Thursday, Dec 18th 2014

IHub needs to take business out of IHub

Saturday, October 20, 2012 - 00:00 -- BY ANDREA BOHNSTEDT

Sometimes there’s a fallout to my column. When I recently wrote about the IHub and much of the real tech business occurring elsewhere, the IHub people didn’t lob bristling ‘rights of reply’ pieces with ‘perish, idle foreigner!’ at me.

Instead, they asked whether I’d come to a talk on these issues at the IHub. Now at the IHub, there’s Pete’s Coffee. And Rachel Gichinga, the IHub’s community manager, said that Conrad Akunga aka Roomthinker, one of my favourite Kenyan bloggers, would be there, too. It’s all about the right incentives!

On Thursday’s panel, apart from Conrad and myself, were Njeri Rionge and, beamed in from Tanzania, Mbwana Alliy from Savanna VC. Here are a couple of points that I briefly mapped out during the evening:

Not every app is a business, and not every IHubber with a laptop is an entrepreneur. The IHub guys often struck me as very technology-focused.

Technology in itself isn’t a business yet. If you want to be a start-up, then you need to think about it in a bigger context. Your app, website or other idea may be great, but if you don’t understand marketing, if you don’t understand how to build a company around it (or how to find people who can do this), then you probably won’t get very far.

I don’t want the IHub (or similar bodies) to discourage anyone from pursuing a business idea, but to be more realistic about what it takes.

And I also argued that the IHub, as an organisation set up to support and nurture the IT community, could do a better job in broadening its efforts.

In a conversation with Erik Hersman quite a while ago, he said that they had received generous funding from foundations, so they had little need to engage with the local business community.

I always felt that this was a pity, and that the IHub could be much stronger on its mandate if it had come out of its fourth-floor bubble and tried to work with the local business community (beyond ‘fireside chats’).

Most ideas aren’t at even at the VC stage, so building an angel investor network could be useful. If you are setting up a company in Kenya, then surely having access to people to know how to run a business in Kenya would be helpful.

If you’re not doing a subscriber-focused app, but looking at a service or product for businesses, surely you want the connections to those businesses?

And finally, don’t underestimate the value of access to traineeships, internship, and employment. I know it sounds dull, and it’s often very difficult to find, but employment can be huge learning experience, not just with regard to technical skills.

A friend of mine set up a very promising B2B tech firm in Kenya that now works regionally and has huge demand. He is still employed in the US, partly, he says, because it gives him incredible access to knowledge, industry practices and corporate contacts.

Conrad, who I had expected to be wild of hair and fiery of eye, turned out to be a far more mellow looking sort, but that was merely appearances: Silicon Savannah, he said, was just a stereotype, like African drums.

He ran a couple of well-known IT brand names past us and asked if anyone knew where they came from. We didn’t, and it turns out they were all from Eastern Europe.

Did it matter? No, not one tiny bit. Users used them because they work. So forget the Savannah bit and benchmark yourself against global quality. Don’t, he said, develop something and then go looking for a problem that this might solve.

And he’s not a big fan of all those conferences, pitch events, hackathons, bootcamps etc: ‘What have they bloody produced?’

Start-up, he says, is a dirty word – it’s a company to which the following doesn’t apply: Cost management, marketing, strategic planning, talent acquisition and retention and so on.

And not all paths to success are mobile, mobile, mobile: there are enormous opportunities in providing products and services to business. A lot of this is ‘boring. Hard work. When people hear about this, they vanish.’

Mbwana also wasn’t so hot on the competitions/hackathon/pitch circuit: In Silicon Valley, he argued, these happened in universities to get youngsters started – if you actually have a start-up, you’re usually too busy chasing real investors (oh, and getting work done).

There is effectively a market for competitions in Kenya now, he finds, but most competition judges don’t really go through the company metrics carefully enough.

However, when he asks people looking for venture capital about figures, they often, disappointingly, have nothing to show.

In her contribution, Njeri Rionge focused on ‘corporatising’ your idea – more emphasis on taking your idea beyond yourself and your laptop.

And she actually showed the IHub what they could get out of pursuing connections to the local business community more systematically: she offered five internship positions.

But a final ‘voice of reason’ contribution from Mbwana: failure is normal. There are lots of failures in Silicon Valley – and you do learn from them.

And it’s worth bearing in mind that this tech sector in Kenya is still very young, so trial, error, failure, and revision are natural while it matures.