Tanzania Tech Ecosystem Rising: Kinu Innovation workspace, Competitive mobile money & mCommerce Kicks off

By Mbwana Alliy  |  August 18, 2012


I have now spent a good few weeks (maybe months) in my home country of Tanzania. I begun my efforts to help Tanzania’s tech scene 2 years ago when I directly brought i/o ventures mentor network to Dar es Salaam. At the same time the Commission for Science and Technology (COSTECH), a Govt agency was put in charge in setting up the first incubator/workspace in the country known as the Dar es Salaam Teknohama Business Incubator (DTBI). That incubator is now fully running with TANZICT, a bilateral project between Tanzania and Finland is operational in the space having run a few events, conferences. Envaya (team behind Telerivet) are one of the tenants at DTBI. Meanwhile, I decided not to get involved anymore because I fundamentally believe that Governments should form an enabling environment and not over-stretch themselves in startup ecosystem. Secondly, I believe there were too many parties at the table with multiple agendas that was not conducive to focusing on supporting entrepreneurs.

A new workspace is born- KINU
However, I was delighted when a new group begun to work on a new workspace known as Kinu– funded and supported by Google, Indigo Trust and the new 4G/LTE provider, Smiles. I have met up regularly with one of the founding team members, Mrusha Jones, who works for Citibank helping them implement mobile money systems, he showed me around the space and let me use it as my base for working in Dar es Salaam. Other core founding team members inc. Taha (BongoLive), CatherineRose, Emmanuel, JohnPaul and Luca (BongoFive).

First, I experienced the blazing fast (for Tanzania) 20MB wireless connection set up by Smiles and some concept drawings of what the interior might look like in future. The space is enough to hold talks, provide hotdesks and even have a small mobile lab- unfortunately no coffee shop setup. However it is located right next to the Airtel building in Mikocheni neighborhood, providing easy access from most places in Dar es Salaam, whilst also being in a vibrant area of the city. The space is set to launch sometime later this month.

Earlier this month, the coast of Tanzania/Zanzibar was hit with yet another Marine accident tragedy, MV Skagit. A good friend of mine Rachel Hamada who had family on board the sunken ferry sprung into action and we were able to utilize the KINU workspace to brainstorm and rally interested parties in the tech community to help kickstart the Usizame.org (mobile passenger manifest and SMS warning system) project which launches later this month. Workspaces should be the seeding grounds for such ideas to become reality, and I am glad to see that Dar es Salaam has the community need for a (2nd) such space, but more importantly the talent and drive to get involved in useful tech projects. Ultimately, I believe workspaces in Africa should be judged on their ability to seed and support innovative ideas.


Incubation not limited to the City
On the other side of the country, as part of my work advising startups, I joined Angaza Design to help set up their mobile money pay as you go solar pilot in Musoma near lake Victoria. There Angaza was partnering with a local NGO, TANSolar, which helps distribute solar products in the region. Besides TANSolar’s core business, one of the things that struck me whilst out in what many would consider middle of nowhere, is how much talent there is there that is untapped and the opportunity that many far flung areas can become “satellite incubators” – providing mentoring support for promising students who cannot easily access the main cities across Africa to participate in the incubator/workspace boom- instead, with the spread of bandwidth capacity to all across Africa, the notion of a virtual incubator in which satellite locations connected via the internet to watch talks and do eLearning. Very similar to what the FabLab concept has with connected webcams around the world. You don’t have to be and traditional incubator to incubate talent- you just have to have someone who is out to help the community that teaches and connects individuals to the resources and contacts to help them grow. TANSolar’s Robi Machaba has sent quite a few students to Universities in Sweden and Finland for instance as well as connected folks to various local and government jobs. The next step would be to start thinking about creating startups- for instance they are working to create a tablet rental and wireless network business together with a chinese company and the National telecommunications provider, TTCL.

Mobile Money Finally takes Off

One of the most exciting aspects of Tanzania’s tech Ecosystem is the long awaited boom in Mobile Money. It is absolutely cut throat competitive between the 4 mobile operators. M-PESA by Vodacom is in the lead (recently crossing 1 Trillion shillings ($680M)/month in transfers) followed by Airtel Money and Tigo Pesa. Ezy Pesa by Zantel is struggling to keep up but dominates Zanzibar. There are numerous promotions and you can’t avoid the ad campaigns. A competitive mobile money sector is a good thing for innovation, transfer commissions have dropped led by Airtel Money who in turn forced M-PESA to match. Its not clear whether Airtel Money is actually doing well, but as we know, Telco mobile money is more about retention and airtime top ups then it is about commissions as a standalone business. Bill Payments are still not widely used, although many employers are using mobile money to pay employees at the end of the month which has led to a slow down of the M-PESA network at the end of the month. The occasional outages now makes headlines in the paper.

One of the earliest m/e-commerce companies to take advantage of the boom is Kivuko.com. I was able to make my first ecommerce transaction and got delivered to my doorstep (KINU workspace) in 24 hours! I met with the Kivuko team and was impressed with their ambition and sleek operation. They handle orders not only in Dar es Salaam but upcountry as far as with deliveries as far as Mwanza and they have not lost an order shipment to date!