5 Tech Trends that will Affect African SMEs in 2022
What are the tech trends that will affect African SMEs in 2022? Read this post to find out.
Africa has long been regarded as a major frontier for global growth and investment, but in reality, has frequently fallen short of promises. Historically, the continent has failed to turn its vast endowment of human capital and natural resources into stable development, having been damaged by colonization and the attendant turbulence and violence. Nonetheless, the continent has revealed pockets of the enormous potential that have proven to be fertile ground for entrepreneurs and businesses to thrive and flourish.
This year, Africa has piqued international interest as a potential growth market. Private equity investment in Africa hit an all-time high last year. Aside from its vast landmass and youthful population, the continent’s technological advancements make it extremely promising. According to the World Economic Forum (WEF), the COVID-19 pandemic raised the demand for more digital technology adoption and integration among SMEs.
Tech Trends That Will Affect African SMEs in 2022
Some tech trends might cause disruptions in established businesses. Many of the technological innovations in Africa today are by-products of the COVID-19 pandemic. Video conferencing and productivity tools, for example, have made remote work more convenient. They are also reducing the demand for office space among startups. More Africans used technology last year than ever before, and more SMEs adopted these as well. Based on these premises, here are a few noteworthy tech trends estimated to have tremendous impacts on Africa’s commercial landscape this year:
The Growth of Telemedicine
The health-tech industry in Africa is booming. The number of startups in the field has exploded, as has the amount of money invested. Traditional healthcare providers have been compelled to adapt their business models and use new technology as a result of the pandemic. All these have resulted in new opportunities in the medical field.
These days, the most prevalent form of service supplied by health innovators founded in the last five years is telemedicine paired with the direct-to-consumer distribution. Companies are now using tech-enabled solutions to revolutionize the way health items are distributed. For example, MYDAWA, a Kenyan online pharmacy, now offers SASAdoctor-powered telemedicine services. E-commerce behemoths like Jumia, Konga, and Copia have also begun to sell over-the-counter health items.
The Rise of Proptech
Real estate is one of the world’s oldest business sectors. It is, nevertheless, one of the least altered sectors and is in desperate need of a makeover. Proptech businesses are developing to challenge traditional property thinking in this regard. The Africa Report by Knight Frank highlights the emergence of this tendency. “What began as a trickle with the launch of internet search platforms has grown into a tsunami of disruptive and cutting-edge technologies that continue to increase both transparency and efficiency,” according to the research.
African Proptech startups gained traction last year. Rent Small Small, a Nigerian Proptech business has become the first African startup to be accepted into the Techstars Accelerator in Canada. Seso Global raised $600,000 in pre-seed funding last year, indicating that investors are optimistic about the area.
The Merger of Art and music with blockchain technology.
Several African artists have begun to use NFTs to express their stories about the continent. This is because blockchain technology is changing the arts and music industries through NFTs. This phenomenon has sparked worldwide interest, and Africa’s tech sector is riding the wave: last year, a South African NFT business garnered $5 million.
Aside from the headline-grabbing revenues, the key disruption with NFTs is ownership. Artists no longer have to wait for streaming networks like Spotify to pay them commissions before earning money; instead, they can sell straight to their fans at their desired prices without concern of piracy. This event is slowly making its way into the African music scene. Don Jazzy, a well-known figure in the Nigerian music business, has joined the NFT. Last year, top artists like M.I. and Falz expressed interest in music NFTs. It is reasonable to expect that many more will get on this moving train this year.
The Metaverse and Increased Internet Usage
Africa’s internet economy brought in $115 billion in 2020 and is expected to bring in $180 billion by 2025. Urbanization is one of the internet economy’s driving forces. According to an OECD report, Africa will have the world’s fastest urban growth rate. By 2025, cities will be home to 45 percent of Africa’s population. Furthermore, cyber behemoths like Facebook and Google are constructing massive cable networks across Africa in order to boost internet access. As the number of people using the internet grows, so does the visibility of businesses on the internet. But it also implies that the internet culture, which prioritizes speed and ease, will expand even further.
The metaverse, for its part, is one of the most popular terms right now. It’s essentially a virtual world made possible by merging several technologies, such as virtual and augmented reality. Companies like Facebook hope that the metaverse will become a place where we can meet, work, play, study, and shop, even if it doesn’t exist yet. The next phase of the internet is expected to be ‘extended reality’ which will blur the barriers between physical and digital existence. Consider in-game purchases, in which computer gamers can pay real money for virtual products and services. A customized avatar creator or a metaverse research scientist are examples of jobs in the metaverse.
In Africa, agriculture is a significant business, accounting for 14% of GDP in Sub-Saharan Africa. However, due to the sparse number of smallholder farmers, this sector still has a productivity problem. Fortunately, agritech startups are on the rise in Africa, with tremendous development. Last year, innovative businesses such as Releaf and Hello Tractor received funding and are changing the agriculture industry. In 2020 and 2021, agritech businesses received the second-largest amount of venture capital funding. We’re witnessing an increase in mission-driven agritechs leveraging technology to boost agricultural productivity.
The African business scene is continually changing, and businesses that do not adapt will become extinct. The past two years have demonstrated that the only certainty in our world right now is more change and uncertainty. Most company leaders are functioning in a context of rapid and near-constant change, thanks to the impact of the pandemic, the expanding importance of digital technology in every aspect of our lives, and the increasingly visible impact of a changing climate.
Tech trends bring up ideas of the world’s most forward-thinking businesses, the ones that produce products and services that establish entirely new industries or new solutions that change current ones. To succeed this year, African entrepreneurs will need to build a culture of adoption that spans across their organization to affect how their employees think about the issues they face and the solutions for them. This is crucial if they are to meet current and future challenges and deal with persistent unpredictability and upheaval.
Entrepreneurs will need to innovate in a variety of areas, including how they interact with customers, how they approach sales, how they give ongoing support, and so on. Such changes will be tough and potentially disruptive, therefore business leaders must maintain business balance while establishing confidence both internally and externally during the transformation process.
Visit SME360 for other interesting trends to help African SMEs.