MENU

entrepreneurship
Tag Archive

Starting up in Nigeria: a challenging environment

20 August 2016 Comments (0) Africa, Business, Featured

Nigeria startups

Nigeria has massive potential for innovative tech start-ups, although there are numerous obstacles in their way.

While it is officially Africa’s biggest economy, the Nigerian nation is struggling. Talk of a recession has darkened the horizon for over a year. The slump of global oil prices has been a hammer blow to the country, while terrorism and oil refinery problems have worsened the situation. Nigeria is currently beholden to oil for 70% of its revenues; it must rebalance its economy to unbind itself from market volatility. The country realizes this, and is making an effort to diversify its revenue sources. Many are starting to look toward innovative start-ups to take the country in a new direction.

Big tech potential in Nigeria, Konga leads the way

The conditions in Nigeria are rife for daring tech start-ups to create new solutions and drive growth. Unlike other regions on the continent, Nigeria has high rates of mobile penetration with approximately 75% percent of its 175 million people using mobile phones and data services, making it the largest mobile market in Africa. However, this market is currently woefully underexploited. According to a 2013 report by consultancy firm McKinsey, only 1.5% of the country’s $500 billion economy took place online. This void presents a glaring opportunity for tech start-ups to create revolutionary new services.

Konga, is one such start-up that seized the initiative. Launched in 2012, Konga was an early pioneer in Nigeria’s tech space, offering online retail services. Today the company is thriving, offering a range of original solutions, which have connected all manner of suppliers and manufacturers to consumers across the country. Other innovators are also following Konga’s lead, carving out their own niche in Nigeria. However for every success, many start-ups struggle to overcome barriers in their way.

Unusual obstacles: reluctance and electricity

The issues facing start-ups vary. Some are complicated while some are frustratingly mundane. One simple yet formidable roadblock that start-ups face is the availability of electricity. For a new business trying to carve its own niche in the ecommerce space, a reliable energy supply is essential. However, when energy supply is unreliable, as it often is in Nigeria, a start-up has to generate its own power and purchase alternative fuel sources in order to consistently operate. Ultimately, this can lead to greatly increased costs which squeeze margins, snuffing the life out of promising but cash-strapped startup ventures.

KongaPay launch

On the whole, Nigerians are still very wary about parting with their money over the internet, for fear of their capital or financial information being stolen. This paranoia is not entirely without merit, as Nigeria is a hotspot for online scamming and phishing schemes. In order to accommodate these fears, some successful start-ups such as Konga and Jumia have built cash-only payment methods into their business. Konga has also recently created a payment system called KongaPay whereby money is held securely until orders are delivered. Despite these efforts, reticence remains. While some start-ups have survived, this reluctance has certainly deterred some consumers from using new services, reducing the customer base that new start-ups rely on for growth. Tech firms must realize they need to foster a safe and reliable online payment environment, and convince the masses to use it.

Investment is needed, although so is caution

New accelerator programs sponsored by large foreign entities are helping more start-ups get off the ground, especially in the Fintech space. However, Nigerian banks aren’t traditionally interested in providing loans to risky start-up ventures, and encourage start-ups to attract private equity investors instead. Fortunately, foreign private equity is really starting to pick up in Africa, with more and more investors willing to take a punt on a good idea. Regrettably, these investors sometimes undervalue Nigerian enterprises, and strong-arm inexperienced Nigerians into unfavorable deals.

Other issues such as the country’s poor logistics system can bring woe to start-ups who rely on delivering a physical product. Sometimes the lack of skills in critical areas such as accounting and marketing can kill a promising tech business before it can get off the ground. In other instances, eager entrepreneurs try to make an idea that has worked elsewhere work in Nigeria; without analysis and adaptation this often leads to the graveyard.

A veritable gauntlet of obstacles faces Nigerian start-ups. However, those that have survived are serving as a shining example to those that wish to follow. Success is more likely if a fledgling firm is aware of the pitfalls ahead, provided they have a great idea, a solid business plan and the business acumen to make it all come together.

Read more

“Spinach king” turns healthy eating into a business

7 August 2016 Comments (0) Africa, Featured, Leaders

Spinach King

A young South African entrepreneur sources local gardens to produce popular, nutritious baked goods.

A young South African entrepreneur has built a business in healthy baked goods that has earned him the nickname of “Spinach King.”

Lufefe Nomjana, 28, produces spinach-based products including bread, muffins and sandwiches for retail outlets around Cape Town. Nomjana also offers delivery service via bicycle to local offices and consumers who want healthy meals.

He launched the business in 2012 with only 40 Rand (less than $3) in his pocket. Fast forward to 2016 and he operates Espinaca Innovations, which includes a bakery in a renovated shipping container, a café and bakery, and plans for a large-scale bread factory to open in August.

Recognized by the South Africa Breweries Social Innovation Awards in 2014, Nomjana used about $6,000 in prize money to expand his business.

A lesson in entrepreneurship

But the young businessman insists that entrepreneurial thinking has been more important than money on his path to success.

“You’ve got brains and intellectual capital. That will actually open many doors for you,” he said.

Nomjana was just out of school and in his early 20s when he embarked on a business career. He was selling clothes door-to-door but realized he needed to learn more about business and finance if he was going to start a successful business.

“Although I had the ambition and discipline to be self-employed, things weren’t going well,” he said. “I didn’t know enough about stock control and cash flow.”

A five-month course in entrepreneurship taught him that he could build a business while helping people in his community, providing them with access to healthy food.

Spinach king in action

Spinach readily available

That is when he started thinking about spinach, which was growing in abundance at a community garden where he volunteered in Cape Town’s Khayelitsha Township, where he lives. “Spinach grows easily almost everywhere. It’s one of the most nutrient-rich vegetables with many healthy side effects.”

He looked up recipes on the internet, persuaded a neighbor to let him use her oven and his healthy, low-carb spinach bread was born.

He was unable to find investors for his idea. But he went ahead, using the neighbor’s oven at nighttime in exchange for paying for electricity and giving her a supply of bread.

Nomjana baked four loaves a night, then eight and then 16, the most he could produce in his neighbor’s oven.

Building a brand

Profits were small. But while he wasn’t making a lot of money at first, he was building a reputation. Soon, he found he could not keep up with demand.

In the beginning, “it was not about profits. I was building a brand, and educating people” about good nutrition, he said.

A breakthrough came in 2013, when he asked Spar, a local retail chain, if he could use their ovens in exchange for supplying their stores with his baked goods. His production increased dramatically to 200 loaves a day. In addition to Spar, he could supply oven-baked spinach products to local offices.

He soon hired a small sales staff and – eager to speed up deliveries – launched a crowdsourcing campaign to raise money for five delivery bicycles.

By the end of 2013, Nomjana had saved nearly $3,000. With that money and his prize from the SAB Social Innovation competition, he bought his own baking equipment and renovated a shipping container as a bakery.

In 2016, Nomjana produces about 500 loaves daily of his popular low-carbohydrate “banting bread” along with other baked goods. He buys organic spinach from local farmers.

Plans to increase production four-fold

He believes he can increase production to 2,000 loaves once he opens a factory later this summer in nearby Stellenbosch.

At his new café, which also contains a bakery, customers can buy healthy, affordable meals such as gluten-free spinach bread and fresh butternut soup for about $1.

His experience has prompted Nomjana to advise other entrepreneurs to first identify resources they have – in his case locally grown spinach and a neighbor with an oven – before looking for investment.

It may make more sense to just get started with the resources available, the way he did.

“The first capital that you need, more than money, is intellectual capital.”

Read more

From Tragedy to Tech Triumph: Mubarak Muyika

16 July 2016 Comments (0) Africa, Featured, Leaders

Mubarak Muyika

The remarkable story of Mubarak Muyika and his burgeoning tech empire.

The tech scene is exploding across Africa as ambitious young entrepreneurs are changing the face of the continent. Kenyans have been at the vanguard of the action in recent years. One individual currently making big waves is Mubarak Muyika, a dynamic 22 year old with a colorful past.

Muyika was born in Western Province, Kenya. His father was a prominent civil servant and his mother was a high school teacher. Unfortunately, his young life was marked by tragedy: his father passed away when he was two years old. Then, when he was ten, his mother died and the young orphan was taken in by his mother’s sister and her husband.

Great Beginnings

It has long been observed that tragedy seemingly makes, or breaks an individual. In Muyika’s case, it was most certainly the former. He was known as a sharp and gifted student and it was in the early days of high school that his tech-entrepreneurial promise first blossomed.

Aged 16, Muyika developed the “enhanced petrol tracker.” The tracking database was designed to mitigate government mismanagement of oil resources by more efficiently cataloguing oil tanker movements, oil flow and demand. The project was incredibly well received. He was recognized as the best student in the computer exhibit category at the annual Kenya Students Congress on Science and Technology.

His adoptive parents were the owners of a book publishing and distribution company, Acrodile Publishers. Mubarak realized that the web presence provided by their current website manager was substandard and expensive, bottlenecking the company’s productivity. He taught himself PhP, Java and HTML and built a highly functional website for the business.

Business Blossoms

On the back of his newly earned skills, Mubarak launched his first business, Hype Century Technologies and Investments LTD. The company offered website designation, management, domain reselling and hosting services. He enlisted the help of two friends and the business quickly began to take off.

In a 2012 interview, Mubarak spoke about Hype Century’s remarkable success in the startup period: “By May after our first financial year we had about 1,800 domains which represented clients in Kenya, Uganda, Tanzania, South Sudan and some in the RC (Republic of the Congo). That was something that I can say is the biggest achievement, in terms of where the company is today.”

It was during this early period that Kenyan multi-millionaire Chris Kirudi realized Mubarak’s great potential. Through his contacts he recommended Mubarak for a scholarship to one of the world’s most prestigious universities, Harvard. Incredibly, Mubarak turned down the scholarship in order to focus on his business ventures, demonstrating extreme belief in his own talents and entrepreneurial ability. He is a man who knows his own mind. He gave insight into his tenacious business philosophy, saying, “If you are in a society with intelligent people who have a plan and a strategy, you need a plan, a strategy, speed and aggression. That is the only way to succeed in Africa.”

Soon, Mubarak’s business attracted heavyweight attention. International tech investor Jignesh Patel teamed up with the rising star, buying a 25% stake in the company. This proved to be a shrewd move, as Patel’s connections and experience propelled the firm to even higher heights.

A Bright Future

Zagace platform

Zagace platform

However, Mubarak soon felt the itch to challenge himself further; he clarified his decision to move on from Hype Century saying, “I had the feeling that I was not maximizing my potential. I opted to sell my shares and develop a new venture.”

In 2013, he settled a deal netting himself a cool six figure settlement for his 60% stake. Astonishingly, Mubarak was still only 19 years old.

His newest venture, ZAGACE is both ambitious and innovative. His firm offers a unique service providing a completely integrated, online business management toolkit for small and medium sized companies. ZAGACE allows users to manage human resources, inventory, accounting and communications all through a series of well designed, instanced apps. The concept has been lauded as ingenious and effective.

Eager to feed his business with the best talent available, Mubarak has recently moved his operations to Silicon Valley, USA. The young Kenyan means serious business, and the world has noticed. In 2015, he was named one of Africa’s most promising entrepreneurs in Forbes 30 under 30, while Yahoo named him one of nine “Mark Zuckerbergs” of other countries. With his talent, resilience and determination, Mubarak Muyika is setting the tech scene ablaze. We will no doubt be hearing more about him, very soon.

Read more

WeFarm combines cutting edge ideas with simple technology

6 July 2016 Comments (0) Africa, Business, Featured

wefarm

WeFarm aims to help farmers around the world support each other through simple SMS connections.

WeFarm was launched in 2014, as a means of giving farmers – in very different areas – access to advice and information from other people in the trade. The idea was to connect people who had no internet access, in order to give them the opportunity to learn from each other, and help share vital information. The company’s slogan is: “The internet for people without the internet”.

Connecting the unconnected

With 500 million small-scale farmers across the world, offering a wealth of experiences and methods to draw on, peer-to-peer networking for this essential group of workers could be huge. CEO and founder Kenny Ewan spent 7 years working with many remote agricultural workers in Peru before he devised the idea.

Ewan explained what inspired his idea: “I was always very impressed with the unique and low-cost solutions farmers would come up with as solutions to their problems, (but) farmers living less than 20 miles away wouldn’t have any way to hear about these local innovations because very few people in rural Latin America and Africa have internet access.”

From here the WeFarm idea was born. Ewan approached his co-worker, Claire Rhodes, and the two quickly drafted out their plans. After winning grants from the Nominet Trust and the Knight Foundation, WeFarm began to pilot its service in Kenya and Peru.

WeFarm CEO and founder Kenny Ewan

Strength in diversity

While it might initially seem unusual to try and connect such different markets as Kenya and Peru, Ewan explains that a wide range of experiences is a strength for the system. Citing a recent example of a Kenyan farmer who wanted information on keeping rabbits, Ewan says, “He was able to ask questions and get information from someone who’d been keeping rabbits for 20 or 30 years on their farm. He was a farmer in Kenya. His question got answered in Peru.”

Once a farmer has signed up to the service, they simply text a question to the local WeFarm number, and WeFarm’s online system scans the question for keywords, before forwarding it to farmer profiles that seem relevant. A body of translators ensures that questions can be asked and answered in English, French, Spanish, and Swahili.

WeFarm had 33,000 Kenyan farmers signed up inside 10 months of launching, and within its first month in Uganda there were 5,000 Ugandan members.

Ewan hopes that by sending questions to both local and remote members, all those using the service can benefit greatly. “Farmers,” he noted, “can obtain both instant, relevant local knowledge as well as new ideas and insights from further afield.”

Growth for all

With over 5.2 million messages having already been sent, and with an average of 65% of all users contributing their own knowledge to the service, WeFarm is growing quickly.

The service is on the verge of launching in Tanzania and The Ivory Coast, but it also has plans far beyond these impending introductions.

There are planned moves into the markets of Rwanda, Ethiopia, India, and Brazil, with Ewan and his team currently raising $2.9 million in funding to drive this expansion.

As the database of information increases, so does the opportunity for the company to expand its positive influence. The beneficial information, that farmers can find ranges from more in-depth reports on market prices and products, to shared tips about adapting practices to climate change.

As the company grows, so does the proportion of farmers in the developing world who can grow their own business. Moreover, as everything at the user level requires no more than a basic cell phone, the penetration of the project far outstrips internet access.

Ewan says that some people were skeptical about farmers helping each other for no fee, but on the contrary their users embrace the chance to share their views. Ewan said, “It’s not just about the exchange of information; it’s also about empowering people to have their voice heard.”

As WeFarm continues to grow, a lot more of the farming world’s voices should soon be heard.

Read more

Romain Girbal: Doing Mining Differently in Africa

28 June 2016 Comments (0) Africa, Featured, Leaders

Mining has often been a “dirty” industry, with a history of exploitative social practices and environmental degradation, particularly in Africa. Various treaties and organizations have made efforts to clean up mining practices over the years, but French entrepreneur Romain Girbal has decided to start at the source. He is the president and cofounder of the Responsible Mining Alliance (AMR), a new company that is working to develop responsible mining projects in Africa that respect both the community and the environment. The company has already started its first bauxite mine in Guinea and its passionate leader is looking to expand.

Romain Girbal: From the City to the mines of Africa

Romain Girbal looked set to pursue a career climbing the corporate ladder. He studied business law at the University of Paris X Nanterre and international trade in Madrid. After graduating from the prestigious HEC business school in Paris in 2007, he moved to London and worked in the City as a junior consultant in structured financing for mining behemoth Glencore, where he focused on West Africa and Latin America. Glencore is the world’s largest commodities trading company, with over $170 billion in revenue in 2015. Looking back on his experience there, Girbal notes that “working there allowed me to familiarize myself with the sector and to quickly learn its norms, challenges and growth opportunities.” These lessons helped him to later launch the Responsible Mining Alliance.

In 2008, however, Romain Girbal left Glencore to become the director of the legal department of Harvest Energy Limited (owned by State Oil), a British company working in fuel distribution in several European countries. In his new role, he managed the daily negotiation and drafting of contracts. Girbal soon felt the need for a change, stating, “I then realized that I had more of an entrepreneurial spirit, and I wanted to try out an African adventure.” He joined up with Thibault Launay, a friend he made in London, and the two decided to try to make it on their own.

In 2012, they created Adventure Capital Corporation, a venture capital and consulting firm specializing in mining, oil and gas investments, mostly in Africa. These first steps foreshadowed the creation of the Responsible Mining Alliance in July 2015. This time, Romain Girbal and Thibault Launay set out to develop mining projects in Africa that were responsible both socially and environmentally, an innovative and ambitious vision that would begin to take shape in Guinea.

The Responsible Mining Alliance (AMR) rethinks mining

logo-alliance-mimiere-responsable“With the Responsible Mining Alliance, we wanted to show that you can do mining differently,” declared Romain Girbal in February 2016 when asked about the philosophy of AMR on French business channel BFM. With this credo in mind, the two young French entrepreneurs set up shop in Guinea, persuaded of the enormous potential of mining in this emerging country. The Responsible Mining Alliance now holds a bauxite mining permit in Boké, in the northwest of the country.

Although Romain Girbal and Thibault Launay were eager to jump into the mining sector in Africa, they wanted to do so in a new and ambitious way. This is why the Responsible Mining Alliance goes further, with the goal of doing “socially responsible mining” as they told BFM Business. What does that mean?

“We’re trying to set new standards in the mining industry, first in Guinea where we are starting our operations. We’ve signed partnership agreements with the Boké School of Mining and the Boké Center for Professional Education so that our mining engineers and geologists can give free classes there,” explained Romain Girbal, sincerely motivated by the idea of changing things in an economic sector that has been stained by negative clichés. While the government of Guinea has standards for socially and responsible practices, his group is “working hard to set ever higher standards. Mining is about more than extracting raw materials. It can also be a way to get local communities involved in mining by starting win-win partnerships for everybody.”

The Responsible Mining Alliance’s vision could be summed up in a few key points: following high social standards, respecting the environment, favoring local employment as much as possible and training engineers and workers through partnerships. These aren’t just pretty words; as Romain Girbal likes to point out, “For us, we consider it a requirement. In terms of employment, for example, right now we are only a small team in Guinea, but 18 of our 21 employees are Guineans.”

romain-girbal-photo-conseil-administration-alliance-miniere-tesponsableThe high standards Girbal has set for his project have attracted outside attention as well: in January 2016, Xavier Niel, the famous French billionaire and boss of telecom operator Free, decided to invest in the Responsible Mining Alliance via his personal holding company NJJ Capital. This was a big publicity win for the young mining company, and other well-known investors and partners have since joined the adventure. These include Anne Lauvergeon, ex-CEO of Areva; Edouard Louis-Dreyfus, head of Louis Dreyfus Shipowners; Alain Mallart, head of Energipole; and Daniel Lebard, head of ISPG. Not to mention Arnaud Montebourg, the former French Minister of the Economy, who worked his network to support the young French entrepreneurs’ project. In addition, the well-known French business journal Les Echos recently wrote an effusive article on AMR about how this mining startup is taking the Paris elite by storm. It’s just the latest media success for a project that seems to be going quite well.

Bauxite, the mineral at the heart of the AMR

Beyond the historical ambitions of this project, the AMR represents a strategic business choice to invest in bauxite, a mineral necessary for the production of aluminum. Bauxite is sold to aluminium oxide refineries, who then sell it to aluminum smelters to make the final product. According to Girbal, “You need about 4 tons of bauxite to produce 1 ton of aluminum.” In the context of globalization, where emerging economies like China have profoundly shaken up the market, bauxite is one of the most important raw materials for several strategic economic activities, such as aviation, transportation and construction.

In 2010, worldwide production of bauxite reached 211 million tons. Australia is the largest producer, with a third of the market, followed by China, Brazil, India and Guinea, which holds an 8% share.

According to the French Geological and Mining Research Bureau (BRGM), Guinea alone holds 52% of the world’s bauxite reserves. Romain Girbal readily shares this number to show the potential of the Responsible Mining Alliance in this West African country undergoing rapid growth. “For the moment we’re only operating in the Boké prefecture, which is the real global center of bauxite and where the future of this strategic mineral lies because it’s where you find the world’s best bauxite,” Girbal notes. “Big mining companies are setting up here more and more.”

In Boke prefecture, in the northwest of the country, the Responsible Mining Alliance has obtained an exploration permit for 295 square kilometers (114 square miles). Prospecting has already begun and extraction should start soon. This deposit contains an estimated 650 million tons of very high quality bauxite.

“I think we came at the right time to Guinea, getting started with a very promising bauxite permit,” Girbal says. “That’s how we have been able to develop the Responsible Mining Alliance and get to where we are today.”

Read more

Yeelenpix – the African startup changing the way Africa is seen

10 June 2016 Comments (0) Africa, Business, Featured

yeelenpix

Yeelenpix is the startup company selling images of Africa that reflect the continent’s diversity.

Yeelenpix is a company in its infancy, having only been launched in 2013, but it aims to broaden the way that Africa is presented in pictures. Asking someone to pick an image that represents a vast continent would be impossible, and the team behind Yeelenpix felt that the images available were too limited.

From the Pyramids of Egypt to iconic wildlife on safaris, there are images that are distinctly African, but whole areas of African life, trade and experiences had little documentation. Yeelenpix founder Moussa Fofana felt that this was problematic, not just for how the continent was seen by the rest of the world, but for businesses in Africa who needed stock images for marketing.

Fofana elaborated on the catalyst for starting up his company saying, “It all started with a remark made to me one day, by a friend who works in communications in Abidjan…she had to go and buy images on the western platforms to illustrate papers for her African clients, without the benefit of African images that are at hand.”

Moussa Fofana

Moussa Fofana

Fofana set up the company with his close friends Alex Poblah and Maguette Mbow, who were living in Paris at the same time as Fofana. Fofana is from the Ivory Coast, and the word “yeelen” actually means “light” in his native language of Dioula.

An African database

With a gap in the market identified, the three friends set up Yeelenpix, and immediately looked to source additional funding. However, thus far the company has been entirely self-funded as, according to Fofana, “The private equity firm with whom we were negotiating in Paris has proved too greedy.”

This setback did not stop the company from having early success. Yeelenpix quickly built up a large cache of over 10,000 images from across Africa, and they currently have a network of 50 professional photographers providing them with photographs. In addition to providing employment opportunities for African photographers, Yeelenpix also works with British and French photographers who spend extensive time on the continent.

Within 2 years of their launch, Yeelenpix’s clients include the TV station Africa 24, and Morocco’s Chaabi Bank. The range of images is set to grow, as Fofana has stated they aim to have 100 professionals working for them within a year, and they are also happy to work with amateurs if the quality of their work is good enough. If a company needs images of rice farming in Nigeria, or the cotton industry in Mali, then Yeelenpix can provide the pictures needed to create promotional brochures.

By accepting work from amateurs, Yeelenpix is not only providing work opportunities for aspiring photographers, but it is increasing the range of its reach. Areas of life that might not have attracted professionals become accessible, and countries with less status (than some of Africa’s most famous destinations) get greater opportunities for exposure.

Fofana explained the company ethos on utilizing talented amateurs saying, “They can express their vision of Africa and the market. Young people who are not yet professional contact us, word of mouth starts working.”

Democratizing the process of how the continent is represented puts at least some of the power into the hands of the people, who live and work in the nations being portrayed.

Affordable Accessibility

Yeelenpix operates a flexible price structure to allow as great a number of organizations as possible to access their database, and use their images. On average, it costs $22 to use a Yeelenpix image for a website, with a commission rate of 35% to 60% of sales paid to the photographer.

There are additional fees for companies wishing to use an image on printed materials, but pricing structures are negotiable, thus allowing smaller clients to still benefit from the wide stock of images available at the Yeelenpix website. The images are also hosted in various categories to help clients filter out images that are not relevant to their needs.

Fofana and his team want Yeelenpix to create jobs, but also to inspire pride in showcasing Africa in new ways. Talking about what drives his team Fofana sums it up saying, “We wanted to participate in the dissemination of a new image of Africa. Africa is changing and evolving. (We want to) enable African photographers to become better known and live their art.”

Read more

Elumelu Foundation: Entrepreneurs will lift Africa

9 June 2016 Comments (0) Africa, Business, Featured

tony Elumelu Foundation

The Nigeria-based foundation pledges $100 million to train and mentor 1,000 entrepreneurs a year for 10 years with a goal of creating one million jobs.

One thousand young African entrepreneurs will receive intensive training, mentoring and networking opportunities as participants in the 2016 Tony Elumelu Entrepreneurship Program (TEEP).

The program, launched in 2015 by the Nigerian entrepreneur and philanthropist Tony Elumelu, is designed to identify 10,000 entrepreneurs over a 10-year period and empower them to launch ventures that will create one million jobs and add $10 billion to the African economy.

The Tony Elumelu Foundation has made a $100 million commitment to the program.

More than 45,000 entrepreneurs from 54 countries applied for the 2016 program, more than double the number of applicants in the first year. The successful 1,000 candidates represent a variety of fields including agriculture, information and computer technology and fashion.

Elumelu Fondation participants

Elumelu Fondation participants

All regions represented

All five regions of the continent are represented. The largest numbers of entrepreneurs came from Nigeria, Kenya, Ghana, Uganda and Cameroon.

(Here is a list of the entrepreneurs from each country and their areas of interest.)

Elumelu predicted the 2016 group of entrepreneurs “will become a generation of empowered business owners who will show that indigenous business growth will drive Africa’s economic and social transformation.”

He said his foundation has invested $8 million in the 2015 group, including $5 million that went directly the entrepreneurs as seed capital. “The results have far exceeded our expectations,” he added. With funding and networking, the program has “helped extraordinary people take control of their destinies.”

In addition to receiving training and networking for nine months, the entrepreneurs will participate later this year in the Elumelu Entrepreneurship Forum.

Elumelu is #31 on list of Africa’s richest

Elumelu is a Nigerian entrepreneur and investor who is listed as #31 on Forbes’ list of Africa’s 50 richest people. He owns the controlling interest in Transcorp, a Nigerian conglomerate with businesses in hospitality, agriculture, oil production and power generation. Forbes puts his net worth at $700 million.

Elumelu became prominent in African business circles nearly 20 years ago, when he persuaded investors to take over a small, failing commercial bank in Lagos and turned it around and made it profitable within a few years. It later merged with United Bank for Africa, which has subsidiaries in 20 countries as well as the United States and the United Kingdom.

According to his profile on Forbes, he also has a stake in the mobile telecom MTN Nigeria and owns extensive real estate across the country.

Entrepreneurs will drive growth

As many African nations work to diversify their economies and move from resource-based revenue to manufacturing and services, entrepreneurship is considered an important way to drive economic growth.

While the continent is already seeing returns, experts say entrepreneurship holds untapped potential to drive economic development to the next level.

A 2014 study ranked Uganda as the most entrepreneurial country in the world and listed Cameroon, Angola, Botswana and Burkina Faso among the top fifteen.

The study, by Global Entrepreneurship Monitor, counted the percentage of the adult population that owned a business and paid wages for at least three months. In Uganda, the percentage was 28 percent. (Suriname in South America was the least entrepreneurial in the world with less than one percent.)

African Development Bank pushes employment

Akinwumi Adesina, president of the African Development Bank, recently reaffirmed the lender’s commitment to entrepreneurship as it seeks to promote a sense of urgency about youth employment on the continent.

In Africa 10-12 million young people enter the workforce each year but only three million jobs are created annually. Even when there are jobs, young people often lack the skills employers required.

“We need a sense of urgency for tackling unemployment,” Adesina said, noting that the bank has created a strategy that could create 25 million jobs for young people on the continent. These programs focus on agriculture, manufacturing, and information and computer technology. The bank will also index youth employment and track the labor market over time.

“The skill sets and the jobs of the future are digital. The world is changing fast,” Adesina said.

Read more

Herman Heunis: the tech entrepreneur who stepped away from the limelight

7 June 2016 Comments (0) Africa, Featured, Leaders

Herman Heunis

What’s next for Herman Heunis, the man who created “Africa’s Facebook”?

Herman Heunis is the man who created MXit, which was at one point Africa’s most subscribed to social media platform. Born in Namibia, Heunis grew up in a rural community where his parents ran a sheep farm, but Heunis was drawn to technology as a young man. Having moved to South Africa, Heunis attended Stellenbosch University in 1977 and 3 years later began his career in computer programming.

It was not until 1990 that Heunis launched the first of his own businesses, when he created an ICT consultancy firm. This was followed in 1998 by the launch of Swist Group Technologies, an information and communication technology company which specialized in software development. This entrepreneurial spirit would eventually lead to the formation of MXit.

The MXit explosion

MXit was launched in 2005 as an instant messaging service in Stellenbosch, and it took a rapid hold within the youth of South Africa. By 2013, MXit had a larger user base in South Africa than Facebook, with 45 million registered users in the country. This user base was growing by 60,000 new registered members per day, and 750 million daily messages were being sent across the MXit network.

MXit had originally been created as a mobile game, but it struggled to find sponsors, and the gaming angle was eventually removed. Heunis explained the evolution of the MXit service saying, “An integral part of the game was communication between players. After several metamorphoses we dropped the game idea and focused only on the communication part – that worked extremely well.”

The MXit application on iPhone

The MXit application on iPhone

When MXit was launched the entire team consisted of Heunis and 7 employees, but the rapid growth of the service attracted attention and further investment. Only 2 years into its existence, MXit received major investment from the Internet giant Naspers. What had been an 8 person company grew to employing 150 people as MXit looked to expand its reach far beyond the confines of South Africa.

Through innovative viral marketing, Heunis secured 500,000 users in Indonesia, and while the core of MXit’s users was still in South Africa, the platform was being used in more than 120 countries by 2011. The speed of MXit’s success and growth was impressive, but Heunis does not like to take all the credit, saying, “Timing was perfect and I had a fantastic team. The word ‘failure’ was never an option.”

Selling up and moving on

At the height of MXit’s popularity, Heunis made a shock decision, and decided to sell the company. Stepping down from his CEO position at the end of 2011, Heunis completed the sale of his company in 2012 to Alan Knott-Craig Jr. The decision was evidently a difficult one to make as Heunis said, “Selling a company that you have started is traumatic. Fact of the matter was, I was extremely tired and burned out, and staying on as CEO was not in the interest of the company.”

Knott-Craig Jr’s company, World of Avatar, did not grow MXit as Heunis might have hoped to see. In fact, in 2015 MXit was closed down, and Heunis expressed his disappointment on Twitter. Heunis tweeted that he regretted being too burnt out to continue at the helm in 2011, but that he truly believes that MXit had “all the ingredients to become a major success story.”

Heunis has said that his motto is “You are the captain of your ship,” and it appears that without its captain, MXit experienced a rapid decline after its sale to World of Avatar. As numbers dwindled the reversal of the company’s fortunes could not be stopped, and what had been Africa’s largest social media network ceased to exist.

Since departing from MXit, Heunis has stayed away from the limelight, and thrown himself into various hobbies including endurance bike races such as the Absa Cape Epic.

While MXit’s sale has ensured that Heunis need never work again, it was never money that motivated him anyway. Heunis has said, “For a true entrepreneur, the satisfaction of creating outweighs the money rewards.”

With that in mind, it would be too soon to say that we have seen the last of Heunis as an entrepreneur, but he says he has no immediate plans to return to the world of technology.

Read more

Eric Kinoti: Young Kenyan serial entrepreneur

26 May 2016 Comments (0) Africa, Featured, Leaders

Eric Kinoti

At age 32, Kinoti operates four businesses, including a tent manufacturing company with $1 million in annual sales.

Kenyan businessman Eric Kinoti says entrepreneurship is a journey. At age 32, he has already come a long way.

From a humble start selling eggs by day and working the night shift at a hotel, Kinoti has gone on to launch four companies, including the successful flagship Shades System East Africa, which manufactures canopies, military and party tents, gazebos, and car park shades.

The company, which Kinoti started when he was just 24 years old, has customers in several African countries including non-governmental and humanitarian organizations and reports annuals sales of $1 million.

Kinoti also founded and runs Alma Tents, a tent rental company; Bag Base Kenya Ltd., which manufactures bags from canvas remnants from the tent business; and Safi Sana Home Services, a cleaning company.

Forbes 30 Under 30

One of a growing number of Kenyan entrepreneurs, Kinoti has been recognized twice by Forbes as a top African entrepreneur and in 2014 was named to Forbes list of 30 Under 30 Most Promising African Entrepreneurs.

Born in Mombasa and raised in Mombasa and Meru, Kinoti went on to earn a degree in business management at Tsavo Park Institute. He became interested in business as a child. At 10, he worked as cashier in his father’s shop and sold snacks to his classmates at school.

After he finished college, he got a job as night cashier at a hotel in Malindi and spent his days buying and reselling eggs.

After a move to Nairobi, he tried to start business selling milk to hotels. But a breakthrough came when a customer asked him to supply a tent. Kinoti found that non-Kenyan companies dominated the tent business in his country, and the idea for Shades System was born.

Company expands in region

A shades system tent

Shades System, based in Nairobi, has expanded rapidly and now exports products to Somalia, Congo, Rwanda, Southern Sudan and Uganda. Customers include USAID, Toyota Kenya, Bata Company, and East African Breweries.

He said raising capital has been his biggest challenge.

At one point, he borrowed from a money-lender to start his first and saw his belongings sold off when he couldn’t pay. He ended up paying back the full amount, $20,000, plus $10,000 in interest.

But he persisted. Kinoti stressed that entrepreneurship is a journey, not an overnight get-rich success.

He said young entrepreneurs often jump from one idea to another in hopes of making fast money but that rarely pays off. “You cannot be rich in a day. You have to accept that entrepreneurship is a process,” he said.

Difficult lessons in entrepreneurship

He said he has also learned to be careful whom he trusts and not to rush decisions.

Early on, he trusted people with money and some ran off with it.

He also discussed his business ideas freely, only to find others used his ideas. The lesson? “As an entrepreneur, listen more than you speak,” he said.

Kinoti said he also made mistakes jumping in too quickly when a deal sounded good.

For example, he said opening Safi Sana Home Services was premature and the returns so far have not been very good so he is restructuring that business as a web portal offering home improvement solutions.

He said he might better have focused more attention on the tent business and waited to start a new company.

“It’s important to create a strong foundation,” he said. “Then you can proceed to another business.”

Entrepreneurship booms in Kenya

According to USAID, Kenya has become a center for entrepreneurship and innovation. The agency’s Development Credit Authority has sought to increase access to capital for small businesses and promising entrepreneurs.

In 2014, USAID mobilized $340 million in credit and enabled nearly 600,000 loans to small and medium-sized businesses.

The agency’s Yes Youth Can program has helped expand economic opportunities for young people through training and access to loans.

The hope is that young Kenyan entrepreneurs will be able to avoid the expensive moneylender trap that Eric Kinoti had to climb out of on his journey to creating a thriving business.

Read more

In Dubai, child’s play is good business

25 May 2016 Comments (0) Business, Featured, Middle East

Fairytales Dubai

Two Emirati women combine family with entrepreneurship to launch Fairytales, an indoor play area for young children.

Basma Al Fahim and Fatma Al Madani wanted to spend more time with their young children. But to them, that didn’t mean staying at home all day like many of their fellow Emirati women.

Instead they launched Fairytales, an indoor play area for young children in Dubai. For the two friends, business innovation began with family.

Al Madani had left a seven-year career in government to focus on raising her two young daughters while Al Fahim, who has two young sons, had already launched several successful businesses when they opened Fairytales in December.

Arabian Business recently recognized Al Fahim and Al Madani for their entrepreneurship.

The play center is a new idea in the United Arab Emirates, where most women stay home to take care of their children and only 14 percent of the workforce is women, mostly younger women who have been able to attain an education as the federation of emirates modernizes.

Inspiring creativity, growth

Unable to obtain bank financing for their project, the two women funded the business themselves from their savings.

“The concept was inspired by our children,” Al Madani said, noting that their children were playing pirates and fairies while the two women held their first brainstorming session in the same room.

“They reminded us of how we played as kids’’ before digital devices came along, she said. That sparked the goal of creating an environment that stimulates the child’s imagination and intellectual growth.

Their priorities as mothers – education, healthy food, and safety – became priorities for their business, according to Al Fahim, who had already started a fashion brand, an events company, and a beauty salon.

Teach social responsibility

At Fairytales, their goal to spark the imagination and creative thinking of each child as well as to instill social responsibility among the children, who are up to age eight.

They donated more than 200 children’s books during a local donation campaign on behalf of young cancer patients in Dubai Hospital on World Cancer Day.

The two also took part in a Happy Hearts project, organized by The Happy Box in Dubai, which sent more than 600 handmade cards to orphans in India.

Basma Al Fahim and Fatma Al Madani

A serial entrepreneur

Al Fahim brought significant business experience to the venture as founder and managing director of Eventra Events, an event-planning agency.

After studying marketing at Zayed University, she moved to Dubai and worked in digital and brand marketing. Coming from a prominent business family, she wanted to set a pioneering example for young Emirati women.

Her family’s conglomerate is the Al Fahim Group, whose activities include support for development of oil and gas fields, luxury cars, hotel management and investments. She chairs the company’s employment committee.

Events business succeeds

She opened the events business in 2010, bringing a fresh approach to events ranging from corporate gatherings to weddings to exhibitions. Today, Eventra is a premier event management company in Dubai.

Al Fahim went on to open The Dollhouse, a beauty salon with what she described as a “super chic” atmosphere and attention to detail and glamour.

After establishing The Dollhouse, she also launched Sirkaya, a fashion line that has become a well-known brand in Dubai.

After starting Eventra with three employees, she said she now has more than 100 working on her different ventures.

Advice for young entrepreneurs

She said she has many more business ideas. Growth plans keep her motivated.

“When I say growing I mean improving,” she said.

Al Fahim encouraged young Emirati entrepreneurs to pursue their dreams by having confidence in themselves and focusing on key goals.

“Keep your mind positive,” she said. “Train your brain to think positively to attract the right energy in your life.”

Read more