The transcript of CFA’s interview on Channels TV Business Morning show is in 3 parts. Click here to read the part 1 of the interview.
Harriet: Let’s quantify this in terms of how much this contributes to the economy. How much money do they make, can it be quantified to what a traditional business owner will make for instance?
- CFA: Well, not all at the moment. I know that the e-commerce chops combined they’ve attracted an investment of close to $200 million, the e-commerce shop combined, the major ones, they’ve done that and I know that the guys called IROKO, I think the last one they raised is about $6 million. It’s growing, a lot of seed capital is growing. A South African company “88mp” just launched and they are giving seed capitals of between $10,000 – $100,000. We must understand that it has to happen in phases. The phase where we are now are the phase where ideas have to be incubated, some of the ideas have to be accelerated and made commercial, so we should not expect to begin to see the commercial gains immediately as a nation, that is the truth. If you look at the history of the way silicon-valley, that’s the same way it started, it started with a group of people fiddling with ideas, fiddling with ideas. I mean, I heard live from the man Steve Wozniak how for 10 years they were struggling, I mean they were struggling, they were struggling until the break came. He talked about the struggling period. The traditional businesses yes are still ahead but I can tell you the e-commerce shops are doing some wonders. They are doing some crazy figures, crazy figures that you will not even imagine. My friend who launched a small, very young e-commerce shop not like the big guys, what we know He’s making about a million monthly
Harriet: Dollars or Naira
- CFA: Naira, But when I say small I mean small, I mean He just started it small no big name, I mean the other guys have foreign backers and partners but he’s strictly local 100% local and he’s making about a million so he’s not doing badly but again if he tells you what has gone into it, it’s quite huge. Take for example, a South African firm investing $10 million in a start-up firm. The first thing he wants to do is to get the right programmers. So what does he do, he’s willing to pay what the average guys here cannot pay. He goes there and he poaches the good programmers so what you are left with are guys who are growing. What do you do? They are given new access, the younger player need to start training your own programmer it’s going to cost money so everything is going to take a process. We need the right skill, we need to grow the skill, that’s why Government is key. They have to start from the schools. I went to a University in Nigeria unfortunately, I was trained to get a job that was the outlook cause there was nothing like training me to become an Entrepreneur so we need to change people’s mindset, job creation. Now the thing about ICT is that ICT in as much as it will create jobs it will cause some certain jobs to be redundant and become useless more or less. So, if somebody wants to be this kind of professional, you must look at 5 – 10years now, will this profession be relevant? Will it be something ICT will not make redundant? Many years ago there used to be this people they used to call people who write short-hand I remember those people those days they were very good people and very proud of their profession back in the day but today I mean who…. So, that’s one of the things about technology and many more will happen.
Harriet: Ok, So let me just ask Fred, most of these businesses who are online they need funds. You’ve mentioned that a couple of partners either foreign or domestic actually give funds for such companies to start and then the traditional business owner seems to always get more funds than the companies who go online
- CFA: Well, again it’s a structure now let me say this actually at the moment now, You have more foreign venture capitalists than local. So, actually the people controlling and investing in this space is more foreign. So there’s a possibility of another round of colonialism online. Yes I mean if the big players are all foreign it’s good for the profit I mean the money when they make the profit it’s repatriated that’s the fact. So our business gurus and business owners should begin to think about how to invest in the tech space because the tech space they don’t believe in, the foreigners believe in it and they are pouring in money by the seconds
Harriet: That’s where people like you come in, people like you should begin to champion this cause to begin to make people understand that look your money is safe. This is a very good venture to come into, this is the profit at the end of the day, this is what you stand to gain and this is what you stand to lose.
- CFA: You are very correct and it’s part of the things that we are doing. I for example I’ll be starting a hub very soon just like what the CChub guys are doing. Somewhere where young people can come also, sit down train and then we find a way to get money for them. Because you see again it has to do with the trust thing. How can this people trust that their money is safe with these young kids. So there has to be a structure. Just the way silicon-valley wasn’t wishful thinking, it was a carefully planned, thought-out and implemented process that took place over the years so that’s the same way it has to happen here. We must also give people the outsiders who are not techies or who are not in the technology space the confidence that when you invest here it is safe. But then like the venture capitalist the way it is it’s a game of chance actually there are more businesses that die around the silicon-valley area than the ones that succeed much more about 90% die so there are great ideas, you know why they don’t feel it, because at every point in time they have about 5,000 – 10,000 ideas in incubation. If Steve Wozniak can be telling us that he’s even marvelled, this guy was the brain behind everything engineering in apple and he was saying that he was marvelled at the level of what is happening in the technology space. So it simply tells you that we are at an amazing speed and there’s a new concept called the internet of things where everything is said to be connected to everything. There’s a researcher in Hong-Kong that is trying to work on ladies’ eye lashes that will be electronic, finger nails that’ll be electronic all sort and everything will be connected to the internet
Harriet: Fred I don’t think a lot of people, well maybe a lot of people will buy into that idea but let’s leave that one for a minute. Let’s talk about, a lot of banks this days in the financial circle you see a lot of them coming on the internet to try to promote their business sell products and a lot of it and a lot of people are keying into it or a lot of people keyed into it that’s another thing. So in terms of financial transactions online banking and other forms of financial transactions. How much of that has been successful in the last couple of years?
- CFA: It’s been huge. The number of transactions that go on online these days is huge. I think I read over last week where NIBSS released a report I think almost 200 Billion for January and February or there about worth of transaction so it also tells us that it’s increasing it keeps growing and more people have access to ATM banks are beginning to adapt what is called social banking where with your Facebook account only you can start up a regular account. So it’s increasing the number of ATMs have grown banks now have what you call the e-channels, the e-banks or e-channel banks where it’s just strictly ATMs so it’s growing by the day and by the second but again it brings up an issue, that’s the issue of security. One of the things I always say and I’ll keep reiterating that Nigeria needs to begin to raise cyber-warriors that will defend us. Because the wars of the future will be fought through the cyber-war but let’s leave that aside. What am trying to say is that a friend of mine actually used a bank as a case study, the guy hacked into the banking system and added about 3,4,5,6 figures and about 2 Billion showed up in his account
Harriet: And nobody was able to detect that?
- CFA: Nobody, until he now told them that this is what he did
Harriet: So that means we even have issues of cyber-space insecurity?
- CFA: We don’t even have a strategy for that, I mean there’s no strategy to defend anything cyber. Yes, our cyber space is very very porous most of the data except for a few companies that just recently launched like computer warehouse that recently launched local data center most of our data are styled abroad and if you’re hearing about what’s happening with Switz so it means that the guy in NSCA can sit back in the US and he knows what’s going on here. There’s nothing, no National secret, it’s not there so cyber threat is a big issue a lot of banks have very porous sites, very porous infrastructure that people can actually hack into that again is part of the process. The way technology works is that when you come up with something, with an invention with a software overtime there will be need for patches and that’s why you see Microsoft and co they release patches every now and then because there are a group of people, you know there’s something called ethical hacking, Ethical hacking means you are licensed to hack but it is ethical so it means that you can hack and then report that you have hacked this is the process that you used to hack it
Harriet: Hacking in anyway, in any manner in any form or in any language you want to call it is still a criminal offence
- CFA: No it’s not, there’s ethical hacking, its legal worldwide. There’s ethical hacking.