An increasing number of tech-savvy Africans are no longer prepared to wait for governments to provide solutions to everyday problems – they are using technology to connect with thousands of others and working out their own solutions. The phenomenon, known as crowdsourcing, has been remarkably successful where it has been applied. Richard Seymour explains how this approach to business is accelerating Africa’s development.
In 2006, a New York woman lost her phone and the teenage girl who found it refused to return it. A webpage highlighting this injustice was created and circulated. Within weeks, millions of people were following the story, some doing their own detecting work. Soon after, the teenager was arrested and the phone returned, something the police did not have the resources to achieve, all because of a new phenomenon – which was unknown at the time but which we now call crowdsourcing. It is now promising to change the way Africans will do business in the future. Ghanaian economist George Ayittey has spoken of what he calls the ‘Cheetah Generation’: a generation of adaptable, innovative entrepreneurs who will wait no more for their leaders to make their lives better but who will act to do it themselves. He is unequivocal in his criticism of successive African governments and is clear in his belief that the best hope for a better future lies with the people themselves.
Modern technology can and will be a great liberator of this untapped potential, but according to Ayittey, who supports his economics with an intimate knowledge of African history, what he calls the traditional sector, which has always embraced bottom up, free market principles is the real source of change. A change built on centuries-old African ideals of personal freedom and the free exchange of goods and (now) ideas. In other words, crowdsourcing.
The technology sector in Africa is growing and this is providing a rich seam of ideas as well as wealth creation for the continent. The technology industry was once a closed shop with a clear dividing line between suppliers and consumers. This is no longer true.
As a business model, open source is a radical new way of doing business. It promotes free access to a product’s design. Studies have been done which show that it was not until patents lapsed on ground-breaking technologies and they became free to develop that their full potentials were unleashed. And the open nature of the World Wide Web, which its creator did not seek to make proprietary, is exactly what allowed it to change the world as we knew it in such a short space of time.
Technology companies were able to give their services away for free. Indeed, a number of new technology firms become ‘successful’ before finding a business model to work from. Even today, Facebook is looking for ways to monetise its operation, making only about a dollar per user per year.
The counter-intuitive lessons the business community had to learn with the arrival of the Web were difficult to process. Clay Shirky, a writer on the social and economic effects of the Internet, writes in Here Comes Everybody that in the early 1990s he worked for a small web design company which entered into a contract with telecommunications firm AT&T. The culture clash between old and new was immediate. What AT&T could not understand was that the technical support for the programming language that was being proposed would come from a community of programmers working for free, answering questions, between them, rapidly and accurately 24 hours a day.
Even when it was demonstrated to them that community support worked, they refused to believe the evidence. To the men at AT&T, support was something you had to find a budget for and employ people to run.
The most famous of all open source projects is the operating system, Linux, started by a Finn, Linus Torvalds, as a hobby but which quickly grew into a vast, self-organising community of developers who produced software which today underpins much of what makes the telecommunications world work. Of course, you cannot manufacture cars in this way, but the technology sector is growing and it operates under a new paradigm. It is true that many of these open source projects fail. Yet that is the secret of open source as a business model. Open source has brought the cost of failure down to such a level that an ambitious entrepreneur can afford to risk failure more than once before stumbling upon the idea that takes flight. This is a luxury not readily available with traditional business models.
Open source creates an ecosystem where one person can contribute just one good idea over the course of a lifetime and still benefit the whole. If a traditional company hired someone like that they could not afford to keep employing them.
Open source businesses make use of crowdsourcing, which calls upon the collective wisdom of the people (and which can recover stolen phones). One of the most potent symbols of crowdsourcing is Wikipedia, the open source online encyclopedia where self-organising contributors from the community run and maintain one of the most popular websites in the world. Crowdsourcing as a business model is at the heart of Africa Rural Connect, an initiative run by the National Peace Corp Association. The project pools ideas from experienced and knowledgeable people across the world with the aim of helping young farmers in Africa succeed. It provides a platform for ideas to be suggested, discussed and developed. And it makes it possible to track the life of an idea from proposal to implementation.
The initiative claims that in the three years it has been running it has contributed directly to the attraction of investment and greater crop yields. This year’s winner of ‘best idea’ was Backpack Farm in Kenya, which proposed the continued development of a mobile phone app for farmers to manage crops and irrigation, make crop calendars and to learn more about agribusiness.
The reduced cost of the new business models being developed in Africa have put more expensive government-run projects to shame. When the Kenyan government wanted to find a way to use mobile technology to track the spread of diseases in real time, they sought the partnership of a multinational telecommunications company and the estimated costs for the project ran to almost $2m.
When the scheme hit problems, the government turned to Nairobi’s Strathmore University who paid four of its students to come up with a mobile app, for a tiny fraction of the original cost. And the app works. Faced with the inertia of government and traditional business models, more and more of Africa’s people are taking their own initiative.
The developers of a system for recording incidences of human-rights violations found that the NGOs they offered it to for free, and with free technical support, were not interested. The developers, with help from some of the world’s biggest technology firms, set up iHub, a base for an online community of thousands of programmers to develop ideas, in Kenya. Only two years old, iHub launches approximately 1,000 apps annually, with around 40 companies being born from its creative womb, notably the M-Pesa service Kopo Kopo.
The common refrain in Africa is that the ‘government is the problem’. Young, tech-savvy entrepreneurs using business models that governments scarcely even understand, frustrated at the old way of doing things, are carving a new way that taps directly into the vast creative potential of the continent held back by the ossified state. The cost of failing is coming down and the rewards for success are spiralling up.
The new reality for business could not have come at a better time for Africa.