In July 2016, having just resumed a new job at an e-commerce startup on Victoria Island, I witnessed the bizarre spectacle of my new colleagues carrying out a collection for a delivery driver. Bizarre because he was not bereaved, incapacitated, in family difficulty or otherwise disadvantaged in any way. He had however suffered deductions from his N50,000 monthly salary until he was apparently in debt to the company.
The reason?
Said company had a completely unrealistic same-day delivery guarantee to its customers, and its way of achieving this goal was not to create a more efficient delivery system or disrupt the infrastructure of delivery in Lagos. Its route to the paradise of customer satisfaction via same-day delivery was to fine delivery drivers N5,000 for each missed delivery target. Motivated by the Damoclean Sword of having their salaries slashed if they didn’t make it, these drivers were to furiously navigate the famously well-maintained and traffic-free roads of Lagos and help the company achieve its stated 20 percent monthly growth target.
Barely 6 weeks later, I left the job.
Solving problems – but for whom?
A few years ago, an analysis I wrote about Jumia sparked a conversation about exactly what tech should ideally exist to achieve in Africa. On the one hand, there is a popular narrative about tech as the industry that has disrupted the way we transact business and transport ourselves, which is certainly true. In Q2’2019, ICT contributed 13.85 percent to Nigeria’s GDP, up from 11.22 percent in Q2’ 2018, which underlined how influential this burgeoning industry was.
Apart from effectively subsidising delivery failure risk using employee salaries, the most basic operating costs were borne by employees
On the other hand, as encapsulated by the travails of the pre-IPO iteration of Jumia, the practice of running a tech operation in Nigeria can be as malign as it can be positive. The key problem with the tech space in Nigeria is not an infrastructural or regulatory one. It is a cultural problem – a culture of extreme, obnoxious selfishness and greed that encourages participants to act like predators and throw all other stakeholders under the bus.
Read also: Deficit of tech talent in the African tech ecosystem: Nigeria as a case study
In Jumia’s case, those stakeholders were investors, suppliers and employees – especially employees. Unfortunately, the so-called “Jumia culture” percolated into the general ecosystem and affected, at the most, basic level on how many tech entrepreneurs and organisations do business in Nigeria. In 2016, while working at the afore-mentioned startup, I got a first hand glimpse of how employees were to be utterly rinsed in a rigged game of cards.
Apart from effectively subsidising delivery failure risk using employee salaries, the most basic operating costs were borne by employees. Marketing, analytics and IT employees were to use their own laptops to do company work, and Operations employees were to fuel and maintain the delivery vehicles themselves. Allegedly, the idea was that after five years, the company would give the cars to the drivers who could then set about building their own small transport businesses. In reality, all this did was outsource operating costs to drivers who would never ever own the cars because they rarely made it to six months there before moving on or getting fired.
Exploitation of employees and investors
The company thus also got to remove the cost of asset depreciation off its books by outsourcing as much operating capital cost as possible to its employees. It did this while making sure to squeeze as much productivity as possible out of its staff – 8.45am resumption was non-negotiable, but closing times essentially did not exist in any conventional sense. The company also paid staff in the middle of the month, as against at the end, which I heard was supposed to make it more difficult for staff to leave. Despite this, the annual turnover rate by my reckoning approached something like 60 percent.
The exploitation does not only point downward at employees though, because investors are not spared. A growing number of startups are now explicitly conceived with the intention of raising money to fund the founders’ personal lifestyles under the guise of solving a problem. Explaining how this scam works, Telnet Nigeria Group executive director, Adewale Adetugbo, said: “Tech should exist to solve a problem profitably. However, there are different kinds of problems.
So if, as a founder, the problem I am solving is how I can look “good”and raise money so I can be on max enjoyment, I would behave differently from a founder who is actually trying to hopefully solve a problem that would ultimately be profitable. The fact is this, almost all startups fail, however founders believe that is the other guy and not them. There is a lot of money (relatively) that has found tech sexy in Nigeria. If you raise $5 million, do you give a toss what the street thinks as you move into your serviced flat in Lekki?”
