Learnings from emerging markets

In Startup Learnings, Startup Scene by Sébastien FluryLeave a Comment

Seedstars, a Geneva-based organization co-founded by Pierre-Alain Masson, Michael Weber and Adrien de Loës, aims to build and to grow companies. Seedstars World is one of their project, powered by Alisée de Tonnac, one of the few « women in tech » in Switzerland. Alizée and her team are travelling around the emerging world to discover the best startup of each country/city. They hold a local competition in 20 cities in 2013, 36 in 2014 and 2015 will see Seedstars World coming in 50+ cities. Winner of each competition is then invited to the final event (with a bootcamp), which was hold in Geneva early February (I’ve written about the 36 startup finalists here). The winner scores $500k in funding and all entrepreneurs get global exposure, as well as an international network of entrepreneurs (that’s one of the fringe benefit of the competition: they meet dozens of fellow entrepreneurs based in other emerging countries and build international relationships).

Moreover, Seedstars doesn’t want to keep for itself the promising startups they discover… That’s the reason why they are also launching seedstarsfund, so you can co-invest in these startups from emerging countries. Learn more about this investment opportunity here!

SSW has noticed that we, Europeans or Americans, often put emerging countries in boxes and that we have big stereotypes, for instance:

  • Mexico = Drugs
  • Nigeria = Corruption
  • Philippines = Zyphoon
  • Colombia = Kidnapping
  • India = Overpopulation
  • Kenya = Terrorist attacks

Beeing on the ground and meeting local entrepreneurs of these countries gives a completely different overview and feeling. As well as these stereotypes have some reality behind it, founders and entrepreneurs are found everywhere. With the same desire to change the world!

Seedstars city bis

Seedstars World does not only organize startup competitions, but also makes its best to understand the local startup scenes. And to share it ! They have developed their own methodology to assess the quality of a local startup ecosystem, the so called SSI (SeedStarsIndex). They consider 3 factors :

  1. Success : are there successful local entrepreneurs ?
  2. Culture : is it socially acceptable to be an entrepreneur, how is failure and risk taking tolerated ?
  3. Execution : is there access to funding, skilled labour, infrastructure and a supportive legal and tax system ?

SSI gives a score to each ecosystem they have visited and is benchmarking it against USA (which has the highest score, 100). For instance, among the startup scene visited by SSW, Singapore lands #1, South Korea lands on 2nd position and United Arab Emirates on 3rd place. I’d be really interested how Seedstars evaluate the Swiss startup scene according to SSI. Alisée, what do you think ?

SSW even has published a booklet gathering their learnings collected during the SSW journey so far. I’ve extracted 8 interesting facts (but there are many more to find in it):

  1. 74% of adult Kenyans use their phone to make payments (in 2014), compared to only 14.4% in North America
  2. Argentinians spend 4.3 hours on social media per day
  3. 88% of web traffic in Nigeria comes from mobile phone (only 30% in USA)
  4. There are more mobile phones (564M) than toilets (366M) in India
  5. 4% of the world’s twitter post originate from Jakarta, Indonesia
  6. Africa has 14M phone lines but 880M Africans have a mobile phone
  7. 7% of women in Nigeria and Zambia are entrepreneurs
  8. By 2016, 88% of world population will be living in emerging market, of which 80% will use a smartphone

Alisée and her team also gathered some learnings, that she has shared at SSW grand final:

  1. Emerging markets are building global hits
  2. One size fits all is an illusion
  3. Women are wrecking it : in some countries, economies are powered by women (38% of female tech founders, 3x times more than anywhere else)
  4. Governments are not the enemies
  5. Globalization is turned upside down
  6. Emerging markets are building the future
  7. Diasporas are waking up ! There are more than 500k Palestinians in Chile, and there is even yet a VC fund of USD 30M for Palestinians. It is estimated that Lebanon counts 4.5M people, but has a diaspora of around 20M people. Imagine the potential power of such networks…
  8. Talents are found everywhere. What is always missing in startup ecosystems is role models

According to Seedstars’ team, the best time to plant a tree (build a startup) was 20 years ago. The second time is NOW.

And finally, here is a quote of Mark Zuckerberg Seedstars has used in its booklet :

The only strategy that is guaranteed to fail is… not taking risks !