As Africa keeps emitting positive economic signals, international investment will continue to rise. The question is, how will it affect Africa’s tech startup scene? Will it boost the fledgling ecosystem, or cannibalise greenfield opportunities? There’s a balance in the middle there somewhere, and it’s worth exploring.
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For example, Futurex is the latest international security company to see opportunity in Africa. Based out of Texas USA, the 30-year old company specialises in encryption for secure transactions. Futurex will be represented in South Africa by Stanchion Payment Solutions.
As Africa’s unbanked start to gain access to new payment channels, while connectivity booms and broadband becomes more prevalent, there’s a definite growth in electronic payment solutions being rolled out across the continent. But, securing those transactions is critically important.
Seizing market opportunities, within months of its arrival in South Africa, three major organisations in South Africa and Tanzania have already implemented Futurex solutions.
We spent some time thinking of notable local security startups. We came up with FireID, Entersekt, IMPI and of course Thawte. Should there be more?
When German eCommerce startup-cloner Rocket Internet turned its gaze to Africa, it injected Zando and Sabunta into South Africa and Nigeria’s fashion industries. The company also set up 5rooms, the furniture e-tailer in South Africa and Kasuwa in Nigeria.
While the success of these companies can be disputed, the African market is attracting international attention. Were these opportunities overlooked by local entrepreneurs, or did they require unattainable capital?
Perhaps certain industries don’t lend themselves to clear market needs, but as Africa’s economy grows and with it, its financial service requirements and the security challenges they pose, there might be opportunities for local entrepreneurs to move first.
The Futurex example is intriguing because it also asks a question about how enterprises will react. Will corporates source solutions from the most competitive seller — potentially internationals entering the local market — or will they approach locally-bred enterprise-facing startups for tailored solutions?
