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oikos UNDP Academy participants recently paid a visit to iHub, the innovative ICT hot spot located outside the city center in Nairobi, to discuss Kenya’s booming ICT sector.

Opened in March 2010, iHub was a response to the post-election turmoil that rocked the country. Techies were using less than adequate Internet connections at cafes, on their phones, and wherever else they could connect. A need for space to share, network, and incubate was widely recognized, and iHub, a facility for the tech community that focuses on young entrepreneurs, Web and mobile phone programmers, designers, and researchers, was born.

iHub currently connects to more than 8,500 members through a weekly newsletter and events that include Start-up Pitch Night, Fireside Chats, and Hack-a-Thons. A tiered membership scheme gives select members daily access to the facility, including the 20MB Internet connection and space for meetings, Internet use, networking, and collaborative projects.

Our introduction to the hub was a panel debate on ICT Solutions for the Bottom of the Pyramid, with Monica Kerretts-Makau, senior lecturer at the Academy’s host school Strathmore Business School and Board Member of Kenya’s Communications Commission; Angela Crandall, project manager of iHub Research; and Linda Kwamboka, co-founder of M-Farm, an innovative mobile phone application that aims to encourage farming by transitioning it from a subsistence-based model to agribusiness. Discussion topics ranged from the explosion of the ICT sector in Kenya, to the rise of M-PESA among the BoP, to the difficulty of connecting small-holder farmers in one region to buyers in another.

iHub Research is the research and consulting arm of iHub that provides space where people can collaborate and problem solve. Current research focuses on mobile use at the base of the pyramid and the implications for Kenya’s ICT sector. While the official report is not due until October, Angela gave us some surprising initial data. Most members of the BoP bought their first mobile in 2009 when prices of mobile devices decreased enough to become affordable. In three short years, 77.9 percent of BoP mobile owners send or receive money via their phones, and 83 percent of BoP mobile owners send text messages, which is why mobile application development for SMS is not only encouraged, but supported in Kenya.

The widespread use of SMS is what has helped M-Farm become so successful. Linda and her co-founders realized that while farmers own mobile phones, they are usually lower-end models without internet access. How can farmers find up-to-date prices for their crops without access to the Internet? Through M-Farm’s SMS-focused design that gives farmers access to daily market prices and to buyers across the country. As Kwamboka explained, the company “targets farmers with one acre or less of land. A farmer will use SMS to see the price of the crop and the amount buyers need. Then the farmer can join with neighbor farmers to bring a bigger crop to market.” Partnering ensures a better price for farmers and assurance that their crops will be sold. M-Farm makes a profit by charging a small fee per text message and by selling its market data to government agencies and NGOs.

Academy participants also took part in informal brainstorming sessions with three entrepreneurs from the education, agricultural, and financial inclusion sectors. The three entrepreneurs were able to ask questions and seek advice on how to strengthen and grow their businesses from participants who have knowledge in various fields including management, economics, sociology, and anthropology. In the evening, we attended iHub’s first Start-up Pitch Night where six start-up companies got five minutes each to pitch their ideas. The room was packed with developers, software engineers, and techies willing to give advice and ask questions after each pitch, all while tweeting under the tag #NBOpitch.

Where is all this innovation coming from? In a word, from the people. The driving force for change in the ICT sector has not come from the government, but from the people working and living in Kenya. Kenya has become known as the Silicon Savannah, modeled after Silicon Valley in the United States. A $7 billion, 5,000-acre site known as Konza Technology City is planned for development 50 kilometers (30 miles) south of Nairobi’s Jomo Kenyatta International Airport. The City, which is to be completed over four phases by 2030, will provide space for business process outsourcing, a university, science park, office space, and housing. The Konza Technology City is not the only new addition to Kenya’s technology landscape. In June 2012 the Savannah Fund, an East African-focused accelerator fund, was started to find and invest in early-stage, high-growth web and mobile startups addressing the Sub-Saharan African market. The fund will invest $25,000 to $500,000 per project in Kenya the four other East African countries, hoping to capitalize on the area’s “mobile revolution.”

iHub’s funding comes from a variety of sources. It’s phyiscal space is funded by the Omidyar Network and Hivos. Ushahidi, a non-profit tech company that specializes in developing free and open source software, covers the lease, electricity and data connections. Wazi WIFI installed the free WIFI. Membership fees are charged to the highest of the three tiers (the highest tier receives physical space in iHub), and iHub charges for some of the events that are held in the facility. iHub Research’s projects are funded by various organizations, including the World Bank.

Much of the growth in Kenya’s ICT sector has been made possible by the arrival of four fiber optic cables in 2009, with the fifth currently on its way. The cables dramatically increased download speeds and gave some Kenyans access to affordable home internet service. The question now, according to Karretts-Makau is “how do we get access to the internet for everyone?” Mobile application developers have fantastic ideas, and the country has made great strides, but national policies have not yet been put into place to give access to all. It will be interesting and exciting to follow the evolution of Kenya’s ICT sector over the next few years.

What do you think about the exciting things happening in ICT in Kenya? Have you experienced the energy in Nairobi?