Author Jake Bright on Race for E-Commerce Into Africa (Audio)

European Union. The del industrial leverage rose two hundred thirty five points one point three percent to close out the session at seventeen thousand, nine hundred twenty nine. Smp F I founded up twenty eight points one point four percent to two thousand ninety eight. NAZDAC added sixty three points one point three per seven, closed at forty eight forty two. West Texas Intermedia Crude Oil down a dollar fifty a barrel, that's a loss of three percent at forty eight thirty nine.

Sparckled down a dollar fifty announce at thirteen forty and a tenure treasury up ten thirty seconds yield one point four seven percent. And that's a Bloomberg Business flashing to taking stock with Kathleen on Bloombird Radio. As the technology wave continues to sweep across Africa. We're very happy to welcome back to the show Jake Bright. He is joining us. He's co author of the award winning book The Next Africa.

He's a contributor at tech Crunch and The New Yorker, and he is constantly writing and speaking on business, politics and foreign affairs. But of course for the last few years, Africa has been his focus. So Jake, welcome back. Great to be back. Well, uh, the race for e commerce in Africa. You broke a couple of stories this week. One of them is about eBay. What's going on, yeah,

story of tech Crunch. eBay is expanding in Africa through a partnership with an African startup called Mall for Africa dot Com, which basically what Mall for Africa does is takes all the headaches that American retailers face when they try to enter an African market with logistics, with payments, etcetera. And it has a platform that makes it all easy

for them. So eBay is going to be able to sell American eBay vendors will now be able to sell to African clients um starting in Nigeria and Ghana and Kenya through them All for Africa's platform, All for Africa will do logistics, payments in marketing and will eventually expand that further and will eventually open up the platform to allow Africans to sell stuff into the US. Africans to sell stuff into the U s well, what kind of

stuff will they sell? Well, what you have going on is you start to get into the value proposition of African commerce and really when you break it down, you have an upside and a downside. The upside is that Africa's consumer markets are really starting to define themselves. By Mackenzie Stats, they're expected to spend a round a billion one trillion four by seventy five billion of that is

expected to be online. So that's the upside. The downside is that most of Africa's consumer markets are largely informal, meaning completely off the grid barter cash exchange, and many of the countries that have the most potential or these e commerce startups like Mall for Africa or eBay want to go into, they lack a lot of the baseline infrastructure that e commerce startups completely take for granted here in the US, and that includes you know, low internet penetration, UH,

third party delivery systems, and also in some cases you know, even electricity. So it's it's a huge challenging opportunity and that happens in every market, but in Africa, the contrasts and the darkness between the challenges and the opportunities of tapping consumer markets are even greater than other places in the world. But a lot of African set phones now,

well that's part of the shifting horizon, right. So what you're getting into is you have some core economies um that have really started to shape up and reform, places like Nigeria, which is really Nigeria is kind of the central point for this this e commerce um you know venture. And the reason why is Nigeria, for all of its challenges, has these dual distinctions that you can't get away from

if you're a global business. That the first is that it became Africa's largest economy in twoteens through passing South Africa. And the second is that it's Africa's largest population UM. But the you know, the the challenge on that is that again you have low broadband penetration, you have a lot of Africans actually have have phones this is this is where you know the breakdown comes. Most Africans have phones now, but very few of them are smartphone or

internet equipped. But you're now starting to see that shift happen where large percentages of Africans are going to start moving to smartphones and being connected. And these are all the things that these e commerce startups um like eBay and Mall for Africa are trying to tap as they shift into Africa. Because another story you worked on was in New York or um last quarter Africa mented its

first one billion dollars start up Unicorn Jumior Group. UH big funding round like three and a quarter million dollars. Goldman and others were in on it. How how people milestone is that? What does this tell us? I mean, it's huge. If you know, I was just thinking you and I started talking about this, you know, emerging African business narrative several years ago here on Bloomberg and when

we started, we would never have imagined it was. It was just starting to even define that there was economic growth, that there were markets that were gonna start attracting you know, Western companies more. But if we would have said to ourselves then um, you know in several years, you're going to have a real tech scene. You're gonna have Goldman included in a funding round for Africa's first startup, Unicorn. I don't think we would have believed it back then.

So these are huge movements for the continent. Then of course there's a lot of expectation and now these companies like Junia, which is now Africa's first billion dollar startup, has to actually demonstrate that it can generate revenue and profit. It's generated, it's it's demonstrated can generate revenue. But of course, like all e commerce startups, the big one is actually going from in the red to in the black. So, uh, the this whole this this bigger question though of e

commerce and tech models and the growing tech ecosystem. Where is that now in its evolution and where is it going? It's very nascent um. Africa has, as you say, this tech ecosystem that's really had a tremendous amount of growth just in the last five years. And one of the things co author Abrey Ruby and I did in our book was trying to break down what is this emerging African tech ecosystem. So some of the building blocks are there's a lot of innovation hubs, around two hundred that

have started to sprout up across the continent. You have a startup boom in Africa right now, m similar to the US in late nineties. It's a huge informal economic space, and you have a lot of entrepreneurs, many of whom and I think we've had some one on there here, many of whom are dropping out of advanced economy gigs to go back and found startups for everything to tackle just about every commercial opportunity you can have, So startups are a big part of it. You're starting to see

a growing amount of investment. Aubrey and I did a study where we captured i think between eighteen real and expected a billion dollars in VC investment going in to Africa's ecosystem tech ecosystem. And the final thing is you're starting to see um places where African governments are starting to build out I c T infrastructure and take a real commitment to building some kind of an environment where

tech can thrive. Alright. Jake Bryan, thank you so much for joining US Opportunities Investment Opportunities in Tech in Africa. He's co author of the award winning book the next Africa. I'm Kathleen Hayes. This is taking stock and this is Bloomberg coming up. Bloomberg Law brought to you by a Bank of America. Merrill Lynch seeing what others have seen, but uncovering what others may not. Global research that helps you harness disruption, but a top global research from five

years running. Merrill Lynch, Pierce, Finner and Smith Incorporated. It