Markets

We focus on 8 key markets in the SEA Region. These markets have been handpicked over the course of 6 years based on their exposure to broad-based growth and the importance of innovative technologies and disruptive business models to enable this growth. 

The following markets have been chosen based on a variety of key factors which expose them to growth and act to reinforce broader social and economic development. 

As any economy goes through different stages of growth (refer to Rostow’s Stages of Growth) certain industries will be more exposed to growth than others based on a variety of social and economic dynamics. The following industries have been chosen due to their importance to this region at the current stage of development. 

No market operates in isolation. As an economy develops key markets act as enablers for growth in other markets, sending positive feedback loops throughout the broader economy. At SEA, we focus on these growth enabling markets as they are key for long-term social and economic development.

Although technological innovation permeates all markets in an economy, certain markets are more exposed to newly available technologies than others. Using a region’s Connective Capacity and Adjacent Frontier we can better anticipate these markets to capitalize on developments in connectivity and technological capacities. Explore all our Focus Technologies

Certain markets are more exposed than others to leveraging the strategic opportunities resulting from emergent technologies.  At SEA we focus on markets with high information asymmetries, high costs of coordination, unconnected multi-sided exchange networks and more. Explore all our Focus Models

Our Approach to Market Selection:

The following markets have been chosen based on a variety of key factors which expose them to growth and act to reinforce broader social and economic development. 

Growth Exposure
As any economy goes through different stages of growth (refer to Rostow’s Stages of Growth) certain industries will be more exposed to growth than others based on a variety of social and economic dynamics. The following industries have been chosen due to their importance to this region at the current stage of development. 

Market Enabling
No market operates in isolation. As an economy develops key markets act as enablers for growth in other markets, sending positive feedback loops throughout the broader economy. At SEA, we focus on these growth enabling markets as they are key for long-term social and economic development.

Technology Timing
Although technological innovation permeates all markets in an economy, certain markets are more exposed to newly available technologies than others. Using a region’s Connective Capacity and Adjacent Frontier we can better anticipate these markets to capitalize on developments in connectivity and technological capacities. Explore all our Focus Technologies

Strategic Alignment  
Certain markets are more exposed than others to leveraging the strategic opportunities resulting from emergent technologies.  At SEA we focus on markets with high information asymmetries, high costs of coordination, unconnected multi-sided exchange networks and more. Explore all our Focus Models

Agriculture

Agriculture is central to the East African economy, contributing between 24 and 44% of GDP, while also accounting for the livelihood of about 80% of the region’s population. The key to this sector’s growth lies in a shift from subsistence to commercial farming. Opportunities for large-scale commercial farming exists in the region for a wide variety of food and cash crops. Opportunities include, but are not limited to, apiculture, coffee, cotton, fruits, grains, nuts, oil seeds, horticulture, sisal, sugar, tea and tobacco.

E-Commerce

Although still nascent, the East African e-commerce sector is showing strong signs of growth, largely due to increased smartphone adoption, greater connectivity and improving infrastructure. Access to e-commerce solutions provides great value to consumers in this region, often to the most underserved who previously had no way of accessing certain goods via the physical solutions available to them. According to the EIU Canback opportunity scores, 3 of the top 8 countries in terms of potential market opportunity are in the East African region; Ethiopia, Kenya and Tanzania. Africa’s largest retailer, Jumia, became the first company on the continent to surpass $1 billion in market value in February, 2016.

FinTech

The launch of M-Pesa in 2007 helped to put East Africa, specifically Kenya, on the startup map. For over a decade now, M-PESA has brought about increasing financial inclusion in the country as well as increased investor interest and the foundations for a burgeoning FinTech scene. Banks have also gotten in on the action, giving a further boost to Fintech growth, increasing accessibility across unserved markets in the financial chain. While Kenya is the star of the region, new categories like insurtech, blockchain, group savings and innovative business solutions present outstanding opportunity for the whole of the SEA Region.

Healthcare

Three challenges that are placing increased pressure on health systems across the SEA Region; The double burden of communicable and non-communicable diseases, the current state of healthcare financing and the geographic maldistribution of healthcare providers. Fortunately, private sector players are organizing across the region for growth and impact. With these challenges in mind private sector participants often find the greatest opportunity in the following 3 solution spaces; creating patient and provider networks, improving quality of care and developing technologies that improve efficiency and financial sustainability.

Infrastructure

While capital-intensive projects & infrastructure have been seen as predictably engineered, labor-intensive projects far removed from the cutting-edge of technology, this is changing. A wide array of innovative technologies are rapidly transforming the way infrastructure is built and operated, fundamentally restructuring how the infrastructure industry operates. At the top of this list of technological innovations are the Internet of Things, Drones & Smart Cities. Although some of these technologies are years off of implementation, considering their use and impact couldn’t be more relevant as the SEA Region looks to develop the infrastructure necessary for a 21st century networked society.

Manufacturing

Manufacturing offers a wide range of opportunities in the SEA Region. Among the most promising opportunities in manufacturing include; Textiles & Apparel, Vehicle Parts/Assembly, Electronics, Plastics, Chemicals, Pharmaceuticals, Beverages and Packaging. The manufacture of garments has been revitalized since the signing of the African Growth and Opportunity Act in the US, which allows the SEA Region access to the market. Also, the number of new motor vehicles registrations in the region has been increasing rapidly over time, leading to greater demand for automotive parts which are currently mostly imported from abroad. The electronics industry is also exposed to high investment as Manufacturing Under Bond and Export Processing Zones programs incentivize domestic manufacturing.

Tourism

Tourism is a critical industry to the East African economy, In Kenya alone accounting for 9.7% of GDP in 2017. East Africa offers some of offers some of the most beautiful natural attractions in the world. With national parks, game reserves, marine parks, biosphere reserves, archaeological sites and pristine beaches, this region remains a natural tourism magnet. While opportunities abound, many remain largely unexploited. All SEA Region countries are actively interested in diversifying the sources of tourism and adding new ones such as the countries of East, South and Southeast Asia and additional members of the EU.

Transport

New technologies are transforming the way we plan, design, build, and operate transportation systems. Transport agencies use them to count traffic, detect crashes, collect tolls and fares, and manage transit operations and traffic signal systems. Travelers depend on traffic condition reports, electronic maps, on-board vehicle performance monitors, real-time transit arrival information, and a host of other services that did not exist a generation ago. The implications of these technologies are especially relevant in the SEA Region as governments and private investors look to develop a transportation system for a 21st century, technologically networked society.

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© 2019 SEA. All rights reserved.

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