The South Africa’s New Fintech Degree

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August 18, 2017

A South African university, The University of Cape Town, has unveiled a degree program for fintech (financial technology) which is expected to equip graduates with the skills to launch fintech companies. The school wants to help deepen the talent pool in the sector.

The University of Cape Town (UCT) is now the first university on the continent to offer a degree specifically designed to equip students with skills and knowledge in the ever growing financial services sector.

The new degree is a Master of Data Science with a specialisation in Financial Technology and will be offered for the first time in January 2018.The aim of the degree is to combat the main challenges in the sector such as the rise of modern technology and lack of skilled graduates who are able to take charge.

Though the school has promoted this program as the “first” in Africa, the university is not necessarily offering anything different from most schools which have added Data Sciences / Big Data in their computer science programs. This is not an undergraduate program to merit that “first”. A master’s degree student can specialize in any area of choice, to a large extent. Had this been an undergraduate program, that is where disagreement will come and the claim of the “first” in Africa will make sense. Any student in a decent Master’s degree computer science program in any African university should expect to cover data science. But of course, UCT is making this a specialized program.

The Master of Data Science with a specialisation in Financial Technology is a welcome program. Covenant University Nigeria has Big Data/Analytics in its MIS program. Yet, the biggest challenge for these programs is not really what the students are taught, in theory, but the ecosystem (i.e. the lab) where they will practice the things learnt. Cape Town is a center of financial excellence, so if the schools create partnerships with the industry, the students will benefit.

The use of machine learning (ML) and the broad AI (artificial intelligence) cannot be limited to fintech. In short, the best education could be getting the Master’s degree in Data Science, focusing on the models and algorithms and dealing with the applications later via a project. I know that some of the models we have used in Zenvus, my precision agtech company, came from models developed for biological robots. It turns out that biological robots and plants share many things in common. In other words, focusing on the fintech may even limit the student. For all the nice names we call ML, it is really statistical modeling and computation at scale.

A fintech program like this should be designed with many labs. I will recommend that they ensure students get value through exposure to real market data. Instead of just teaching blockchain and bitcoin, they have labs where students can experience them. With such labs, many African fintech founders and entrepreneurs could be seeded with great insights on what these technologies offer.

I do hope one university in Nigeria will mimic the South African university and offer something for our entrepreneurs and students. But before they do so, they must have the labs where models can be simulated. It may not come easily because National Universities Commission (NUC) may not allow such. The South African university is seeing demand for the program, and one will expect the same in Nigeria, especially in Lagos schools.

“We see extraordinary demand for the degree already,” continues Georg, “also because Cape Town-based students can do the degree part-time. This is quite important to us since we want working finance professionals to be able to complete the degree and acquire the skills to thrive in a changing industry. For students who want to do the degree full time, we do offer full scholarships to ensure that nobody will be excluded financially.”

Georg concludes “Fintech offers a unique opportunity to radically transform the industry. Young startups are already challenging the incumbents and our students will be on the forefront of this technological revolution in South Africa. Our focus on entrepreneurship means that we will change the students’ mindset so that they not only want to go out and ‘get’ a job, but also to go out and create a job – or a hundred.”

This could be a good program and South Africa wants to be on top of it. If they deepen the entrepreneurship component of this degree, South Africa’s role as Africa’s heart of finance will remain unchallenged. Yet, it is very debatable that you can use a Master’s degree program framework to create great fintech entrepreneurs. I still believe that the core pillars, in unlocking creativity, take place at undergraduate education. But one thing is clear: if the students improve their data science capabilities, they will have the world open to them, not just in finance but in many other areas. Data, they say, is one of the pillars of the 21st century commerce. Knowing how to manipulate it is a skill of our time.

Just Accepted A Committee Invitation from the Government of Canada

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Ndubuisi Ekekwe

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August 18, 2017

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I just accepted to serve in a committee to assist the good people of Canada and the Government of Canada on an important health project. It is part of the PhD club duties of being a subject matter expert in your area.

On behalf of Grand Challenges Canada (GCC) and the Canadian Institutes of Health Research (CIHR), it is with great pleasure that I invite you to serve as a member of the peer review committee for the Stars in Global Health program. Your participation as a member of the peer review panel would be greatly appreciated. Your name was recommended by Dr. Jere R. Behrman and we feel that your expertise would be an asset to this committee.

Thanks Prof Behrman of the University of Pennsylvania for the recommendation.

Software Eats Cisco’s Networking Gears, Lesson for Entrepreneurs

By

Ndubuisi Ekekwe

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August 18, 2017

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Cisco, the venerable IT company, is going through a total redesign in its business. The networking unit has seen its revenue decline for seven straight quarters. Not a good trajectory.

Revenue from Cisco’s switching business, easily its largest, also missed Wall Street’s estimates, resulting in the company’s total revenue falling for the seventh straight quarter.

With its traditional business of making switches and routers struggling, Cisco, like other legacy technology firms, is focusing on high-growth areas such as security, the Internet of Things and cloud computing.

The reality is that Cisco is entering the IBM Moment where revenue in its core business will see continuous decline. This happens because their core products are increasingly being substituted by customers.

Networking is seeing some components move into software. And with that transition, the hardware has many competitors to deal with. Also, the big companies that used to spend easily on Cisco gears are buying non-premium products from Asia that get the job done, despite not being made by Cisco. So, Cisco is experiencing a double whammy: product substitution and competition from cheaper rivals. What Cisco sells at premium are available at lower prices by Chinese firms. As that happens, its business will drop further.

Most things are now outside the control of Cisco. It cannot stop Huawei from growing in Africa and around the world. It cannot do much to stop software being used to replace the gears it used to sell at premium.

HP went through that transformation and ended up breaking itself into two, with the legacy printing business as a separate firm. Cisco, if it finds success in the extremely new areas it is pursuing, will possible in future spin-off the networking business. At the moment, it is lagging in those new areas like cybersecurity. And networking business, at the hardware level, is a commoditized business.

Cisco demonstrates why it is hard running a hardware business: software indeed can eat it. Software is eating printing (with mobile, we print lesser), networking and other legacy hardware sectors.

Lesson for Hardware Entrepreneurs

No matter what you do, as a hardware entrepreneur, always think how a platform can save that hardware business. A platform will provide the ecosystem to protect revenue and ensure you have your customers. But it requires an entirely new business model that is totally different from the way we run hardware business today.

Increasingly, it is evident that there is little competitive capability for hardware business with no element of software-driven platform. Everyone knows that sooner or later, someone will make any hardware cheaper, through commoditization of its core function. What will protect an innovator or a pioneer is the platform.

You cannot be running a solar lantern business in Africa without thinking how you can build a lending business or something that will engage your customers around it. You cannot be installing solar panels for customers without thinking how they could be paying through subscription to give you room to innovate without worrying about risks of someone displacing you. In the electronics business, prices drop largely every two years. If you keep the present model of electronics business, you will experience the IBM, Dell and Cisco moments. Choose the Apple model which is organic with evolutionary features for whatever the markets bring.

There is no hardware business that will survive by itself in this age of Internet without an element of customer post-purchase relationship. You have to find a way to keep customers in your ecosystem. The old model of carry and go will be challenged by cheaper rivals.

Cisco is learning a lesson, and very soon, its remaining pricing power on networking gears, will decline as competitors continue to program them out from hardware into software. In software, the price drops and margins collapse. That was not the Cisco business model of old. The reality is here. You must learn from this as you build your business.

Further Insights via LinkedIn comments

I am posting these insights on this piece from LinkedIn users.

A good insight to those who rely so much on ‘experience’ and old ways of doing things. There’s one sub-topic in Chemistry, which every science student must come across, it’s called Displacement Reaction; there’s also another version of it in Physics. I want to believe that the ‘Displacement Reaction’ is now more pronounced and louder in hardware business than the mixture of acid/base and water as the case maybe. The central maxim must now be ‘rethink your strategy from time to time’, else you wait for your ‘moment’; not a good moment anyway.

“Cisco is learning a lesson” – ndubuisi ekekwe in a VUCA world you can’t be playing catch up especially when you are a brand like CISCO. One of the tenets of a solid strategy is ‘innovation that wins customer advantage’ – specifically staying relevant to the customer via value adding products and services that touch lives. Our lives are no longer stagnant like 20 years ago – businesses sleeping need to wake up. As I will share in an article soon, people fear change and that is essentially what strategy is; consequently the likes of CISCO have copied and pasted old strategies rather than proactively reinventing themselves. Despite the foregoing a company’s core purpose shouldn’t change e.g. Motorola’s purpose is “applying technology to the benefit of the public”, hence they and their products have evolved over time contributing to people’s lives (from TVs to microprocessors and more). What we are seeing in many businesses in CISCO’s situation is symptomatic of the absence of a core purpose and poor strategic foresight. ndubuisi as you have rightly said, they have to revamp their business models. But note that depth of #clarity of their business is required – that’s why I freely prescribe a diagnostic for such #clarity.

Great insight Sir! Businesses are expected to continously assess their competitive business environment. The Michael Porter’s Five Forces model provides a good framework in which this can be done. With this type of analysis, the likes of Cisco should have seen, before hand, the potential lowering of entry barriers, increasing power of substitutes and those of buyers. What other entrepreneurs would do is to also create high switching costs for their customers or simply evolve with the tide. Facebook has expanded the scope of the interactivity of its platform over the years by copying or acquiring potential competitors. This has made them look ever young. (edited)

Let Customers Score The Product Vision

By

Ndubuisi Ekekwe

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August 18, 2017

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I own a Yahoo email account. Yahoo Mail is a very terrible product which is unusually slow. Yahoo used to work very well, but over the years, they made it extremely worse. They padded the product and at the end, Yahoo frustrates users. The most damaging aspect is the feature that keeps refreshing, annoying and frustrating the users.

If you live in a place where Internet is metered, Yahoo may not be optimal. It will not just take your time to get basic things done, it will also cost you more money.

Unfortunately, the new Yahoo Mail was introduced as an innovative (improved) product expected to serve customers better. The people that made it, perhaps created it in California, where internet speed might have been very fast. They had the perfect world and everything looked good for them. They saw no problem.

Yahoo does not have a global team spread as Google. Sure, it is now under the control of AOL, but that company also does not have local teams, across the world, as Google does. For Google, it has staff in practically most parts of the world. Their people use their products in the most natural and practical modes. That helps Google to understand the realities on ground, helping it to make products that meet the needs of customers from many regions.

Yahoo and AOL do not have that luxury, because in their minds, the world must be like America, Japan and Western Europe and anyone that cannot conform to those could be forgotten. That is a big problem.

Lesson for Founders

There is a lesson I am trying to draw here with this preamble. According to Fortune Newsletter, Google continues to optimize its search to ensure it works in different environments, saving people, in the emerging world, money on data.

Google tests “light” search app. The search giant is testing a data-friendly version of its search app in Indonesia, where connectivity and mobile data allocations are limited. The pilot is one example of how Google is attempting to cater its products to emerging markets, where it sees the next wave of Internet consumers.

That is it: Google has simply understood that even though the product may work very well in New York, it may not be optimal in Indonesia. This is the way it has innovated around the world, putting local realities in its products. When you try to use Gmail in slow internet, it quickly suggests using the HTML version to help improve the experience. Google is also investing in local languages thereby making sure that no opportunity exists for any competitor to sneak in.

Google sees product vision from the lens of the customers, focusing not on the supremacy of the product from Google’s point of view, but rather from the customer who is using the product. This makes Google to deliver a lesser aesthetic and ergonomic design to a customer in Accra who is more interested in saving money on metered Internet than how great the site looks.

Your product vision does not matter if what you have in mind is not what customers are getting. Internet business is not really about making the best graphics or websites, but rather, serving customers at the best possible way.

I see sites designed for African markets with so much graphics and video contents that play automatically on visits. Personally, if I am in Lagos, I do not visit sites that play videos automatically on arrival. I used to read ThisDay Nigeria but when they started the auto-video, I avoided them. I hate to be in a client’s office and then without my control, my laptop will start making noise.

Only customers can score product vision and the most complicated is not really what determines success. “Product is what customers say it is”, says Francis Oguaju (a LinkedIn user), and the way you deliver it to them matters for a digital product. You have that product you are testing which will be used across West Africa. Instead of doing real live test, you run it in your test server (in your above Internet speed Lagos HQ) and everything comes back 100% fine. Then product is launched and users are complaining from all parts of the region.

Why? Under slow internet, your product fails. I have dealt with this in a bank client’s headquarters. We quickly updated the going live strategy requiring that the bank tests across more than 13 states in Nigeria, making sure the tests happen away from the bank branches where Internet was typically faster than the ones used by customers. Now, when new products are launched, the customer experiences have improved.

Add SSL to Your Site

Yesterday, Google sent this email below and it does mean that sites without SSL will be heavily penalized by Google ranking system. Not just that, Google will be sending security warming on your site if you do not have SSL when users want to complete simple Contact-Us forms.

To owner of [Site Name]

Starting October 2017, Chrome (version 62) will show a “NOT SECURE” warning when users enter text in a form on an HTTP page, and for all HTTP pages in Incognito mode.

The following URLs on your site include text input fields (such as < input type=”text” > or < input type=”email” >) that will trigger the new Chrome warning. Review these examples to see where these warnings will appear, so that you can take action to help protect users’ data. This list is not exhaustive.

….

Here’s how to fix this problem:

Migrate to HTTPS

To prevent the “Not Secure” notification from appearing when Chrome users visit your site, only collect user input data on pages served using HTTPS.

Simply, there is no reason why you should not have SSL if you plan to make progress online. If your customers want to complete your form and see a warming, that will be the beginning to the end of your business. They will run away. There is no better product vision than making sure that Google likes your site.

Mastering The User-Centricity of Internet Business

By

Ndubuisi Ekekwe

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August 17, 2017

0

A few decades ago, firms ruled supreme in getting the best profit margins out of their customers. It was an era of optimizing for the maximum possible profit. Market was very opaque because information was very expensive and untimely. Customers could not track price changes in real time. Even when they get the comparative prices, the distance to the other shop was a huge barrier. So in most cases, customers would knowingly pay high prices because of the need to save time.

This was the era when airlines maximized prices on tickets. When you leave your house to a travel agent, you have made up your mind to come back with a paper ticket. The travel agent was serving the airlines and the higher you pay, the better is the business. Though the agent may offer some choices among the competing airlines, there was no major price pressure, since at the end you would be forced to buy from the agent.

Why? You may need to drive another twenty minutes for another travel agent. Under this model where you either buy from the airline offices or travel agents, your choices are very narrow and the airlines were in control.

Then came the Internet era; from Wakanow to Jumia Travels, Expedia to Priceline, the customer for the first time had the power to make decisions based on price without even leaving the house. Go online; describe the trip and airline choices will roll down; usually, the cheapest one comes first. This market is a commodity business, especially for an average traveler. Who cares for the airline you flew from Boston to Baltimore? Without that brand loyalty, the cheapest ticket always wins. The travel agents have lost the power to control the price. The airlines suddenly must compete on price resulting to lower profit margins.

The internet has commoditized the airline pricing sector. Without the Internet which destroyed the pricing model, through commoditization, most airlines will still be commanding huge prices based on the mismatches owing to information asymmetry. The Internet has allowed the low-cost carriers to have direct access to customers. It has abstracted out the brand. The Internet was the most important factor that enabled these low-cost carriers to get into the industry. It provided a platform through which they connected to customers directly and competed on price effectively. You can now search, compare, and book in a few clicks without stepping outside. Many businesses that depend on stable digital channels build the stack to Own IP address blocks that keep traffic reliable and measurable. Control at this layer tightens feedback loops and sharpens pricing decisions.

We will continue to see major transformations and disruptions arising from the Internet.

Your Business on Internet

Starting and operating an internet business is not as easy as anyone could tell you. As I have noted on Tekedia, Internet has three main core features when you look at it from the business angle

Aggregation Capability: Internet has this feature that those that create contents and value may not be the core recipients of the value delivered. Those that aggregate become the people that earn most of the values. Wakanow will always be in a better position than most airlines in Nigeria because it is asset-light, aggregating ticket pricing with minimal risk. When you expand that to Facebook and Google, which offer services completely free, the entities that create the values like media firms are totally lost. If you can build scale on the Internet, a business that depends on this aggregation construct is always good. Airbnb, Uber and most modern digital firms are good on this. Narialand is also one, aggregating contents, legally or otherwise, under one man and earning big profits all the way.
Diminishing Abundance: Internet offers unconstrained distribution channel. This makes it so hard for anyone to control pricing because you do not just compete with your local peers; you compete globally. Yet, in some industries, the fact that Internet gives you global scale does not mean you can make money. ThisDay Nigeria newspaper may be accessible to any reader in the world, having thousands of readers daily, yet, it may not be making as much money as when it had very fewer readers, before the dawn of Internet. That is a diminishing return: internet is very notorious for that.
Commoditization: Any content that is online is simply commoditized because they all have the same level of access. And when the contents are linked on Facebook, they compete for the same positions. Unlike in the past, before Internet, where New York Times print would be seen as a more prestigious material than most competing papers, the fact is that within this Internet era, everyone is competing for positions with Google search algorithm. Mastering this commoditization is very critical in understanding how to find success on the web. Building a fintech must be designed on the construct that a great product can be chosen over a big bank product because for the internet user, say for remittance, provided the money gets safely to the destination, no one cares how nice the branch of the bank looks. So a fintech can compete on price against a bank, if its services are great. The bank heritage has been commoditized. To win and succeed on the web, one has to differentiate by efficiency, pricing and or elements of value.

All Together

The future of commerce resides on the web. You should go for it. But understand the biggest vulnerability of Internet business: lack of defense, because on Internet you compete globally, with limited defined boundaries. Your mistakes cannot be masked. Your pricing can easily be compared with peers, and you cannot be guessing while on the web because information asymmetry, typical in the meatspace, is gone. Internet demands the best from you because Internet is a huge “continent” that herds, working on the wisdom of the crowd, the network effects. You cannot trick the crowd and that is why succeeding on the web is harder. If you ask a typical web hosting company in Lagos, Nairobi and Accra, you will be surprised on the number of people that abandon renewing their domains after just a year. Why? The promise of a huge global market was met with the inability to find a space in a big sea, mimicking the seaman that shouted “water everywhere, but not a single drop to drink”.

The South Africa’s New Fintech Degree

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Just Accepted A Committee Invitation from the Government of Canada

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Software Eats Cisco’s Networking Gears, Lesson for Entrepreneurs

Lesson for Hardware Entrepreneurs

Further Insights via LinkedIn comments

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Let Customers Score The Product Vision

Lesson for Founders

Add SSL to Your Site

Here’s how to fix this problem:

Like this:

Mastering The User-Centricity of Internet Business

Your Business on Internet

All Together

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The South Africa’s New Fintech Degree

Share this:

Like this:

Just Accepted A Committee Invitation from the Government of Canada

Share this:

Like this:

Software Eats Cisco’s Networking Gears, Lesson for Entrepreneurs

Lesson for Hardware Entrepreneurs

Further Insights via LinkedIn comments

Share this:

Like this:

Let Customers Score The Product Vision

Lesson for Founders

Add SSL to Your Site

Here’s how to fix this problem:

Share this:

Like this:

Mastering The User-Centricity of Internet Business

Your Business on Internet

All Together

Share this:

Like this: