French-speaking Africa has often been approached with caution by investors and companies from English-speaking countries within and outside the continent. However, the region is being viewed as an exciting place to do business as more local and international companies enter the market.
Francophone Africa has a total population of more than 300m people with some of the big economies being Senegal, Côte d’Ivoire, Guinea, Republic of the Congo, Cameroon and the Democratic Republic of the Congo.
According to Yann Le Beux, catalyst at CTIC Dakar, the region’s first incubator and accelerator based in Senegal, technology is one of the sectors expected to thrive in the region in coming years. While some francophone African countries are politically insecure, Senegal is quite stable making it a good entry point into the region.
“Senegal is a very good base to start a business because people are well educated, very talented, there is good infrastructure and a lot of companies are headquartered in Dakar making partnerships easy and accessible. It is a good entry point into the rest of francophone West Africa.”
Le Beux said Senegal’s market is mature, adding that the country has a good technology infrastructure network with three mobile operators and about 98% mobile penetration.
“The technology market there is actually mature. It is not a very large market in Senegal, but what is interesting is that a lot of companies are headquartered in Senegal and target the entire francophone region and its 300m inhabitants [from here]. So there are a lot of opportunities.”
In two years of activity, CTIC Dakar has incubated 15 companies and supported more than 30 startups drawn from within francophone West Africa.
“Generally, a lot of Senegalese companies do well when they go to Ivory Coast, Burkina Faso or Cameroon. That is an advantage. The companies that we support at CTIC Dakar may have between five and 30 employees but already half of their revenue is made outside of Senegal.”
CTIC Dakar is currently focused on supporting high-growth tech companies and startups because “there are not enough of them” in the region by linking youthful tech enthusiasts with more experienced entrepreneurs. The incubator for IT and mobile services entrepreneurs offers training, business development, financing and linkages with industry players and public decision makers.
“There is opportunity to use technology to create linkages in other sectors such as agriculture, tourism or education which are big in Senegal. We still have basic needs on this continent that have not been addressed using technology yet. We see a lot of opportunity for enterprise products.”
Skills, financing and culture
Companies that choose to venture into the region through Senegal have to contend with the challenge of accessing well trained and experienced manpower.
“We need more training in this area in Senegal. Generally, all over the continent these skills are lacking. Financing is also a challenge because we don’t have enough early-stage private sector investment in Senegal. We need more business angels to bring seed capital to startups but we know that a number of venture capital funds like I&P (Investisseurs et Partenaires) are already based [in] or looking at Senegal.”
Local entrepreneurs also have to battle with cultural expectations which stifle their business endeavours.
“The family is something very important in Senegal so, as soon as you get your diploma you are expected to start giving back to your family. Starting a business means you have to borrow a lot,” said Le Beux. “This makes it difficult for one to start a business because they are expected to give, when what they need is other people to lend to them money to support their startup. For some young entrepreneurs who start being profitable, it is not easy to find the right balance between helping the family or investing back in their growing businesses.”
He advised companies interested in investing in Senegal to hire the right people and form partnerships with local companies.
“As an investor you need to find a good person that will support the structure that you have. You need to have a reliable local team that you trust.”
English speakers, Le Beux added, should not shy away from francophone Africa since they can “easily get around without speaking a word in French” if they work with local partners.