"Specialization is one of the major ways for companies to grow," said Conrad Akunga, co-founder and director of Innova Ltd. "For instance, we work in the finance and investment instruments space; this requires a lot of know-how, expertise, research and continuous market analysis and intelligence."

Akunga, who led the Virtual City Ltd. team that won a US$1 million innovation prize from Nokia last year, feels that emerging companies are not specializing and do not provide services that best suit their qualifications, making them lose out to international brands.

However, Kenya's relatively stable policies and politics have been cited as a major asset, given that the country's neighbors -- Sudan, Ethiopia, Uganda and Somalia -- have various forms of security issues.

The Kenyan ICT Board, in place for five years, has encouraged local and international investment. Members of the board have engaged venture capitalists and the feeling is that emerging companies can and should provide services that can be scaled to the region, given similarities among culture and language, as well as challenges faced.

"In my discussions with venture capitalists, they now are very specific about funding companies locally that have ideas and business models that can be scaled across markets because it makes their investment more attractive in the long term; in fact they are becoming hesitant to deal with companies which are too locally tied and whose existence depends purely on local sensitivities," said Paul Kukubo, CEO of the ICT Board.