Everywhere you look, the Moses Mabhida Stadium radiates yellow and green. From the bleachers to the field, thousands of people came to the city of Durban to listen to the stadium’s gargantuan loudspeakers. With May legislative elections in South Africa looming on the horizon, the African National Congress (ANC) met on 12 January 2019 to prepare for the battle to come. “Let’s grow South Africa together,” president Cyril Ramaphosa declared to a packed crowd.
Launching the ANC in the run-up to the elections, the president announced the party’s intention to use innovation to inject life into the country and to “promote economic and social development on the African continent with innovative and successful startups.”
“I believe the greater attention to technological innovations in the country is a very good sign,” says Natalie Miller, CEO of GreenFingers Mobile, a South African agricultural startup. “Obviously the elections are on their way, but I think the challenges facing South Africa are evident and we can no longer ignore the role technology can play.”
It’s been going well so far. Reports coming out of the continent have sung the praises of its startups, South Africa included. In fact, some are convinced that technological innovation is going to transform South Africa, starting with its agriculture.
In Cape Town, the GreenFingers Mobile team is finding it hard to contain its excitement. It must be patient, though; Google.org won’t reveal its highly anticipated results until next spring. The agro-startup was one of 12 finalists in the Google Impact Challenge, a tournament that the American company launched for NGOs, social enterprises and research institutions worldwide. Like the other entrants, GreenFingers has its eyes – if not its fingers – on the prize: $25 million and the support of Google’s AI experts.
GreenFingers Mobile’s platform is, in the words of Miller, a “management space for connecting farmers.” This Software as a Service (SaaS) wants to help small and new farmers growing crops like chili, soy, corn and sorghum access the market.
“A lot of small farmers don’t have the necessary connections to do business with big buyers,” Miller says in a phone interview from her office in downtown Cape Town. Thanks to the work of field analysts, GreenFingers Mobile has created a virtual profile for each farmer, chocked with information on transactions completed and training courses followed.
Formed in 2013, it wasn’t until 2015 that GreenFingers really hit the scene after two years of field testing and analysis. The platform now has more than 8,700 farmers, has processed more than 60,000 commercial transactions and has registered more than 12,500 agricultural training courses. With or without the aid of Google.org, GreenFingers Mobile wants to go further. “Our priority this year is implementing online payments and providing microfinance to farmers through the system,” Miller says, all while remaining proud of what the company has already done.
The agri-tech sector in South Africa and on the rest of the African continent has been expanding rapidly since 2016. According to the report “Exploring the African Agri-Tech Startup Ecosystem Report 2018,” published in May 2018 by the specialized platform Disrupt Africa, the number of African startups using technology to improve agriculture has increased 110% in two years. In January 2018, Disrupt Africa counted no fewer than 82 functioning startups trying to take on the many challenges in African agriculture, including the coming demographic boom (the United Nations predicts that the African population, 1.3 billion people today, could double by 2050), lack of access to the market, drought, weak productivity and geographic isolation.
Faced with these problems of scale, agro-startups are pushing for new technologies. It’s common for them to focus on young farmers. “I don’t come from farmers myself,” Miller recognizes, adding that even though we may no longer be ignorant of Africa’s diversity, it’s still hard to put a face to all the statistics. “We don’t have much data on agri-tech in South Africa, so it’s hard to establish a percentage and to not generalize. Still, a lot of agri-tech startup founders in this country and on the rest of the continent witnessed the difficulties facing their parents every day, and now they’re trying to find solutions to those problems.”
She cites Wolfgang von Loeper, creator of the MySmartFarm app “for farmers tired of collecting and interpreting information coming from several sources” in order to maintain their lands’ health. The farmer became a tech entrepreneur in order to create an easy-to-use application for his colleagues to manage their businesses. “He brought together all his experience to create this app, focusing mostly on his own needs,” Miller says.
The Holy Trinity of African agri-tech is composed of Nigeria, Kenya and Ghana, who together represent 60% of African agri-tech startups. “Outside of the fact that it gets more media attention than other places, I think startups are going there because that’s where investment and opportunities are,” Miller adds. South Africa isn’t far behind, however, as shown by the international conference Agritech Africa, which will take place there in June 2020.
In a report exploring the digital landscape on the African Continent, titled “The Future of Work 2018,” Disrupt Africa revealed that tech startups of all kinds have been on the rise since 2015 across the entire continent, with South Africa and Nigeria at the helm. In time, this abundance began to concentrate in various nerve centers, including Cape Town.
Afritech and townships
Dedicated to Cape Town startups, the space known as “Cartel House” is already becoming the startup hub of the South African capital. In recent years, Cape Town has been considered the dream location to launch a startup. “Cape Town attracts people from around the world. The city is growing quickly, as is its network, and that attracts investors,” Miller says. So it was in a former foundry that Zachariah George and Philip Kiracofe installed their baby, Startupbootcamp AfriTech.
After working for 10 years as a Wall Street investment banker, Zachariah George fell in love with South Africa at the 2010 Men’s World Cup. “What impressed me most back then was the strong tech ecosystem that had developed in Cape Town. It reminded me of San Francisco,” the Startupbootcamp AfriTech cofounder says. “There’s a reason people call it the ‘African Silicon Valley.’ There was also an abundance of capital, good universities, and a very encouraging government.”
Founded in Copenhagen in 2010, Startupbootcamp is a global startup incubator, providing entrepreneurs with initial investments along with professional mentorship. Described by Forbes as “the biggest startup incubator in Europe,” it offers three-month programs in Amsterdam, Copenhagen, Berlin, Istanbul, Eindhoven, London, Barcelona, Singapore, Miami, New York and Cape Town. Launched just two years ago, the Cape Town branch is now considered one of Africa’s most important incubators.
At the first bootcamp, in 2017, nearly 500 startups applied to be one of the lucky few. A year later, there were 1,000 startups sending in applications from all over the world. Registration for the third edition opens on 20 February. “We’re focusing on startups going into financial services, retail and insurance,” George says. Startupbootcamp AfriTech’s startups run into similar problems in those industries as GreenFingers Mobile’s farmers do. “In South Africa, the biggest issues, just like with the agri-tech sector, are struggling to reach consumers, getting into the market, marketing their platform, etc.” George says.
The Startupbootcamp AfriTech team is choosing 10 winners among its participants, offering them full support with the help of entrepreneurs, investors and Startupbootcamp AfriTech partners, including BNP Paribas. The end goal is to get these startups to a point where they’re able to make commercial deals with companies, “because raising money is important, but if it’s possible to do business, that’s even better and a more accurate indicator of success,” George explains, highlighting Cape Town’s hectic activity and the ongoing community effort to encourage social and economic development in the country.
Common action and success story
For some South African challenges, tech is a powerful lever for change. The World Bank estimates that more than half the South African population of 53 million people live in townships, neighborhoods on the edges of cities that cropped up in the 19th century. On top of that, according to the International Labour Organization (ILO), the unemployment rate for 15-34-year-olds reached 38.2% in the first trimester of 2018. A number of startups are based in townships, but their work is regularly ignored and their accomplishments skirted over. That’s where groups like RLabs come into play, seeking to give credit to the forgotten initiatives of the townships.
Since its creation in 2008, RLabs has incubated more than 50 startups in Cape Town’s suburbs. For startups that are active in townships, RLabs offers commercial support, as with Loyiso Mbete, who came from “a poor family,” becoming a beekeeper with three employees to “make ends meet.” RLabs believes that these businesses that are active in the townships create jobs and contribute to the national economy. They choose to focus on local businesses because “their knowledge of local needs gives them an advantage over other South African companies,” says Craig Dumont of RLabs’ management team.
The recent statements by the South African president in Durban and the subsidies that allow RLabs to function follow the famous National Development Plan. Launched on 19 February 2013 by Trevor Manuel – then Minister in the Presidency in charge of planning –, it establishes a strategy for putting an end to poverty and inequalities in South Africa by 2030. According to the plan, these goals could be achieved by mobilizing the entire population, all industries united, identifying everyone’s needs in order to find solutions. For their part, George and Miller have already bet on innovation to steadily improve productivity, food security and job creation.
“Honestly, technological innovations started revolutionizing South Africa three years ago. The difference with Silicon Valley, for example, is that these come to us out of necessity, not from a hobby you can live without,” George says. “I think what these startups need right now is for the success stories to be told, in order to encourage others.” Successes, for example, like those of GreenFingers Mobile.