Asher's Blog

Many companies begin by solving the part of a problem that the customer can see. A bank builds an app, a logistics company builds a tracking screen and a health company builds a portal for booking appointments. These products can be useful, but the companies that create lasting value often go beneath the interface and build the infrastructure that allows many other products to exist.

This is particularly important in Africa because so many foundational capabilities remain fragmented. A bank should not think only about collecting deposits through its own application. It can also ask how its identity, payments, credit and compliance infrastructure might allow other businesses to serve customers the bank will never reach directly. When a company turns a difficult internal capability into a dependable service other companies can build on, it stops being only a product and begins to become a rail.

Payment companies illustrate the difference. The visible checkout page matters, but the deeper value lies in connecting merchants, banks, cards, transfers, settlement, reconciliation and fraud controls. A founder can use that infrastructure to build an education platform, an insurance product or a marketplace without first becoming a payments expert. The rail multiplies the number of people who can solve problems.

However, “rails, not apps” should not become another slogan that founders follow without thinking. Owning the infrastructure while surrendering the entire customer relationship can leave a company invisible, commoditised and dependent on businesses that control distribution. The rail may process every transaction while the application earns the customer’s trust, understands the customer’s behaviour and captures most of the margin.

I think about it like a printer and its consumables, although the precise analogy matters less than the strategic question. If one company makes the machine and another company owns everything the user repeatedly buys, which company truly understands the customer and which one has the more durable economics? A business may begin with one side, but the company that remains important may eventually need a credible position in both.

This is why infrastructure companies often move upward into applications, while successful applications gradually build or acquire more of their own infrastructure. They are not necessarily losing focus. They may be protecting reliability, economics and the customer relationship. The danger is expanding without a coherent reason and becoming mediocre at every layer.

An African company building rails should therefore answer several questions early. Who is the direct customer, and who is the ultimate user? What must remain neutral so that partners can trust the platform? Which end-user experience is too important to outsource? Where does the company earn its margin today, and where will bargaining power sit after the market matures? If a partner can replace the rail easily, it is not yet much of a rail. If the rail can replace every partner, the ecosystem may reasonably fear it.

The best strategy may be a carefully designed combination. Build common infrastructure that other companies can rely on, but retain one or more direct products that keep you close to real users. The infrastructure provides scale; the application provides feedback. The rail shows how the market moves; the product shows why the customer moves. Each side makes the other more intelligent.

At Eazipay, this way of thinking affects how I look at payroll and compliance. A payroll product can serve an employer directly, but the underlying capabilities—employee records, statutory deductions, verification, payments and reporting—can also enable other institutions to solve deeper problems. At the same time, we cannot become so fascinated by infrastructure that we forget the employer and employee whose trust gives the infrastructure its meaning. A technically elegant rail that creates a poor customer experience is not a successful rail.

Africa needs more companies that make difficult capabilities available to thousands of builders. We need financial rails, health-data rails, logistics rails, identity rails, energy rails and compliance rails. But we should not build infrastructure as an escape from understanding customers. Infrastructure is valuable because of the human and commercial activity it makes possible.

The enduring company will know when to stay underneath the market and when to meet the customer directly. It will allow other businesses to grow without making itself strategically helpless, and it will expand across layers only when doing so improves trust, reliability or economics. The goal is not to choose a fashionable label. The goal is to occupy the part of the value chain from which you can keep creating and capturing meaningful value.