Billionaire Tomorrow
"We were flying but the seat of our pants!” Soaring to $1 billion"
He’s an American pouring money into Africa. Jeremy Johnson is financial muscle behind the West African tech boom that has thrown up a blessing of unicorns - that is, a start-up with a billion dollar capitalization. How difficult can this be? What is his secret? Billionaire Tomorrow sat down with the man himself.
Jeremy Johnson is as humble as he is rich and successful. In this face-to-face interview he is wearing a plain white t-shirt that could have come straight off the discount rack of a Walmart store.
He’s cracking jokes, talking about the weather and saying how he misses travelling to Lagos with its vibrant Afropolitan beats.
On this day it’s a far cry from where Johnson speaks to us from his hotel room in Nashville Tennessee in the United States, where he is on business.
Yet Johnson may be as humble as his clothes but he listed on the New York Stock exchange by the time he was 30 and the man behind 2U and Andela. The latter is now a $1.5 billion business – the only non-fintech unicorn from Africa – that finds engineers for more than 200 tech companies including the likes of GitHub, Cloudflare, and ViacomCBS, in more than 80 countries.
“We’re the first of what is going to be a stampede [of unicorns]…It’s a matter of time, we’re seeing a long-term shift of the world starting to pay more and more attention to Africa, as they should. From what I’ve been seeing for the past five or six years of high growth technology start-ups across Africa,” says Johnson.
It’s been an unusual route to becoming an investor in Africa. Johnson, dropped out of the ivy league college Princeton, aged 21, to build his businesses; the educational technology company called 2U. The US based ed-tech provides educational resources to create online classes and create degree programs and was behind the purchase of Cape Town based Get Smarter.
The origins of Andela start with an equally humble gathering of tech and education experts hosted by the MasterCard Foundation in Nairobi, where a long-time friend, Christina Sass (who would later end up as a co-founder and President of Andela) invited Johnson to speak.
It was at this conference Johnson first came across the idea of investing in Africa. It was based on a vision of finding sharp African talent to train as technicians to work remotely for some of the world’s top businesses.
It sounded crazy back in 2014, but not so in 2022.
“Senior leaders from around the continent, largely donors and recipients, came to talk through what was happening around the world and try to share knowledge that can help accelerate each of their efforts…That kicked off this whole crazy thought process around how would you try to leverage education to generate opportunity across emerging markets,” says Johnson.
Johnson says he was blown away by how different the reality of living in Africa was compared with what he had heard back home.
“I think that the news especially then, was all too often focused on, you know, poverty and disease, as opposed to the really exciting things taking place across at this point, almost every major urban centre on the continent has a thriving, rapidly growing technology ecosystem, that is going to be a big deal in the years to come. People just weren’t talking about this at all.”
A chance meeting with a Nigerian in New York, who was to become a mover and shaker in West African tech business by the name of Iyinoluwa Aboyeji, who went on to co-found unicorn Flutterwave.
“I said I’ve got a crazy idea for you. I’m talking to Christina Sass about potentially launching a program to identify super smart, basically very high aptitude and high cognitive processing young people and train them to be software developers. Do you want to do want to do this? Like, what do you want to shift your business? If you do, I will fund it. He came back a day later, after talking to his other three co-founders, and they were like, alright, we’re in.”
Luckily for Aboyeji, Johnson, who had spent time in Accra, was benevolent towards a persistent stranger from Africa.
“I had this bad habit when I was growing up, I was bugging people with email. You don’t want to be on the other side of my email! I was just emailing him and then the responded out of the blue as I was about to leave New York and he said: ‘let’s go out for fresh and coke’. That was the meeting that changed my life.” In English, fresh and coke is salad and a fizzy drink – did it go down well? “I didn’t eat the salad. Us Lagosians like our meat!” says Aboyeji.
Jeremy Johnson and his team of techpreneurs: Brice Nkengsa, Christina Sass, Ian Carnevale, Aboyeji and Nadayar Enegesi. On the busy streets of Lagos, this team set about its dream.
“Going back to those early days, Nigeria feels like a second home to me at this point. Nigeria was a fantastic place for us to start because everything else has seemed easy afterwards. When you are walking around, in the air is this feeling as if electricity is coursing through it.”
“I think of our very first office, and like teaching soft skills myself to engineers, and working with Enegesi to develop the curriculum. I remember the energy and the excitement and this feeling from a room full of people and that we’re going to change the narrative around the content.”
A mere seven years later, that small dream is now worth $1.5 billion.
“Andela is a story of surging momentum around the continent, and eventually around the world. Our founding values and our founding mission were really, really clear from the beginning. And I think that created a level of clarity that enabled the energy and momentum,” says Johnson.
Johnson calls it a ‘global talent marketplace’ that connects global companies with vetted, remote technologists from Africa.
“Andela, is the definition of the kind of story that couldn’t happen if people from different backgrounds didn’t come together to believe in something bigger than themselves. Like, it just would have been impossible. You had two people from Nigeria, two from the US, one from Cameroon and one from Canada.”
From a small office space in Lagos, without even a website, Aboyeji, looked for engineers over Twitter.
“I look back in those early days, like, you know, it was chaos, just like any start-up. We were trying to prove one step at a time that brilliance was evenly distributed. First, we had to source and confirm that brilliance. And for our first cohort, we were looking for four people. We ended up with 750 applicants, even though we had no website at this point.”
Next the company decided to run a second pilot. This time including an aptitude test as a filter in finding only the smartest. This time 2,400 applied.
“We still have no website whatsoever. Literally just on Twitter. It was a fly by the seat of your pants like operation. And the testing service calls and says what on earth are you guys doing? We’ve never seen so many applicants for a job before. And by the way, are you aware of the 2,400 applicants, 42 of the applicants are in the top 2% aptitude and problem solving of all humans on the planet.”
This was the point the team realized they were on to something. The company began by selecting a few to train in their hub and over six months paid them a salary along with providing them with housing and food.
We are the first of what is going to be a stampede of unicorns…It’s a matter of time, we are seeing a long-term shift of the world starting to pay more and more attention to Africa, as they should. From what I've been seeing for the past five or six years of high growth technology start-ups across Africa.
Jeremy Johnson co-founder Andela.
Our Vision
A world where the most talented people can build a career commensurate with their ability – not their race, gender, or geography.
Once trained they were slotted into businesses.
In just a few years the company went from recruiting developers in Lagos to the rest of Nigeria. Then to Kenya and then Uganda, Rwanda. Along the way they garnered the backing of investors including SoftBank, Whale Rock, Generation Investment Management, Spark Capital, and Google Ventures.
Even the Chan Zuckerberg Initiative, founded by Dr Pricilla Chan, wife of Facebook’s Mark Zuckerberg, wanted to invest $24 million to train more engineers in Africa to get tech jobs during a Series B round in 2016.
Aboyeji and Johnson sparked this interest when they cannily wrote an article for the Wall Street Journal asking: will the next Mark Zuckerberg come from Africa?
““The Chan Zuckerberg Initiative is obviously at the epicentre of a lot of what’s happening in the global tech ecosystem. Especially in terms of helping global engineering leaders understand that [Andela] was a quality offering.”
With a placement rate of 96%, their ticket to success was not just finding the right people but putting the right people in the right jobs and able to increase income by 64% on average from an engineer’s previous job.
According to TechCrunch, 100,000 engineers have taken part in the company’s learning network and community, and, as of 2019, Andela had more than 1,500 engineers on its payroll.
“We wouldn’t have started in Nigeria without Aboyeji and Enegesi. I hadn’t even been to Nigeria when we started in Andela. I came for the first time to do basically interviews for our first cohort of applicants.”
Some of the toughest challenges the founding team faced was operating over two continents – having to decide on splitting the work up between attaining clients in New York and identifying talent in Africa.
“At the time, for many people who invested, it was the first time investing in Africa…A lot of people thought it was crazy, the response was well, I mean, you just, you’ve just had this great outcome, your previous company, like, you can’t be that crazy here. And obviously, investment in Africa looks very different now seven years later than it did in 2014.”
In 2019, things changed when the global pandemic struck. Andela’s business model wasn’t sustainable, and it let 420 junior engineers in Kenya, Uganda and Nigeria go. Soon after, 135 employees were laid off as well as salary cuts.
Covid-19 lockdowns, however, encouraged the business, like many other businesses to pivot internationally and start working remotely. They saw a turnaround and recorded a 500% growth in applications in the last six months or 2021. This was because shifting internationally allowed the business to hire in Asia and the Americas –circumvent issues with Africans working across different time zones and bringing on more clients.
“For someone hiring in the UK, Nigeria is perfect. But if someone is hiring in San Francisco, surely makes more sense to hire from Argentina. Time zone still matters, even in a fully distributed world, in most cases, and so that that has allowed us to continue refining our algorithms, our algorithms and the approach to placement, to be able to have a more and more perfect fit between companies and global talent.”
“What’s become clear is that roughly 10 years of the trends that have made Adela possible in the first place, have basically been compressed into the past 18 months. What we’re seeing from clients now, particularly in North America, and Europe, is increased comfort with the idea of building out global teams.”
“If the world of remote work continues advancing it will create an entirely new set of opportunities for how you bring people together, through the world of work, and that’s what we’re experiencing right now at Andela.”
“The thing that’s become very clear is that this is not just a pandemic story. This is the acceleration of trends. Even as the world starts to slowly open back up.”
For the moment the business remains squarely focused on bringing African talent to the world. Johnson says about 70% of their engineers are from Africa and expects it to be the majority for a long, long time.
“I’ve met dozens of young Africans who have taught themselves to code on smartphones, things like that that people in the US couldn’t even fathom. It was their resilience that I was blown away by.”
As for the future and what trends Johnson has his eye on?
“By 2040, you will have more people graduating high school in Africa than the rest of the world combined. I think that the world is going to have a perpetual shortage of talent. For decades to come, like automation, is not going to catch up fast enough. And as a result, like smart people who are curious, are going to be needed all over the world, you’re going to increasingly have companies open to hiring anywhere, I think that’s going to be one of the most exciting things that’s ever happened to any continent, anywhere,” he says.
“Africa is going to follow a path that looks a bit like Southeast Asia and the extraordinary growth experience over the past 20 years, largely driven by human capital, and an export of knowledge work. I, for one, am very excited to see that and I hope that we played a role in helping to accelerate that.”
As for the skill sets of the future you should be investing in.
“If there was one thing, they should learn how to build on the blockchain right now, if I got two things, it would be learning how to build on the blockchain and simultaneously learning how to engage from a business standpoint with people across cultures, and walking between worlds is going to become increasingly important. Africa is 54 very different countries, and it often gets kind of bundled together.”
“Each of those countries is still a relatively small market. But collectively, it’s one of the biggest, you know, biggest blocks of human talent in the world. But I think that people who have spent time going between countries and engaging with people from different backgrounds across the opposite, are really, really, really well positioned.”
Not a bad return on investment for a humble idea born in Nairobi, forged in the vibrant streets of Lagos on its way to becoming a $1.5 billion unicorn.
Images: https://www.linkedin.com/in/jeremiahjohnson/ https://d.facebook.com/thisisandela/photo https://techpadi.africa/2020/07
