Driving Development: mlabs

Transcription

1 Vital Wave Consulting Field Teams Latin America Argentina Brazil Chile Costa Rica Dominican Republic Mexico Peru Asia India China Cambodia Eastern Europe Estonia Uzbekistan Ukraine Driving Development: mlabs Emerging Market Speaker Series August 11, 2011 Africa Egypt South Africa Nigeria Kenya Middle East United Arab Emirates United States California (Headquarters) Annie Schowalter Director of Client Services

2 Contents 1 Mobile Application Incubation 2 Landscape and Segmentation Analysis 3 Ecosystem and Offerings 4 Business and Operating Model 5 Common Challenges 6 Critical Success Factors 1

3 The Case for Mobile Application Incubation More than 5 billion mobile subscribers worldwide With fastest 5-year ( ) growth rates in emerging markets: Africa - 278% Asia - 218% Eastern Europe 119% Market largely untapped. Low-cost, high-value applications with direct impact on emerging markets still in need. 2

4 infodev Creates mlabs Incubation Network infodev is working with the Government of Finland and Nokia to drive mobile innovation in emerging markets Vital Wave Consulting created a toolkit for infodev to support network of mobile application laboratories, branded mlabs The toolkit supports mlabs to define sustainable business models that also impact development objectives infodev supports mobile application development initiatives globally, so toolkit is publically available Toolkit supports definition of sustainable business models to stimulate the creation of mobile applications at the local level in emerging markets. 3

5 mlabs Definition and Characteristics Definition of Mobile Application Laboratory (mlab) What is a mobile application incubation lab? A physical space where mobile technology entrepreneurs can access the tools, expertise, and support network necessary to develop their solutions and start and grow their businesses. Why do incubation labs work? Clustering like-minded entrepreneurs together while offering them a range of business, technical and financial resources has proven to increase their long-term success rates. Who operates these labs? Labs are operated by public or private organizations, and succeed by building a local ecosystem of stakeholders government agencies, academics, corporations, investors and local business mentors all focused on helping the incubated companies succeed. 4

6 mlabs How are they different? 1 Technical Areas of Focus mlabs offer technical training and certification on the latest mobile platforms like Symbian, Java, Meego, iphone, Android, Windows Phone 7 and Bada 2 Business Training Focus Business training addresses the revenue and deployment models unique to mobile enterprises 3 Partner Ecosystem The partner ecosystem includes stakeholders unique to the mobile app value chain like mobile operators, device manufacturers, and SMS gateway operators 5

7 Landscape Analysis Geographic Mapping of Incubation Labs that Include mservices Technology Incubators that Include mservices Appfrica Labs (Uganda) Bandwidth Barn (South Africa) Bantalabs (Senegal) Belarus Hi-Tech Park (Belarus) Bios Business Incubator Osijek (Croatia) CIIE (India) Emerging Technology Centers (USA) Hive Collab (Uganda) Hong Kong Science Park (Hong Kong) Horizon (Scotland) iaxil (Singapore) ihub Nairobi (Kenya) Innovation Hub (South Africa) InSTEDD ilab (Cambodia) ActivSapces Limbe Labs (Cameroon) MEST (Ghana) Octantis (Chile) PICTI (Palestine) RTBI (India) SHBI (Vietnam SoftStartBti (South Africa) Techhub (UK) Technology Incubation Centre (Pakistan) Ungana-Afrika (South Africa) White Bear Yard (UK) Yes Incubator (Macedonia) mservices Incubators EPROM (Kenya, Uganda, Ghana, Ethiopia, Rwanda) Grameen AppLabs (Uganda, Indonesia,Ghana) Mobile Experience Innovation Centre (Canada) Mobile-Empowered Entrepreneurs in Africa (Ghana) Wavefront (Canada) 6

8 Segmentation Analysis Lab Groups Development for Development Innovation for Commercialization Primary Organization Driver Financing Environmental Characteristics Market Forces Organizational Mission Distinctions Between Lab Groups NGOs are primary drivers May also be hosted by government, foundation/ngo, university, corporate/private May receive grant funding and donations Contract with NGOs and public sector May earn revenue from lab services Located in countries that tend to invest less in technology and innovation Home countries tend to receive more support from the international development community, on average Often located in poorer cities, regions, or countries Nascent or less developed venture capital ecosystem Social or economic concerns that may inhibit business growth Lacking infrastructure and educational resources Benefit underserved communities Create content relevant to developing countries Offer training and mentoring for job creation Focused on social development Target market tends to be local Often located in less developed economies Challenged by lack of educational resources, at the regional level Corporate/private are primary drivers May also be hosted by government, foundation/ngo, university, corporate/private entities Seed capital from private or public sector Contract with MNCs and public sector May earn revenue from lab services Located in countries that tend to invest more in technology and innovation Home countries tend to receive less support from the international development community, on average Often located in wealthier cities, regions, countries More robust venture capital ecosystem, with attention of foreign backers Demonstrated government support for tech and entrepreneurial growth Flagship universities and educational institutions Benefit the mobile ecosystem Create the next big app in the global market Incubate start-ups for commercial viability Focused on commercial development Target market is international (and local) Often located in more developed economies Empowered by availability of educational resources, at the regional level 7

9 Representative Segment Profiles Development for Development Grameen AppLabs Uganda Sponsored by Grameen Foundation to use mobile technology to improve the lives of the poor. Currently operates in Uganda, Ghana and Indonesia partnering with local governments, NGOs, large multinationals and local mobile operators. Creates mobile services to address social issues in the areas of health, information and agriculture. Incubated services then spun off to be supported by local partners. Example: Using Google platform and NGO content developed a Google SMS application. App now offered through Ugandan mobile provider (MTN). Provides info (like weather forecasts) and platform for buyers / sellers to trade agricultural products. AppLabs also provides employment opportunities in areas like field management, operations, R&D and application development. Innovation for Commercialization ActivSpaces (formerly Limbe Labs) Cameroon Operates as both a software consultancy and incubation lab for promising startups. Offers for-profit development services for local and international clients. Revenues cover physical resources provided to incubation program. Entrepreneurs in incubation program can work on development projects to earn income and seed capital while developing their business ideas and valuable project management skills. Screens applicants for incubation program based on business model, market need, competitive landscape. Connects entrepreneurs to mentors and important business contacts. The lab may invest in early stage companies, earning returns if the venture is acquired or goes public. They have also built a network of local and outside investors. 8

10 mlab Stakeholders Public Non-Profit Private National Ministries Local Government Agencies Public Universities Regional Development Associations Non-Profit Development Organizations Philanthropic Foundations Multi-lateral Organizations Business Mentors Platform and Application Developers Non-Profit Universities Other Non-governmental Organizations Multinational Corporations Network Operators Device Manufacturers SMS Gateway Operators Investors (i.e. VCs) Business Mentors Private Universities Platform and Application Developers Other Non-governmental Organizations The mlab ecosystem depends on a number of different players who can offer services and resources to help grow successful small businesses. 9

11 mservices Value Chain The mlab is at the center of the ecosystem Regulators Government Ministries and International Bodies Funders and Investors Banks NGOs Hardware Vendors PDAs, Handsets Laptops Content Providers Content Aggregators Content Developers App Developer Platform Provider mlab Project Owner NGOs, MNCs or Multilaterals Potential App Store Provider Mobile Services Provider Voice, Data, Texting Vertical IT Systems Financial or Health Information Systems Vertical Intermediary Health Workers, Microfinance Agents Subscriber Subscriber Subscriber Subscriber Subscriber Subscriber 10

12 App Stores Are Just One Distribution Method Distribution Method Pros Cons Key Players Monetization Model SMS Simple to develop Works on all Phones 160 character limit Not real-time service SMS Aggregator Premium SMS provider Mobile Operator Revenue Share Subscription Sponsorship / Advertising USSD Works on all GSM phones Interactive Hard to offer in multiple markets Content privacy issues Mobile Operator Revenue Share Online Application Stores Low entry barriers Store offers marketing support, payment gateway, and global presence User must find, download, and install app Multiple app versions needed App Store Mobile Operator Handset Maker Payment Gateway Per Download Freemium / Premium Advertising Differentiation difficult Mobile Web Easy distribution Simple to update Connectivity required Limited features Cross device compatibility issues Website Host Payment Gateway Mobile ad network Advertisement Sponsorship / Affiliation Subscription e-commerce 11

13 Proposed Membership Categories To serve intermediate customers Virtual Members Affiliated Members Residential Members Partner Members mlab Incubatees Virtual Members: Motivated to be access on-line community and attend events. Affiliated Members: Motivated by access to online services and networking opportunities. Residential Members: Motivated by access to office space, value chain partners and networking opportunities Partner Members: Stakeholders that are motivated by a desire to access the entrepreneurs themselves. mlab Incubatees: Most elite level; members must be pursuing a new business venture 12

14 mlab Offerings The mlab is an intermediary Complete list of services offered by the mlab: Venture Funding Market Intelligence Member Categories: Business Training Physical Space Partner Mentoring Technical Training Technical Outsourcing Professional Services mlab Virtual Affiliated Testing & Certification Competitions Residential Due Diligence & Capital Readiness Networking Events Incubates Value Chain Partners Code Repository 13

15 Identifying Service Offerings Not all services are essential Revenue Generating Revenue Neutral Contribution to mlab Sustainability Competitions Job Placement Professional Services Non-essential Services Content and Distribution Code Repository Technical Outsourcing Market Intelligence Physical Space Priority Services Networking Events Business Training Testing & Certification Technical Training Funding Mentoring Due Diligence & Capital Readiness High Cost Low Value Value to Entrepreneur High Value 14

16 Business Model Workbook Tool Conceptual Overview Available for Download Free of Charge Foundational Input Tabs Membership Fixed Costs Output Summary Sheets Business Model Summary Sheet Operating Model Summary Sheet Key Assumptions - Input and Calculation Tabs Member Dues Technical Outsourcing Events Grant Revenue Physical Workspace Professional Services Market Intelligence Training Investments Testing and Certification Job Placement Additional Services 15

17 Fundamental Resource Requirements 1 Skills Critical thinking Lesson planning and curriculum design Quality assurance testing Business development Special event production Marketing Business operations Client management Program and project management Application certification Mentoring Competence in latest software development tools Security IT Maintenance 2 3 Topical Knowledge Knowledge area Financial and Technical evaluation of potential investments ICT for Development (ICT4D) Local market expertise Market analysis and consumer research Business Mentoring mservices: Agriculture, Health, Education, Governance, Entertainment Mobile application platforms Intellectual property Contracting / Subcontracting Servers Computers Phones Lights Printers Copiers Bandwidth Handsets Equipment 16

18 Challenges to Application Development What challenges do incubation programs commonly face? 1 Investor network is poorly formed Investors are hard to reach or may require unrealistic returns 2 Lack of skills and inexperienced talent pool Young developers may lack sufficient educational foundation 3 Misaligned Incentives Entrepreneurial growth is difficult in risk-averse cultures 4 Partnerships are challenging and unpredictable Partners may have different priorities 5 IP protection is poorly defined Lack of formal property rights protection discourages product development 17

19 Critical Success Factors Which factors are critical for successful application development? 1 Local market need and market data Building successful application requires an understanding of local market needs 2 Professional team of managers Labs are managed by professional business people and not necessarily technologists 3 4 Development of partner ecosystem Labs bring together strategic partners required for successful launch of applications Strong mentorship program Mentors can provide individualized assistance to entrepreneurs 5 Diversified funding model Labs sustain themselves on a mix of grants and earned revenue sources 18

20 Thank you For more information contact: Annie Schowalter Director of Client Services +1 (858)