By Pascal Oparada
Social Media/Tech Reporter
There is a wave of Initial Public Offerings going on in the tech industry.
Four global tech brands have gone public over the past month and investors are falling over each other to get a juicy part.
Jumia, Pinterest, Uber, and Lyft are some of the globally known companies that went public and the prospects are looking good, analysts believe.
Many of these firms filed for their IPOs abroad, even though many of them have a presence in Africa.
Jumia, considered as ‘Africa’s Amazon’ hit it off at the New York Stock Exchange last Friday, raising $196 million dollars in its first day.
It’s stock which was at priced $14.5 closed up at 75% on Friday.
While Jumia’s first day at the NYSE shows positive signs, analysts believe it’s also a sign that the company lacks faith in the country where it operates and makes a profit from.
They argue that the African e-commerce giant has not been a truly African company. It’s four chief executives are non-Africans. The company has headquarters in Berlin and got early funding from German startup incubator Rocket Internet SE, while its biggest shareholder is MTN Group Ltd., Africa’s largest mobile-phone company.
More recent investors include French drinks maker Pernod Ricard SA and Mastercard Inc., which put in a combined 125 million euros in the build-up to the initial public offering.
This leaves Africa in the lurch and most people fear capital flight.
“There are a lot of companies in Nigeria that are raising money from outside. It’s not specific to Jumia. Raising money from outside gives you more leverage. It’s not as if the Africans don’t have capital,” Dochase Co-founder, Chibuike Goodnews told TheNiche.
“Raising money from outside Africa gives them more leverage. They have more patient capital. Some investors in Nigeria may not be willing to run profit and loss of business. It’s just for them to make a profit,” he said.
According to him, companies like Nigerian online payment platform, Paga, which raised $10 million last year through Venture Capital, ceased to be Nigerian or African company the moment they attract funds from outside.
Most of these tech firms also register outside Africa in order to attract investors from abroad.
While Jumia’s listing is a watershed moment for Africa’s tech ecosystems as, the largest e-commerce company on the continent with operations 14 countries, its believed that unless African tech firms up their ante to impact their home or host countries, Africa’s economy will continue to be in the lurch.
