November 29th 2021
The Next Wave provides a futuristic analysis of BizTech and innovation in Africa. Subscribe here to get it directly in your inbox on Sundays at 3 PM (WAT).
Hello, friend. We’ve come to this year’s last edition of The Next Wave. As such, this calls for predictions—for how can we go into the new year without some?
Last week, we discussed how Africa is running its race to get 5G, but what we didn’t tell you is that there is another race—a political one—going on between two world superpowers: China and America.
The race is about fighting for who will build and dominate the continent’s telecommunications sectors, important infrastructure that offer access to the youthful, billion-strong, emerging African continent. While China’s Huawei has a head start in the race—with its low-cost wireless equipment—the US is responding by recommending an open-source technology created by Ericsson, Nokia, or Samsung, while warning the continent about privacy and national security risks that could arise from Chinese government-linked companies building ultra-high speed networks.
Next year, countries like Morocco who want to expand 5G access nationally would have to choose between Huawei and its Western rivals. This will be the case across the board as more African countries start or continue to make 5G available in their respective countries.
More funding, unicorns, and exits
African startups have seen massive VC investment in recent times, raising close to $5 billion in funding this year alone—over 2.5 times more than what they raised last year. The number of startups that also attained unicorn status increased from two to seven, with Flutterwave, Opay, Wave, Andela, and Chipper Cash joining Fawry and Interswitch.
Come next year, the continent is gearing up for even larger investment and hoping for a similar trajectory like the Latin America tech ecosystem has had. The Latin American tech ecosystem raised more than $14.8 billion this year—more than it has raised altogether in six years—while minting nine of its 17 unicorns along the way. This huge precedent is enough to make the mouths of African founders water at the thought of what 2022 holds for them.
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The creation of CBDCs won’t stop crypto adoption
On the surface, Central Bank Digital Currencies (CBDCs) look like a decent effort by central banks around the world, including Africa, to slow down crypto adoption, but their chances at success are low.
In Nigeria—being the first Africa country to launch a digital currency, the eNaira—even top commercial banks and the presidency are sceptical as to the need for the eNaira, with our Managing Editor, Koromone arguing that it is simply like the physical naira, but in digital form. While the Nigerian central bank, like other central banks, created CBDCs to tap into the digital currency frenzy that started with cryptocurrency tokens like Bitcoin, they lack the investment potential and decentralisation appeal that draw people to cryptocurrencies. The Nigerian e-Naira can as well pass for just a digital wallet, a solution that doesn’t come close to stopping people from using cryptocurrencies.
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Podcasts will keep preserving African stories
Yes, we know Clubhouse, which was supposed to replace podcasts, is no longer buzzy, but we still believe that podcasts won’t disappear just yet.
Similar to the proliferation of blogs, podcasts are super easy to create. Podcasts give more power to Africans to move away from depressing topics about Africa to a variety of subjects, from the serious to light-hearted. The creators of these podcasts—who are not interested in the Western gaze—are also becoming celebrities. As these podcasts are important to pushing and centring Africa’s own narratives, podcasters are building viable online communities, and it’s clear that there will be more breakout content in the podcasting space in 2022.
Have a great holiday
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Sultan Quadri, Staff Writer, TechCabal.