Tech and the City

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In 2021, a group of students in Ibadan, Nigeria struggled to get food deliveries on campus.

The only option available was Jumia Food, a well-funded, pan-African startup.

But they were too expensive for students, their menu was too small, and they couldn’t deliver to the student dorms.

Spotting a real opportunity, Taiwo Akinropo and his friends launched Heyfood, an app to deliver meals right to students on campus.

Heyfood teamed up with the local joints students love. And they took off.

Within a year, they became the go-to food delivery app in Ibadan - Nigeria's third-largest city.

And today, they’ve expanded into cities like Benin, Abuja, Abeokuta, and Port Harcourt.

They’re skipping Lagos—Nigeria’s biggest city, where giants like Chowdeck are squeezing each others’ throats for every hungry customer.

For Heyfood, starting in Ibadan was a good call:

• It’s 41% cheaper than Lagos, so people here have a bit more cash to spend

• It helped them keep their operational costs low

• And they didn’t have to fight over customers with a ton of competitors.

Turns out, Africa has thousands of cities like Ibadan.

They’re big and growing fast, but they get overlooked for the capital cities because we assume that’s where all the opportunity is.

Tier-two cities are Africa’s next big opportunity

Since 1990, African cities have more than doubled in count, going from 3,300 to 7,600.

But in over half of African countries, only 30% of the urban population lives in the largest city.

The smaller cities are growing fast, with some doubling in size in just a decade.

Ibadan now has 4 million people, making it Africa’s second-fastest-growing city.

Arusha in Tanzania has tripled its population to 617,000 in the last two decades.

While Goma in the DRC is developing quickly, drawing in major East African banks to set up shop.

Sadly, these cities don’t get nearly as much clout as the bigger cities.

Resources like funding, skilled talent, and even government support are hard to come by.

So, entrepreneurs have to hustle twice as hard to get things off the ground.

If you narrow in on tech, you find that:

•  88% of Nigerian startups are in Lagos

•  60% of South African startups are in Cape Town

• 90% of Tanzanian startups are in Dar es Salaam

That’s a missed opportunity for Africa’s growth, especially when there are problems to be solved all over the continent.

Some founders are Jumping on this opportunity

Loibolu Loponu has called Arusha home all his life.

Growing up, it felt quiet compared to Dar es Salaam - Tanzania’s biggest city.

But lately, Arusha has been coming alive in ways that feel exciting and a bit surreal.

The population has grown, and he sees way more faces than he used to.

More founders, just like him, are taking a chance on this new market.

Loibolu runs Sambazah, a grocery delivery startup. But back in 2016, when he first tried his hand at a startup, Arusha was a dead zone for startups.

“Everyone was focused on Dar es Salaam, and that scene is like a whole other world.”

He reflects on his early days, saying, “We needed a place where we could try things, stumble, and learn. Dar es Salaam, with so much competition, just couldn’t give us that space.”

Thankfully, Arusha’s starting to get more resources to back entrepreneurs.

Last year, Loibolu joined the Westerwelle Foundation's 10-month entrepreneurial support program.

Westerwelle Foundation sees real potential in Africa’s smaller cities like Arusha, and they’re building startup hubs across Africa to tap into it.

Seeing the entrepreneurs who go unseen

Africa is the youngest continent in the world.

But its young people are starved for opportunities.

Right now, 23.6 million young Africans (ages 15-35) are unemployed—that’s roughly one in every 22 people

Sure, informal jobs and small businesses help fill the gap.

But they’re not enough to build real wealth or drive big-time economic growth.

Westerwelle Foundation kicked off in 2013 to support entrepreneurs in emerging markets and create more jobs.

And they saw the biggest need for this in Africa.

They launched their first African hub in 2016 in Tunis, Tunisia.

Then two years later, they launched in Kigali, Rwanda.

But along the way, Westerwelle Foundation realized that…..

Founders were traveling from other cities in Tunisia and Rwanda

It was the only way to meet up with tech communities, or access programs like Westerwelle Foundation’s.

And to make a real difference, the foundation had to expand its focus beyond cities like Tunis and Kigali.

So in 2022, when they decided to launch in Tanzania, they picked Arusha and skipped Dar es Salaam - the biggest city in Tanzania.

Then, when creating their programs, they skipped the usual templates and focused on what founders actually needed and cared about.

Today, 135 founders, like Loibolu, have completed their 10-month program, getting help with marketing, managing finances, and linking up with potential investors.

And come December, they’re launching in Mombasa, Kenya’s coastal city.

Mombasa has about 1.4 million people

With East Africa's biggest port, it started as a trading hub and has leaned heavily on trade.

But its growing population is drawing in founders to set up shop.

And Mombasa is now the second most popular startup city in Kenya, right after Nairobi.

Westerwelle Foundation’s country director for Kenya tells us:

“The local community here is really welcoming, and we can’t wait to see what more support will enable for the entrepreneurs here.”

Africa’s future growth will happen in its cities, but not just the big ones.

Tier two cities like Ibadan, Arusha, and Mombasa are growing quickly.

And we need more organizations like Westerwelle Foundation because Africa has many entrepreneurs that still go unseen.

This is how we’ll spin more startups like Hey Food, solve more problems, and create more jobs across the continent.

Did any tier two cities mentioned in the piece surprise you?

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