Celebrating Jumia: A Proudly African Tech Unicorn’s IPO
On Friday, Jumia went public on the New York Stock Exchange - the first African tech company to do so. It may sound silly, but I shed a small tear and said a prayer for all involved including the Samwer family, as I watched Aunty Juliet Anammah ring that bell. That was history. Like everyone else, I have my reservations about Rocket Internet but what they have built in Africa against all odds remains symbolic. We should be celebrating them and taking credit for our role in making that feat happen.
However, a vocal minority of leaders and opinion makers in our tech ecosystem are saying Jumia, a company co-founded by Africans (Tunde Kehinde and Raphael Afaedor), built with African talent (including a lot of Lagos Business School, Unilag and OAU student interns), to serve an African market (14 African countries) and primarily financed by a Pan-African company (MTN) isn’t African because they are incorporated in Germany and IPO’d on the New York stock exchange.
Rather than take the opportunity to celebrate black excellence by sharing and amplifying inspiring stories of how the early founders, investors, customers and team members who are mostly Africans built a behemoth that is now listed on the New York Stock Exchange, we got into a meaningless and primordial debate about what an African company is in a world without borders.
Let me attempt to correct a few misconceptions fueling this annoying debate.
First, incorporating the headquarters of a tech business in most of Africa makes it effectively dead on arrival. It is almost a sure way not to win. I can write a whole piece on why this happens. Between the massive hyenas that roam our public and private sectors and the serious socio-political and economic risks our countries face, no one can in good conscience convince seasoned tech investors to invest in an African tech business incorporated in Africa.
I also believe that this isn’t a battle our tech founders should fight simply because it is a long term fight and it is way bigger than them. I truly believe we all benefit from them building successful companies domiciled outside of Africa instead of trying to prove a futile point.
More importantly, this isn’t unique to Africa in the developing world, see Singapore for South East Asian companies or Hong Kong for Chinese companies. In fact, it is my hope that once the African Continental Free Trade Agreement is signed, Rwanda can join the list of jurisdictions like Mauritius and the UAE where Africa focused companies can domicile to access pan-African opportunities. It will force giants for nothing like Nigeria and South Africa to do better.
Another misconception is that the role of foreign capital and management in scaling tech ecosystems in Africa is some sort of colonizer idea unique to us. It’s the sort of silly idea my idol Fela would respond to with ‘teacher don’t teach me nonsense’. Many of the people opinionating clearly don’t understand how tech ecosystems are built.
After all, I’m old enough to remember when Yuri Milner from Russia was running around hanging out uncapped convertible notes to my peers who had YCombinator companies in the valley. Or maybe these folks don’t know Saudi Arabian oil money built the massive Silicon Valley Unicorns you see today.
What our irresponsibly educated elite are struggling to understand is that foreign capital and management contribute incredibly to the growth of ecosystems in the face of an increasingly competitive global digital economy. This is why smart governments seek out talent and capital that can build them rather than harass the few that dare to and cry foul when they succeed in spite of the booby traps placed in their path.
More so, just as making iPhones in China doesn’t make Apple a Chinese company, taking money from the SoftBank Vision Fund doesn’t make Uber a Japanese or Saudi Arabian company. Alibaba didn’t magically become a US company because Goldman Sachs invested and then listed it on the same New York Stock Exchange Jumia listed on. Do we assume because Indians hold management positions in Dangote Industries, Microsoft and Google they are Indian companies? Do we designate the 50% of Fortune 500 companies founded by American immigrants like Sergey Brin, Elon Musk and Peter Thiel as foreign companies? Well then, Jumia doesn’t stop being an African company because it has a dab of foreign capital and management.
What is tragic is that while we engage in these meaningless arguments, we miss the company’s mission and the opportunity it represents for Africa’s ability to leapfrog traditional retail infrastructure and build infrastructure for a digital economy.
Unlike in the rest of the world, Africa doesn’t have an existing retail infrastructure. The logistics that drive our commerce are broken. Our open markets are an environmental and health hazard waiting to happen (imagine if Ebola got to our markets). Government is desperately trying to provide infrastructure to support the old but it is companies like Jumia that will ultimately build the future of commerce in Africa. That conversation obviously doesn’t matter to our elite but it does to the man on the street who is building new approaches to retail via e-commerce.
We should be excited about the opportunities and resources Jumia would get to build this by going public. We should have begun to define through the public conversation that feeds public market investor sentiment what Jumia’s role in building an African future should look like. But no. We would rather bicker about an accident of incorporation. Why are we African elite so petty and visionless?
Now, am I saying we shouldn’t encourage more local content? No. This success doesn’t absolve our governments of the fact that this success is in spite of it not because of it. Any early Jumia employee can tell the stories of many run-ins with police who seized goods and its founders can talk about how the government made the operating environment almost impossible with the currency shenanigans. It doesn’t stop us from indicting our 1% who could have financed Jumia and others like it but refused to because of lazy thinking and easy cash from government treasury bills. It doesn’t stop us from demonstrating that if we begin to seriously invest in our young people today, we could have more companies toe Jumia’s path along with Andela, Flutterwave, Paystack, Mines, and so on.
So yes we know it isn’t Uhuru. Yes we know we have work to do and a long way to go. However, like my brother, Igwe Tupac will say, we deserve some accolades.
At the end of the day, today’s companies are defined by who they serve and in a digital economy where Africa struggles to be served by global tech giants, there is something to be said for this company’s roots.
Jumia’s roots are proudly African and that’s all that matters.