Helping to build African startups from the ground up

5 min read
10 Dec 2019

mazon Web Services (AWS) has a track record of supporting startup communities globally and is now focusing on Africa in a big way. We caught up with the company to find out how AWS Activate and NGO partnerships are helping African entrepreneurs.

Startup sectors are rapidly developing across Africa, and the increased density of innovative businesses in various communities is generating improved accessibility for founders to mentorship, funding, coworking spaces, and startup programs. 

The major positive trend, AWS believes, is increased access to early-stage financing from firms such as Nigeria’s Microtraction, propelling them into global accelerators. Smaller, boutique investment firms focusing on particular areas, such as South Africa’s Dazzle Angels and ed-tech focused accelerator Injini, are expanding the availability of value-adding options for founders, providing more than just money.

According to an AWS spokesperson, “Clearly, access to seed capital at an earlier stage is more prevalent than two years past, hence startups are scaling faster from earlier in their journey.”

All of this creates the perfect cocktail in combination with AWS startup programs and its value proposition of paying only for what is consumed.

“AWS dedicates startup teams focusing on helping startups with addressing not only technical challenges but also business mentorship in addressing how to make a pitch deck, how to write a technical term sheet, how to market and hire like Amazon,” the spokesperson says.

Where early-stage funding is coupled with AWS startup programs, startups accelerate faster than usual. AWS cites Nigeria’s Paystack, Flutterwave, Jumia, Aella Credit, Ghana’s Asoriba, Kenya’s Cellulant, and South Africa’s Sensor Networks, Aerobotics, DataProphet, Ctrl, and Pineapple as recent examples where founders have secured early access to startup programs and funding, as well as follow-up funding for growth and scale. 

“Overall, these startups today are leveraging the AWS breadth and depth of services to innovate, which in turn enables venture firms, like Microtraction and Venture Garden Group in Lagos, or Knife Capital and 4Di Capital in Cape Town, to return an investment, which in turn seeds the next early-stage founders,” the spokesperson says.

4Di Capital is an independent venture-capital fund manager specializing in high-growth technology venture opportunities at the seed, early- and growth-funding stages.

There is more to be done, however, in areas that include ease of starting a business, gaining global exposure, and even access to skills, both technical and business. Yet, at the early stage, funding and business mentorship are key for startups. And expanding access to these things, regardless of location, is pivotal for the development of the startup sector as a whole.

“Considering the number of countries in Africa, our many languages and the business logistical barriers, and infrastructure challenges such as access to lower-cost internet, a key area to address for founders is incubators and accelerators expecting founders to physically attend,” says the spokesperson.

Virtual acceleration can fill the gap here, and this is where AWS Activate comes in. Through the program, startups that are portfolio companies of AWS partner accelerators, incubators or seed funds gain access to AWS resources that will quickly help a founder to get started, including promotional credits for AWS usage, an AWS business support plan that gives founders access to technical support, self-paced lab credits for training on AWS, office hours with an AWS solutions architect, and the chance to be featured on one of the many AWS startup marketing channels, including Startup Spotlight and Startups on Air

“New breeds of accelerator offering virtual business acceleration, such as Sw7 in Johannesburg, are helping to bring startups into a more blended, accessible program, which enables founders to set time aside anywhere, as opposed to a traditional cohort-based accelerator that requires on-site attendance in a foreign country, which comes with all matter of challenges,” the spokesperson says.

Sw7 is one of the best established accelerators in South Africa with over two hundred tech businesses accelerated through programs in Johannesburg and Cape Town.

Dozens of African startups have already benefited from AWS Activate, but this is not where the company’s impact on the continent’s startup ecosystems ends. Free AWS StartupDays are run in JohannesburgLagosAccra and Nairobi, aimed at delivering educational content, practical learning, and networking opportunities for startups looking to accelerate their innovation and growth. 

“Many startups need to meet enterprises, which is why AWS launched “Startup Showcase,” presenting an opportunity for SaaS [software-as-a-service] startups to present to top enterprises,” says the spokesperson. 

“Additionally, in order to accelerate the startups, we invite founders to showcase at Startup Central for free. Startup Central is the center of the AWS Summit in Cape Town attended by thousands of enterprises, developers and startups.” 

The Johannesburg-based AWS Loft event, meanwhile, offers startups access to more than 150 sessions, ranging from development to analytics, and also allows them to meet experts that can help them scale their businesses.

“Some startup founders require assistance to build, either on the business side or technically, and as such we have mentorship or technical office hours where founders meet with startup architects and others,” the spokesperson explains.

Support is there even earlier, at the pre-startup stage. Recognizing that the digital skills gap is a big challenge, and one that is not being solved by traditional educational institutions, AWS is tackling the issue across its various initiatives. 

“The digital skills problem is exactly the kind of innovation that AWS startups are addressing and at scale, including startups such as Eneza Education in Kenya and SkillUp Tutors in Cape Town,” says the spokesperson. 

The company has also launched AWS EdStart, its ed-tech startup accelerator designed to help entrepreneurs build the next generation of online learning, analytics, and campus management solutions on the AWS Cloud. AWS EdStart is now available to South African startups. The company also offers AWS Educate, which provides tools to students dreaming of careers in tech, and AWS Academy, which provides higher education institutions with a free, ready-to-teach cloud computing curriculum that prepares students to pursue industry-recognized certifications and in-demand cloud jobs. 

“Our curriculum helps educators stay at the forefront of AWS Cloud innovation so that they can equip students with the skills they need to get hired in one of the fastest-growing industries,” says the spokesperson. 

We need to attract more boutique VC firms to be more easily accessible for startups

There is much that AWS is doing, then, to help build the African startup space from the ground up. But ensuring its ongoing development will be a communal effort involving many different players. The main component of this growth is that access to investment and acceleration opportunities continues to increase.

“We need to attract more boutique VC firms to be more easily accessible for startups. A startup is about speed to market, and founders are under pressure to build a sustainable business very fast,” says the AWS spokesperson.

“Seed funding organizations like the African Business Angels Network (ABAN) and startup organizations such as the Silicon Cape Initiative and VC4Africa make expedited efforts in getting angels.”

All startup organizations across the continent, AWS believes, will need to ensure they make themselves more available and increase the number of programs on offer for founders. AWS is doing its bit to help, with the goal of providing startups with support from entry to exit in order to increase their chances of success.

Main photo: Tim Johnson / Unplash

All other photos: Startup Guide