Why Africa’s Accelerator Programs Are Going Niche
Accelerator programs for African tech startups are common these days, with companies benefiting from training and mentorship from Cairo to Cape Town.
These programs are run by a variety of organisations ranging from investment funds to incubators, and, increasingly, corporations looking to tap into the startup space.
In theory, the value of accelerators is undeniable, offering startups access to vital infrastructure, training and connections with mentors and investors. Yet the number of tech startups that have graduated from these programs is still relatively small compared to the huge impact of global favourites such as 500 Startups and Y Combinator.
African accelerators are in a state of evolution. Initially programs, run by the likes of the now-defunct 88mph in Kenya, South Africa and Nigeria, had a general focus. Increasingly, accelerators launching these days focus on niche verticals.
One such program is Digital Health Cape Town (DHCT), which recently selected its first cohort of ed-tech startups. It is just one of a number of accelerators across the continent that has chosen to deep dive into one space to offer more focused assistance.
DHCT’s chief executive officer, Siraaj Adams, says the benefits to startups of a narrower focus include access to sector specific potential clients, and one-on-one mentoring by industry experts rather than generalists.
Such programs allow startups to gain better guidance and more knowledge of a rapidly evolving sector than if they were part of a general accelerator that also included companies in spaces like e-commerce and fintech.
“The e-health space is endless, based on the rate of technology and the day and age we live in. The pace of technology makes this area a constantly evolving sector to improve systems, data, medical procedures, devices and access to healthcare, to name a few,” Adams said.
“Healthcare is now getting the attention it needs to anchor itself in the base of patient-centric models. Entrepreneurs need the support, empowerment and funding from both government and private sector to make the difference and a reality in the healthcare arena.”
German pharmaceutical firm Merck also runs an e-health accelerator in Nairobi, but it is not just in healthcare that accelerators are focusing on a specific niche. John Karanja runs the Nairobi-based blockchain and digital currency accelerator BitHub Africa.
He says the focus on blockchain – as opposed to fintech in general – allows his community to specialise and gain expertise collectively in one key disruptive area that he feels will be critical for the growth of jobs and the economy in general.
Karanja says there is a clear trend across the continent in this regard.
“I think we are seeing more hubs focusing on sectors. This is great as it leads to specialisation and the addressing of key challenges facing different sectors and societal groups. However, there should be an exchange of Ideas through more collaboration to enhance cross-learning through shared experiences,” he said.
Back in Cape Town, Barclays (now Absa) has been running a host of programmes from its Rise incubator, all of which have specific focuses. Ecosystem manager Camilla Swart says the hub has found being niche in terms of fintech – Barclays has partnered with Techstars to run two fintech accelerators from the space – has reaped rewards.
“Networking and collaboration is far more seamless because of the common ground,” she said.
“Being niche means we can focus on the specific challenges facing the entrepreneurs in that niche. The peer interaction is a vital part of these accelerators – the support you get from each other helps drive success. Being able to spend time with peers who have had similar experiences and challenges means you support each other differently – ‘you get it’, there is a different empathy and also a different lens on the strengths of the group.”
Rise has even gone niche in terms of gender, recently launching the second edition of its program for female founders.
“Last year we saw the benefits to the entrepreneurs and so we are repeating the program, but this year with a bit more of a framework or structure, and additional value-adds like the financial modelling and planning tools,” Swart said.
“The beauty of this year’s program is that one of the graduates of last year, Antoinette Prophy, is actually running the program for us – that’s a result! And we are thrilled to have her expertise and passion driving things.”
Tom Jackson is co-founder of Disrupt Africa, a news and research company focused on the African tech startup ecosystem.