Edited by Bitange Ndemo and Tim Weiss DIGITAL KENYA An Entrepreneurial Revolution in the Making PALGRAVE STUDIES OF ENTREPRENEURSHIP IN AFRICA Palgrave Studies of Entrepreneurship in Africa Series Editors Kevin Ibeh Department of Marketing , University of Strathclyde Glasgow , United Kingdom Sonny Nwankwo School of Business and Law , University of East London London , United Kingdom Tigineh Mersha Department of Marketing and International Business , University of Baltimore , USA Ven Sriram Department of Marketing and Entrepreneurship , University of Baltimore Baltimore , Maryland, USA Th e Palgrave Studies of Entrepreneurship in Africa series off ers an urgently needed platform to document, promote and showcase entrepreneurship in Africa and create a unique home for top quality, cutting- edge work on a broad range of themes and perspectives. Focusing on successful African fi rms, small and medium sized enterprises as well as multina- tional corporations, this series will cover new and ground-breaking areas including innovation, technology and digital entrepreneurship, green practices, sustainability, and their cultural and social implications for Africa. Th is series is positioned to eminently capture and energize the monumental changes currently taking place in Africa, well beyond the pervasive informal sector. It will also respond to the great thirst amongst students, researchers, policy and third sector practitioners for relevant knowledge and nuanced insights on how to further promote and insti- tutionalize entrepreneurship, and optimize its benefi ts across the conti- nent. Th e series will off er an important platform for interrogating the appropriateness and limits of Western management practices in Africa, examiningnew approaches to researching the fast- changing continent. A diverse set of established experts and emerging scholars based in Africa and around the world will contribute to this series. Projects will also orig- inate from entrepreneurship- themed tracks and Special Interest Groups at major Africa-focused conferences, notably the International Academy of African Business and Development, the Academy of Management Africa, and the Academy of International Business African Chapter. Th e foregoing breadth and diversity of themes, target authors and manuscript sources will produce a richly distinctive series. More information about this series at http://www.springer.com/series/15149 Bitange Ndemo • Tim Weiss Editors Digital Kenya An Entrepreneurial Revolution in the Making Editors Bitange Ndemo Tim Weiss Lower Kabete Campus Zeppelin University University of Nairobi Friedrichshafen , Germany Nairobi , Kenya Palgrave Studies of Entrepreneurship in Africa ISBN 978-1-137-57880-8 ISBN 978-1-137-57878-5 (eBook) DOI 10.1057/978-1-137-57878-5 Library of Congress Control Number: 2016956398 © Th e Editor(s) (if applicable) and the Author(s) 2017 Th e author(s) has/have asserted their right(s) to be identifi ed as the author(s) of this work in accordance with the Copyright, Design and Patents Act 1988. 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Th e registered company address is: Th e Campus, 4 Crinan Street, London, N1 9XW, United Kingdom To the new generation of entrepreneurs Foreword Th is is not your usual run-of-the-mill entrepreneurial business book. Th e authors are going after nothing short of a transformation in the African business environment, specifi cally in Kenya. Th ere are scores of books on innovation and entrepreneurship, but this one is clearly focus- ing on what could make Kenya tick in an age of innovation and rapidly evolving technology. Kenyans, along with many of their fellow Africans, have leapfrogged into the modern, smartphone world without passing through the his- torical wire-line telephone stage. Th e economics of mobile telephony are diff erent from those of older forms of telephony—and, of course, a smart- phone is much more than a telephone. It is a general-purpose computer that can access the Internet, run local programs, serve as a remote con- troller, and tell users where they are with the Global Positioning System, among myriad other tasks—and, by the way, make telephone calls. But this book is not just about mobiles. In fact, it is mostly not about mobile technology. It is primarily about fostering innovation, harness- ing talent, gathering capital, fi nding or defi ning markets, and asking the right questions. It is also about the for-profi t and nonprofi t world and the roles each can play in an economy. Th e authors do not duck the challenge of government policy when it comes to competition. Th e book wrestles with the relative merits of domestic and international market making— for every country, participation in the global market has a larger potential vii viii Foreword than any domestic market, but for entrepreneurs just starting out, local sales may at fi rst be much easier to close than global ones. What I particularly like about the book are the dialogues with prom- inent entrepreneurs, investors, and thinkers in Africa. Th ese give very concrete examples of what has been done and how it was done. Th eir pragmatic examples provide essential guideposts for fulfi lling the promise of African innovation. Adapting to the unique and varied strengths and characteristics of the continent is a vital ingredient to business success. Th is book has set my mind buzzing with possibilities—and I hope yours will react the same way. Vinton G. Cerf Vincent “Vint” Cerf is an American Internet pioneer, celebrated as one of the “fathers of the Internet” and active today in many organizations that are working to help the Internet deliver humanitarian value. Praise for this Book “Digital Kenya is a candid look at the backstory of Kenya’s celebrated entrepreneurial revolution. It combines insightful analysis with hon- est conversations in the unique voices of the nation’s tech leaders. A sober look at Kenya’s dream of becoming the ‘Silicon Savannah’ — and an essential guide to the new African narrative.” — Bob Collymore, CEO, Safaricom, Kenya “Insightful, thorough, and revealing. Digital Kenya thrusts the nation’s tech entrepreneurs, policymakers, fi nanciers, and thought leaders into the limelight. How is Kenya transforming itself into an unprecedented world tech leader? What historical, cultural, and other barriers is it facing? Will it succeed? Digital Kenya tells all from a truly African perspective.” — Joseph Mucheru, Cabinet Secretary, Ministry of Information and Communications, Kenya ix x Praise for this Book “ Th is book just will change your vision of what’s possible in life, when people dare to think big. Digital Kenya explores the country’s astounding emergence as a tech powerhouse on the world stage — and the challenges still ahead. It’s comprehensive, colorful, and one-of-a-kind.” — Victor Kyalo, Principal Secretary, Ministry of Information and Communications, Kenya Contents 1 Th e Paradigm Shift: Disruption, Creativity, and Innovation in Kenya 1 Bitange Ndemo Conversation #1 Th e Past, Present, and Future of ‘Digital Nyika’: How to Fix an Aircraft in Flight 13 Jimmy Gitonga of Afroshok Media Part I Looking Back and Looking Ahead 25 2 Th e Internet Journey for Kenya: Th e Interplay of Disruptive Innovation and Entrepreneurship in Fueling Rapid Growth 27 Muriuki Mureithi Conversation #2 Exploring the Ideal Role of Government, NGOs, Angel Investors, and Universities for Technology Entrepreneurs 45 Erik Hersman of BRCK xi xii Contents 3 Th e KINGS of Africa’s Digital Economy 55 Eric M.K. Osiakwan Conversation #3 Changing the Game: Building Mindsets of Hope and Possibilities in Africa’s Future Leaders — One Game at a Time 85 Anne Githuku-Shongwe of Afroes Part II Uncovering Unique Market Opportunities 95 4 Addressing Voids: How Digital Start-ups in Kenya Create Market Infrastructure 97 Marissa Drouillard Conversation #4 Finding the Right Problem to Solve 123 Timbo Drayson of OkHi 5 Reimagine What You Already Know: Toward New Solutions to Longstanding Problems 133 Jay Larson and Michael Munger Conversation #5 To Keep Disrupting, You Have to Listen Closely to What the Client Wants 155 Elizabeth Rossiello of BitPesa 6 I-Entrepreneurship: Changing Lives Th rough Technology 163 Carmen Merab Wamukoya and Amolo Ng’weno Conversation #6 How Technology Makes Farming Sexy Again 177 Su Kahumbu Stephanou of Green Dreams Tech Ltd.