CREATING INCENTIVES FOR TECH START - UPS IN N IGERIA AND THE
ROLE OF GOVERNMENT. CREATING INCENTIVES FOR TECH START - UPS IN N
IGERIA AND THE ROLE OF GOVERNMENT. A presentation by: Dr. Omofoman.
I. Daniel DBA,M.AES,RFID+ Co-Founder, RFID Research and Development
Centre AUST-ABUJA @ the E-NIGERIA ANNUAL INTERNATIONAL CONFERENCE
TRANSCORP HILTON HOTEL- ABUJA FCT 18 TH NOVEMBER, 2014. 1 Slide 2 F
OOD FOR THOUGHT In the 21 st Century knowledge is arguably the
single most important factor of socio-economic power, production
and Research & development. The management of intellectual
capital is one of the most critical success factors of society in
its quest for survival, dominance and creating an enabling
environment for technology startups in Nigeria and by extension
sub-saharan Africa. Knowledge is therefore about people. 2 Slide 3
Introduction Concept of Incentives Categories of Incentives Concept
of Startups/Challenges Startups Success Stories The Role of
Government Recommendations and Way forward Conclusion C ONTENTS 3
Slide 4 It gives me a great pleasure to be at this epoch making
event and to present this paper. Nigeria is a country of great
potentials and possibilities and this makes it a great nation that
would become the envy of all if we channel our natural and human
resources in facilitating the production of goods and services for
National Transformation through consented efforts by the public and
private sectors as well as government at all levels. Mr. Chairman
let me state here that the theme for this years annual conference
Creating Market opportunities for Indigenous ICT products and
Services and the sub-themes under which this paper is being
presented is very apt for a number of reasons but especially for
the crucial role the private sector is playing and will continue to
play in the economic and social development of our nation, as we
match towards the realization of our aspirations to become one of
the 20 economies by the year 2020. INTRODUCTION 4 Slide 5
Consequently, a growing army of technopreneurs (i.e. Technology
focused Entrepreneurs) is an emerging start-ups in Nigeria. We are
a country of about 140million people with the population being
vibrant youths with median age of 19years or there about, this
leads to a greater consumer-driven market. It is no longer news
that Nigeria is the largest oil producing nation in Africa, the
largest mobile market in Africa with approximately 125 million
mobile subscribers and a penetration rate of 75% in early 2014. An
economy of about $510bn and a growth rate of more than 8 percent,
an interesting capital market according to recent statistics
released by the Nigerian Stock Exchange which shows that
international investors bought about $789 million of Nigeria stocks
in the first 3 months of the year, this is no doubt a pointer to
great dividends as well as a sound projection for positive economic
growth in Nigeria. INTRO CONTD.... 5 Slide 6 Wikipedia (2014),
defines incentive as something that motivates an individual to
perform action, this is to say when channeled into startups it
could turn around the fortunes of such business thereby bringing
about greater rewards. Similarly, the study of incentive structures
is central to the study of all economic activities (both in terms
of individual decision-making and in terms of co-operation and
competition within a larger institutional structure. This further
explains that economic analysis, show the differences between
societies (and between different organizations with in a society)
largely amounts to characterizing the differences of what is known
in modern terms as incentive structures faced by individuals
involved in this collective efforts. Ultimately, incentives are
aimed at providing value for money and contribute to organizational
success. W HAT IS INCENTIVES 6 Slide 7 A classic example therefore,
of economic analysis of incentive structures is the famous
Walrasian chart of supply and demand curves. However, a strong
incentive is one that accomplishes the stated goals. If the goal is
to maximize production, then a strong incentive will be one that
encourages workers to produce goods at full capacity. Incentives
can be categorized according to different ways in which they
motivate agents to take a particular course to action, and one
common and useful taxonomy divides incentives into four broad
classes as shown in the table below: C ATEGORIES OF INCENTIVES 7
Slide 8 8 WHAT ARE THE PROBLEMS ASSOCIATED WITH CREATING INCENTIVES
FOR TECH STARTUPS? Incentives structures are notoriously trickier
than they might appear to people who set them up. Human beings are
both finite and creative; that means that the people offering
incentives are often unable to predict all of the ways that people
will respond to them. Consequently, imperfect knowledge and
unintended consequences can often make incentives much more complex
than the people offering them originally expected, and can lead to
either unexpected windfalls or to disasters produced by
unintentionally perverse incentives. Slide 9 9 STARTUPS IN NIGERIA
The term startup has been bandied around with increasing frequency
over the past few years to describe scrappy young ventures, hip San
Francisco apps and huge tech companies. But what is a startup,
really? According to Neil Blumenthal, Co-founder and Co-CEO of
Warby Parker, A startup is a company working to solve a problem
where the solution is not obvious and success is not guaranteed.
Another school of thought has that: is a process, a product, a
category, a business model, an ecosystem. No matter what it is, it
has to have not existed before. Obviously other factors come into
play: restrictions around resources, finances, size of teams, etc.,
but I find there is a lot of variation there, and for me the most
important first qualifier is that it is novel. One thing we can all
agree on: the key attribute of a startup is its ability to grow. As
Graham explains, a startup is a company designed to scale very
quickly. It is this focus on growth unconstrained by geography
which differentiates startups from small businesses. A restaurant
in one town is not a startup, nor is it a franchise a startup.
Slide 10 10 TECH STARTUPS SUCCESS STORIES FOR RFID R&D CENTRE
Slide 11 11 TECH STARTUPS SUCCESS STORIES FOR RFID RESEARCH CENTRE
Slide 12 12 TECH STARTUPS SUCCESS STORIES FOR RFID TECHNOLIGIES In
recent times, RFID Research & Development Centre has designed
and implemented various RFID Applications in area like: Library
Inventory and Tracking System (LITS) Animal Identification and
Tracking System (AITS) Vehicle After Sales Management System
(VASMS) Third-Party Insurance Policy Certification Systems (TIPCS)
Data Centre IT Assets Management System Equipments Maintainance
Management System These are system designed and implemented by the
centre, they are no doubt a transformative tools for technological
advancement, I therefore urge stakeholders to key into the RFID
Technology as a platform for technological innovations in startups.
It is my fervent believe that if NITDA pioneers the deployment of
RFID Technologies to MDAs in the country, these could go along way
in promoting good governance, value re-orientation, local contents
as well as engendering National Value System for uncommon
transformation. Slide 13 13 WHAT DOES THE FUTURE HOLDS FOR STARTUPS
IN NIGERIA? It is my candid submission at this summit that in few
years to come some of these challenges I mentioned would have been
tackled if the Nigerian government show more support to the
industry. There are great potentials in investing and supporting
the startup ecosystem in Nigeria, considering the economic outlook
of Nigeria. We have seen several companies like Nokia, MTN, Techno,
Samsung, BlackBerry, Qualcomm, Google, Microsoft, Africa Internet
Holding, Tony Elumelu Foundation, Stanbic IBTC etc. supporting and
exploring the ecosystem. The system before the end of 2017 will
witness massive investment. There are huge opportunities yet to be
tapped around Education, E-commerce, Health, and also
Telecommunications. There is great need to develop startups that
create products for the large consumer market in Nigeria. WHAT ARE
THE ROLES OF GOVERNMENT? Slide 14 ROLE OF GOVERNMENT 14 Private
industry provides the greater proportion for Gross Expenditure on
Research and Development (GERD) but this will not happen until
government provides the enabling environment for startups. it is
therefore imperative that government establish the environment for
private industry that is conducive: To investment in technology and
development To enhance the transparency of markets To establish
solid intellectual property protection regimes. To create
conditions of economic stability To create financial markets in
which trust and openness rather than corruption and clientilism
supervene. That journey as challenging as it is can be accomplished
in a decade given a visionary, knowledgeable and committed
leadership, but work must start now. Slide 15 CONCLUDING REMARKS In
the new international environment of competition driven by
technology and trade, the creation of incentives for tech startups
in Nigeria is imperative. In what areas of industrial and
technological endeavours can Nigeria best develop competitive
advantage? We need to ask this question in order to prioritize them
effectively. It is no longer news that Nigeria is rich in oil and
gas as well as in various solid minerals, metallic and non-
metallic. Can we take advantage of these God-given resources into
technological leadership in material science? Our vast biological
diversity encourages the expectation that we can be a leader in
Biotechnology. But what kind and what area of biotechnology? 15
Slide 16 16 Finally, we must understand science and technology
cannot play the role we all envisage in our industrial and economic
development in creating an enabling environment for tech startups
unless we sign on to the dictates of a merit-driven but just
society of technopreneurs. How are we building in merit competence
in our educational system? In a nutshell, whatever may be our
vision and ambition for creating incentives for tech startups in
Nigeria; until we can embrace the total scientification of Nigeria
as a cultural necessity we are unlikely to fulfill our noble
vision, mission and ambition as the giant or heart of Africa. Slide
17 Material Science Building, African University of Science and
Technology, Abuja Nigeria Tel: +234 (0)81 7474 3777 E-mail:
[email protected] [email protected] Thank
you, for your attention 17
