Here’s Our Version Of Jason Njoku’s Spark 2.0 Manifesto
Jason Njoku just penned what he has essentially called a manifesto for Spark 2.0. He is no newcomer to the Nigerian startup community and is one of those some may consider as a Nigerian success story on the global scene. He picked up the outstanding industry achievement award at WAMAS 2016.
This article represents what you can call an analysis of the manifesto published by Jason. Let’s start off by rewinding a little……..
What Is Spark 2.0?
Who better to tell us than Jason himself:
“We are not a fund and we are not an incubator; we are a company that builds companies. We focus on Lagos, Nigeria as the gateway to Africa. We focus on well defined and scalable revenue models. We are a collection of internet people. We are Spark”
So think of Spark.ng as as a VC that not only funds companies but builds them. Oh well, hopefully you get the point.
Spark has funded and built some of Nigeria’s most successful internet businesses including:
- Mark Essien’s Hotels.ng
- Lanre Akinlagun’s Drinks.ng
- Fikayo Ogundipe’s Totel.com.ng
Speaking About The Manifesto
Jason wrote a six-point manifesto, here’s how our version or better yet, analysis:
1) But why always Lagos?:
This might be the question in the minds of Abuja startup community members and other non-Lagos startup communities after reading that Spark 2.0 “..will still focus on Lagos first”. Jason actually made a good case for why this is so. He points to data usage, internet usage, high population and talent. He is right about this. Lagos is estimated to have a population of about 9.5 million. It is the pace setter in terms of infrastructure and systems businesses need to succeed. Plans are already ongoing to build a smart city.
While it doesn’t yet appear that the population, internet and data usage of locations like Abuja will become as attractive as Lagos, perhaps Spark 2.0 might become attracted to the growing startup community and talent pool in no distant time. Jason doesn’t seem to be ruling out other locations with his use of the adjective “first” to qualify the focus on Lagos.
Lanre Akinlagun, CEO Drinks.ng, a Spark company (Image Credit: BellaNaija)
2) No customers, no business!
Jason communicated that Spark 2.0 “focuses on linear revenue models”. From his explanation, I read two things; customers first & zero marketing. My best statement from this manifesto point is: They (Startups) need to be lean at first and focus on understanding their base unit economics. This is priceless advice for startup founders from someone who knows. The focus at the initial stage needs to be on proving your business model and customer acquisition while keeping cost very, very low. High costs at the early stage can kill startups.
Jason however pointed out that they have stopped all paid marketing at iROKO 11 months ago. He stated that he anticipates zero marketing for the next 18 months. If you don’t read in between the lines, this can be misleading. At some point, especially after a startup has proven its business model and acquired its first set of customers, it needs to figure out the marketing channel that works for them. There is a great read here about this. The point is, while Jason’s team may not be spending on marketing, they are definitely doing some form of marketing. Go figure out yours.
3) Street Smart Over #IJGB:
Jason has a bias for local champions. This is code for startup founders who did not get foreign education. This diverges from the idea among many aspiring startup founders that VCs prefer to give their money to foreign-educated entrepreneurs. Foreign entrepreneurs definitely do not deserve the bias against them as many of them have put in the work to get the attention they now have. It however makes sense to shine the light on local champions who would typically be overlooked because they didn’t attend the same school with a VC founder or know somebody that knows one.
Here is a strong statement from Jason — “I have seen too many daddy funded wantrepreneurs who play at being a founder, whilst maintaining a lifestyle even I would envy. I believe Lagos founders need to be forged in fire”.
Fikayo Ogundipe, CEO Tolet.com.ng, a Spark company
4) No Cash To Burn!
Frankly speaking these are challenging times, so Jason is on point on this one. Two statements from Jason sum up his point on capital efficiency:
- “The one thing I know is that a lot can be achieved with less capital”
- “So that is where the focus will be. $20–50k first money in to support the first phase of experimentation”.
Will Jason’s ‘experimenters’ find this fund just enough to get started? This we cannot tell. One thing we know, it’s achievable.
5) We Are Opportunists?
Jason appears to be saying they wouldn’t admit startups in batches as it is typically done by incubators or some funds. This is not your typical VC. There can be a number of reasons for this. One is to give the company the freedom to choose the startups and entrepreneurs that meets its criteria without being expected to take up a certain number at certain periods. It can potentially increase the quality of startups. It also allows better control over capital available for investment.
The only issue might be that there wouldn’t be announcements for admission which means that not really everyone will learn about and tap into the opportunity Spark 2.0 provides. Although, Jason has provided email addresses by which entrepreneurs can reach them if they have a great idea.
Mark Essien, CEO Hotels.ng, a Spark company (Image Credit: BizIntel)
6) No better time to be back!
Jason makes the case that this is the best time to launch Spark 2.0.
“Many millions in losses and lessons learned have been institutionalized across the Nigerian tech space. We are in recessionary times, no doubt. Things are hard for the entire country. I was super negative for the last 18 months. Then I realized that now was the best time to be active. I feel more alive than I ever have been.”
So why is this the best time for Spark.ng to return? One reason:
Also $20k is the new $50k as the Naira has devalued from N165 to N380–400. So now is the time to deploy capital efficiently.
Want more reasons? Read this interesting CNN article.
Originally published at Techvoize.