The market size of Africa’s digital economy is massive and, if projections go as planned, should top $712 billion by 2050. The dynamics that play into this forecast, aside from the impact of COVID, include a youthful population (the youngest globally), rising smartphone adoption and internet penetration that has led to a burgeoning tech ecosystem backed by local and international VC dollars.
While many publications and reports have done an excellent job of describing the opportunities that abound on the continent, a few stakeholders like Endeavor believe a more precise picture needs to be painted.
New York-based Endeavor is a global community of “high-impact” founders across almost 40 underserved markets in Africa, Asia, Europe, Latin America and the Middle East. The firm also has a fund, Endeavor Catalyst, which has backed many unicorns outside the U.S. and China.
“From my conversation with many entrepreneurs, we kept hearing the same thing: While we talk about the African story and opportunity, not everyone has the African context,” Tosin Faniro-Dada, the managing director and CEO of Endeavor Nigeria, said to TechCrunch on a call.
“Entrepreneurs will say to me, ‘When we have to go beyond our local markets and walk into rooms to meet investors in San Francisco, New York and London, most of them don’t even know what we’re talking about; they don’t understand the African opportunity.’”
The organisation’s report intends to shed more light on Africa’s market dynamics. For investors, it hopes to help them build local market intelligence. And though they are inclined to follow the money, Endeavor wants them to look beyond usual market opportunities and map out exit pathways.
Africa’s digital opportunity
The continent’s $115 billion digital economy is in its early phases. For instance, 33% of individuals use the Internet compared to a global average of 63%. The report also pinpoints other metrics such as fixed and mobile broadband connections and mobile cellular network coverage.
Much of the growth so far has been concentrated in four key markets: Nigeria, South Africa, Kenya and Egypt. These markets make up 32% of Africa’s population, 51% of the continent’s mobile network connections, 50% of its professional developers and 51% of its GDP.