AfriLabs: The Founders Fund for Africa

Today Appfrica and Hive Colab are happy to announce our participation in the cofounding of AfriLabs.

On March 3rd 2010, founders from several established African tech incubators and open collaboration spaces @HiveColab @iHub @Appfrica Labs @NaiLab @Bantalabs @LimbeLabs came together for the iHub launch in Nairobi. The meeting hosted by Nailab (an iHub neighbor) made clear that each of the labs shares in a common vision to promote technology as a platform for entrepreneurship on the continent. The labs have a lot to gain by working together and it was in this thinking that Afrilabs was born.

As a network organization Afrilabs seeks to build on this common vision and further promote the growth and development of the African technology sector. By working together the labs improve their chances of success, generating more success stories and decent work for young Africans, both as a means of self-employment and as job creation for others. Already members of Afrilabs have come together successfully in their bid to implement the U.S. Department of State sponsored contest Apps4Africa. Afrilab members have also worked to establish the Hive Colab as Kampala’s leading open collaboration space and successfully tendered to host the infoDev sponsored mobile apps lab in East Africa. AfriLabs by virtue of its on-the-ground engagement and local ownership is uniquely positioned to be a catalyst for the sector.

The Founder’s Fund is a group in Silicon Valley made up of some of the most successful entrepreneurs and investors of the past few years. There are a number of similar groups in the Valley, that were founded on the ethos of investing in the place where your own success came from. They are more than just venture capitalists, they also happen to be incredibly successful serial entrepreneurs who want to create the conditions for the people coming up after them to match their success.

This basic idea there, paying it forward, is something I feel is commendable so it was especially exciting last year when myself, Bill Zimmerman (Limbe Labs), Ben White (VC4Africa.com), Erik Hersman (Ushahidi/iHub), and Bart Lacroix (1% Club) got together to discuss creating an investment fund and consortium that would be informed by our own experiences, interests and expertise.

The problem, that I see, with investment in Africa currently is that it tends to be done by investors who are solely capitalists. There’s nothing wrong with this. It’s a good thing to have number crunchers looking for the money to be made in the continent’s growth markets (agriculture, resources, textiles etc.). It supports growth, it improves infrastructure and allows for other types of growth, it does not always imply the growth of a middle class.

However, to these types of investors, investing in the continent’s nascent sectors doesn’t make sense. There’s either too much of a risk, or there’s not enough money to be made to make it worth their while. The problem I have with investment in Africa is that everyone is waiting on someone else to prove that there’s money to be made, nothing to be lost and a good story to tell. Fair enough, those types of investors aren’t the same pioneers who will create markets. They are the capitalists who will help them scale and there’s certainly room in the world for both and they will most likely come in hordes, later. So in my opinion there aren’t enough pioneers, and this includes successful Africans who invest their wealth elsewhere rather than forging new paths.

Investment during the industrialization of “the West” wasn’t always a safe bet. You could make the wrong bet and lose everything; or you could become the Rockerfellers. Investment then and there was literally a business for pioneers, for better or for worse. It implied being a bit reckless, a bit impulsive and a bit stubborn. More importantly, it meant taking risks on opportunities or people who are otherwise ignored. All qualities I’d use to describe the world’s most successful entrepreneurs.

That said, I’m excited to be included amongst a group of likeminded mentors, entrepreneurs and investors and as part of the AfriLabs group, what I like to refer to as a sort of “Founder’s Fund for Africa”. We’re all entrepreneurs, who understand what it’s like to build technology businesses in Africa. We all have the benefit of having done this for a number of years, we’re all willing to take what some might see as a fairly big risk, investing in Africa’s nascent tech sector, we’re all attempting to share our personal success, failures and resources to benefit upcoming African entrepreneurs.

It’s an exciting collaboration and I’m looking forward to the great things to come!