In this interview, we talk to Wong about the eFounders initiative, Alibaba’s long term plans for Africa, and the future of financial technology (fintech) on the continent.
As a Special Advisor to the United Nations Conference on Trade and Development (UNCTAD), Mr Ma recognised the need to empower young entrepreneurs with ideas and practical knowledge from some of China’s most innovative businesses. This, he believed, could accelerate the development of inclusive ecommerce platforms and markets around Africa. Inclusive platforms offer an entirely different approach to enabling entrepreneurs and small businesses with the objective to provide access to prosperity for all.
Thus, the eFounders Initiative was born. In this interview, we talk to Wong about the initiative, Alibaba’s long term plans for Africa, and the future of financial technology (fintech) on the continent. The interview has been condensed and lightly edited for clarity. Enjoy.
Business Insider (BI): What is Alibaba's long-term outlook in Africa, using the eFounders Initiative as a starting point?
Brian Wong (BW): As with other regions outside of China, Alibaba’s expansion strategy is one of ‘inclusive development.’ The company seeks to work with local partners who share our values and understand local markets. By partnering with local platforms in Africa and elsewhere, we believe we can better enable SMEs and create a more inclusive globalized trading network.
The eFounders Fellowship is a two-week course for entrepreneurial founders in developing countries who are operating open, platform-based businesses in the ecommerce, logistics, big data, and tourism sectors. The program provides first-hand exposure to and learning about ecommerce innovations from China and around the world that enabled growth and a more inclusive development model for all.
The course consists of a structured series of classroom workshops, lectures, meetings with business leaders, team building exercises, site visits and a business hackathon at Alibaba Group Headquarters in Hangzhou with site visits to other cities in China.
Upon graduation from the program, fellows make a 2-year commitment for how they will apply their learnings from their course to transform their businesses and make a positive impact on their societies.
We also invite ecosystem partners from local venture capital and incubators to observe during program and to participate in the hackathon portion in order to engage them and to work with Alibaba to provide the necessary support to the fellows during the subsequent two years.
BI: What are some of the most interesting revelations you have from the program so far?
BW: Along with our partners at UNCTAD, we check in with fellows every 3 months to see how they’re doing and how we can help. We completed our six-month calls with Class 1 from Africa last month and found that many fellows have taken insights from the fellowship and made major, successful changes to their businesses. Three examples: Eston Kimani, Jessica Anuna, and Adetayo Bamiduro.
Eston Kimani is a Kenyan entrepreneur. Since the course, he has been getting more involved in helping entrepreneurs think through their business and raise money for their startups. He started a personal blog to share his knowledge as an entrepreneur at www.estonkimani.com and has about 3000 readers. He is also considering becoming an angel investor in some startups and has committed to one already.
Eston started building a unified pan-African payments platform for consumers. This new startup was inspired almost completely by Alibaba, then set in motion by a trip that Alibaba organized with Eston and his co-founders to PayTM in India.
He tells me that the fellowship in Hangzhou is why he’s doing it. Seeing what Alipay has done in China was very inspiring, saying, "I realized how essential a payments platform is. If not for our trip to PayTM, we would not be having this conversation.”
Jessica Anuna is a Nigerian entrepreneur who runs Klasha, an online fast fashion retailer for millennial consumers in West Africa. Klasha strives to be West Africa’s largest fast fashion e-commerce retailer for 20-something-year-old women. Klasha seeks to be the leading provider of affordable, in-season clothing and to make access to apparel and accessories easy for consumers in West Africa starting with Nigeria.
Partly due to insights gained during the fellowship, as well as the mentorship of Gary from AliExpress, Jessica managed to secure funding and a spot in TechStars Dubai. In addition, she’s leveraging introductions made by UNCTAD to address regulatory hurdles in West Africa (for example it is cheaper to ship from China to Nigeria than it is to ship from Nigeria to Ghana, right next door).
Adetayo Bamiduro is the co-founder of Metro Africa Xpress (MAX), a Nigerian startup that provides safe and affordable motorcycle-taxis. With over 25,000 consumers and businesses, Adetayo is a leader in the market of providing online motorcycle-taxis and deliveries with motors.
Adetayo is hugely inspired by Alibaba’s eFounders Fellowship, he later came to China again, and visited China Mobility Companies in Shenzhen to imported electric motors to Nigeria. He will launch hybrid motorcycles in his company to reduce pollution, and use the censors of electric motor to save data.
Alibaba taught him the importance of “people” after the trip to China. Alibaba has spent a lot to help merchants online and Adetayo took this knowledge to invest more to help drivers become legally licensed for the better of his larger business.
BI: What are your general thoughts on the state of fintech in Africa?
BW: We are not experts in Africa and we do not pretend to offer fellows country-specific knowledge on fintech or any other industry in Africa. Our inclusive development model, including the eFounders Fellowship, is an effort to share our experience in China with entrepreneurs in Africa who can combine these insights with their own expertise to create platforms optimized for local markets.
Our initiatives in Africa are consistent with Alibaba’s original mission, which is to make it easy to do business anywhere by connecting SMEs around the world. Enabling platforms in other countries strengthens this worldwide network and “grows the pie” for all, rather than fighting over the same pie. The more open, platform-based businesses there are in the world – the more opportunities there will be for all players (including Alibaba), and the more partnerships will be possible in the long term.
That being said, Fintech holds incredible promise in Africa. Offering efficient financial services to underserved populations creates a world of possibilities. Looking at the size and demographics of the African market, there is a lot of potential here. It is likely that the traditional banking model as we know it will not be the main method of accessing financial services for a majority of the population. Rather, mobile devices will be the key channel by which most will engage and transact in payments, savings and investments.
BI: What do you think we are doing right (in FinTech)?
BW: Judging by our experiences with fellows who operate FinTech businesses in Africa, we can see that these businesses are taking elements of successful systems from around the world, but creating something that is uniquely African. It is important that Fintech products understand and reflect the markets they operate in, which is why we believe so strongly in partnerships rather than traditional expansion.
BI: And where do you see us still falling short?
BW: Launching new technology ventures in the developing world is challenging. In Africa, as in China, entrepreneurs face daunting challenges like a lack of physical Internet infrastructure, restrictive government regulations, lack of engineering talent and a host of other challenges. Our fellows are facing these challenges because they understand that this is where opportunity ultimately lies.
BI: How can Alibaba play a role in helping African fintech startups/companies deal with some of those shortcomings?
BW: Alibaba Business School is committed to helping African companies overcome these challenges by sharing how Alibaba overcame similar challenges over the course of our development. Between the eFounders Fellowship and our New Economy Workshop for policymakers, we believe that key examples, case studies, and best practices can help create the environment necessary for innovative ventures to succeed.
BI: Where are your projections for fintech in Africa in 10-15 years?
BW: Alibaba Business School is not an authority on African fintech, but we hope that we will see something that resembles the rise of fintech in China over the last 20 years. By solving consumer problems, building trust and championing financial inclusion, new African business – fintech and otherwise – can provide access to prosperity for all.