Osmotic Tech

Osmosis is naturally occurring. Solvent molecules move across a selectively permeable membrane from an area of high water potential to a region of low water potential in a manner that tends to balance the solute concentrations on the two sides. This occurrence can be likened to what has happened in the global tech startup and funding space. Over the years, we have seen growth like we didn’t expect, growth that has seemingly flowed from the West. Osmotic tech is the movement of tech assets (funding and startups) from regions of high concentration to regions of low concentration. While this definition is not official, just take it for this piece.

But why does water move?

You should understand that when I say water, I mean tech assets. But let us talk about what makes water move at all. Molecules travel and, if possible, distribute uniformly throughout the medium, according to a diffusion principle. Only substances that can flow through the membrane, however, will diffuse across it.

In an illustration here, water could permeate through the membrane even though the solute cannot. Osmosis, or the diffusion of water through a membrane, will continue until either the water concentration gradient becomes zero or the water’s hydrostatic pressure equals its osmotic pressure.

Africa and Tech 2021

Africa owes a part of its changed tech narrative to the development of the West. North America and Europe could easily move to develop tech assets in Africa due to the high growth the developed economies of the Western Worlds had. Although the diffusion of tech molecule into Africa won’t be same with the pace of the water and solute illustration from above, there is no doubt that Africa can mostly discuss the pros when discussing the concept of Osmotic Tech.

Osmotic Tech Drivers for Africa

International investment accounted for 73% of VC deals in 2020, making it clear that money coming from outside of Africa has dominate tech finance. This may help to explain why nearly 20% of funded African startups have their headquarters in the United States. However, while tech growth relaxed at the courtyard of the West, Africa was developing necessary human and infrastructural assets needed to drive tech adoption and acceleration in the region.

Labour Skills Match: Africa was unfamiliar with the idea of startup some decades ago. The workforce at the time had their focus on mastering traditional skills. Tech money usually goes towards hiring top talent, building new products or strengthening existing ones. Investors will complain of not finding the necessary tech talents if keep investing in an economy whose workforce is are greatly skewed to the traditional sector. Luckily, this is not the case. Africa’s burgeoning youth population have rightly positioned themselves for the innovative takeover.

6 startups bridging the tech talent gap in Africa

Policy Match: Since innovation is at the core of technology, it is crucial for success to strengthen state and institutional capacity to promote innovation, support it, and foster a supportive business environment. An exceptional chance to improve control over technological progress has been presented by the African Continental Free Trade Agreement. The continent has adapted to the quick changes brought on by osmotic technology and used it to speed its involvement in international value chains.

Physical and Digital Infrastructure: Africa’s progress in infrastructure parameters is contained power distribution, telephone density, internet and broadband penetration. Africa has unquestionably made progress in the adoption of standard application programming interfaces and common data languages to allow for enhanced system integration and exposure to the risks of cyberattacks. Accelerating fiber-optic network physical connectivity and virtual platform interoperability is essential not only for modernizing technology on the continent but also for reaching underserved populations and bringing down unit prices.

Final Note

Africa undoubtedly owes a majority of its tech advancement to the massive attention it received from the West. While it was noticeable that North America and Europe had progressed way ahead of other regions, there was need to invest in areas where tech occupied very little space in the economy. In discussing Africa’s steady increase in tech investment, one can look towards the massive contributions made by foreign investors and accelerators.

How Y Combinator Has Influenced Startups in Africa

Flutterwave, Paystack, Kudi, and many other tech giants in Africa cannot discuss their success stories without mentioning the role of Silicon Valley-based startup accelerator firm, Y Combinator.

Although the massive interest in Africa’s tech space has not placed it on per with those of the North America and Europe, it is clear that the region is becoming the focal point when discussing tech investment. The youth of Africa, in particular, have greater access to knowledge and technology than ever before, which is very encouraging for the future long-term development of the continent.