Route-to-Market African Startups Need to Adopt

Never in the history of the African enterprise have we seen the level of interest and availability of financing not to mention rapid growth of African start ups. In this article we shall explore avenues technology startups can adopt to tap into markets in a sustainable manner.

It’s estimated that 50,000 technology startups reach the basic funding stage every year in Africa. Angel investors (including friends and family members) help about half of these companies with their initial development.

Fewer than 5% (about 2,500) are then able to show enough promise to actually receive a first round of capital from venture or private equity sources. An entrepreneur who has reached such a milestone deserves a pat on the back. Basically the proposed technology is not only an interesting idea but a commercially viable opportunity. It is assumed that the entrepreneur has tested the product with sample customers and an investor is willing to take a risk in investing in the idea/product.

The next challenge to the entrepreneur is how to sell the product so as to create steady revenue; which would help further develop product, build operations systems and infrastructure, repay loan owed to investors among others. It is sad to note that, many tech startups get stuck at this stage because they can’t quite figure out a scalable way to go to market.

Often, this is because they’ve been founded by technologists, and sales most likely is not their forte. Or perhaps it’s because the only person who is passionate enough to sell the product is the person who developed it. Or people may believe their invention is good enough to sell itself. So sales doesn’t become a focus of attention until cash starts to burn.

Developing a business model or go to market approach can never be underestimated as it separates successful companies from the rest. Over the years working with startups in Africa, we have come across various questions related to how to start thinking about sales: Should a company put together a direct sales force or sell indirectly through others? If so, should they organize salespeople by market, industry, geography, company size? Will the salespeople require technical support and work in teams? Among many other questions.

The problem is that these are fundamentally the wrong questions to begin with. They all focus on the perspective of the startup and the technology, but startups need to take their customers’ perspective to understand how to approach the market. They should think about what the customers are trying to achieve and what problems they need to solve — and then think about how the product can help them be successful.

Veteran salespeople might recognize this “consultative selling” approach and dismiss as old school. The point, however, is that the consultative selling mindset needs to start before the go-to-market approach is developed, and it must evolve as the sales strategy evolves.

Figuring out how you go to market is not a one-time exercise for a new company; it should be an ongoing process, constantly informed by a deeper and deeper understanding of customer needs and how your product can meet them. If you are part of a startup or a relatively new company that needs to accelerate revenue growth, consider how this approach might apply to you. Start by identifying a small number of very specific customers — either companies (if you are a B2B player) or desired consumer segments (e.g., urban professionals with specific characteristics).

Then put yourself in the shoes of these customers by thinking about their issues and by talking to them not about your product but about their challenges and pain points.

Once you’ve taken these steps, you can begin to experiment with a go-to-market approach with the expectation that you’ll continue to refine and change it based on experience and further insights. Figuring out an approach for going to market is one of the toughest things for a startup to do. But without understanding the customer’s issues, it’s almost impossible to get right.