How Nigeria’s Rising Tech Hub Is Addressing the Software Developer Shortage

By David Ryan Polgar

Today, Nigeria is home to the second-best Ruby developers in the world and has become Africa’s biggest source of VC investment for tech startups. With $109 million in startup investments in 2016 alone, some refer to Nigeria as “Silicon Savannah”— a rising power in the tech world.

It’s perhaps no surprise then that, Andela, an American startup that aims to train 100,000 world-class software developers in Africa over the next ten years, has landed in Nigeria. Founded in 2014 with headquarters in New York and offices in Lagos, Nairobi, and Kampala, Andela has a simple goal: Fill the 1.3 million software development jobs expected to arise in the next decade with top tech talent from Africa, specifically, Nigeria, where the economy is ripe to support a new class of talented developers and entrepreneurs.

A Rising Tech Hub

Nigeria, a country of 186 million people, is larger than Russia (population: 144 million). By 2050, it is expected to pass the U.S. as the third most populous country on the planet. And according to Andela co-founders, president Christina Sass and CEO Jeremy Johnson, these population stats tell a truth about discovering tech talent.

“If you believe that brilliance is evenly distributed but opportunity is not,” Johnson explained in this video, “then you have to conclude that there are places where there are staggering numbers of extraordinarily bright people who just don’t have a path in the formal economy.”

Sass’ motivation for starting Andela, which was also founded by Nigerian serial entrepreneur Iyinoluwa Aboyeji, was to find a way to systemically boost employment on a meaningful scale. Her background in youth employment—building programs in Kenya, China, Gaza, and the West Bank—prepared her for the unique responsibilities of tackling youth employment. For Sass, it’s companies like Andela that will help fix the large gap between educators and the labor market.

“If you believe that brilliance is evenly distributed but opportunity is not, then you have to conclude that there are places where there are staggering numbers of extraordinarily bright people who just don’t have a path in the formal economy.”

– Jeremy Johnson, Co-founder and CEO of Andela

Yet, getting into Andela’s four-year program is both competitive and rigorous, with an acceptance rate of just .77 percent, a multi-month application process with psychometric and skills assessments, and a six-month onboarding process with Andela’s senior engineers and internal product team.

If a programmer has showcased the requisite skills and personality after the onboarding, they join one of Andela’s partnering companies as a full-time engineer. Andela runs on a fellowship model, so every Nigerian selected into Andela’s program becomes an Andela employee that is placed with a partner company (as opposed to an employee of the participating company).

While the developer works remotely out of Andela’s office in Lagos, they spend the first several weeks visiting their partner company’s headquarters during that initial kickoff period. During the four-year program, developers will typically work with two to three partner companies.

With the inaugural class set to graduate in May 2018 (completing the program they began in 2014), Andela will get a sense not only of how its participants have fared in the program, but also what they will do with this opportunity upon graduation.

Andela’s big bet is that graduates will support and help grow the tech scene in places like Lagos while supplying tech companies that suffer from a shortage of software developers with skilled remote programmers. These two goals in mind, the company hopes to support the African tech hub ecosystem, increasing developer skill-sets, attracting investments, and creating future mentors.

According to Sass, the model has already opened investors’ eyes to the tech scene in Africa, particularly in Lagos and Nairobi. “We have already had a lot of investors say, ‘When can we invest in your graduates when they build companies?'”

Big Money

Interest in investment in Andela’s graduating talent comes after substantial funding for Andela itself, which has raised over $80 million and ballooned to 1,000 employees, including the 600+ developers in Andela’s four-year program, since its founding in 2014.

Andela’s disruptive education and labor model may be the reason that the company received the first investment from the Chan Zuckerberg Initiative—$24 million in Series B funding in June 2015. (The Chan Zuckerberg investment led this round of funding for Andela.)

In late August of 2016, Facebook founder and CEO Mark Zuckerberg made a surprise visit to Lagos, making Andela one of its premiere stops. The response to Zuckerberg’s visit, according to Sass, was arguably the biggest moment in Andela’s history and put Lagos on the global tech map. For a company that aims to shine a light on unheralded talent and overlooked locations, Zuckerberg’s arrival into Lagos offered a burst of exposure. In Sass’ view, the visit was an extension of the Chan Zuckerberg Initiative partnership, which, she said, “shares a theory of change around connectivity and digital.”

The ROI of Andela Graduates

Although members of Andela are free to stay within the Andela programmer role after they graduate, Sass is optimistic that graduates will also become an integral part of mentoring and growing Nigerian startups.

In the near future, Sass sees Nigerian startups excelling in e-commerce, media, and mobile money transfer. When they do, she said, “we will be there to offer support, office space, advice, and funding.”

For Sass, it’s this exposure to high-quality global tech companies in Silicon Valley, Austin, and other tech hubs around the globe that will be a key factor in promoting the growth of the tech scene in Lagos. “If you want to build great products under market pressure,” she explained, “you have to [learn from inside of successful] companies.”

In many ways, Andela hopes to become a self-fulfilling prophecy. While it currently solves the problem of uniting talented programmers in Africa with companies in need of developers, it is also molding the next generation of tech entrepreneurs.

The ideal scenario, Sass said, is for graduates of Andela to jumpstart a “PayPal Mafia” situation whereby founders of one wildly-successful startup then break off to form additional companies. (The six founders of PayPal, including Elon Musk, Reid Hoffman, and Peter Thiel, later broke off to start and back the next generation of successful startups: Tesla, SpaceX, LinkedIn, and Facebook.)

The economic return of these developers comes after a meaningful investment by Andela in its own students. When developers first sign with Andela, the company invests $15,000 per developer, covering the six-month onboarding period. Once the student is placed with one of the partner companies, Andela benchmarks their salary to be competitive within the local tech ecosystem. (The rest of the revenue generated goes toward each developer’s continued professional development, Andela’s infrastructure costs, and growing the business so that additional developers can take part in the program.)

During the four years a developer works with Andela, their income multiplies threefold, and their earning potential is significantly higher than when they started, given their training and exposure to global tech companies. Whether they decide to work full-time at another company, launch their own venture, or stay within Andela as a team lead or senior engineer, developers’ individual earning potential is much higher than when they began.

In the end, though, Sass and her colleagues are relying on the return of this investment on a local level: “There is no doubt in my mind that Andelans will reinvest in their communities.”