What an awful time to start a company.
The economy is depressed, many sectors are struggling, inflation in Nigeria is at a 28-year record high of 33.88% and the currency’s value is dropping faster than a sinking submarine.
But weʼve been here before – many times.
When Covid hit, launching a start-up was also a terrible idea.
Yet from that painful period, a culture of remote work was born and spread faster than the coronavirus.
Tools, companies, and founders thrived after adapting to this shift, even before it was popular.
For example, companies like Foodcourt and Chowdeck made it possible to order essentials like food and groceries when movement was restricted. They saw massive growth that continues to this day.
If Covid taught us that an office is not required for a team to be productive, this period is ushering in the idea that “built hereˮ, can mean “built betterˮ and local cloud technology is at the heart of this shift.
The common argument against local cloud is that the big cloud providers have expertise that we lack. This is simply not true. People built and managed their own servers before ‘cloudʼ was a thing. These experts are still around. There is no “patentˮ on cloud knowledge owned by a few. Africa can also buy, develop, train, and own the same expertise.
Once we get past the mindset of “they know betterˮ we can begin to see the true benefits of owning and controlling our own access to the global economy.
Cheaper pricing and faster websites are the obvious advantages, but it goes deeper than that, and it starts with data.
Our data is precious, we should guard it, preserve it (like archivi.ng), and ensure it does not fall into the wrong hands. Regulations like NDPR exist for this reason, requiring that sensitive data like BVN are stored within Nigeria.
Besides banks and a few enterprises that run their own on-premise servers, hardly anyone else can comply with this because the big cloud providers serve limited regions across Africa. The dynamics change when there is an affordable and accessible local cloud, so startups can easily comply with these laws, ensuring the security & integrity of our data.
However, local cloud enables more than just data sovereignty, it’s a foundational step for technological sovereignty. Until we control our own data and compute, any AI ambition is unrealistic. Fundamentally three things drive AIʼs advancement, Compute (GPUs), Data and Algorithms. Algorithms tell AI how to learn, Data provides the ‘examplesʼ AI learns from, GPUs power the entire process.
Globally, nations are in an arms race to acquire all three, and we cannot afford to lag behind. Local cloud providers are a step towards owning the data and infrastructure needed to build AI tailored to Africa’s context—AI that learns from our data.
Weʼve demonstrated our ability to drive new technology further than expected, like mobile money with MPESA. If we fall behind, Africa will end up ‘rentingʼ emerging technologies like AGI.
For many startups, cloud services represent one of their biggest operating expense – alongside salaries and tax. The business model of earning in Naira, and paying huge bills in dollars is flawed, especially when the local currency is almost 2,000x weaker.
Ebun of Bento.africa announced some radical changes at his company this year, including migrating all major workloads off one of the big cloud providers to a local cloud. The results? A business model that works. Earning more than you spend. Thereʼs no point in a start-up if it canʼt stay up.
The biggest point really is that – No one is coming to save us.
Big cloud providers are not racing to build Tier 4 data centers across Africa. Why would they? When they already dominate the market, thereʼs little incentive to invest heavily in regions where alternatives donʼt exist.
This is why Africa must invest in itself. Monopolies benefit the companies that hold them, not the people they serve.
As we build our own cloud for Africa.
Not riding off others, but truly our own world-class, affordable, reliable cloud – tailored to our unique needs.
We simply cannot begin to imagine the innovation that will come from it.
So perhaps there is no worse time than now to start a company, I donʼt see it that way, the team at Nebula certainly donʼt see it that way.
No, now is the time to build.
Not despite the challenges—but because of them.
Biodun Oni
BD Lead, Nebula by Okra
Thanks to Fara Ashiru, Bodunrin Akinola, Zoli Szekely, Ebun Okubanjo, and Henry Nneji for reading drafts of this piece