Startups and innovation is something that I’m quite passionate about. I don’t claim to know everything in these areas. But I know enough to know what I’m talking about. There are a few things I realised over the last few years. Among those, these two are my focuses, we need a bottom of the pyramid startup strategy and we need an IT industry strategy that can leapfrog whatever is right in front of us.
A bottom of the pyramid startup strategy
While I have no issues with bold-font startups (AI, big data, machine learning, crypto, etc.), I think we need a better way forward.
What do I mean? Many countries, including Sri Lanka, are facing similar socio-economical issues. To the left of us, we have the African continent. To the right and above us, we have the rest of the Asian continent. Most problems that we face as people living in these countries are similar. Most problems that we face as nations are similar. Even when it comes to issues like pollution, climate change, urbanization, last-mile delivery, etc., we’re similar. I fully appreciate the country-specific nuances. But quite a lot of things are common.
Let me give an example. Apollo Agriculture, an agri-innovation company based in Kenya. In a nutshell, they provide the initial credit to the farmers; gives them good seeds and fertilizer; buys back where possible; has insurance to cover farmers’ risk and Apollo’s risk. All of this is data-driven. Apollo understands demand cycles, weather cycles, needs of the farmers and use complex tools like insurance.
Isn’t that the sort of solution we need to modernise Sri Lankan agriculture too? Or the agriculture of any number of countries in the African or the Asian continent? Apollo is a good example where tech and bold-font avenues like big data solve tough problems for the bottom of the pyramid.
In Sri Lanka too we need a perspective where we get the builders and tinkerers to solve such problems at the bottom of the pyramid. The ticket size per engagement could be smaller. But we can sell a replicable solution at a massive scale. We can loop in development agencies and impact investment to create a winning model for scalable startups.
IT industry strategy that can leapfrog
Most of the Sri Lankan IT companies are providing development services as extended teams. This is a profitable business vertical. But there are inherent issues. Let me list some:
- Many mid-career IT professionals are leaving the country.
- Cost leadership is not permanent.
- At some point, AI-based development tools and no-code platforms will become more efficient.
So, we need a different thought process. Sri Lankan IT companies need to think about how to retain more value internally. It can be intellectual property, own product development (for the bottom of the pyramid!), or completely new avenues such as quantum computing. In the case of the latter, the two things you need is a good knowledge of physics and programming. I’m generalising of course. But I think the Sri Lankan youth can become world leaders in quantum computer programming.
The broader need is we have to envision 10 years ahead of us. Pretty much every other country is working on what’s on the immediate horizon. If we too think like that, we’ll get the same or even worse results. Plus, we have issues in lack of talent, education reforms, quality of life, etc., that we have to deal with.
Granted though, it’s not as simple as that in execution. A lot of things will have to align, a lot of sacrifices will have to be made, not to mention a lot of work.
I don’t think a ‘we’ll cross that bridge when we come to that sort of approach would work. For example, IT companies that had a business continuity plan before 2020 are now in a better place. These companies have grown to the point that they don’t have enough people to hire in Sri Lanka today.
I’m certain that both these; a bottom of the pyramid startup strategy; and an IT industry strategy that can leapfrog are possible. But, we need cohesion, a structured plan and above all, we need a lot of collaboration across many stakeholder groups to make this happen.