Saying that there’s no startup funding ecosystem in Zim is an understatement. For most, this is the biggest stumbling block when it comes to our local startups. I am not most, however, and I tend not to agree that funding is the biggest issue. I acknowledge that it’s an issue yes but I don’t think it’s the biggest issue. I was also pleasantly surprised to learn that the CEO of Startup Bootcamp –Philip Kiracofe- seemed to share some of these sentiments. Now, when a CEO whose company helps startups to scale is saying funding isn’t everything then surely something gives?
Traction before everything else…
Speaking at the recently ended AfricaCom Mr Kiracofe made it clear the getting traction before funding was fundamental. So yeah, at some point you may need funding but that should never be the reason why you don’t even start out to begin with. In Startup Bootcamp’s work with startups, this is one of the key elements they place emphasis on.
Rolling out an iteration of whatever product or service you’re rolling out is vital because it affords you the opportunity to get some feedback. And because you HAVEN’T received funding yet you can actually iterate on this product/service. Once you’ve poured thousands or worse millions into whatever product service you’re offering you have far less wiggle room to actually iterate and change the things that might need changing.
Don’t rush to build an app
Another thing that tech companies and startups love to do is build apps. From time to time you hear, “we have an app for this” and now “there’s an app for that”. There’s nothing wrong with apps per se but the only problem is that high-quality apps take a lot of resources in terms of time and money. It takes us back to that issue of over-committing which makes it harder to then iterate and make changes as need be.
Another unfortunate side-effect of geeking out on apps that I’ve personally seen is that because some developers don’t have the resources to make a good app we end up with sub-standard apps that only got out of the gate because developers have fallen in love with the effort they put and they expect everyone else to do the same. The unfortunate reality is that the people who get to use apps don’t see it the same way and ideas fall out of the way.
Another reason why you might want to curb the enthusiasm when it comes to making apps -in Zim especially- is that most people don’t even get to access the apps because of the simple fact that most people are buying bundles for WhatsApp and social media. So even if you have a fantastic app there’s a chance that people won’t even get to use it; simply because they can’t afford the data.
If you won’t take it from me then take it from the CEO of Startup Bootcamp. APPS MIGHT NOT BE ANSWER!
Traditional venture funding is not straightforward
The final reason why venture funding and the idea of funding is generally trickier might be the simplest one. If you have a startup and you’re looking for funding there’s a very important question you have to ask yourself: what’s the valuation of my company? In order to evaluate that there’s legal fees and then legal fees for whatever investment agreements
So where from here?
This is not all to say that funding is bad or you should outright avoid getting funding. There are people such as friends and family who might be interested in investing in your idea as you’re in the initial phases of your business and that might be a great way of growing; think of it as a looser version of angel funding. From there once you’ve had some experiences and you’ve gone through all the trial and error phases you can safely seek funding and take it from there.
Obviously, there may be different thoughts and opinions regarding the issue of funding. Let’s continue the discussion in the comments.
5 comments
It’s about time someone said this.
Funding is the last thing a startup should seek. I might even say, if you get it right, the funding will seek you.
The first thing is to provide a solution, that a critical number of people can access, are willing and able to pay for, at a price that enables the startup to keep delivering the solution. Funding then helps to scale the solution.
If the idea or business model is already flawed, finance cannot help turn a bad idea into a good one. On the other hand, if the team is responsive to change and willing to pivot through the customer discovery process, this may be different.
However, our ecosystem is not robust and liquid enough to “pay for mistakes” à la Silicon Valley. We don’t have access to a full stack of funding (and mentorship) from seed to series X. In other words, the cost of pivoting is generally borne by the startup alone.
The same thinking applies to an “app.” The app is not the business, it simply enables the business to scale. The business remains the solution, it’s accessibility and affordability.
Funding is normally based on a track record. Therefore it’s important to start running with the available resources, reflect, refine and run again and keep repeating this process.
It all comes to priories, whatever you think is important at that time, run with it. I believe if one is creative enough an APP can be launched into a successful product here in Zim. Combo bundles (whatsapp+your app) can be negotiated with telecom companies to get people to have a test of the APP, it can be done. On funding there are many creative ways to fund a startup. Its not easy but its hard.
**Not easy but can be done
for a startup to succeed you dont need funding, you do not need beta resources to create whatever you think is good for people , you do not need good timing… you need to solve real world problems nobody gives a damn about how many hours to spend creating an app that they dont find value in. SPEND time listening to what the market wants and form a business around that not create what you THINK people want. What evidence do these startups have that thier idea is good ? if the app is produced what evidence do you have that im ready to buy? probably none .Most tech guys dont have business skills on their belt u cant solve problems with jst creating a software WHAT DO PEOPLE WANT that is the real question that should be answered before going on a computer and opening a code editor(whatever they will be using) … Tech guys attach themselves to the software they create that they think everyone wants it and thats why they fail in the first place . FOCUS ON DELIVERING DIGITAL PRODUCTS THAT BRING VALUE TO PEOPLE ….