A new piece is coming in the Harvard Business Review. I have taken time to examine the African technology domain, looking at the Cambrian moment of entrepreneurial capitalism that we are right now. I have waited for this piece primarily to put the statistics of 2021.
Good People, it is good morning in Africa when you see the numbers. But yet, there are issues ahead. Those issues if not managed could posit a challenging future for Africa. Africa’s finest companies of the future are not Africans – and that alone breeds an economic dislocation where even the current local exchanges cannot be refreshed, with new companies. Simply, without those new firms joining as the old fades, where will the resilience to deepen asset classes come from?
I make the case that redomiciliation of startups out of Africa to the Western world will punt Africa’s future if not addressed. You will like it when it is published. My editors are on it.
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The goat that is fed by the public will always die of hunger, according to Igbo adage, and that’s what Africa’s future looks like.
This geographic space called Africa, what kind of creatures inhabit it? There is no other continent built and maintained by foreigners, maybe Africa will be the first…
People from the mother of all continents celebrate getting visas or residency in North America, Europe or Australia, they celebrate it wildly as though it’s passport to heaven. So, who are we really building this Africa for, the very people that want to run away?
Everything is interrelated, when you lack confidence in your own heritage, is it owning the best businesses there that you won’t have doubts about? Everyone wants to be paid in dollars, and with that mindset, you have implicitly and explicitly rejected your own, you cannot have it both ways.
As always, everything wrong here has its roots in our system of education, if we want to reinvent and transform this geographic space, then we need to school the transformers here, not in America, Europe or Asia. Once you get it wrong at cultural level, you will be more comfortable defending your headmasters than your own heritage and people.
Wake up, my people!
I totally agree, a good number of our startups today aren’t owned by Nigerians, they’re owned primarily by the foreign investors who have the risk appetite to believe in the future of Africa as against African and Nigerian investors who may have first dibs on these deals.
We’re essential creating wealth for foreign investors when we have secondary market cash outs via Series A,B,C etc or the occasional acquisition.
Hopefully with the advent of Syndicate funds like Future Africa, Tekedia Capital, Flying Doctors Healthcare etc, this should change.
I think we need more ‘tooling startups’ – startups that are essentially technology driven and are easy acquisition targets. Startups like these MAY require less capital, but essentially create a good opportunity for an acquisition. When the founder cashes out, he could launch a new business with deeper pockets meaning he doesn’t necessarily need to sell his business too quickly to VCs.
More tooling startup acquisitions likely pushes local investors for FOMO to get involved, and more founders with deeper pockets can hold on till they really need capital and can negotiate better deals.
P.s: thankfully firms like Ventures Platform are creating more local representation on term sheets.
My point is not really about ownership but the legal domain of the company. I have no problem if a German comes to invest in my village blacksmith provided the company will not be legally moved to Berlin. That is my point, Ownership in my opinion is not the main issue but domiciliation.