What makes entrepreneurship in emerging markets different— Part 1
I’m developing a course at the moment and in module 2 we cover the realities of Entrepreneurship in Emerging Markets, these are some of my thoughts.
Let’s take some startup mantra’s and try to examine them at a macro-scale. In the first part of this series, I’ve chosen “live in the future”.
“live in the future”
One way to live in the future is to play with whatever technology will be mainstream in the future. In this respect, we (people in emerging markets) used to live in the past, but now we live in a smaller, more concentrated, but not uniform, future (I borrowed this from someone, but I can’t remember who). This means that there are small (or very small, even tiny) pockets of people who can live in the future, or very close to it, but not many.
Some clarification on two points:
1 — ‘We used to live in the past’, because the time it took technology to diffuse was far longer, and
2 — ‘a smaller, more concentrated, but not uniform, future’ — because living in the future is prohibitively expensive for most, and thus the future tends to concentrate in small groups of higher-income consumers.
If we take smartphones as an example of how long it takes for the majority to ‘live in the future’, smartphones had 50% penetration in the US in 2012, whereas for South Africa 50% penetration was only reached in 2015 and many other emerging markets are still not quite there yet. So, in this example, South Africa is (crudely) 3 years behind the US.
Though, if you compared that rate for TV’s it would be a lot longer — it is getting easier to live in the future in emerging markets because of globalisation and the decreasing cost of computing has made it affordable for more people.
But, living in the future isn’t enough, the next part says “…and build what’s missing”. But to build anything on the internet, you need a PC— although you can live in the future with a smartphone, you can’t build for the future without a PC.
When you look at the penetration rates of PC’s and household broadband, you realise that there certainly aren’t many of us who do or can live and build in the future.
Household broadband penetration:
And the PC penetration rates?
Not great when you consider Western Europe:
