By Rasheed Sobowale
Africa’s technology startup market is dominated by Nigeria, South Africa, and Kenya. This assumption is confirmed by the number of startups emerging yearly from these areas and the amount attracted from tech investors.
But a recent survey conducted by Timon Capital and Briter Bridges has revealed that tech startups in South Africa on average pay their CEOs and other employees more than any other African countries.
The survey analysed 48 startups in Nigeria, Kenya, South Africa, and Ghana. Start-up tech employees (CEOs inclusive) in South Africa earn as much as three times of their Nigerian counterparts according to the survey. The situation is worse in Ghana where when compared could sum up to about four times on average. The difference between payment in Kenya and South Africa is not much when compared to others.
On average, CEOs in Ghana earn $15,769; Nigeria $21, 818; Kenya $64, 500; and South Africa $65, 714.
The meagre payment of technology experts in Nigeria may be attributed to the brain drain and loss of interest which could significantly lead to subpar performance and reduced overall productivity.
But looking at the financial management of these startups in Nigeria and Ghana, the economy less favour tech startups survival compared to Kenya and notably South Africa. There are lesser investors (such as Venture Capitalists) in Nigeria ready to invest in tech startups compare to South Africa.
Quartz Africa, for instance, noted that South Africa has a mature financial market and overall investment culture. According to its report, “South Africa-based startups are likely also closer to capital than their counterparts elsewhere. In one significant example, Africa’s most valuable company, the Cape Town-based Naspers has committed to investing over $300 million in South African tech businesses over the next three years.”
The study was conducted to promote transparency and incentivising the conversation about compensation and more accessible data across Africa.