Net Prophet 2010 - Top of the BOPs: Observations from building online business in Africa (By Stefan Magdalinski)

Net Prophet 2010 – Top of the BOPs: Observations from building online business in Africa (By Stefan Magdalinski)

Stefan Magdalinski is the CEO of Mocality.com, a new mobile business directory (and a lot more to come) providing services to thousands of entrepreneurs across Africa. Mocality’s first city is Nairobi, Kenya. Previously, Stefan was the CTO of MOO.com, the innovative digital printing company, but has been building web applications and online civic hacks since 1994, most of which are start-ups. In his spare time, he wonders why he doesn’t have any.

“We are about to see a transformation [in Africa].”

A summary of Stefan’s presentation:

Mocality is a mobile business directory for sub-Saharan Africa. We are often asked why we do business in Africa, and our responses are vast:

We wanted to see if the perception of Africa as a ‘hungry, poverty-stricken and war-torn continent’ was true, well it isn’t,

Fibre capacity is growing exponentially in Africa,

Broadband is advertised a lot in Kenya, and is clearly very needed and used,

PC penetration in Africa is growing rapidly and prices are becoming more and more competitive.

There are four characteristics of successful BOP businesses: Scalabilty, New price/performance envelop, Modern technologies, and International standards of quality, sustainability and aesthetics.

M-PESA’s biggest success is the “bottom of the pyramid” type venture. Concept: Send cash via SMS – At 3 years young, with 9,5 million users (50% adults), 18,000 agents (change cash into SMS), US$ 4,4 billion in 2010 (14% of Kenyan GDP) M-PESA was being used for savings despite not being an actual bank, and was teaming up with big e-Commerce services such as, Kalahari.net.

Mobile money is important in BOP because of productivity, transparency, safety, regularises income (protect from shocks) and investment saving becomes easier (‘rainy-day’ savings).

As of it’s launch on 3 May 2010, Mocality uses M-PESA to pay people in Nairobi, where anyone with a WAP-enabled phone can start earning immediately.

Users in Nairobi are generally more brand-conscious, open-minded, mobile power users, have multi-modal access and are always connected online.

To users in Kenya, Facebook is King with a 21% online penetration. Kenyan users have different usage patterns – FBO vs SEO, and Facebook is not driving this!

Conclusion: A call to arms: Africa has many opportunities and a fast growing technology industry – we just need to be aware of the hunger, war, corruption and poverty.