Editor’s Note: This was originally published as “Why Nigerian entrepreneurs should solve other problems apart from ecommerce” by Dotun Olowoporoku.

Nigeria is almost a victim of it’s size. It’s almost too easy to have big ambition. The population size makes the country one of the most viable markets to monetise consumer products. It’s quite common to see startup founders creating various versions of ecommerce platforms than anything else.

I get it, size matters. After all, size is a significant factor that drove most of China’s stratospheric growth. It’s easier to build and monetise an online consumer product that provides a slight improvement to what people already do offline, rather than build a deep-tech product that intends to create new habits.

However, I think a lot of Nigerian startup entrepreneurs are getting blindsided by the population size. The reality is, research data on the number of people with access to internet and consumer behaviour in Nigeria is still patchy. Internet is still expensive. It’s not everyone that has a mobile phone, that uses the internet. It’s not everyone that uses the internet that trusts it enough shop online. It’s not everyone that shops online that does so regularly. So the total addressable market for ecommerce in Nigeria could be smaller than what you see on numerous pitch decks and telco-sponsored research reports.

Also, consumer internet business models are relatively easy to validate but expensive to scale. Customer acquisition cost tends to go up as the market matures and more competition enters the fray. The Mexican standoff between Jumia and Konga highlights how tough this could be. Both businesses are burning loads of cash for land grab and market share that is still mainly confined within Lagos. And there is going to be another big boy in the hood – Mara.

The bottom line is, except you have deep-pocket investors with the willingness to fight a long drawn battle for network effects, building an e-commerce  business at scale could be a hard one. So, why do so many Nigerian founders still default to ecommerce solutions? Well, I reckon it has a lot to do with size and solubility. The size of the market is alluring with an obvious demand. And most of the problems with e-commerce have been solved and can be adapted even in relatively immature markets.

So, it’s easier for Nigerian founders to demonstrate traction selling stuff online than trying to build a product that will make car registration in Nigeria more efficient. For the former, rallying your immediate friends and family network around your MVP can generate the first $100 in revenue, but the latter will take months of product development and government buy-in to demonstrate any meaningful traction.

However, technology and innovative business models can be used to solve other problems in Nigeria beyond buying and selling goods online. There are pockets of underserved and untapped markets in other spaces. Significant value and wealth can be created through B2B enterprise solutions that will create efficiencies in specific industries.

Nigerian founders should focus on problems-to-be-solved with technology rather money-to-be-made. Revenue is a reward for solving problems. Here are few that comes to mind.

1. Nollywood Movie Subtitle Service: Use combination of human and machine learning algorithms to improve (cringe-worthy) subtitles on Nollywood movies.
2. HR Management – Cloud-based SaaS for managing human resources including hiring, scheduling, payroll, staff evaluation, insurance and incentives.
3. Expert Consultants On-Demand: Online marketplace for MBA and PhD consultants from world-class universities and companies to provide on-demand consulting services for African SMEs and organisations
4. Office Building Check-in App: It’s annoying to sign into a tatty notebook at the security post before one is allowed to enter most office buildings in Nigeria. Someone needs to create a ‘foursquare-ish’ app that enables visitors to check-in to an office building via their mobile phone.
5. Multi-channel Marketing Attribution: I assume millions of dollars is spent by brands to advertise in Lagos. There is an opportunity here for algorithm-based software that helps quantify the impact of marketing across online and offline channels and estimate ROI for these brands.
6. Back-Office Automation– Lots of companies in Nigeria, including large banks and other financial service companies, still rely on manual/Excel-based processes to manage inventory, qualify leads, generate quotes and sell their products. Building vertical SaaS products to solve these problems will create significant value and increase efficiency
7. Real Estate Investment Syndicate – Real estate will continue to be a decent investment opportunity in Nigeria. A platform that enables people to purchase equity in private real estate investments for as little as possible through crowdfunded syndicated deals will create value for buyers and sellers.
8. Software Development Project Management –  match project owners with organised team of software developers, designers, project managers, testers and business analyst.
9. Customer Review – Make it easier for businesses/brand to collect  and publish customer reviews and NPS survey results from various sources.
10. Medical Diagnostics Lab –  enable users to discover and book private medical labs based on facilities, availability, expertise and user ratings. Provide subscription-based insurance programme that will guarantee routine medical checkup.

I believe there are many others that a lot of smart entrepreneurs in Nigeria may be working on. I look forward to seeing more ideas that can be added to this.

—————

Dotun currently works on Starta, a content and data platform that makes it easier to build, discover and track high growth business opportunities in Africa.

The thought that this mini bus was designed and constructed in Nigeria, by Nigerian Engineers and not foreign Engineers, working here as expatriates; is indeed a hard one to believe, as it is looking more foreign than home made.

The thought that it was produced inside the University workshop of Nnamdi Azikiwe University Awka, by 7 Graduate Engineers of Mechanical Engineering Department, of the Faculty of Engineering, is certainly a hard bone to swallow.

These lads have given in their best, to put up this gigantic project within a very short frame of time, and thus, it has become the talk of the town.

One will wonder how undergraduates, who know they have got very limited time to stay in the University and so, should enjoy their last days within the 4-walls of the University, still gave in to stressful and strenuous nights at the workshop, just to write their names on the sands of time.

These guys are worth all the laurels and awards in this country at this particular point in time and thus, be given immediate employment, so that their brains and zeal towards invention are kept in line.

They are:
EZEIGWE CALLISTUS CHITOO
OBINANI VICTOR CHIMDIKE
NWOBODO NNAMDI MIRACLE
OGBU THADDEUS IKENNA
OMINIGBO FIDELIS IGHO
EZEANOLUE IFEANYI EMMA
OKORO CHINAZA
Obliviously, these students are geniuses, as it is only people in that category that can put up something like this, using crude equipment and 100% local content. They improvised for barely everything that can be found in that mini bus, from the chassis to its roofing.

The bus was even test driven in front of the Minister of state for Education, Prof Anthony Onwuka and other top dignitaries present during the National Universities Commission (NUC), held in UNIZIK. This goes a long way to tell the world out there that, this is Naija’s giant invention, its has been tested, and its indeed it can be trusted.

A warm kudoz! to these guys, for it is certain that a bright future awaits them. A big congratulations to their supervisor and the Head of Department at that time, Dr. C.H Achebe, for giving his boys every necessary vigor they needed to carry out this work, and above all, for being leading by example.

We wish them the best in their field of specialization, as we look forward to bringing our country on the top list of Innovators in the world.

Editor’s Note: This piece was contributed by Eve Pearce

There has rarely been a better time to start a new business within Africa. With a few exceptions, the economies of Africa’s major nations are on the up. Despite a recent slowdown in the continent’s general economic rise, the future looks rosy. Little wonder that brand new business people are seizing the chance to let their entrepreneurial spirit take the reigns. However, it’s not all smooth sailing. There are still lots of challenges to overcome if your fledgling business is going to make it in the African economy.

Financing

You have to have money in order to make money, as the saying goes. Unfortunately, it’s true. While you can build yourself up from scratch, it helps if at some point during that process you’re able to save up enough money to get yourself to the next level. Hand-to-mouth operations simply don’t progress. Finding the funds to set up or advance a business is a major headache for plenty of African entrepreneurs. Having been in the economic doldrums for some time, many African nations simply don’t have the resources (yet) to offer the kind of monetary grants and fiscal incentives which other nations can throw at new businesses. A lack of funds for new ventures is, therefore, something of a challenge. However, it’s not an insurmountable one. There are funds out there for those who have the time, guts, and tenacity to hunt them down. And, as our economic climb continues, it’s likely that more grants etc will be made available. In the meantime, however, a lack of basic funds throws up all kinds of challenges for new African businesses – particularly when combined with other problems which first-time ventures may encounter. Anything is surmountable with enough money. Unfortunately, enough money is precisely what a lot of new African entrepreneurs do not have.

Risk

Somewhat related to a lack of funds is the presence of great risk for new African ventures. Without a financial cushion or other such provisions to bolster your business, the prospect of financial ruin in the face of trials looms large. Businesses which have the resources to stand firm during the inevitable hard times are at a considerable advantage. Unfortunately, many African start-ups do not have the resources to put funds aside, and may lack the know-how required for effective crisis-management. Added to this is the fact that insurance is either expensive or unavailable for many new African businesses – and that many African entrepreneurs do not trust either banks or insurance companies. While there may be good reason for this, it does leave them high and dry when disaster strikes. Sure, taking the risk and striking out without a strategy or resources set aside for hard times can pay great dividends. But it can also destroy your business. When the stakes are this high, it’s well worth putting a risk-management strategy in place. Apart from anything else, doing so will reassure potential customers  and investors that you and your business are a safe pair of hands with which to trade.

Infrastructure

Companies starting up in the extensively developed Europe and Americas are generally able to plug themselves with ease into a network of well-established infrastructures. The work of providing communications links, transport connections, energy, and other such vital resources is largely already done for them. Not so in many parts of Africa. The untrammelled, unbeaten, undeveloped nature of the African continent is one of its greatest strengths – but it does present challenges for the fledgling business. Unless you’re setting up in a major city (or running the kind of business which doesn’t need a lot of infrastructure to operate) then it’s likely you’ll need to splash the cash on a private generator for power, and go to great lengths to transport products, staff, and resources – all of which puts running costs up considerably. Not to mention the immediate issues with sporadic internet access and negligible communications facilities in an age which is seeing businesses rely heavily upon the internet. Again, the infrastructures of many African nations are developing fast, allowing more and more startups access to the communications and resources that they need. However, in the meantime, those without the funds to provide their own infrastructure frequently find themselves struggling.