Left to Right: Thomas Gajan, Chief Innovation Officer at CFAO, Sendy CEO Meshack Alloys, Teliman CTO Abdoulaye Maiga, and Teliman CEO Etienne Audeoud
Like many African cities, Bamako’s population of 2.3 million is growing rapidly by roughly 5% a year. As people increasingly flock to the city, its road network is coming under increased pressure, especially when it comes to public transportation.
Traditional taxis are too expensive for the average commuter and the alternative option, SOTRAMA or public vans, are uncomfortable and slow, overflowing with people on Bamako’s roads.
Photo: Arne Hoel
Description: Fish market and vegetable market, Nouakchott. The daily catch is brought here by the fishermen’s wives and family members to sell the fish.
As the World Bank Group’s flagship publication, Doing Business, celebrates its 15th edition, Mauritania continues to thrive as a major reformer in investment climate policy. The country was highlighted in the Doing Business 2016 report among the top 10 reformers worldwide and the current 2018 report shows that Mauritania outperforms the regional average.
Following a downward trend between 2010 and 2014, Mauritania has been steadily improving its ease of doing business performance. Figure 1 shows how, in just three year, a series of reforms that began in earnest during 2015, were key to help the country jump a remarkable 26 places from 176th in 2015 to 150th this year in 2018.
"In Chad, young people increasingly turn to innovative entrepreneurship but often become demoralized when confronted with the common issue of lack of early-stage financing.” This is how Parfait Djimnade, co-founder of Agro Business Tchad, a leading e-commerce agribusiness and social enterprise in Chad, described the challenge many aspiring entrepreneurs face in securing the necessary capital to fund and grow their start-ups, specifically in the Sahel and West Africa.
The frustration Parfait highlights is common across the Africa region, where more than 40 percent of entrepreneurs cite access to finance as the major factor limiting their growth, according to World Bank Enterprise Surveys. West African start-ups and innovative young SMEs are indeed facing the classic ‘valley of death’ — the space between where the entrepreneur’s own resources from family and friends (“love money”) gets depleted and when the company is financially viable enough to attract later-stage investment and financing available on the market. The shortage of financing in the market starts from the pre-seed stage (US$20,000) to early-venture capital stage (US$1 million).
The World Bank Group has helped strengthen the ecosystem for digital entrepreneurs and seed digital incubators in several countries around the world, including Kenya, Senegal, and South Africa, just to name a few. Start-ups in these “mLabs” have developed or improved more than 500 digital products or services, and some 100 early stage firms raised over $15 million in investments and grant funding. But is this the answer to scaling growth entrepreneurs on the continent?
Recent World Bank investment climate surveys find that the top two constraints for small and medium enterprises (SMEs) in Africa are access to finance and access to energy. Given that SMEs contribute disproportionately to boosting job creation, GDP, and exports, addressing these two constraints is critical to promoting economic development on the continent.
A new project combining skills across the World Bank Group and IFC is taking advantage of disruptive advances in the energy and finance sectors to address these longstanding challenges for SMEs.
Current access to electricity remains woefully low and is a major impediment to economic growth. More than half of Africa’s population isn’t connected to the energy grid and has no access to reliable power. At the same time, fewer than 50% of adults have an account with a formal financial institution.
In recent years, however, two important developments have made it possible to begin addressing these challenges:
Off-grid energy solutions—notably solar power—have fallen dramatically in price with new business models working to scale them
New digital-based financing mechanisms, such as crowdfunding, cryptocurrencies, peer-to-peer lending, psychometric testing, big data, and blockchain have emerged as tools for under-served finance markets.
The Malian diaspora counts between four and six million people, many of whom have benefited from a good education and rich experiences, that could help develop high-potential businesses in their home countries.
However, starting and running a business in Mali isn’t easy. That’s why Pape Wane, a Malian reality TV producer, decided to partner with local business incubators to launch the Diaspora Entrepreneurship competition in order to identify, promote, and support members of the diaspora community who can seize business opportunities in Mali, while also understanding the unique challenges of the local ecosystem.
Using the codes of reality TV, the competition has strived to resonate with Mali’s youth by increasing their awareness of entrepreneurship’s potential to address the country’s socio-economic challenges.
In the decade since mobile money first sparked international interest in African innovation, hundreds of tech hubs have sprung up across the continent; global giants like GE have rushed in to build innovation centers; and the venture capital industry has steadily grown. Nevertheless, the continent’s tech scene continues to face challenges.
The rise of African innovation has inspired thousands of new start-ups, and this trend will continue into the foreseeable future. Existing acceleration programs, however, still leave growth-stage companies in need of additional support to secure investment and scale their businesses across borders. With many of the continent’s acceleration programs lacking in quality, we hoped to introduce an innovative post-acceleration program, XL Africa.
After infoDev launched its mLabs in Kenya, Senegal, and South Africa in 2011, they introduced incubation programs that successfully supported the creation of over 100 start-ups that raised close to $15 million in investments and grant funding, and developed over 500 digital products or services. As these ecosystems and start-ups have matured, more needs to be done to improve the marketability of these companies to global and local investors.
3-1-0 Three minutes to complete the online loan application, one second for approval and with zero human touch for SME loans. This is the marketing slogan used by Ant Financial, one of China’s largest online lenders with more than 400 million active users.
Digital finance is a cost-effective route to financial inclusion for many unbanked and underserved consumers in emerging markets. But digital finance is also still developing and maturing, with many open questions on the impact it will have. One of the most important of these is whether digital finance will ultimately help consumers to make better financial decisions over time.
October 31 is World Savings Day, a day which emphasizes the importance of savings to economic development, and provides a good occasion to look at how fintech may help solve the challenge of savings.
What is it like to set up and run an incubator as a woman? The answer, much like anywhere else in the world for working women, is that it’s complicated.
In many countries, it’s still unusual to see women working in certain sectors. Regina Mbodj, CTIC Dakar CEO, knows very few women in Senegal who studied ICT. “When I came home and told people about my studies, a lot of people responded, 'I thought only men did that!'"
Mariem Kane, an engineer by training and now president of Mauritania’s incubator Hadina RIMTIC, said that career development can be difficult for women who have been trained in hard skills. “It’s tough for women to find opportunities in these sectors and, because we’re considered more suited to softer skills, we aren’t given the opportunity to prove ourselves.”