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Three takeaways from the hierarchy of venture opportunities in Africa and other emerging markets
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Three takeaways from the hierarchy of venture opportunities in Africa and other emerging markets

Analyzing and categorizing unmet needs across African markets bestows a powerful framework for entrepreneurs and investors to understand and assess the relative attractiveness of various opportunities

Emeka Ajene
Mar 19
5
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Three takeaways from the hierarchy of venture opportunities in Africa and other emerging markets
afridigest.substack.com
Afridigest provides ideas, insights, & analysis for startup founders, operators, and investors across Africa and beyond.
Today, I revisit a previously published essay that introduced a novel framework for entrepreneurs & investors to use to evaluate opportunities. This post contains a brief introduction and actionable insights for founders, operators, and investors.
If youโ€™re new, welcome ๐Ÿ™Œ โ€” youโ€™ll receive a weekly digest every Monday and, generally (but not always), an original essay/article on Saturdays. For past essays and digests, visit the archive.

On Thursday, Afridigest received what we believe is our first major media mention in a Quartz article on influential Africa-focused tech media. In it, I was quoted as saying, โ€œThe most influential content goes beyond fundraising or launch announcements to showcase innovative or pioneering thinking that offers new insights to readers.โ€

One example of such pioneering thinking that new Afridigest readers might have missed is the now almost two-year-old essay, โ€˜The hierarchy of venture opportunities in emerging markets.โ€™ The piece draws inspiration from Maslowโ€™s hierarchy of needs to develop a framework for entrepreneurs & investors to use in evaluating opportunities across sub-Saharan Africa.

After publishing, the article drew quite a bit of interest from founders, VCs, and angel investors worldwide as gauged by follow-up emails and WhatsApp messages received โ€” so much so that weeks later I published a subsequent clarifying piece, โ€˜Demystifying venture opportunities in African markets.โ€™ Ultimately, to quote from the original essay:

โ€œEntrepreneurs & investors in sub-Saharan African (and similar) markets are most likely to find success if they concentrate on ventures that: build basic or alternative infrastructure; organize and integrate fragmented markets; minimize transaction costs & friction; enable entrepreneurship & economic empowerment; or create entirely new markets.โ€


Click here to read the article


Actionable insights from the article

Actionable insights GIF
Credit: Cesno

If you don't have time to read the full piece, hereโ€™s what founders, operators, and investors can learn from the hierarchy of venture opportunities in emerging markets:

โ€ข ๐—œ๐—ฑ๐—ฒ๐—ฎ๐˜€ ๐—ณ๐—ฟ๐—ผ๐—บ ๐—ผ๐˜๐—ต๐—ฒ๐—ฟ ๐—ณ๐—ถ๐—ฒ๐—น๐—ฑ๐˜€ ๐—ฐ๐—ฎ๐—ป ๐—ผ๐—ณ๐—ณ๐—ฒ๐—ฟ ๐˜‚๐—ป๐—ถ๐—พ๐˜‚๐—ฒ ๐—ถ๐—ป๐˜€๐—ถ๐—ด๐—ต๐˜๐˜€ ๐˜๐—ผ ๐—ถ๐—ป๐—ป๐—ผ๐˜ƒ๐—ฎ๐˜๐—ผ๐—ฟ๐˜€ & ๐—ถ๐—ป๐˜ƒ๐—ฒ๐˜€๐˜๐—ผ๐—ฟ๐˜€.

It's not often that investors and entrepreneurs look to the field of pyschology for answers in their professional lives, but sometimes the best ideas come from outside one's industry. And, according to renowned psychologist Abraham Maslow, analyzing and categorizing unmet needs provides the best insight into and understanding of human behavior. One can extend his work to the context of entrepreneurship across African markets โ€” analyzing and categorizing unmet market needs bestows a powerful framework for entrepreneurs and investors to understand and assess the relative attractiveness of various opportunities.

โ€ข ๐—ง๐—ถ๐—บ๐—ถ๐—ป๐—ด ๐—ถ๐˜€ ๐—ฒ๐˜ƒ๐—ฒ๐—ฟ๐˜†๐˜๐—ต๐—ถ๐—ป๐—ด.

Timing may well be the single most important factor in a startup's success or failure. So then, it behooves founders and funders to evaluate the African startup ecosystem critically and develop a defensible, personal viewpoint on which business models, sectors, and general archetypes are well-timed considering the current stage of development of markets across the African continent. 

โ€ข ๐—•๐˜‚๐—ถ๐—น๐—ฑ๐—ถ๐—ป๐—ด ๐—ฏ๐—ฎ๐˜€๐—ถ๐—ฐ ๐—ผ๐—ฟ ๐—ฎ๐—น๐˜๐—ฒ๐—ฟ๐—ป๐—ฎ๐˜๐—ถ๐˜ƒ๐—ฒ ๐—ถ๐—ป๐—ณ๐—ฟ๐—ฎ๐˜€๐˜๐—ฟ๐˜‚๐—ฐ๐˜๐˜‚๐—ฟ๐—ฒ, ๐—ฏ๐—ฟ๐—ผ๐—ฎ๐—ฑ๐—น๐˜† ๐˜€๐—ฝ๐—ฒ๐—ฎ๐—ธ๐—ถ๐—ป๐—ด, ๐—บ๐—ฎ๐˜† ๐—ฏ๐—ฒ ๐—ฎ๐—บ๐—ผ๐—ป๐—ด ๐˜๐—ต๐—ฒ ๐—บ๐—ผ๐˜€๐˜ ๐—ฎ๐˜๐˜๐—ฟ๐—ฎ๐—ฐ๐˜๐—ถ๐˜ƒ๐—ฒ ๐—ผ๐—ฝ๐—ฝ๐—ผ๐—ฟ๐˜๐˜‚๐—ป๐—ถ๐˜๐—ถ๐—ฒ๐˜€ ๐—ฎ๐—ฐ๐—ฟ๐—ผ๐˜€๐˜€ ๐—”๐—ณ๐—ฟ๐—ถ๐—ฐ๐—ฎ ๐˜๐—ผ๐—ฑ๐—ฎ๐˜†.

Investment theses and startup ideas should reflect the realities of the markets they target. And today, considering the realities of African markets, the biggest opportunities may lie in the aggregation of supply or demand or both, the connection of disjointed markets, and the development of platforms that act as infrastructure or operating systems for others to leverage, plug into, and build/layer on top of.

Read the article now


AUTHORโ€™S NOTE

As always, Iโ€™m very interested in your thoughts. Contact me via Whatsapp, Twitter DMs, or  email or leave a comment here. And take a look at our friends at intellence for your thought leadership needs.

Thanks for reading โœŒ๐Ÿฝ
โ€” Emeka

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