Building Africa’s legacy with sustainable businesses and start-ups
KIZITO OKECHUKWU | OCTOBER 7, 2019
I was invited by Helvetas to spend last week in Switzerland where I delivered a keynote address on the power of the informal sector to drive job creation and ignite entrepreneurship in Africa. Helvetas is an independent organization for development based in Switzerland with affiliated organizations in Germany and the United States. Helvetas supports poor and disadvantaged women, men and communities in about thirty developing and transition countries in Africa, Asia, Latin America and Eastern Europe.
I used the Swiss trip to also explore the entrepreneurship ecosystem in Zurich and Geneva, the Netherlands and Scotland. This included ETH, which is a science, technology, engineering and mathematics institute, as well as the Impact Hub and others. ETH shared some of their successes and collaborations, and how they continue to on-board and support high impact start-ups in Zurich.
Further afield in Aberdeen, Scotland, I learnt more about the power of creating a legacy business, its building processes and systems to ensure its sustainability. My visit to the Glenfiddich Distillery in Aberdeen, where William Grant passionately built what is today a multi-billion-dollar company, was a perfect example of this.
Back to my speech at the Helvetas Symposium in Berne Switzerland. The informal sector remains crucial to drive Africa’s prosperity, given that this sector in sub-Saharan Africa makes up nearly 80% of all employment, according to the International Labour Organization and absorbs many of the continent’s young employment-seekers. Today, there are various industries igniting the power of the informal economy, such as various blue-collar jobs, farming, stokvels, spaza shops, taverns, au-pairs and many more.
Cash continues to fuel this invisible economy, which limits the productivity, growth and development of other sectors, such as micro- and small enterprises. It also makes it difficult to include this economy in any form of official statistics, oversight, taxation and regulation. Many informal traders also struggle to scale due to their lack of financial records, which ensure that they have credit scores, as well as no business advancement strategy, vital to attract investors. Most of those who lose their jobs in advanced economies could be the largest consumers in the informal economy.
Growing the informal sector must be our priority and here’s a snapshot of how in my opinion. We need to make access to capital easier, help to improve their skills and educate/inform them on the various tools available (many are free and online) to ensure they have a proper business system, which will allow them to scale.
What’s more, the use of technology and ensuring that infrastructures in which they operate are enabling and empowering is critical. Informal traders should also be given the opportunity to create their own ecosystems, as opposed to nudging them towards big corporate supply chains. Allowing them to operate in this way with various support mechanisms means they can retain their informality and still scale successfully.
Secure pride-of-place for these traders is also important. Maybe they receive title deeds or enter into rental contracts with either the city or the landlords. This peace of mind will help them to think strategically and more long-term.
My visit to Glenfiddich was an inspiring deep dive into what it took William Grant to build his now five generation-strong business. It was passion, vision and big picture thinking that took his company beyond borders. Today, his whisky is consumed in 180 countries and interestingly, the whisky that will be consumed in the next eight to ten years, has already been made. Scotland has also learnt perfectly their competitive edge and cherishes the whisky production with pride. The industry contributes over four billion pounds to the Scottish economy annually.
So, as Africans, how can we build a legacy that will survive and thrive for many generations? How can our entrepreneurial and business role players create their own legacies? How can our leaders leave their various countries far better off than they were?
Africa has many legacy businesses to be proud of, such as Remgro, Pick ‘n Pay, the Dantata family, the Metl Group and Nando’s.
We must also remember that most successful business across the world never started big. They were born in a backyard, a garage or even written on a serviette… the most important thing is to build processes, systems, traditions and legacies that will ensure the sustainability of these businesses into African brands.
We are excited to announce that one of our Fintech startups, Maxicash App, is amongst the 5 African countries to have been selected to pitch at the Migration Challenge Startup Competition in Ecuador. The International Organisation of Employers (IOE) and Seedstars competition is targeted at the most promising HR, Fintech, Civitech and EdTech startups with solution-orientated products to improve migration systems that respond to the labour market.
Under the auspices of South Korea’s Ministry of Foreign Affairs, I was invited to visit the East Asian country last week by the Korea-Africa foundation to discuss and engage on sustainable ways to build a stronger Korea-Africa relationship, which was established last year.
This past weekend, the annual Geekulcha hackathon (GKHack19) took place at 22 on Sloane startup campus. Led by Mixo Ngoveni, it focuses on boosting and sustaining a strong geek culture in South Africa.