Focus on Africa, says tech investor

2014-04-22 09:20
Tech incubator 88mph has a developing market focus. (Duncan Alfreds, News24)

Tech incubator 88mph has a developing market focus. (Duncan Alfreds, News24)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

Cape Town - Emerging markets are where investors should focus their energies to secure a place in the next wave of growth in technology companies, an industry insider insists.

"Ten years ago, I couldn't say 'I was global' if I wasn't in Europe and the US, but that's changing - and has changed now," Kresten Buch, managing director of 88mph told News24.

The incubator has a South African office in Cape Town and funds technology start-ups with up to $100 000 and up  in exchange for an equity stake of at least 10%.

In the 2013 round of start-ups, one has hit the jackpot in terms of returning investment.

Apex Peak raised $2.4m after seed funding from the incubator. The start-up has moved to Singapore to secure a second round of funding.

Revenue

Apex Peak facilitates short term capital for businesses through trading a firm's outstanding invoices to investors.

Buch said that despite the attention from big firms on the US and Europe, developing markets like Africa, Latin America and Asia has a bigger market share in terms of the number of people accessing the internet.


Tech start-ups work on their projects at the 88mph incubator. (Duncan Alfreds, News24)

China alone has an internet population of 500 million people, more than double that of the US and in Africa, Nigeria leads with over 50 million internet users.

"Emerging markets - that includes India, Africa, Indonesia – that’s a massive market. So if you look at the emerging markets, it’s very big and it doesn't have the same competition as if you would have if you want to go to the US and Europe," said Buch.

88mph, though, is no charity and start-ups are selected based on the usefulness of an application, potential profitability as well as its ability to scale to an audience.

The incubator selected seven start-ups in SA for 2014, including several that focus their applications on business to business revenue, in a diverse group.

Mark Raa founded diarize.me which helps service orientated businesses manage appointments and Courtney Farquharson founded Pet Heaven which aims to provide deliveries of pet food and accessories.

Focus

"Emerging markets are much bigger in terms of connections than the US and Europe. It depends on what you define as global. I think it's a fail just looking at the US," said Buch.

He said that products should be focused on developing markets because competing with Silicon Valley was extremely difficult from SA, Nigeria or even China.

"Even if you have a product that is say, developed market, I would still look at Asia rather than the US because it's very hard to compete with US start-ups from here."

He said that the established networks and capital was far more organised in the US than in SA.

"You can raise a hundred times more money; the investors getting in will have ten times better networks in the US than you can get here."


- Follow Duncan on Twitter
- News24
Read more on:    mobile  |  mobile apps
NEXT ON NEWS24X
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/News
 

Five wrapping hacks you have to know before Christmas

Five gift wrapping hacks that will save Christmas for you!

 
 

I love summer.24

Sexiest Instagrams of 2014
Joburg hot spots for cocktails, craft beer, tapas and wine!
Summer Survey!
Great ideas for the best summer sandwiches!

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Kalahari.com - shop online today

Grand Theft Auto 5

Now available on PS4, Xbox One and PC from R649. Buy now!

Festive gifts!

Check out our awesome range of festive gifts to make everyone’s wishes come true. Shop now!

Save on Samsung

Cameras, mobile phones, TVs, Tablets and more. While stocks last. Shop now!

Save up to R2200 on electronics! – As seen in the catalogue

Wishing for tech gadgets this festive? Save up to R2100 on hot tech products at kalahari.com. While stocks last. Shop now!

30% off the bestselling books

Save big on the most captivating reads of 2014. While stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

It is hard to keep some sort of balance when the natural rhythm has flown out the window. The best thing to do is try not to keep...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.