Can Kisumu city replicate Africa’s silicon savannah?

August 10th, 2015

While Nairobi, the capital city of Kenya, is considered the epicenter of Africa’s digital entrepreneurship industry, the little known, lakeside town of Kisumu is the latest force in attracting some of the country’s most innovative minds.

The city’s most recent accomplishment was landing the Lake Hub, which officially launched in March this year at Harvey’s building on Oginga Odinga street. More importantly, Lake Hub is the first and currently the only one out of 15+ start-up tech hubs in Kenya with a physical presence outside the capital. Startups like MobiDawa, a drug adherence mobile app; e-Kodi, a house hunting platform; and Sokonect, an agricultural produce listing platform are among the digital enterprises bootstrapping their way to sustainability at the hub.

Flaunting itself as an innovation lab, business incubator and co-working space all at once, Lake Hub places a great emphasis on venture capital funding opportunities, events, networking, mentorship, and training opportunities tailored to the particular demographic it serves – Western Kenya based entrepreneurs.

Before James Odede – a computer science graduate from Maseno University, one of the region’s institutes of higher learning – invested time and resources to co-found Lake Hub, almost all of the state’s tech start-up community convened in Nairobi. It is also here that some of the world’s notable FinTech success stories e.g. M-Pesa, were incubated; and rightly so, positioned Nairobi as Africa’s Silicon Savannah.

Without access to essentials such as reliable internet access, venture capital and deal flows, hands-on business building support, a sufficient network of mentors and investors, and/or relevant training opportunities, the tech professionals were forced to take the long road to Nairobi in search of opportunities. The danger then was that constituents of western Kenya relied on solutions “exported” from the capital – and hope it served their needs.

Today, things are different with the advent of Lake Hub. It has created a window for prioritization of the region’s everyday needs, in the financial marketplace, in particular. Well meaning entrepreneurs now have an opportunity to develop solutions that are in sync with realities on the ground.

In an effort to heighten its foothold outside Nairobi, the FSD Kenya retail innovations initiative team met Lake Hub officials early in the year to discuss ways of working together. While discussions are still at very early stages, potential opportunities lie around accelerating FinTech innovation in the region.

But what defines Lake Hub and how is Kisumu differentiating itself from the more famous Nairobi and the oft-repeated Silicon Savannah success story?

The creation of a successful tech hub is a factor of many parts: business growth opportunities, large demographic, reasonable costs of operation, and a large pool of academia to draw research and expertise from.

Well, UN Secretary-General Kofi Annan figured out a long time ago that Kisumu possessed all of these traits and more. In 2006, he declared Kisumu the first Millennium City, raising its stakes as a model for poverty eradication under the UN Millennium Project.

Kisumu city has its own tech cluster of developers attune to the region’s unique reference frames, culture, and financial needs. This provides an ample opportunity for designing financial solutions with contextual relevance.

Kisumu city is host to 17 universities – both satellite and main campuses. This is quite a large pool of expertise readily available to be tapped.

Other aspects to Kisumu’s rise as a tech hub include: presence of an international airport with daily flights to and from Nairobi, Eldoret, and Mombasa, as well as outside Kenya; being located strategically at about 3 hours drive to neighboring towns and countries including Tanzania and Uganda; and boasting 342 miles (equivalent to 522 km) of shoreline offering techpreneurs an escape from the city’s hustle and bustle. Kisumu city also has a great quality of night life.

Annan has frequently noted that the challenge facing most cities globally and leading to urban poverty was due to the underdevelopment of rural areas.

While Kisumu city may be a victim of such systemic challenges, responsible for its current ranking below the Silicon Savannah, Lake Hub strives to keep techies in the area. That increases their chances of establishing new startups and companies that are relevant for the region.

By staying behind to design home-grown solutions, the locally based techies get an opportunity to participate in shaping their future of low income households who constitute about 46% of the region’s population.

James’ inspiration to launch Lake Hub in Kisumu was driven by the fact that he and the rest of his team had a history with the region and were therefore better placed to take ownership of the narrative and design solutions for its most pressing needs.

Overall, the outlook about Kisumu as a tech hub is positive, and any clichéd contrasts with the Silicon Savannah are taken cautiously. At the recently concluded Devolution Conference, the chairman of the Council of Governors Isaac Rutto described Kisumu as having been “rediscovered.” In fact, one of the start-ups at the hub, dubbed Dala Images, is focused on sharing the positive vibe about Kisumu City that has largely been overlooked by mainstream media.



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