
Why a Successful Valley Entrepreneur Started a Tech Incubator in Ghana - hayksaakian
http://blog.capitalandgrowth.org/jorn-lyseggen/
======
lyal
Seeding entrepreneurialism in emerging markets makes sense both altruistically
and in return potential for an investor -- you're not competing in a saturated
market, like say seed investing in the valley, and costs are low. If you can
solve the other side, such as access to capital, M&A opportunity, and
potentially international customers, as Jorn is doing, you're in a great
place.

The part about training for business conduct feels a bit iffy in tone from the
level of detail it goes into. I bought a company in Germany a few years back,
and my Canadian sensibilities certainly offended folks until I learned the
rules of the local culture. Any cross border business interactions are fraught
with this.

A few of my friends are currently investing/managing a company out of Ghana.
Extremely low investment has yielded a great growth curve, and they're
changing how sub-Saharan Africans manage their finances. They're some of the
happiest investor/entrepreneurs I know.

~~~
0xbear
How do you make money off of people who don’t have anything though?

~~~
eganist
It's about value creation. A band of enthusiasts in the middle of nowhere and
with no resources to create anything will probably have a hard time
bootstrapping a startup, especially when you consider the relative definitions
of "no resources," but that's the point of starting an incubator: to help
resource the enthusiasts.

If they can take what they get and run with it in pursuit of the idea that got
them the investment, they've now created value where none previously existed.
Commence the theoretical positive cascade of investments and growth and having
an exit strategy so that investors and entrepreneurs get back a return on what
they invested.

The part that's kinda taken on faith, though, is whether the value created
will stay in the area. Unless there are huge incentives to stay local, I see
the companies, exited founders, and investors all taking their funds and
resources back into developed nations rather than staying local and
perpetuating prosperity where they first laid their roots. There's hope that
there'll be a will to stay local... but man, people tend to take whatever
chance they can get to escape a bad place.

~~~
taneq
> The part that's kinda taken on faith, though, is whether the value created
> will stay in the area. Unless there are huge incentives to stay local, I see
> the companies, exited founders, and investors all taking their funds and
> resources back into developed nations rather than staying local and
> perpetuating prosperity where they first laid their roots.

Are you talking about the foreign investors or locals who've succeeded? I can
see locals using their new wealth to escape, but if it's working that well for
the foreign investors, I don't see why they'd leave (at least in the short
term - over decades the brain drain effect would be real).

~~~
frostymarvelous
Escape? Those who wished to escape took different paths, visa lotteries and
the like.

Those of us who've stayed back and are actively involved in tech
entrepreneurship have little desire to leave. We would have already, we have
the skills.

Ghana might not have it the best, but every country started like this. It
takes dedication from its citizens to grow and that mindset is catching on
now.

Not to detract from the rest of your answer though.

------
curiouslurker
"There’s the old saying that A students become professors, B students become
mid-level managers at large corporations and the C students endow buildings
and professorships."

Is this really true? Where is from?

~~~
projectramo
It is true that people with poor GPAs (to a certain extent) often do very
well. They might achieve extreme results more often than people with better
GPAs.

To what extent? The number is 2.9 [http://www.businessinsider.com/eric-barker-
millionaires-bad-...](http://www.businessinsider.com/eric-barker-millionaires-
bad-grades-gpa-2017-6)

However, this just shows that they are outliers. It may turn out to be the
case that there are just as many negative outliers for that GPA (or not, I
don't know).

If you are asking if it is true that this is an old saying, I have heard the
sentiment before many times. I can't remember the name of the book where
someone said the people who got the to the moon were lead by a C-student but
all of them had perfect GPAs. However, I don't know of that particular
phrasing.

~~~
zone411
This 2.9 number comes from "Millionaire Mind," published in 2000 with the data
from 1990s. The same book states that 2% of millionaires were in the top 1% of
the college classes and 90% graduated from college. Note the huge amount of
grade inflation since the surveyed millionaires graduated (their average age
was 54, so they would be in college on average in the 1960s) and a large
increase in the percentage of students attending colleges. And a myriad of
possible selection biases. It doesn't seem like a good argument that people
with poor GPAs do better than people with high GPAs.

[http://www.gradeinflation.com/tcr2010grading.pdf](http://www.gradeinflation.com/tcr2010grading.pdf)

[https://www.bls.gov/opub/ted/images/2010/ted_20100428.png](https://www.bls.gov/opub/ted/images/2010/ted_20100428.png)

[https://books.google.com/books?id=p60tDntHVnUC&pg=PA99&lpg=P...](https://books.google.com/books?id=p60tDntHVnUC&pg=PA99&lpg=PA99)

~~~
divenorth
Exactly. How much money did those people start out with? If you're from a
wealthy family and will work for the family business it doesn't matter what
your GPA is.

------
qazpot
Q - Why a Successful Valley Entrepreneur Started a Tech Incubator in Ghana?

A - To make more money.

------
wilsonfiifi
>> One challenge has been the lack of engineering expertise to build
infrastructure that scales. The ‘WhatsApp for feature phones’ company got more
traffic than they could handle and could not scale up fast enough ...

If I remember correctly, at the time Saya was being built, GAE (google app
engine) was available so couldn't they have just used that to take care of the
scalability issues whiles they gradually developed local/in-house expertise?

I've always assumed the "easier path" would be to use GAE, Heroku or any other
commercial PaaS until it becomes more economical to switch to an IaaS which is
more hands-on and requires in-house devops or system admin skills.

~~~
mattmanser
You can't just throw an app at GAE, Heroku or any other PaaS and it'll
magically scale. Even putting aside you have to have design the program for
that kind of scaling, use the right language and database, a lot of apps will
have hard bottlenecks in them. Table locks, disk access, API access, whatever
it is.

That's part of the expertise he alludes to.

For example, one client had a small customer base (10s of thousands), but was
already having to use Premium tier in Azure because of performance problems
(P2). Very seasonal business, massive usage around Xmas.

The coming Xmas they knew they had a serious problem, triple the amount of
users. The site would have gone down.

Bit of refactoring and performance tweaking from me and instead they never
really went above 20% CPU and could sit on Azure's S2 tier (and realistically
could have used S1).

I'm no scaling expert, but I at least knew where to look after a decade of
working on real apps and reading articles about scaling on HN.

------
honestoHeminway
Seeing how many of the valles incubators focus on things that are sole needed
by the inhabitants in the valley, this is a great chance to supply blindspot-
markets with products & solutions.

------
yinso
> We’ve had a few successes. One of our companies was acquired by an Accel
> backed company.

> The other is Saya, the first African company to pitch at TechCrunch Disrupt.
> Weeks before the event the founders didn’t even have passports!

It is very cool that there are already success stories.

Without ever being in Africa, I lack the knowledge and wonder if the current
infrastructure is capable of supporting knowledge-based economy on a broad
scale, but it's certainly good to see that high tech businesses could thrive
there, and incubators are getting created.

~~~
jernfrost
Most of these countries are developing countries with low education levels so
obviously it can't be broad, but of course in any country there will be a
segment of the population who are well educated and/or affluent. Take China,
most Chinese are dirt poor but because there are so many Chinese you can go to
modern enclaves like Shanghai and never experience this poverty.

In general however return on investment tends to be high in developing
countries because they lack so much. There are lots of businesses you can
start with minimum competition. E.g. I've seen many stories about poorely
educated Chinese getting rich in Africa. They start shops, facories and all
sorts of stuff lacking

~~~
ejanus
>>poorely educated Chinese getting rich

Why can't educated Chinese do same ?

~~~
bobabooey02
They can, and many do succeed. In the US right now, education is a proxy for
class, so saying the uneducated Chinese can succeed is like saying the Chinese
lower class can succeed, which isn't necessary true. It requires capital to
start a business, not education.

