6 BUSINESS OPPORTUNITIES IN AFRICA FOR 2017
- Solar power
Solar energy is one of Africa’s most abundant natural resources. Most parts of sub-Saharan Africa enjoy more than 300 days of free God-given sunlight every year. Still, over 600 million people on the continent, especially in rural areas, don’t have access to reliable electricity. In most cities and towns, power outages are the norm and people often have to rely on noisy petrol and diesel power generators. Solar energy is free, absolutely clean and abundant. And it provides the best alternative for people in remote parts of Africa who are out of reach of electricity grids. Interestingly, some smart entrepreneurs are rising to the challenge of lighting up Africa through solar energy, and are very likely to join the millionaires club in 2017.
I’ll share a few interesting examples…
Off Grid Electric, a solar energy provider in Tanzania recently raised $25 million from international investors and won a $5 million grant from USAID. The company is already on track to provide solar power to 1 million homes in East Africa by 2017 and has recently expanded into Rwanda.
M-KOPA, which provides ‘pay-as-you-go’ solar power systems has attracted investments of up to $40 million. This Kenyan-based business has already provided solar power to nearly 300,000 homes in Kenya, Tanzania and Uganda.
Agribusiness is Africa’s untapped goldmine, and a major potential source of millionaires in 2016.According to a World Bank report, Africa’s agribusiness industry is expected to be worth $1 trillion by 2030.With up to 60 percent of the world’s uncultivated arable land, fertile soils, abundant labour, and all-year sunshine, sub-Saharan Africa surely has the potential to become the world’s biggest exporter of food products. Even if Africa decides to ignore export markets, the continent’s one billion people provides a huge and ready market for agribusiness. Still, every year, African countries import more than 70 percent of wheat consumed, over 300,000 tons of chicken and spend more than $10 billion on imported grains, especially rice.Interestingly, more African entrepreneurs are tapping into the vast opportunities in Africa’s agribusiness market. And with the continued harsh impacts of low crude oil prices in 2016, sleeping agribusiness giants like Nigeria and Angola are finally putting a strong focus on agribusiness as a means to diversifying their economies. This means that governments in these countries are now more open and supportive of agribusiness initiatives.
- Internet access
Africa’s internet market is worth billions of dollars. It’s no surprise that tech giants like Google and Facebook are scrambling to improve internet access to millions of Africans. Google’s Project Loon and Facebook’s Free Basics are just two of several bold initiatives to connect Africa. However, some smart African entrepreneurs are already making impressive moves to conquer the internet access market. One example is ‘BRCK’ a startup company in Kenya that has created a rugged internet modem device that’s designed for harsh environments with limited internet connection and electricity. The modem can hop between Ethernet, WiFi, 3G and 4G, and comes with eight hours of battery life. This African-inspired invention has already sold thousands of units in 54 countries, even in faraway places as India. Their biggest customers have been schools. Recently, BRCK raised $3 million in funding from investors to extend the reach of this amazing device. The entrepreneurs behind it will surely be smiling to the bank, after all the hardwork is done.
- Apps & online services
There’s a digital revolution taking over Africa. These days, many services now have an app or are going online. Africa’s digital economy is growing really fast. These days, there’s almost an app or online service for anything you want. If you’re looking for a suitable hotel accommodation in Nigeria, Hotels.ng and Jovago.com are now the biggest online services in the hotel booking business. Recently, Hotels.ng attracted an investment of $1.2 million. If you want to watch African movies on the fly, there’s an app for that. IrokoTV is an app that gives you access to 5,000+ African movies on your mobile phone. In January 2016, IrokoTV secured an additional $19 million in investment funding to expand its presence across Africa. If you’d like to order bespoke furniture pieces without having to run after artisans or worry about quality, there’s an online service for that too. Showroom.ng is a Nigerian startup that’s changing how people buy furniture in Africa’s biggest economy. In 2016, more apps and online services will launch across Africa to solve problems and provide value. And more millionaires will be made in the process.
Africa’s human talent is one of its most ignored and underexplored assets. With one of the world’s youngest populations (over 50 percent of Africans are younger than 31), the continent is rich with creative and innovative talent. However, poor access to quality education is a serious threat to Africa’s human capital. Currently, a couple of interesting businesses and initiatives are achieving remarkable successes as they tackle Africa’s education problems head-on. Bridge Academies (in Kenya and East Africa) and Omega Schools (in Ghana and West Africa) have built an incredible education model of low-cost primary schools that allow pupils to pay as low as $1 a day as school fees. Another interesting business on Africa’s education scene is Andela. Through its free and highly rigorous training program, Andela develops promising African talents into top class software developers who are hired out to the likes of Microsoft and other tech giants in the USA and Europe. This interesting business model is called ‘talent-as-a-service’. Andela recently attracted $10 million in investment and is on track to train 100,000 world class African software developers over ten years.
- Real estate.
Africa’s real estate market is a multi-billion dollar opportunity, and several new millionaires will build their fortunes in this market. In almost every corner of the continent, real estate projects are emerging. The biggest attractions are high-rise hotels and office buildings, residential homes and apartments, and shopping malls. In Nigeria alone, there is a shortfall of 17 million housing units, with a funding requirement of $363 billion. In Angola’s capital, Luanda, prime office rents are among the highest in the world at US$150 per sq metre per month. In Mozambique, property prices at the sea ports, particularly for warehouses, are one of Africa’s most expensive. The key markets for real estate on every investor’s agenda are Angola, Nigeria, Egypt, Mozambique, South Africa and Kenya. All of these countries are experiencing a real estate boom like never before in history. Africa’s large and youthful population, an expanding middle class, increasing urbanization, influx of expatriates and multinational companies are the key drivers of demand for both commercial and residential real estate.