The co-founder and chairman of the e-commerce behemoth Alibaba, Jack Ma made quite a number of Africa trips last year 2019. On one of those trips was his visit to Ghana for the Africa Netpreneur Prize on November 16. The event saw ten Netpreneur prize finalists battle it out in a televised pitch competition for a share of the $1million prize.
In the early days before the televised pitch competition, Ma had an opportunity to deliver a thought-provoking keynote that stirred the hearts of everyone in attendance. His speech centered around African innovation and the UN Sustainable Development Goals (SDGs). As an entrepreneur who is equally involved in mobilizing a workforce towards the actualization of the SDGs, I thought it’s important to share some key insights from Ma’s speech with a wider audience.
Jack Ma’s speech echoes the urgency for an African innovation agenda that is driven by Africans in this new decade. The time has come for Africa to put away the cloak of ignorance and mediocrity that has long created a chasm between the continent and the rest of the world – and fully assert herself on the technological innovation scene.
With that backdrop, here are billionaire Jack Ma’s thoughts on how to build an African innovation ecosystem that works for everyone.
First, Jack Ma says Africa needs dominant innovation – not just aspirations
“If you want to be an entrepreneur, start by solving problems in your community. A lot of people want to go to the moon or mars, but I think that cleaning the garbage in the streets and the ocean is more important than going to the moon. Entrepreneurs don’t wait for conditions, they create conditions.”
– Jack Ma, co-founder of Alibaba and founder of Africa Netpreneur Prize.
Entrepreneurship is about solving problems. Today, Africa is faced with several pressing challenges. Chief among these being youth unemployment, poor infrastructural development, climate change, failure of governance institutions, failure of financial mechanisms, fiscal deficit, as well as water and food shortages.
In Ma’s opinion, we must focus on developing solutions to address these basic needs en masse. Even though everyone must not be a startup founder, we should all have an entrepreneurial mindset. There’s an urgent need for everyone to develop the mindset of problem-solving and innovation, regardless of office or rank in society.
And, really, there should be no controversy about this. The effects of digital globalization on society are proof-positive of that fact. If you don’t take ownership of your thoughts, results, and direction, you will be left behind in no time.
Second, Ma says African entrepreneurs need platforms ownership to create an innovation ecosystem that works for everyone
“Most people say in Africa today, there’s no e-commerce, no logistics, no payment (systems). To me, Africa today is like China 15-20 years ago. When I started Alibaba in China, people didn’t know what internet is. I went to Wall Street to raise money from venture capitalists, they rejected me because they didn’t trust the internet. Today, after 20 years, Alibaba is among the top ten companies in the world. Because you have nothing, that is the opportunity. If everything is ready, there’ll be no chance for us, there’ll be no chance for entrepreneurs,” –
Jack Ma, Chinese Billionaire and Philanthropist
Ask any entrepreneur – here or there – the one necessary and sufficient condition for the art is ownership. You cannot sustain an innovation ecosystem on a third-party platform. For sure, you can leverage third-party platforms and frameworks to drive innovation to the last mile. But, if you want to build an ecosystem that fosters growth, then you need homegrown innovation. And not rely exclusively on imported ones.
Unfortunately, as it stands, very few technology tools with continental usage have their origin from the continent. So, for so long, Africa has been infantilized on various fronts. But if it’s true, and I do believe it’s true, that this century belongs to the continent, then we must take this topic seriously. We must think about the ownership of tools and systems that store and process our data, money, food, and so on.
As Ma rightly said, the obstacles and troubles we face on the continent are unbelievable. That means, there’s equally an incredible opportunity for people that can create the right conditions. If everything is ready, there will be no chance for us, the entrepreneurs. Now’s the best time to be an entrepreneur in Africa!
Third, Ma stresses that for Africa to build an innovation ecosystem that works for everyone, we need people-centered policies
“Young people are the hope of Africa. Each time I come here, I try to tell people, there are four Es that are extremely important for the future of Africa – education, e-government, e-infrastructure, and entrepreneurship. Africa is never in lack of talent, resources or opportunities. What we need today is a group of people to explore, to try, to innovate…These are the seeds for Africa.” –
Entrepreneurs like Steve Jobs, Bill Gates, Jeff Bezos, or Larry Page and Sergey Brin are the “poster children” of the entrepreneurship movement because of government policies that allowed their innovations to flourish.
If we wish to see the next phase of economic renaissance on the continent, then we must ensure that our leaders are making policies with an entrepreneurial purpose.
Here’s why that is important:
According to a 2010 Harvard Business Review article published by Professor Daniel Isenberg from Babson College, nine items make up an entrepreneurship ecosystem. These are Government Policy, Regulatory Frameworks and Infrastructures, Funding and Finance, Culture, Support Systems, Universities as catalysts, Education and Training, Human Capital and Workforce, Local and Global Markets.
The paper went on to stress that the challenge for government policy is to develop policies that work, but avoid the temptation to try to effect change via direct intervention in the ecosystem.
In a similar study of entrepreneurial ecosystems carried out by Colin Mason from the University of Glasgow and Ross Brown from the University of St Andrews for the OECD in 2014, a set of fundamental prescriptions were developed for government policy with regards to these ecosystems. These principles include the following:
- Make the formation of entrepreneurial activity a government priority – The formulation of effective policy for entrepreneurial ecosystems requires the active involvement of Government Ministers working with senior public servants who act as ‘institutional entrepreneurs’ to shape and empower policies and programs.
- Ensure that government policy is broadly focused – Policy should be developed that is holistic and encompasses all components of the ecosystem rather than seeking to ‘cherry-pick’ areas of special interest.
- Allow for natural growth, not top-down solutions – Build from existing industries that have formed naturally within the region or country rather than seeking to generate new industries from greenfield sites.
- Ensure all industry sectors are considered not just high-tech – Encourage growth across all industry sectors including low, mid and high-tech firms.
- Provide leadership but delegate responsibility and ownership – Adopt a ‘top-down’ and ‘bottom-up’ approach devolving responsibility to local and regional authorities.
- Develop policies that address the needs of both the business and its management team – Recognise that small business policy is ‘transactional’ while entrepreneurship policy is ‘relational’ in nature.
Essentially, developing effective governmental policies is of vital importance. In the words of Kenyan activist, lawyer, and blogger, Ory Okolloh, we cannot entrepreneur our way around bad leadership. We need people-centered policies that encourage innovation, not stifle it. Unpacking this further, Jack Ma said on another platform that taxing a startup is like taking the meat from the legs of a mosquito.
Finally, Jack advocates for more startup funding
“Entrepreneurs will be and should be the great heroes of Africa because they do the things others never believe can happen. If heroes succeed, then more people will want to be heroes. Let’s start to help, support, inspire and empower the startup spirit; the entrepreneurship spirit. If a society respects the startup spirit, that society is making progress. The best investment you can make is when you invest in the future. Let’s invest in young people, let’s invest in SMEs,” –
Jack Ma, Chinese business magnate, investor, politician, and philanthropist.
Although startup funding is on the rise in Africa, challenges still abound. For example, African startups attracted a record high of $1.34 billion in venture capital in 2019. But, WeeTracker’s Decoding Venture Investments In Africa 2019 Report found that of all 427 startups that raised funding throughout the year, a mere 6% accounted for 83% of the total investments, with fintech leading the charge.
Further, more than 75% of the deals took place in three markets – Nigeria, Kenya, and South Africa.
Clearly, we need more sector-agnostic, early-stage funds for African entrepreneurs.
Jack Ma is right: you get the best return on investment when you invest in young people. The dividends of this century will only accrue to Africa if we build an African innovation ecosystem that works for everyone. This is not only the right thing to do, but it’s also the smart thing to do.
And the time is now!