Entrepreneurs Should Look At Acquisitions As Success: mSurvey Co-founder Louis Majanja
Anyone who thinks of a startup; thinks of making it big. Founders nurture their ideas to ensure that it grows into a big organisation and offers value for its stakeholders. But, do all startups that begin with the big dream reach an IPO stage? With the hyper growth state that East Africa, in particular, is experiencing and the rate at which startups are getting added to the ecosystem, what defines success for them?
Born in Nairobi and having spent a lot of time in the U.S., Louis got into software pretty early in his life. He is very passionate about technology and is a self-taught techie without formal education in software training. During his stay at Paulo Alto, Louis was involved in developing several e-learning platforms. He collaborated with universities like UC Berkley, who was at early stages of building e-learning platform since it was becoming an excellent medium to reach learners beyond physical boundaries. He also worked with partners like Apple and Youtube to put content library for learners.
After his stint in the States, Louis came back to Kenya, where met Dr. Kenfield Griffith in 2010. Over the years, their conversations developed and took the shape of consumer feedback platform mSurvey.
Having garnered experience in running a startup in the heart of East Africa, Louis Majanja, Co-founder & Director, Products at mSurvey shares his view on defining success for startups.
mSurvey connects businesses with their consumers, in real-time, using mobile messaging technology. It is consumer feedback company in Africa and offers its customers insights and actions points to improve their customer experience and access real-time customer feedback.
Q. What is the product that you have developed at mSurvey and what all technologies have you employed?
When we started, there was not much importance for customer feedback in the market. Businesses were not aware of this need. With Social media coming in power, the need to understand the customer’s feedback became very important as an angry customer could go online and post comments of poor product/services received. Organisations started to realise the importance of customer feedback. The corporations wanted to become proactive rather than reactive.
We realised this need and created an ‘Integrated Customer Experience’ platform. We integrated into the mobile money process so that the feedback could be instantaneous.
Apart from collecting data, we have also developed methods of evaluating the feedback for customers; this allows putting the feedback for businesses in perspective. We use many programming languages, AWS platform, Database technologies – SQL to arrive at the final analysis.
Q. When you were brainstorming/ conceptualising mSurvey, what were your business doubts and how do you feel about those doubts now?
A lot of assumptions were proven wrong. What changed is my attitude towards time.
When we were planning, it seemed that we could solve the problems in 6 months and then we could live happily ever after.
But the actual time required to solve the problems is very different from what is anticipated. It actually takes a lot of time to build a good product and then to get people to adopt it. In the beginning, it is tough to visualise how much time all this will take. You have to educate the market and make people adopt it.
Also, there were assumptions about the market opportunity. What we thought in the beginning, as per our original hypothesis, was that the market lacked data. We soon realised that this was not the case. A lot of businesses accidentally gathered data, and they didn’t know what to do with that. We started focusing on companies who either did not have data or could not understand data. There was a lot of information on customer transactions that could have a high impact on the businesses; we only needed to decode it. Hence our focus shifted from data generation to data collection and analysis.
Q. For a growing startup ecosystem like East Africa, what all do you see as a benchmark of success for entrepreneurs?
Startup environment is great; there are many ways in which startups, investors and corporations can participate. Most of the funding for a startup is international, not because there is not enough money generating in Kenya. But because there is an immediate need to educate the market. The startups should be part of the investment portfolio of high net-worth individuals and corporations. Local investors should think of how they can expand the horizon for startups.
Although, the best way of success is to create a company like Google or Safaricom (that’s a magnificent feat to achieve). But there are also other matrices for success.
Not every super idea can result in a company, but can instead result is a super product.
The corporates could also be urged to look at startups as part of their R&D. There could be chances that the ideas developed by startups could be a better fit for their suite of products and may not be as successful if offered as a standalone product. It could be absolutely valuable to the business and the consumers. Startups are also a great source of talent, and big company should also view this ecosystem as a pool of talent.
To create something much more valuable, at times, acquisitions become the best way of moving forward. Very interesting problems get solved in such scenarios. Though I feel that building a successful company should be the focus, in between, there are many pathways for success. Acquisitions or acquihires could also be viewed as a success. Also, if we look at this way, that few investors also view exits as success and would want to invest in such founders in their future ventures. But a lot of these gaps can be solved with education.
When Facebook started, who thought it would become one of the most influential platforms. But probably one of the beautiful things about the silicon valley mindset is that when they realised people were using the platform, they started figuring out ways to make it useful and profitable.
Q. How do you think we can have more participation from the local investors that can help the local ecosystem grow?
In the early stage of startups, seed stage, there are a lot of people who can invest but do not understand what it means to invest in a startup. What to expect from such investments is not clear. If we have more touch points in the ecosystem in the form of accelerators or incubators, it will create more education and more startups. The narrative needs to change; people need to hear more success stories. In the process educating ecosystem, having success stories is very important. It can give investors a view, that they would be investing in the next Twiga or the next Cellulant. How to participate in the opportunity of startup growth needs to be made available to local investors. It is not that the listed companies on stock exchanges don’t vanish, it is same as investing in a startup. Educating the bigger corporations will help the ecosystem to grow. Press also has a great responsibility to educate the startups.
Q. Your view on what will survive better – a tech product or a traditional product in the East African landscape?
The young population in East Africa is growing. Everything can survive in the East African market; we need startups in every sector of our lives, housing, food, mobility. Mobile-money has been super revolutionary in the ecosystem. Startups can find their space and become the next game changers. What m-pesa is to East Africa is what the internet was to the world, and Fintech has the highest chance of seeing its first Unicorn from East Africa.