Africa charts its own courses: AI, Tech, Local Knowow unlocks possibilities

When Zacharia George of Launch Africa Ventures moved to Africa 15 years ago, Manhattan had more phones than in the whole of Africa. Today, Africa has more mobile phone lines than all of North America, including Mexico and Central America.

In addition to demographics over 60% under 25, that incredible shift is a reason for Africa to jump into the future, bypassing the paths seen in the West and Southeast Asia.

“As always, Africa will carve out its own course,” said Stephan Ekbergh, CEO of TravelStart and co-founder of Innovation City, opening his second Wit Africa in Cape Town. “Africa is leaping with technology when it comes to payments, encryption and mobile use. For example, certain countries like Zimbabwe have gone on to crypto very quickly to store their currency. They pay salaries by crypto, and by apps.

“You'll also be leaping when it comes to education and entrepreneurship. Most things in Africa are still setting up shops to see how many explorers and cutting-edge entrepreneurs can find their way to Africa and blend art/science exploration with entrepreneurial skills. That's certainly a place that brings you to life.”

That message of Africa, carving out its own course, was conducted in every session. Investors have declared local heroes in need of local funding to unlock pent-up entrepreneurial spirit on this continent, where jobs are not guaranteed, and that online travelers will unlock local solutions to unlock the depth and width of the various markets of 137 million on this continent.

Chris Hemmeter: “The Generation of Startups” and “Existential Threats to Suppliers.”

When a panel of local OTAs, consisting of Andy Hedley, Managing Director of TravelStart, Albert Fernando, CEO of Travelwings, and Andy Hedley, Managing Director of Bayo Adedeji, Group CEO of Nigeria-based Ota Wakanow, was asked what Leapfrog needed for a trip to Africa, they answered, cheaper, better, better technology.

So, if that's what you need, could AI be the beginning of a tipping point? In another session, Chris Hemmeter, managing director at Sayer Ventures, pointed out the AI ​​moment as “intergenerational moments of startups” and “existential threats to suppliers.”

He spoke about three wave changes: discovery, agency and adaptation. Discovery Wave reconstructs the way travelers find and plan trips, while agency waves show the possibility of AI completing complex tasks, such as planning an entire dinner from recipe selection to grocery delivery. Adaptation wave refers to a future that goes beyond static personalization, emphasizing real-time context-aware experiences that leverage sophisticated CRM stacks.

For an entrepreneur, he said: “This is the most exciting time for all industries to start a company in the history of this industry, due to the power of this technology. Through the value chain, I will make you think. This is not just about selling and retailing things, but everything that's happening through the value chain.”

“The future of travel planning and booking is headed towards conversational interfaces and AI-driven agencies, potentially eliminating the need for traditional search and booking processes.”

He added: “We live in this world of tuned content keywords, searches and optimizations, managed and tailored content, around the specific methods presented around the world. And now we have experience in controlling this kind of context.”

Therefore, travel suppliers who cannot optimize the content and data of AI systems were at the risk of invisible in search results, pose an existential threat to their businesses, he said.

“That's scary about this world of three or four recommendations. No one else exists. It's really scary.”

From left, how Diesel, Andy Hedley, Bayo Adedezi and Albert Fernando tackle the complexities of the region

However, the reality is that local OTAs face many everyday challenges, including fraud, lack of trust in online payments, credit card fees, low margins, fragmented markets, and increased global competition.

Also, what are the actual addressable markets? Nigeria's Adedeji said: Only 18 million people travelling and from there travelling, and 12 million people travelling the country. ”

But he said the informal economy of young Nigerians who spend the weekends on clubs “doesn't realize that they can travel less than they spend the weekends.”

This contrasts with South Africa-like markets that behave like the West, saying “South Africa is not Africa,” and draws laughter from the audience.

In a wishlist to grow the travel market, the panel cited relaxation of visa restrictions within Africa and reducing travel costs. “It's cheaper to go from Ghana to London than to go from Ghana to Sierra Leone. That makes no sense at all,” Adedeji said.

Hedley said the implementation of airlines' new distribution capabilities (NDC) in Africa focuses on cost savings rather than customer personalization, and is based on that promise.

“NDC doesn't offer promises of what they've been doing. It appears that airlines use it primarily to buy and reduce distribution costs when they have personalised promises to their customers.”

Commenting on the entry of the global OTA into his market, which presents the lowest barrier to entry for these giants, Hedley of Travelstart, he said, “We all have the advantage of being in Africa. We understand the complexities and differences in Africa and have a head start.”

Another factor that could affect the success of global players in Africa is whether they can have flexibility in their policies. He pointed out that in order to operate effectively, international OTAs need to try to put exceptions to global policies. “Most people don't do business the way they normally do,” he added.

Travelwings' Fernando said that while concerns exist, the presence of global brands can accelerate market development. “South Africa is very mature, East Africa is growing, West Africa is quite behind, Central and North Africa offers many opportunities. The market is very large. We shouldn't worry about it – it helps us grow ourselves.”

However, their entries could challenge certain assumptions, Adedeji said. “Like most African markets require offline or online, we need to make sure that the models we've always sold are still important.”

One thing they have in common is to reduce their dependence on flights and expand to hotels, as we saw huge success in Asia, such as Makemytrip in India.

According to Hedley, in South Africa, air distribution is currently about 70% and currently 30% direct, but if it follows a global pattern, there is a swing directly towards it.

He noted that the leisure market in South Africa has reached its limits. “Large players are interested in South Africa and are trying to get in, but there are limits to where they can go as a purely leisure-centric OTA. They need to expand verticals. Cars are a big thing for South Africans traveling abroad, and we haven't tapped into that market yet.”

And Adedeji said that most of his customers booking flights don't stay in the hotel, but “stay with family and friends” – he's adding hotel inventory to one hotel at a time.

“Most of these budget hotels don't have the technology or don't understand, so we need to go door-to-door to get them,” he said.

Fernando said payments were important to unlock growth, but the market was highly fragmented. In South Africa, online payments form almost 95% of the business, for example, while others may be as low as 3%.

The reality is that local OTAs are confident in their local knowledge of the market, but one thing they don't have is the marketing spending of global OTAs. Google and Skyscanner dominate search.

Adedeji said: For example, Expedia spends $1.9 billion on marketing per quarter. You can't beat Expedia with marketing spending. We need to praise them. ”