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The market in the gap

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Africa

In 2014 after a shaky attempt at a pivot back to products from services, we realized the importance of having a product manager with local experience to lead this effort.

The problem was that they were scarce. I discovered that the technology training firm “General Assembly” (GA) had a crash course on product management and my co-founder suggested that I take the course myself to understand it better before I sent others. It was one of the best decisions we ever made.

At General Assembly, people come in “raw” and weeks later; they become something else. I was one of those people; I quickly unlearned a lot of the things I thought I knew and realized why local attempts at building products kept failing.

We always assume the common reason is that startups run out of capital; it is actually because startups run out of bandwidth and scope of understanding. There was indeed a method to the madness of building high-performance product teams, and it is possible to learn it.

One of the pivotal learning experiences for me at GA occurred while trying to build a new product idea up from scratch as part of the requirements for the course. I learned quickly that “the gap in the market was different from the market in the gap.” A massive mistake we make locally is this mismatch. We miss the nuanced opportunities or “the market within” when we get fixated on entire sector opportunities or gaps.

Capital and the “People Gap.”
What is the market opportunity for technology focused capital in Africa? We keep talking about using technology to solve problems in Africa, but we don’t ask ourselves some basic questions. The first question is – will solving those problems become big enough opportunities for capital injection?

One common theme I keep seeing is that people who want to “solve problems” in Africa always want technology product developers. The next question we should ask then is – do we have a “people gap” in the market or a “product gap”?

The Group CEO of Jumia made an assertion recently that they decided to build their product in Portugal because there were not enough developers in Africa and he was skewered publicly on all sides by every one of us. He may have told an uncomfortable truth we have not yet come around to confront; we do have a people gap.

There is a lot of appetite for remote work abroad by local developers not only because of the apparent exchange rate advantages, but it is also simply because there is enough capital outside chasing more opportunities than internal. Capital is usually efficient, and it goes for quality first.

Capital is also very agnostic when it comes to market opportunities. If there are a lot more opportunities locally, the money will move to take advantage of the exchange rate difference. Maybe the real gap in the market locally is for people or talent, and capital is directly or indirectly chasing that opportunity?

Opportunities exist everywhere in Africa to build great things, but the first thing that happens when people get capital to chase those opportunities is that they start looking for outstanding people to hire and there aren’t many of them to go round. We also have a “people quality” problem.

The “People Market” in the gap
The African opportunity is African people and talent is part of that opportunity. Foreign investors are investing in African opportunities, and some of those opportunities include people opportunities like “The African Leadership University” (ALU), Andela, and others. Recently, YCombinator backed “Lambda School” has decided to set up a local shop as well.

High demand by foreign capital for African talent at home and abroad is a good sign but is there enough capital going into sustaining a pipeline? My biggest worry has always been that we are experiencing a temporary bump that may fizzle away as the pipeline dries up and our best people move abroad.

What if this high demand for talent is temporary because we are seeing the first survivors of our deteriorating educational infrastructure who have turned out well in spite of the obstacles? What is the survivorship rate? Will it increase or decline?

The relatively low numbers compared to our overall population should be both a reason for concern and probably also an opportunity. Can we rescue more people and can we start enhancing our pipeline by re-building failed educational institutions?

Should we instead launch more of the new types of institutions like ALU and Andela at scale? That is what India did, but I also worry that we may be looking at where the puck has been and not where it is going to be. What learning outcomes should we be optimizing for to take advantage of future technological trends and product realities?

Mark Essien of Hotels.ng came up with a brilliant idea with HNG internships. He is using his startup as a laboratory to train hordes of young people. Programs like the HNG internship will help solve two problems at once. They help build up the talent pool and provide learning experiences from solving real problems.

Human problems are almost infinite, and the solutions to those problems are also bottomless. Just like Andela and others, Lambda School discovered in America that a real market opportunity in the technology sector was people. Quality people who build products are in high demand because there are not enough of them.

Africa’s most valuable resource is people, and education is the most significant gap between people and opportunity. Africa’s biggest tech opportunity may be just education. Lambda and others will come because we are not taking advantage of this market in the gap fast enough.


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