Two years ago before we launched Rentalgrid in USA, we thought it could be a wise decision to launch in Zimbabwe first. Our initial idea was to help property owners in the Diaspora to manage their properties in Zimbabwe. It took us just 3 months to realize that Zimbabwe was not the place to do this. There is enough infrastructure but there is no ecosystem to sustain startup growth.
Businesses are still closed to the opportunity that exist from opening their systems to downstream consumers. To put things into perspective; We use Stripe to process payments, we use Plaid for real-time bank authentication, Sparkpost to send emails, Plivo for SMS, New Relic for server monitoring, Amazon Web Services for our cloud services, we use credit Bureaus for tenant credit history. When we make money, these entities make money too.
We were committed to Zimbabwe, we rented a desk at Hypercube and hired a part-time customer acquisition resource. For us to succeed, we needed access to a transactional SMS gateway and a mobile payment gateway. We approached Ecocash but instead of somebody giving us a definitive Yes or No, we went in circles without success. Our take was that, they had infrastructure that could do what we wanted but they were closed to unknown entities like we were. We approached Telecel through Dr Makamba who referred us to the current CEO Angeline Vere then she was General Manager. Following the ownership changes that occurred that year we became stuck in bureaucracy. We had the same challenges with other entities.
We tried to push but we realised that the effort was not commensurate with the anticipated rewards. The things that took us months in Zimbabwe, took us minutes in USA. There was nothing extraordinary about USA except the business mindset. The difference between Econet and Facebook lies in how they view the world. Econet has the ability to be a gigantic platform but it is primarily occupied with growth that is fueled from within. On the other hand, Facebook opened the Graph API, Payments, Gaming etc and different people found different ways of leveraging its platform for their benefit which in turn benefited Facebook. Candy Crush is a good example of symbiosis.
When I look at Zimbabwe, I see so many opportunities that can employ thousands of people. If we were an open society that embraces technology we could probably be less corrupt. Imagine if the government could make criminal convictions data available freely, and Edgars teams up with other entities like CABS to create a credit bureau that we pay to check people’s credit history maybe incidences of corruption and serial fraud would go down.
There is so much that the bigger players can do to create an ecosystem that can allow smaller and yet more innovative players to thrive.
15 comments
Brilliant article that hits the nail right on the head. Zim’s tech ecosystem is so closed off its a nightmare. Most of the problems we have can be solved by opening up our systems. Private and public entities need to do more to solve this problem as it is a collective effort. We do not have people who are willing to share for the benefit of the ecosystem. Whoever builds whatever they have built will close it off for personal gain. I bet you if Linus Torvalds were Zimbabwean Linux would not be open source and would probably not be as widely used due to our closed off mentality.
Excellent analysis – pretty much sums up the tech ecosystem currently obtaining in Zimbabwe. Strategic players need to see innovation with an open mindset rather than be scared of it – a vibrant tech culture can stir the economy to levels unforeseen and everyone can benefit from that.
Not to defend Econet, but what I always tell people who want to integrate with Econet, make sure your idea/plan makes business sense to them. Econet and all other operators are businesses and need to make money at the end of the day. Now, if they were to allow you to have access to their USSD, SMS or Voice infrastructure, they need to make a return from you otherwise they make a loss by hosting you if you bring nothing. That’s why they are sceptical to bring in partners especially in this tough economic environment.
The difference between Econet and Facebook is FB relies on apps to retain users and the cost of infrastructure is relatively low for them and hence they can host you easily. Econet on the other hand relies on giving a customer value on the dollar to retain them and the cost of infrastructure is high as they import everything.
My advice to startups/small companies is work with what is there first then approach the big companies. For example:
Bulk SMS: Start with aggregators like AfroSoft or online platforms like Twilo
Payments: Start with PayNow, they have already partnered with the big guns. The TeleCash
API is also available for the taking.
USSD: Start with approaching entities like ZimSwitch who already have partnerships with all operators.
Start small, as you scale up, eliminate the middleman. The big guys may even approach you as you grow and you will be able to negotiate from a point of strength.
There is a fatal flaw in your argument. You are saying it is not economical to Econet to host your idea instead you have to go to a middleman like Bulksms? Do you realise that if Econet was open and had created public APIs there would be little room for the middlemen?
Besides I am sure allowing people to automate SMS sending would allow Econet to make money from SMS, it’s not as if you are asking to send the SMS out for free! How much money are they making out of SMS right now? They are busy complaining about how OTP services are taking away their businesses yet they are leaving money of the table. I am sure Econet already have an API and I am also sure opening it up results in them making more money.
Build it and they will come! More people will use the API if it’s available thus resulting in them enjoying Economies of Scale.
Garikai, my point is it costs money to host you so you have to have a promising proposal for them to consider you. I think we agree most startups fail even in 1st world countries, what of a country like ours?
For SMS, if you approach them as an aggregator, they will consider you. It makes sense for the general public to integrate with aggregators than to have Econet manage and administer user e.t.c. Why are they allowing integrations like this now? It’s because the cost of sending SMSs is now low to them as a business. Now consider the cost of USSD(which uses voice channel), it’s still costly to them.
Have you noticed the Telecash API has been around for a while but I don’t see much innovation from developers.
I don’t think anyone has ever approached Econet asking for a short-code, premium SMS number or SMS gateway that they expected to be provided for free. In Zambia and Namibia, cellular service providers have fixed price charts for such services that you can request for with no red tape. Within a month, including regulator approvals, your short code will be up and running, with very little questions asked.
So, why should my idea makes sense to Econet, if I am a paying customer. If I want an SMS gateway to send out a smiley emoji to my clientele each morning, that has nothing to do with them. It’s none of their business. They should just charge me for the smses sent, as long as my content is legal and within terms of usage.
Imagine if ISPs asked you to provide a complete business proposal on how your company plans to use it’s Internet connection, the anticipated revenue to be made from said connection, then on top of that (for NO GOOD reason) want a profit-share from your online business. Yet, the only work they do is setting up your Internet connection, nothing more. It would be ludicrous! That’s basically what Econet is doing.
PayNows’ integrations are easy to implement, but the charges are high for low value purchases, i.e, up to $10. At the end of the day it’s not profitable for the merchant who is trying to provide lower prices by offering their products mainly online. That’s why developers approach the likes of EcoCash for API access e.t.c, only to start on another bureaucratic journey which has no clear end.
No-one is asking for FREE services, we are asking for WHOLESALE, RED TAPE and MIDDLE-MAN less technology services, that we will PAY for. I don’t think that’s too much to ask, is it?
Was about to say something like this in response. Great explanation.
This article might sound bitter/angry because the author was spited by Zimbabwean businesses but it’s exactly how I feel about Zimbabwe’s business environment as a whole. Despite touting our own acumen it seems everyone in a position of influence from the politicians to the lowly office worker have perfected the art of being an impediment. The selfishness and shortsightedness is Universal and is one of the reasons, coupled with a burdensome regulatory framework why we are experiencing this slump.
“Ita zvako wega!” is the moronic argument I hear often. People don’t realise we achieve more if we work together. If fact if everyone was to take this advice we would be poorer for it. A tuckshop on every house gate would benefit no one. What would be the benefit of everyone selling tomatoes.
had a good time reading your arguements guys
This is the most insightful article ive ever read here.
I put the blame on the regulator Potraz. World, with the exception of New Zealand and Australia(they did away with regulator decades ago), telecoms industry is governed and get direction from them.
If you look at some the decisions FCC made in US, that really changed the way customers are handled in US including business. When voip started to be popular, it was the FCC who jumped in and punished companies who were blocking it in fear of loss of revenues.
In Zim, we have have Potraz which is setting the base limit for calls and data, reason being to try and protect voice calls revenues for telcos.
FCC also introduced the USF, and the subsidising those in remote areas to get basic internet and mobile signal connection.
Potraz have the USF, but its only used in Masvingo to open a one man shop to impress Pres Mugabe, then closed soon after.
My point is we need a non biased, non political regulator to drive the changes needed to open up telcos for OTT businesses.
Until then, NetOne will continue to ask you Zanu Pf membership card for them to even listen to your business request. Econet will continue to grow strangle other businesses via its monopoly
This is a very incisive article. As a developer, I have experienced the same thing. Ecocash API is totally closed off, so are most other systems run by other companies where there is no need to close it off. Until this changes the local tech industry will never reach its potential
which is where l say our regulator is busy splashing money for campaigning instead pushing laws which promote best practices and opening business opportunities in the telecoms sector
Herald and other news outlets disable right click/context menu on their site. Thats the mindset we are dealing with. Petty issues! Chimwe chingori chidofo che vanhu vari pazvi nzvimbo.
I suppose tech giants like EW are also fearful of innovative disruption – which is why they seem to be dabbling in everything. If jingoistic politics is swept aside, and we learn to embrace high standards, merit, criticism and value time our country can go far. As for the Zim govt we all know its limits – reducing everything to a snail’s pace so that we learn to accept mediocrity.