Alongside Kenya and South Africa, Nigeria ranks as one of the top three destinations for foreign investment in African tech companies. Many see Africa at large as approaching the brink of a technological revolution, and Nigeria could be leading the charge. But that doesn’t mean that there’s plentiful wealth for everyone looking to invest in tech. Nigeria’s graveyard of startups is littered with names like IrokoTV and Konga. What’s especially worrying is that these were promising startups with meaningful investment and very smart men and women leading them forward. The tech industry is promising, but it can also be fickle. If you want your startup to weather the storm, here’s what you need to know.
The most important thing when operating a tech company is understanding your market. You might have the cleverest idea in the world, but that won’t mean much if you can’t make a reasonable appeal to your prospective audience. While the answer may seem obvious, that’s not always the case. While a food delivery business like GrubHub may get their money through consumers, it’s ultimately the restaurants they do business with that hold the purse strings. Tech companies need to create an attractive experience and useful service to customers, but they need to ultimately be selling their product for whomever controls the end point of the financial exchange.
And while you should be incentivizing your customers to use your service, you have to be careful about encouraging bad behavior. Accountability is important, and a business that doesn’t reimburse customers for mistakes on their end is doomed to failure, but just as great a risk is capitulating to customers who demand refunds or special perks when recompense isn’t warranted. Similarly, promotions and coupon codes can be a great way to draw in new customers, but they shouldn’t be treated as a continuing expectation. If the business of a consumer is predicated on discounts that make your business unsustainable, they aren’t a consumer worth having.
Finally, you want to make sure that your business isn’t predicated on the strength of specific employees. Good talent can’t be understated, and your business should nurture and reward success, but if your company’s continued profits hinge on a single employee’s talents, you’re one resignation away from collapse. Treat your employees with respect, but make sure that there are redundancies for any talents you need, and avoid leaning too heavily on specific staff or resorting to nepotistic behavior.