Andrew Fassnidge on African tech, capital and hosting a continental tech summit

Andrew Fassnidge is the founder and director of the Africa Tech Summit, an annual convention aimed at connecting tech founders, investors and corporates on the continent and across the globe.

Since 2016, the summit, which also has a London edition, has provided insight and networking with the African tech ecosystem to drive investment and business in African tech.

The sixth edition was held in Nairobi on February 14 and 15, at a time when the continent’s tech ecosystem is striving to recover from 2023 which saw declined funding for start-ups, closures and layoffs amid high inflation and a high cost of living.

To Fassnidge, however, this is not another case of the continent’s tech ecosystem collapsing.

He points out the ‘Dot-com bubble’ in the United States, also known as the tech boom, which was a period from 1995 to about 2001 when internet-related tech companies attracted a massive amount of attention from venture capitalists and investors before the bubble ‘burst’ after the money dried up, causing many tech companies to go under.

“There is a lot of talk right now of the ecosystem being in trouble and I don’t subscribe to that; there is always a shakier period in every ecosystem. America had the Dot-com bubble crash, the internet didn’t die. The African tech start-ups are not going to die,” he says.

Post the Covid-19 pandemic from around 2021, African start-ups enjoyed a funding boom from venture capital firms, with financial technology (fintech) firms accounting for most of the funding secured.

But 2023 saw decreased activity amid a so-called funding winter, especially in Africa’s ‘Big Four’, where the Kenyan start-up ecosystem flies high alongside Egypt, Nigeria and South Africa.

Fassnidge attributes the woes the ecosystem is going through to interest rates in the U.S. and weakening local currencies, coupled with increased cost of living which has affected Africans’ spending power.

“American interest rates have gone up, which is hammering every African currency; the shilling, the Naira are all in trouble and this hits the start-ups… for them to get follow-on rounds, there is a lot of pain in terms of down-rounds where the companies’ valuation has to come down because the dollar revenue has gone down because of exchange rates,” he says.

“It does not mean that the business is down. The talk about VC funding being down is because of the US dollar.”

Moving forward, Fassnidge projects that it is going to take several months for the African tech ecosystem to recover, but still notes that there is still capital that is yet to be tapped.

“It’s going to take a while; the next five months are going to be bumpy. But I see there is a lot of capital that needs a home. There are a lot of firms that have raised money and have not deployed,” he says.

“Between Covid and last year was a crazy period that valuations were going sky-high. There were a lot of speculative people who were not into African technology coming into the market. They vanished; the real guys who are in it for the long haul are here in numbers and still investing.”

Fassnidge founded the Africa Tech Summit after a decade on the continent working in mobile technology. He boasts of stints at the Swedish microinsurance company Milvik Bima as Africa Markets Manager and the UK mobile money company Monitise, where he was the Africa Manager.

He exudes confidence in gains achieved at the 2024 Africa Tech Summit, noting that this year’s convention saw a record attendance of over 140 investor companies.

“What happens here is the seed that can take between six months and a year to grow. This year, we have about 140 investor companies, which is the highest we have ever had,” Fassnidge says.