Nigeria is an immature market for internet startups, but tough choices made today will yield amazing results in years to come, according to iROKOtv chief executive officer (CEO) Jason Njoku.
In a blog post marking the video on demand (VoD) tartup’s fourth birthday, Njoku reflected on the journey iROKOtv has undertaken so far and its plans for the future.
It has been a busy but testing third year for the startup, with partnered StarTimes, Vodafone Ghana and Tigo Rwanda, while also moving into content distribution and licensing by launching distribution network iROKO Global.
The company also shut down its desktop service for African users, focusing on a mobile-only experience, as well as downsizing its Nigerian operations by laying off 130 of its staff in Lagos.
VoD as a sector has also had an interesting year, with large global firms rolling out services in Africa at the same time as others struggle. iROKOtv is still seeking profitability, while South African service Wabona closed down.
Reflecting on iROKOtv’s journey, Njoku noted that after “toiling in obscurity” for years, it was interesting that now the startup’s every move is noted with “equal awe and ill will”, with a team that is very different to the team it started out with. Meanwhile, the competition in the sector has seriously changed as streaming has become more mainstream.
“Today, across Facebook, Instagram, Vine and YouTube, it’s an essential part of how we interact with others around us. It’s an essential diet for millions. But it still has its challenges,” he said.
“In Africa we are super early. I feel even in 2016 and 2017, we will still be too early for widespread data-driven long form video adoption and consumption. As everyone who isn’t a betting company has realised, Nigeria is immature for most internet startups.”
Njoku said many startups in 2015 has adjusted to this reality, with “dreams of unicorns and delusions of grandeur” giving way to “cautious optimism and survival tactics”. However, he said the tough choices made by startups today will yield “amazing results” in years to come.
“It’s just the way of a startup. Success and failure look very similar at the early stages, and I believe in the leaders of our internet companies. They are too hardened to submit to failure,” he said.
Njoku said iROKO Global had just closed the biggest deal in its short history, with details to be announced next week. He described it as a “truly monstrously large deal”, which dwarfs the startup’s entire subscription business revenue for 2015.
“Our consumer business has 110 people working on it. Costs us millions annually in losses. Yet with one client, one deal, linear revenue until 2020 will eclipse it,” he said.
“But we are still focused on the future. Still focused on our subscription-only business where we see the ability to bring millions of people affordable content as our raison d’etre. Inasmuch as we expect iROKO Global to dwarf iROKOtv revenues for the next two to three years, our focus will remain laser-like.”
To that end, Njoku said, iROKOtv had started the migration to a new platform.
“Our 20-person product managers, designers and engineers have spent the last five months building a new logic, a new root and branch architecture for iROKOtv,” he said.
“Over the next two weeks, we will migrate to that new reality. We have made some fundamental product changes for both our android apps and web platforms. We have dug into the hordes of data we collate to try and capture glimpses of our subscribers’ daily realities and thus bring us closer to our mission. Lead you to content y’all love.”
Njoku said the company had experienced a few “existential moments” earlier this year, as a number of competitors burst onto the scene, but he remains optimistic for the future.
“But from a product and vision perspective, I believe we are prepared. The way we approached things in the past will be different in the future. We are veterans of Internet TV and its shortcomings and promises. Bloodied with the scars of reality and hardened by the rocks of dashed dreams. So as always, as I reflect back at the last 4 years, I am happy I started this journey.”
