How Rwanda became Africa’s startup hub | The World Weekly
About a 20-minute drive from the Rwandan capital of Kigali, there’s a barren road that leads to a construction site amid cornfields and banana trees. A single blue sign from the China Civil Engineering Construction Corporation indicates the entrance to the location, which stands at the top of a hill. There, across a stretch of red earth, a hundred workers finish constructing the first building of the “Kigali Innovation City”.
By mid-2017, the site is slated be home to a offshoot of Carnegie Mellon University, the first African campus for the American higher education institution.
It’s one of the many signs that Rwanda is emerging as a hub for new campuses, startups and innovation. The country, which hopes to convince investors and multinational companies that it can be their African “laboratory,” recently hosted the 26th annual World Economic Forum on Africa with a focus on digital transformation.
Rwanda had three days from the conference to fend off competition from Kenya and South Africa — the two countries on the continent that receive the majority of investments in new technology. Giants like Google, Facebook, Microsoft and Uber attended the event, not wanting to lose a rare opportunity to meet local startups.
Many of Rwanda’s startups are born in kLab, an incubator located on the sixth floor of the Telecom House in Kigali. The decor there is clearly inspired by Silicon Valley: vivid carpets, beanbags, industrial furnishing, even a foosball table. Future entrepreneurs can pay a nominal fee for a high-speed Internet connection and use the tables for their laptops. With plenty of light and a view of Kigali’s hills, the incubator is the birthplace of many of Rwanda’s startups.
"The mind must be able to get away if you want to create," said kLab's founder Michel Bézy, who is also the associate director of the local branch of Carnegie Mellon University.
One of Rwanda's most promising startups, TorQue, was born in kLab in 2011. The company developed an application that enables distributors to keep an eye on their sales and stocks in real time. “Previously, everything was based on paper records creating a lot of inaccuracy and fraud," explained founder Jean Niyotwagira.
President Paul Kagame aims to transform Rwanda into a middle-income economy by 2020. Over the years the government has embarked upon an expansionary fiscal policy to combat poverty and bolster economic growth. This has led to major improvements in the quality of education, infrastructure and the level of investment. Today the country is the 12th fastest growing economy in the world. The World Bank has ranked Rwanda as the third most business-friendly African economy.
TorQue’s biggest client is Dutch company Heineken, which has a near monopoly on beer and other drinks sold in Rwanda. "Thanks to that tool, they can better manage their production and adapt their marketing," said Niyotwagira.
The young entrepreneur ignored advice from friends to take up an offer to work for Heineken. Instead, Niyotwagira hopes to use the drinks company's network to start TorQue in Nigeria and Congo.
Valued at $500,000 by an insurance company that took a 10% stake, TorQue is already profitable. And Niyotwagira has started working on his next project — a payment platform for shopkeepers — for which he’s partnering with African telecommunications companies MTN and Tigo.
Like Niyotwagira, entrepreneur Patrick Buchana, 25, sees Rwanda as a good springboard for his startup AC Group. The company’s “Tap & Go Cards” are now used across Kigali’s vast bus network.
“Many users would dodge the fare and part of the money would disappear into the ticket seller's pocket. This is now impossible," said Buchana. "The card is free for users. They just pay for their fare and we take a commission."
AC Group, which is supported by the Rwandan government, its first client, has raised $1 million.
There's no shortage of funds for these startups. Rwanda announced the creation of a $100 million fund for innovation in 2015. In its latest report, the World Bank named the country the easiest African nation to do business in. "We've eliminated all administrative nuisance and there's no corruption," said Francois Kanimba, Rwanda’s minister of trade and industry.
Located on the same floor as the kLab, Kigali also has a space called the FabLab. It was originally a technical prototyping platform for innovation that was invented by MIT’s Center for Bits and Atoms in the US, which has since expanded to the rest of the world.
On May 12, Rwanda inaugurated the country's first FabLab, which has since helped forge a path between ideas and a market for those ideas.
At the FabLab itself, it smells of wood and fresh paint. Two American students explained how the software, 3D printers and lasers there work to a group of Rwandans.
"We're helping them to create their own solutions," said Neil Gershenfeld, the director of MIT’s Centre for Bits and Atoms. "We shouldn't expect yesterday's factories to create the jobs of tomorrow. The fourth industrial revolution everybody's talking about relies on initiatives like this one."
This article has been sourced and translated by Worldcrunch