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Live in Nigeria? This is why your startup will fail

You live in Nigeria or any third world country? Are you a techie and thinking of starting a web startup? Here are some reasons why your startup is doomed to fail.

1. Your startup is a solution to a “WANT” and not a “NEED”. If you can remember your basic economics, you should know what “WANTS” and “NEEDS” are. Quickly, I would define a “NEED” as something you have to have, something you can’t do without, eg food, clothing and shelter, while a “WANT” is something you would like to have. It is not absolutely necessary, but it would be a good thing to have. A good example is music.

When developing your startup idea, ask yourself, “is what I am creating a solution to a NEED or a WANT?” According to Nigeria’s National Bureau of Statistics, 60.9% of Nigerians in 2010 were living in “absolute poverty”, ie less than US$1 per day. Do you think that taking a hiatus to create a music startup to enable these people living in abject poverty to listen to music amounts to a good use of your time? Or “skills”?

2. Your startup is a clone of some popular first world website or application.[1] Why would you clone when there are a myriad of problems you could develop solutions for? If you are developing a clone, ask yourself this question “why would anyone use this (***insert the name of your clone***) instead of the main thing (***insert the name of the website you cloned***)?”

3. Your startup will require loads and loads of traffic, ie page views, with gullible people who would be ready to click on Google ads before it can generate income. In Nigeria, there are no VCs, no angel investors, no startup accelerators, no government support programmes, no infrastructure, regular electricity supply is a pipe dream, internet access is patchy and expensive, in short, “NO NOTHING”. So it kind of beats me why anyone would base his startup’s business model on the benevolence of Google? In between the time your startup comes online to the time it can generate enough traffic to keep the lights on and the servers humming, how would you survive? Do you have some gold bars stashed under your mattress somewhere? If not, why don’t you just develop a product where you can start charging from the very first day?[2]

4. Reading too much of TechCrunch, et al. These tech blogs are written by elitist white techies who live in Silicon Valley where the difference between over there and here is like light and day. Any advice you can glean from those sites just isn’t applicable here in Nigeria.[3]

NOTES

[1] The current fad in Nigeria is creating clones of Groupon.com. It once used to be Twitter clones, bulk SMS and then Facebook clones. Why coders still do this kind of beats me. Instead of cloning, why don’t you build on these sites and take advantage of things like Facebook’s “Social Graph”, etc and develop innovative solutions? Developing another Dropbox won’t meet the need of the average Nigerian, he has no need for it, and if he does, why won’t he go for the original? Patriotism? Please!

[2] Despite the fact that 60.9% of Nigerians live on under $1 per day and there are 90 million mobile subscribers in the country with at least one mobile phone, these phones have to be loaded with “call credit” by these people because communication has become a NEED and not a WANT. So despite the grinding poverty in the country, the major telcos still declare mind boggling profits every year, with Nigeria now having the largest mobile phone market in Africa with 60% penetration. So in order to be successful, develop a solution to a NEED and not a WANT.

[3] When Sarah Lacy, a former columnist for TechCrunch, came to Nigeria in 2011, she advised techies not to read TechCrunch, et al. It’s of no use, the stories of billion dollar valuations for 6 month old companies that do nothing but count your number of Twitter followers will actually screw with your head. That can never happen here, this is Nigeria, be creative, be innovative, think local but act global.

Pascal Ehigie Aito is a startup founder, geek, programmer and social critic. This article first appeared on his personal blog.


  • Yasmine

    Interesting article, Pascal. Whilst for credibility, one needs to cite populations sources such as worldbank, etc..; let us not however forget to open our eyes and ears to the “reality” of Nigeria we know. Viz:

    – Same as other BRIC countries, there is a huge disparity in income distribution and inequalities in Nigeria.
    – Yes 55%-60% of the population live below the international poverty lines (and the key word here being international, because that line in Norway is definitely not the same one in Nigeria!).
    – Haven said this, there is still 40% of Nigerians living okay. This number is very important. 40% of 170m people is 68m = x11 population of Denmark, x7 population of Sweden, +/-1 pu=opulation of Germany! This is a very healthy number to build a business on. This is why the SA investors are pouring in.
    – Don’t also forget that unlike in the developed countries with 3 tiers to their economy, in developing, there are over 3 tiers.

    Regarding your comment on innovation being based on Need or Want. That reasoning is of the most basic denominator. Indeed. I think you’re confusing and compouding innovation and entrepreneurship. The driver in Nigeria for now, is not innovation. It is the latter. The developed countries can innovate because the have reached saturation.

    Nigeria is not there yet and when people identify gaps/opportunities they take it. No matter if it’s rebranded as something else. If positioned and targeted well, they will succeed.

    I say to my compatriots with ideas – GO FOR IT! First come always gets first served.

    God Bless us all.

  • TCS

    One point could be added: there’s much more to “startups” than tech or ventures started from the living room.

    Many parts of Africa could use startups in agriculture, energy, distribution, retailing, construction–you name it and some part of Africa likely demands it.

    Also, it’s a very thin line between “wants” and “needs”. No one needs an automobile, mass transit system or mobile phones, for that matter. Many however would enjoy life less without these. These “wants” have become “needs” today.

  • ImNotAStar(huuugh)

    Your*

  • ImNotAStar(huuugh)

    You’re article would be more plausible if it wasnt for the fact that the most successceful tech companies in nigeria are all based on clones. e.g Dealdey(Groupon) Iroking(Spotify/Imeem/loads more..Tradestable(Ebay) Wackanow(Expedia) the list goes on..Obviously there is scope for success in creating tech companies that tackle needs that are inherent to the nigerian consumers but to say you will fail by copying tech companies abroad is a bit narrow minded, especially as nigerians are becoming more westernized and thier needs aligning with consumers in the west.

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