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Comment by randomafrican | Hacker News Reader

It's still pretty hard to start a business in Africa, period. Lack of acess to capital, quite represive legal and tax environment, lack of cheap and skilled labour (that translates into expensive skilled labour), infrastructure that is very far from being sufficient (even if it's getting better) and potential constumer that remain quite poor.

So a scene of technology companies is pretty far fetched.

Don't let the growth rates fool you. Most of it is still related to oil, mining, construction and public works.

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The South Africans and Kenyans have already built a strong technology scene, so really it's not far fetched. The market is already there and still pretty much open for most products. The talent is available to kick start the industry, a lot of computer science graduates lying around doing nothing. All that is left is for the government,the corporate world and other stakeholders to take advantage of this opportunity. I would also like to point out that telecommunications companies like Econet and MTN have also contributed a lot to their countries' GDP. While the drawbacks you mentioned are significant; they can be solved if everyone involved can share the same vision.

One huge disadvantage also is that many Africans don't have access or the ability to get credit cards and so it locks them out of the ability to pay for hosting and cloud services. If someone can figure out how to connect the local SMS payment infrastructures that most countries have to Amazon AWS, then there could be some serious dough gained from the developer community. I learned this the hard way when I did a presentation on deploying Python Apps to Amazon at klab.rw in Rwanda. Everyone loved it but no one could actually try it out because even for the Free Tier AWS requires a CC.

Well that's a huge disadvantage; I had to ask someone to pay for my domain. Telecommunication companies are in a position to offer such a solution. I heard Telecel,Zimbabwe has been working on such a solution .

> Don't let the growth rates fool you. Most of it is still related to oil, mining, construction and public works.

I'm very interested in learning about growth in Africa, as there is a lot of potential to raise millions of Africans out of poverty as well as contribute positively to the global economy, and a lot of what I hear makes me optimistic (I think of things like, "Could a rising Africa offset a receding Europe?") This is not the first article I've seen talking about huge growth in cell phones in Africa, though I'm skeptical that "90%" of the continent has one... Is the proliferation of cell phones evidence that Africa is growing generally beyond a few key industries, or does that really not indicate anything interesting?

Cellphones and cellular network are consumption, really. Though 90% may be high (or they're couting phones per habitants without considering that many of us have multiple phones) the cellphone penetration rate is indeed high.

And when you think about how few landlines there used to be, it's just amazing. Or the whole point is that there were no landlines.

But we're still talking about a consumption market. And we're talking about a case in which technogical progress and the lack of infrastructure allowed us to leapfrog.

The real growth is still driven by the thousands of jobs created directly and indirectly by mining and oil. (even construction and public works depend on revenue from mining and oil)

I don't want to sound cynical, but a repressive system is what capitalism has always preferred, right? So based on that alone you should see investors rushing for the gold already.

For potential angel investors, the lack of reliable statistics about the relevant markets is probably a big issue. Africa is also less homogenous than Europe, so we're talking about many different markets that need to be looked at individually.

>I don't want to sound cynical, but a repressive system is what capitalism has always preferred, right? So based on that alone you should see investors rushing for the gold already.

They do. In extractive industries and anything that involves negotiating favours with a government. And I'm not sure capitalism prefers a repressive system or that systems in Africa are that oppressive (or the right kind of oppressive).

> For potential angel investors, the lack of reliable statistics about the relevant markets is probably a big issue.

Chicken and egg. Statistics appear when there is a market for them (investors).

I don't see why/how you would call this capitalism. It's got nothing to do with free markets. It's not something anyone who describes himself as a free arket idealist would endorse.

The only thing capitalistic about it is that someone accumulates wealth.

Capitalism does not require a free market and while people are free to describe themselves how ever they want the actions of the vast majority of successful capitalists places them firmly in the pragmatist--instead of the idealist--camp.

You need low corruption, rule of law, contract enforcement, and property rights.

There's probably a very wide gap between the best and the worst countries in Africa in terms of this -- it's not one homogeneous region.

Even though Africa is less homogeneous than Europe, it's roughly divided into two halves, the English speaking and the French speaking countries. I would like to believe it's still homogeneous if you look closely. I think http://en.wikipedia.org/wiki/Mxit have managed to scale , with over 40 million users and still counting.

a repressive system is what capitalism has always preferred

It sounds more than cynical, it sounds disingenuous.

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