It was simple. You built a product that people wanted, you got the funding to buy the tools and you created the team to scale exponentially. Maybe a few smart foreign hires. The numbers worked because the tech ecosystem was flooded with cash and optimism for startups and their technologies.
The numbers for startups in Nigeria stopped working until 2023; the naira’s value has depreciated compared to the dollar. This led to a decline in growth: despite revenue growing exponentially in Nigerian nairas, it regressed when expressed in dollar terms. Meanwhile, expenses have exploded. To keep their business going, founders change their strategies and find ways to spend less money. Spending less money on day-to-day business operations is a common practice.
Firespiside Chat with dedicated dedication
Deji olowe was the keynote speaker at this event. She is the founder of Lendsqr a B2B startup that provides infrastructure for digital lenders. She also serves as board chairman at Stripe owned Paystack. In a private conversation with Fu’ad Lawal (Editor-in-Chief at TechCabal), he shared his thoughts on major cost centers and how to keep costs under control.
Lawal explained that his team switched to open-source software that allows them to communicate without paying for platforms like Slack, which charges up to $12 per employee. He jokingly said, “It’s not the software that makes people accountable to respond to messages.”
Olowe, who acknowledged that employees are the largest cost centers, advocated prioritising local hiring at all levels. He pointed out that hiring from Silicon Valley to fill C-suite positions brings little or no unique expertise, which local employees and ecosystem operators do not have. He went on to say that he knew no foreign executive who’s work matched their pay.
Olowe encourages the training of local talent as do banks, accepting churn in exchange for lower costs and developing ecosystem skills. Olowe has been a banker and executive for more than a decade. He urged startups to implement local training initiatives in their companies. This would reduce costs and boost growth. Babatunde Akin Moses is the founder of Sycamore.
Like banks, he encouraged them to form consortia and share resources, or to push initiatives to solve hard problems that affect everyone in the ecosystem.
Founders shared his measures. Some explained how they reduced costs by assessing costs due to latency and using a mix of cloud storage and on-premises storage. Some mentioned that they train their staff.
After a 40-minute discussion, the founders gave valuable feedback on TechCabal’s role in tech ecosystem.
Some suggestions included the revival and expansion of the “Entering Tech”flagship series. Other suggestions included features on startup offices to show the dynamics within the team, and more articles focusing on product updates and new launches.
The evening was complemented with great drinks and networking.
Mark the dates! Moonshot by TechCabal will be back in Lagos, October 15-16! Join Africa’s leading founders, tech leaders, and creatives for 2 days of keynotes. Early bird tickets are now 20% off — don’t sleep! moonshot.techcabal.com.
