The Africa Business Club, a student club at Harvard Business School, is set to host its 18th annual Africa Business Conference on campus from Feb. 26-28. Reputedly the world’s largest student-run Africa-focused conference and the largest student-run conference at Harvard Business School, the conference will examine pressing issues and developments within the context of its theme, “Unite. Innovate. Disrupt: Homegrown Models for Africa’s Prosperity.”
Among new features this year are Startup Labs, a design thinking and hands-on problem-solving workshop; and a Disruptive Innovation Workshop, where participants will study a specific company that uses market-creating innovation in a developing country. Below is a summary of topics to be discussed.
Agriculture. More than 60 percent of Africa’s arable land remains uncultivated. Of the cultivated portion, the majority of farming practices are unproductive.
Air transport. Africa has more than a billion people and 4 percent to 6 percent annual GDP growth, but accounts for just 3 percent of the global airline capacity. Passenger complaints persist about poor intra-Africa servicing and prohibitive fares. Many Africa airlines still struggle to be profitable.
Banking the unbanked. With 80 percent of its population considered “unbanked,” Sub-Saharan Africa has the lowest proportion of consumers with access to formal or even semi-formal financial services of any major global region. Non-bank market entrants are driving growth in financial services accessibility through innovative solutions. These include M-Pesa’s mobile wallet; MasterCard tools that expand access through its Innovation Lab in Kenya; Sweden-based BIMA’s “paperless” insurance delivered via mobile technology; and New York-based First Access’ credit risk assessment using financial and mobile data.
Consumers. African brands are on the rise and taking over from global brands. With emphasis on relevance, innovation and market disruption, Equity Bank has surpassed Barclays in Kenya; Verve has over 15 million debit cards in Nigeria, beating both MasterCard and Visa; the Peri-Peri chicken of Nando’s in South Africa is consumed in more than a 1000 outlets in 30 countries; and MultiChoice dominates the pay-TV market with localized content “made in Africa for Africans.”
A young population accounting for more than half of income earners gives Africa’s consumer market significant potential. Key challenges to overcome include: poor data quality/availability; fragmented retail markets; and linguistic and cultural diversity. These, however, have not stopped some 400 companies from generating at least $1billion in Africa-based revenues.
Currency depreciation. Currencies in many African countries have fallen to record lows against the U.S. dollar and other major international reserve currencies. Some observers say this presents great opportunity for firms, while others argue the contrary.
Education. Factors behind African’s education crisis include poorly trained teachers, inadequate infrastructure, tight budgets and the inability of too many families to afford the cost of sending their children to school.
Energy. The continent’s abundant wind and solar resources, together with the existing low electrification rate make it ripe for investment in the renewable energy space. Challenges include the high cost of renewable technology; lack of market infrastructure; and limited consumer finance. Still, energy startups are pursuing innovative new technologies and business models to create and capture value in this market, including the often-overlooked base of the pyramid.
Entrepreneurship. Traditional models of poverty alleviation have often trapped developing nations across Africa in a cycle of aid dependence and emergency relief. Today, new models that employ entrepreneurship to empower previously disadvantaged groups have begun to experience success. Incubators, accelerators, business skills-development programs, and networks of experienced investors and serial entrepreneurs are connecting innovative ideas, relevant expertise, and passionate people, while creating jobs and building up communities from the grassroots level.
Healthcare. The Ebola outbreak in West Africa uncovered huge systematic deficiencies in health care and communication throughout West Africa.
Human resources. With rapid growth in Africa, the mismatch between readily available talent and the jobs that need to be filled is a regular concern for multi-nationals and start-ups alike.
Private equity. Over $6 billion has been raised to invest in Africa in the last 18 months and other large global players are increasingly interested. Dovetail this with the challenging economic situation a number of key PE countries find themselves in (e.g. Nigeria, Kenya and South Africa). Some of the headwinds currently being faced include currency crises, higher interest rate environments and stifled domestic consumption.
Sports. Football is widely recognized as the most popular sport on the African continent, with 50 percent of the population said to have watched some part of the 2014 FIFA World Cup. Yet, national football leagues in Africa are hardly thriving, beleaguered by weak infrastructure, low wages, an overall lack of competitiveness and more.
Telecoms. Mobile telecoms penetration in Africa is a success story, with 67 percent of the continent’s population now possessing mobile phones. However, growth is set to slow sharply, possibly heralding an end to the boom in an industry that has spurred the continent’s growth.
Urban transportation. Rapid urbanization in Africa has resulted in high population density and urban sprawl. As urban planning races to try and keep up, one of the key areas for innovation will be in developing efficient urban transportation. Uber has already entered sub-Saharan Africa. The light-rail transit system in Addis Ababa, Ethiopia, is the first of its kind on the continent.
Women. As forces join to create innovative African businesses that pull up the continent, unlocking African women’s full potential is more than a sound strategic initiative: it is an imperative.
