21 of the whole 54 African countries are officially French-speaking countries. Africa makes up more than 70% of the world’s total French-speaking population. But how buoyant the startup ecosystem there remains a question. Only about three French-speaking African countries — Rwanda, Senegal, Cote d’Ivoire— have been at the forefront of all investment into the African startup ecosystem in the past two years.
The question is now: why are French-speaking African countries still backward in terms of startup funding?
Here are some of the reasons:
Startups In French-Speaking Countries Are Under-Funded Because of Language Barrier
While startup owners are not to blame for the language they speak, it appears however that language is actually a major barrier for most startups in the French-speaking countries. A look at the investment preference of investors and their countries of origin show a majority of investors coming from English-speaking countries, or having the major funds coming from English-speaking countries.
The table below represents the top investment in African startups for the years 2017 and 2018. Consequently, potential francophone entrepreneurs are turned off by lack of funding than their anglophone cousins, as the major financiers in tech are English-speaking investors.
This lack of funding has therefore led to the dearth of developers and designers in francophone Africa. Most resources for startups in Africa(e.g. regional incubators and accelerators, labs, conferences) are mostly in the English-speaking countries.
The Ease of Doing Business In Most French-Speaking African Countries Is Still Poor
The economies of English-speaking African countries are growing faster and tend to have better World Bank Doing Business indicators than their francophone equivalents. Top ten African countries in the latest ease of doing business report include Mauritius, Rwanda, Morocco, Kenya, Tunisia, South Africa, Botswana, Zambia, Seychelles, Djibouti. Data show that from the whole ranking in 2019, French-speaking countries were not doing well in terms of ease of doing business.
However, some governments in the speaking countries appear to have already considered this. For instance, the Ivorian government has developed a Schéma Directeur National to support the TIC, the telecoms regulatory, to simplify the creation of tech companies (Horizon 2020). In Senegal, a startup fund of $50 million, the DER, aims to catalyze entrepreneurship all around the country.
To boost internet connection to enable startups to thrive, the government of Niger Republic awarded the country’s first 4G license to Airtel Niger in May 2018.
Also, Côte d’Ivoire’s tech scene is hot on the heels of Senegal’s. The country’s first tech hub, Akendewa, was launched in 2009 and stayed active throughout the 2010–2011 crisis. The country also has generated promising startups that respond to specific problems faced by Ivoirians, such as Qelasy (an educational tablet for children) and TaxiTracker (a geolocation app to address security concerns with taxis).
“It is the hubs’ job to make sure that the different members of the ecosystem can interact, in order to provide more experience, feedback and networks to the startups. But they are not supported or strong enough at the moment to carry out their mission fully and efficiently. Hubs do need more support,” said Impact Dakar co-founder Aziz Sy.
Some francophone nations are now leading the way when it comes to startup-friendly policies, with Tunisia, Senegal, and Mali among those to have passed or been on the verge of passing dedicated “Startup Acts”. The Senegalese government is now also making direct investments in local tech startups.
Relatively Small Market
Another point investors may be taking into consideration may be the size of the market in the French-speaking countries.
“Investors tend to view most Francophone African markets as too small. In 2016, even after a deep recession, the Nigerian economy was worth US$405 billion. That same year, the ECOWAS markets excluding Ghana and Nigeria, and therefore primarily Francophone countries, only amounted to US$120 billion dollars, less than 30 per cent of the size of the Nigerian economy,” Fayelle Ouane is co-founder and managing director of Mali-based startup support organisation Suguba, which is running the Francophone-focused L’Afrique Excelle programme on behalf of the World Bank, noted.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.