherkaoui Said El Mansour Cherkaoui PARENTAL HERITAGE OF MOROCCAN NATIONALISM This is Haj Ahmed Cherkaoui All … Continue reading
🌎 Analyst World Affairs ★ Author ★ Elaboration of Predictive Studies ★ Keynote Speaker ★ Entrepreneurial Planning ★ Business Development ★ United States ★ Europe ★ France ★ Morocco ★ China ★ Sub-Saharan Africa 🌍 Project Development Specialist ★ Entrepreneurship ★ International Trade and Business ★ Faculty ★ 🌍 France and USA: Research and Academia, Letters … Continue reading
There are various types of entrepreneurs. We will see some of it.
Industrial Entrepreneurs: They are in the business of manufacturing products. E.g. Manufacturing of automobile parts.
Trading Entrepreneurs: They are in the business of buying & selling products or services. E.g. Traders of Houses.
Imitative Entrepreneurs: These types of businesses copy other successful businesses & run the business similarly.
Drone Entrepreneurs: These types of entrepreneurs don’t like to change their business style. They don’t involve innovation. They just want to be like how they are.
Fabian Entrepreneurs: They don’t change until it is very much needed. They adopt change when it is very necessary.
What are the various functions of Entrepreneurs?
The main function of an Entrepreneur is to take risks.
The second function is to start the enterprise.
The third function is to keep an eye on the internal & external environment.
The fourth function is to make arrangements for necessary resources.
The fifth function is to deliver products/services to customers.
Innovation
Innovation is one of the key requirements for entrepreneurship.
Innovation is nothing but new ways of doing old tasks.
Innovations can be Chemical, mechanical, managerial, technical, institutional, service, etc.
According to Joseph Schumpeter, there are five types of innovations.
Introduction of new & good quality product.
Introduction of a new method of production.
Introduction of a new market.
Use of some new sources of supply as raw material.
They are making a new organizational form of industry.
The innovation process in Entrepreneurship includes the following steps.
Research of market
Development of product/service
Marketing of product/service
Production
Use by customer
Feedback from the customer.
Innovation has emerged as a headline in the field of business management, recently. Kuratko determines the magic words to describe the innovative way of our time: Dream, create, explore, invent, pioneer, and imagine [34]. Innovation itself is changing. The etymological roots of innovation stretch to the Latin word innovare, meaning to do something new. Most of the innovation definitions have focused on similar points with different perspectives. The key common points imply change and renewal for a better situation. The Organization for Economic Cooperation and Development (OECD), inside the Oslo Manual—the source of information regarding international technological developments— defines innovation by linking it to technological change.
According to the OECD, innovation means “completing products and services by developing them technologically. The European Union (EU) has made a broader definition. To the EU, innovation introduces the change in workforce talent, working conditions, and managerial and organizational jobs. Also, it’s about renewal and growth in product and service range. In addition to this, a well-known expression about innovation; characterizes it as the process of converting new ideas into value-creating outputs such as new products, methods, or services. With the help of innovation; companies acquire the ability to develop and apply not only new products, processes, or designs but also new operations and business models.
After having experienced enormous financial crises all over the world in recent years; company survival has emerged as the most crucial issue both for SMEs and even some large companies. SMEs, as the increasing value of the new economy, are obligatorily undertaking the mission of being innovative. It’s innovative SMEs that will lead the way to economic recovery.
This is what sets innovation-led companies apart: they have been successful in establishing organizational cultures where initiative is rewarded and failures are encouraged. They have structures, processes, and senior leadership that are supportive of innovation, and they have built an ecosystem of partners that enables these organizations to constantly bring in new ideas into their organizations.
MMP: Can any organization be innovation-led, or is it more relevant for some rather than others? Are there simple changes that can be implemented in the short term? And what about the long term?
NN: With accelerating innovation change, every organization needs to aim to become innovation-led. We all have been reading about significant changes caused by new technologies such as AI, VR (virtual reality), blockchain, and big data. These technologies will impact every type of organization. However, some researchers have argued that in highly turbulent and uncertain markets, it could be beneficial for companies to scale back on innovating until they can better understand the future directions of these markets.
In the short term, many established organizations have chosen to set up separate innovation labs. These are usually set apart from the rest of the organization so they can operate uninhibitedly. However, such labs often don’t work, as this recent commentary demonstrates.
In the long term, companies need to pursue a double strategy: developing an internal innovation capability and partnering externally – including cooperating with and even acquiring, innovative companies/start-ups. This is a strategy many leading tech companies are pursuing.
MMP: Do you have any guidance regarding the challenges creative companies face when developing innovation strategies? What can they take from tech companies and vice versa?
NN: Research on creative companies has shown that many creative companies while being quite innovative, are less business-savvy concerning turning new ideas into profitable business models. This is something that has plagued the creative industries sector for quite some time – individual creativity often drives the success of the organization, but they struggle to create a sustainable business model to scale up this creativity.
Creative companies could learn from tech companies to put more focus on the scalability of their creative ideas and how to develop financially sustainable business models. On the other hand, tech companies can learn from creative companies how to ensure that their employees remain creative and innovative, even if they are part of larger organizations with bureaucracy and managerial practices that often stifle innovation. In many ways, the stories we hear from organizations like Alphabet/Google and Apple, about the playful environments they have created for their employees and the flat hierarchies they have established, are in line with how smaller creative companies operate. Yet, Amazon, for example, has been under the spotlight, because of the stifling practices and toxic culture its employees have experienced.
The question of how to keep the creative/innovative mindset as organizations grow is critical to ensure that large organizations, whether tech or not, can continue to be innovative.
Source of the interview on Innovation: Dr Natalia Nikolova is a Senior Lecturer, at UTS Business School and Faculty of Transdisciplinary Innovation. Professor Margaret Maile Petty is UTS Executive Director of innovation and Entrepreneurship.
