As a tech founder, CTO, or technical recruiter, balancing tight budgets with the need for high-quality tech talent is a constant challenge. 

Whether you’re managing a growing startup or handling engineering ops at a large multinational, one thing is certain: hiring costs can quickly eat into your profits, especially for companies in the US, Canada, UK, and other developed economies.

Now, let’s look at this challenge from a different lens. How can working with developers from Africa enhance your profit margin, without compromising on the quality of work?

Where is the Investment Currently Going?

Traditionally, tech companies have outsourced talent to countries like India, Eastern Europe, and Southeast Asia. 

According to Deloitte, India still accounts for over 40% of the global outsourcing market, largely due to its large talent pool and relatively lower costs. 

Eastern Europe, especially countries like Poland, Ukraine, and Romania, has also seen a significant increase in demand due to its proximity to Western Europe and a growing tech ecosystem.

However, these markets are becoming saturated. So, the increased demand for talent in these regions has led to a rise in salaries. For example, a software developer in Poland now costs an average of $40,000 per year, while a developer in Ukraine might cost around $35,000. 

While this is still cheaper than hiring talent in the U.S. or the U.K., the gap for cost savings is shrinking, especially as inflation and economic factors creep into these regions.

Now, the African question…

Africa is quickly becoming a tech outsourcing hotspot, with several unique advantages that make it an attractive option for businesses around the world.

At the top of that list of advantages of hiring software engineers from Africa, is cost savings. For instance, the average salary for an experienced software developer in Nigeria is around $24,000 per year. When compared to the $110,000 average salary for a similar role in the U.S., the cost difference is staggering—a potential savings of over 79.18%.

Table: Comparison of Average Annual Software Developer Salaries

Country	Average Salary (USD)	Savings Compared to U.S.
United States	$110,000	0%
United Kingdom	$78,000	29%
Poland	$40,000	64%
Ukraine	$35,000	68%
Nigeria	$24,000	79.18%
Kenya	$30,000	72.73%

Source: Payscale.com, 2024 - "Comparing Salaries in Tech: Africa vs. the US and Europe."

In a competitive scene where operational efficiency is key, the financial benefits of outsourcing to Africa are hard to ignore

However, cost savings alone are not the only reason why you should consider Africa. Let’s dig deeper into the ecosystem to see what Africa offers beyond just price advantages.

The African Tech Ecosystem is Growing in Quality

Africa has witnessed a tech boom over the past decade, with cities like Lagos (Nigeria), Nairobi (Kenya), and Cape Town (South Africa) emerging as leading tech hubs. 

Over 500,000 IT graduates enter the job market annually from African universities, providing a young, eager, and highly skilled workforce for businesses looking to outsource.

Governments, social enterprises, and boot camps across Africa are increasingly investing in building the infrastructure to support learning and experience-building within the continent’s tech ecosystem. 

For example, in 2021, the Nigerian government launched the Nigeria Startup Bill to create an enabling environment for tech startups to thrive. In Kenya, the government has invested heavily in improving internet access and providing tax incentives for tech businesses. All of these factors create a fertile ground for local talent to grow their skills, working on high-end projects with various companies.

Looking Further: Language, Time & Talent Quality

In addition to cost savings, African software developers bring the added value of:

* Language Proficiency: English is widely spoken across many African countries, including Nigeria, Kenya, and Ghana. This makes communication seamless, especially when collaborating with teams in North America and Europe.

* Time Zone Advantage: African countries are well-positioned in time zones that align with Europe, and while North America Is a bit different, there is a good number of devs who work mainly with companies in that region. So, they are already accustomed to the time difference. This makes real-time collaboration feasible and eliminates the friction of delayed communications due to significant time zone differences.

* Rapid Skill Development: African developers are keen on self-improvement and often take advantage of online learning platforms. According to a Coursera report, Africans were among the top learners in tech-related courses globally in 2023. This means that not only are they affordable, but they’re also increasingly keeping up with the latest technologies.

Matching Cost-Saving with Talent Quality: How Good are Software Engineers from Africa?

One major concern companies often have when considering low-cost markets is the potential compromise on quality. 

However, this is not an issue when outsourcing to Africa. Africa’s tech talent is becoming increasingly renowned for its dedication and expertise. Many African developers learned from boot camps such as Andela’s ALC, Decagon, Moringa School, and other global ones - where they learn to build real-world applications using cutting-edge technologies like AI, data science, and cloud computing.

Moreover, large global corporations are already tapping into Africa’s talent pool. 

For example, in 2019, Microsoft opened its first African Development Center (ADC) in Lagos and Nairobi. Similarly, Google has made significant investments in African startups and talent through its Google for Startups Accelerator and Google Africa Developer Scholarship Program.

Real-World Examples of Companies Saving Big by Outsourcing to Africa

1. Podio, a project management software company, has tapped into Africa’s tech talent pool through ProDevs, achieving significant operational savings while maintaining a high level of output quality. With a distributed team that includes top developers from Nigeria and other African countries, Podio has been able to scale its platform and support its growing global user base without the high costs of local hiring in developed economies.
2. Flutterwave, a Nigerian fintech company, raised $250 million in 2022 and has since grown its valuation to over $3 billion. Much of its success can be attributed to the fact that it leverages affordable local talent in Nigeria while competing globally.
3. Paystack, acquired by Stripe for $200 million, is another Nigerian company that demonstrates the high-quality output you can expect when outsourcing to Africa.
4. Andela, once a talent accelerator, has now become a full-fledged outsourcing service provider, helping companies like GitHub, ViacomCBS, and Cloudflare hire top African talent.

Time to Look into Africa is Now… 

According to a report by Research and Markets, the global IT outsourcing market is expected to grow by $98 billion from 2020 to 2024. 

Africa’s share of this growth will be significant as more companies realize the advantages of outsourcing to the continent.

With immense cost savings, access to a growing pool of highly skilled tech talent, and strategic geographic advantages, outsourcing to Africa is no longer just a trend—it’s a smart business decision that offers immense ROI. 

The question shouldn’t be, “Why should I outsource to Africa?” but rather, “Why haven’t I started outsourcing to Africa yet?”

The time to start exploring Africa’s endless possibilities is now. Your company’s future could depend on it.

Find out how ProDevs can help you have a seamless experience hiring from Africa. Check out our website here, or schedule a call with our Senior Technical Recruiters to discuss your hiring needs.