How replicating success can perpetuate failure

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Tinashe Mukogo and Musekiwa Samuriwo
In our pursuit for greatness and success, it is natural to look to those who have blazed the trail. In the case of many tech entrepreneurs in Zimbabwe, we look to the well-known successful companies from Silicon Valley for inspiration and often desire to replicate those businesses locally. In many respects, this can be like building castles in the air.
This is because there are significant differences between building a tech company in Silicon Valley and building one in Zimbabwe.
Though Silicon Valley companies should be admired, they can also be castles in the clouds for entrepreneurs.
Furthermore, they can be a misleading point of reference for a Zimbabwean Tech entrepreneur to start from for various reasons such as funding, information ecosystems, value and relational networks, access to talent and many more.
Unfortunately, Silicon Valley is often the first and main reference point when thinking about tech innovation.
Even when Supa Mandiwanzira, the Minister responsible for the Tech Sector in Zimbabwe, announced the formation of an Innovation Fund, he highlighted that the goal of the fund was to empower young Zimbabweans “develop software and programmes that counter those that are coming from Silicon Valley”.
To be clear, we have no doubt in the abilities of the Zimbabwean Tech Entrepreneur. We would even say the Zimbabwean techie is more daring and innovative in some regards. We do believe that building a successful tech start-up in Africa is Goliath sized task if you want to kill Goliath with a slingshot, you need to have very good aim.
Over the next few posts we will explore these differences and also look at how best the Zimbabwean Tech Entrepreneur can adapt in order to be successful.
Whilst the majority of the information in these posts may relate specifically to Zimbabwe, the lessons are applicable to tech entrepreneurs in many African countries and indeed many developing economies.
The Funding
The majority of successful companies birthed out of Silicon Valley took a number of years to become profitable. Even a giant like Uber, founded 8 years ago, is still making losses, to be specific $3 billion worth.
Whilst Uber maybe an extreme example of burning through cash. Pretty much all of the well know start-ups birthed in the Silicon Valley were able to raise funds and trade for a number of years before generating income.
This is possible because when it comes to raising funds for tech companies, Silicon Valley is king.
In 2016 alone, companies in Silicon Valley raised $24,9 billion for various ventures and about a quarter of the total global funding.
In comparison, in 2016 the whole of Zimbabwe attracted a total of only $295 million of Foreign Direct Investment for all sectors.
In 2016 alone, companies in Silicon Valley raised $24,9 billion for various ventures and about a quarter of the total global funding.
In comparison, in 2016 the whole of Zimbabwe at Valley raised $24,9 billion for various ventures and about a quarter of the total global funding.
In comparison, in 2016 the whole of Zimbabwe attracted a total of only $295 million of Foreign Direct Investment for all sectors
Even if we took every cent of the entire National Budget of Zimbabwe and invested solely in tech start-ups and nothing else for a year, the funds raised would still be more than five times less than the funds raised in Silicon Valley.
Another funding stream that often helps boost start-ups is funding from friends and families which can often range from between $25 000-$125 000.
For example, Mark Zuckerberg’s father helped him with a $85 000 capital injection to keep Facebook going in its early days.
For the average young Zimbabwean tech entrepreneur, getting those funds from a bank is hard enough, let alone from family and friends.
What does this all mean? It doesn’t mean that one should give up or get discouraged. NEVER! I think it does mean you need to count the cost before venturing into certain ideas particularly those that start off with prompts like “The Facebook of . . .” or the “Uber of . . .” If your start-up is attempting to replicate or compete with something out of Silicon Valley then you may need to raise quite a lot of money.
For example a minimum viable product for an app like twitter is estimated to cost between $50 000-$250 000 to build whilst Facebook checks in at $500 000 and since tech companies are borderless, your target users will compare your product to these companies.
Another approach and we believe is the “more excellent way” is not to use Silicon Valley as your main reference point. Work from your current environment to develop a tech product that is unique for your local context and may not even have all the “Facebook” functionality.
For example the popular website nairaland.com from Nigeria became popular because it fulfilled a local need.
When explaining the website its founder, Sean Osewa, said “Despite, its narrow focus it was the only community that gave a voice to Nigerians at home” The website did not cost much to build.
In fact, it would seem that initially the only “fund raising” he did was $15 per month for VPN services. So often times, if you have a good idea that has a clear value proposition but one that can be difficult to explain with an analogy from Silicon Valley, then you may be onto something.
It is a challenge to uncover these ideas that work within Zimbabwe and unfortunately, there is seldom sufficient access to the capital required to develop the idea.
This means Zimbabwean tech-entrepreneurs must engage in bare bone or skeletal innovation by creating a functional and commercially viable product with little or no money that solves a customer’s localised problem and creates value.
As Thoreau says: “Now put the foundations under them.” Though it is clear that the foundations between Silicon Valley and Zimbabwe are significantly different they are foundations nonetheless.
However, funding is just one thing to consider. You also have to work around another significant difference, the information ecosystem.

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