Interview: Fatoumata Bâ
Where do you see the most potential in the development of digital ecosystems in Côte d’Ivoire?
FATOUMATA BÂ: Financial services and energy were the two main sectors attracting tech investments 10 years ago. Now tech is helping to accelerate more sectors of the formal economy. From health care and education to logistics and trade, technology market platforms are expanding the economic frontier. In these sectors, in particular for e-commerce, habits are shifting and the growth achieved has proven to be long lasting.
The Covid-19 pandemic offered the opportunity to create and use digital platforms for education, health or the provision of government services. Many companies went from having a few dozen clients to thousands of visitors and clients daily on their digital platforms. In education, for example, traditional training companies were able to transform into edtech companies to service schools and universities, enabling students to access educational content at all times. The pandemic had a significant negative impact on the overall economy but it also presented opportunities for firms to invest in tech and reap the benefits of digitalisation.
What are the most significant challenges for small and medium-sized enterprises (SMEs) to scale?
BÂ: African SMEs, in particular Ivorian SMEs, need access to three main elements. The first is access to markets to enable businesses to get their products to as many customers as possible while functioning competitively, for instance regarding logistics costs. On average, 55% of the cost of goods sold in Côte d’Ivoire goes to logistics and transportation, which means that even before you start competing on a global scale, you are already uncompetitive. The second relates to access to capital to fund growth, access to trade finance or, broadly speaking, access to financial services. The third dimension is access to technology. It is essential to look at the intersection of tech and SMEs, since around 98% of Ivorian companies are SMEs and constitute a significant part of GDP. SMEs need to understand how to leverage tech, especially since they are not always very tech-savvy. Technology market platforms can match supply and demand almost on a real-time basis, consolidating orders from different SMEs for certain trade corridors to enable access to the best prices through economies of scale. Policymakers need to address these three dimensions together and not respond to only one need.
Which technologies or digital trends do you expect to have a positive impact on the country?
BÂ: We are seeing exciting changes in the trade space.
There are more than 10m mini retailers in Africa; therefore, connecting a manufacturer or service provider with a retailer through digital platforms brings a lot of added value. It can help cut down on intermediaries and enable the direct integration of the business into the value chain. This also helps reduce product waste, since in emerging markets there are high levels of waste due to the lack of value-chain integration. Beyond decreasing end-user prices, technology investments in this area positively impact the planet.
How can the venture capital (VC) ecosystem help bridge gender inequality and create new entrepreneurial opportunities for women?
BÂ: Women in Africa are the most entrepreneurial in the entire world. The total entrepreneurship activity rate for women is 27%. However, recently they have attracted less than 14% of investment in Africa’s VC space, down from 17% in 2018. This is a business issue. The continent is losing $300bn in GDP as a result of the $42bn funding gap for women entrepreneurs. Investors do not have to choose between a high-performing portfolio or a diverse portfolio. We have invested in 11 successful startups to date that are 56% femaleled, with a woman founder or CEO. VC is a powerful engine to help bridge the gender equity gap in Africa.