African Startups: Unicorns vs. Camels

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Camels or unicorns?

Which applies better to African startups? The race to become a unicorn? Or focusing on being a sustainable business?

In the world of startups, we've got two intriguing animals in the spotlight: the unicorn and the camel.

They might not be real, but they sure stand for something very real - the paths startups can take.

Today, we're diving into the big question: should African startups aim for unicorn status or cozy up to a camel and focus on sustainability?

Here are my thoughts:

The unicorn label has been overly fetishized.

What's a unicorn?

A $1B+ valuation startup.

Is a unicorn sustainable?

Most of the time, no.

Let's talk about camels.

What's a camel?

A camel is an animal that can:

↳ Withstand harsh environments

↳ Store water for long periods

↳ Adapt to different challenges

Camels don't grow as fast as unicorns, but they are sustainable.

A lot of the language we use in startups is about growth.

Scale, accelerate, launch, etc.

This language suggests growth at all costs, but this is unsustainable because it ignores:

↳ Revenue

↳ Profitability

↳ Sustainability

You can't scale losses.

The narrative surrounding Africa is that it's a "unicorn" continent.

That we need more billion-dollar companies.

This is short-sighted and doesn't take into consideration the fundamentals of building a sustainable, long-term business.

African startups are best served adopting a "camel" mentality.

That is to say, building sustainable businesses that tackle real problems for real people.

Building things that last even when the hype fades away.

Having said that, we still need unicorns.

Why?

A unicorn is a signal of potential.

It represents a vision of what's possible.

It highlights the potential of a continent teeming with problems that need solving.

There's a reason why unicorns are attractive to VCs.

We want to hit it big.

But here's the thing:

There's nothing inherently wrong with that.

The important thing is to balance the real world with the need for growth.

To conclude:

In a nutshell, it's not unicorns vs. camels, but rather a harmonious blend of both that's going to unlock Africa's full potential.

↳ African startups need to adopt a "camel" mentality

↳ Unicorns are important because they signal potential

↳ VCs should be mindful of creating balance between metrics & the need for growth

↳ Africa's potential will unlock when we have more camels AND unicorns.

That’s it!

See you next Wednesday.

I'd love to hear from you:

What are your thoughts? Does Africa need more camels AND/OR unicorns?

Tweet at me @euniceajim or reply to this email and I'll do my best to get back to everyone.

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