It is not news that Nigerian Igbos run one of the oldest venture capital industries in the world. It is also not breaking news that Igbos have one of the most advanced business incubation systems in the world. And these things happen without anyone thinking about them. A kinsman is a merchant – he goes to China and imports containers. When I talk to him about bank supports, he laughs: “Bro, we have better banks without CBN wahala”, he reminds me.

Simply, under the Igbo apprenticeship system, the strength and measure of a man is based on how he has made those that worked under him better. In some villages in Ohafia (Abia State), you cannot speak in the village square if your “boys” are not progressing. In some communities in Arochukwu (Abia State), before elders can permit you to talk, you must begin by naming sons you made men.

In my practice, I have worked with some moguls and observed reverence. Yes, you have made money more than your master. But till grave, he remains a demi-god to you. That is why a boy who did not enter university can run the largest (indigenous) car manufacturing company in Africa. That is why if another closes his fuel depot, Nigeria will experience fuel scarcity within days – but that guy dropped out in JS2.

I have asked the Nigerian government to work on the formalization of the Igbo apprenticeship system. We have a great system, and certainly do not need to invent many new things. Interestingly, in this TED Talk, that Igbo apprenticeship, using Alaba market, was celebrated

The Igboland incubation system does not take equity. It does not require raising huge capital. It is driven by human-platform and it works. Nigeria needs to deepen this system even as we celebrate the modern forms of incubation. If government can find human-platforms to work with the youth, we can comfortably fix unemployment. With minor checks and balances, we will provide opportunities to young people.

The TED video expands that message (I could not upload the TED video because of copyright issues. But if you click, you will listen to the audio). The speaker used the Alaba market as a case study.

Update: I have just tracked the video (embedded below on this post) on TED. This is the transcript of the section to focus.

So the interesting thing is that this mutual aid economy still exists, and we can find examples of it in the strangest places. So, this is Alaba International Market. It’s the largest electronics market in West Africa. It’s 10,000 merchants, they do about four billion dollars of turnover every year. And they say they are ardent apostles of Adam Smith: competition is great, we’re all in it individually, government doesn’t help us. But the interesting reality is that when I asked further, that’s not what grew the market at all. There’s a behind-the-scenes principle that enables this market to grow. And they do claim — you know, this is an interesting juxtaposition of the King James Bible and “How To Sell Yourself.” That’s what they say is their message. But in reality, this market is governed by a sharing principle. Every merchant, when you ask them, “How did you get started in global trade?” they say, “Well, when my master settled me.” And when I finally got it into my head to ask, “What is this ‘settling?'” it turns out that when you’ve done your apprenticeship with someone you work for, they are required — required — to set you up in business. That means paying your rent for two or three years and giving you a cash infusion so you can go out in the world and start trading. That’s locally generated venture capital. Right? And I can say with almost certainty that the Igbo apprenticeship system that governs Alaba International Market is the largest business incubator platform in the world.

This is the video I made before connecting the original TED, trying to avoid copyright issues from the portion someone sent me.

The Nnewi has a tradition there also, as shared by an indigene here.

An interesting take, Ndubuisi. But as an indigene of Nnewi, I will argue that government should actually not get involved or in anyway interfere in the Nnewi apprentice model. It has worked for decades and we really do not need government to come tell us how to run it. If it’s not broken don’t fix it, they say.

Innoson, Cocharis, Ibeto, Chikason, Ekenedilichukwu, are all from our great city of Nnewi. None of these may ventured anywhere near the gates of a secondary school, some didn’t even finish primary school, but control multi billion dollar empires. It’s starts with an apprentice system where a master takes a young boy of about 10 years, the boy serves his master for about 7 years. At the end of the 7 years, the master settles the boy with some capital. Most times depending on their relationship, the boy remains in the master’s house even though he is now free, eats there and sleeps there for the next 2 years or so, to save money. In addition to the capital, the master also extends credit facilities to the boy and gives him goods on credit to sell.

The interesting thing is that nothing is in writing, it’s all done on trust and credibility. The boy’s family would usually come together and meet with the master at the commencement of the arrangement. And at the end of the apprentice period, the master will also bring the boy home and settle him in the presence of his family. Government can not replicate that. They can only complicate it.

This is the full video from TED

In the past, moguls built business empires by controlling Supply. By controlling supply, they were able to move the price equilibrium points to their advantages. Demand (the users) just went along. So, in the grand scheme of competition, rivalries evolved out of the needs to control Supply. If you control the supply of rice into Nigeria, you would make tons of money, as you can fix the price. If you control the supply of cement, the same happens. That same applied across markets and industrial sectors, from banking to real estate.

Today, in the digitizing internet world, the game plan is to control Demand (not Supply). It is assumed that Supply is already unlimited and there is no need to build capabilities to control it. If you want to control Supply, you would break in the Internet because you are absolutely going to fail. Yes, how could you control supply of all news posted on the web, from Twitter to Punch to Facebook? You have no chance – only aggregators are positioned for such.

Airbnb controls Demand

Uber controls demand

But in that web economy, there is a smarter strategy: control Demand. Simply, in a market that is unbounded by distribution mechanism and unconstrained by geography, the only remaining opportunity is controlling how all the supplies reach Demand (the users).

Magically, companies like Facebook, Twitter and Google focus on just that. They provide platforms that control Demand leaving the unlimited suppliers to provide the goods. Yes, you have the news (the contents), but if Google does not help to deliver them to the readers, you are in trouble. When Facebook revoked access to some websites after the debacle of Cambridge Analytica, many went bankrupt in days. Those firms had supply but they have been cut-off from Demand.

Facebook is going through a redesign with its privacy policy and strategy. The social media giant has started to significantly limit data access to Facebook’s Events, Groups and Pages APIs. It has also shut down part of the Instagram API. This is expected as the company battles scandals with the mess it found itself with the Cambridge Analytica related privacy violations.

Now, you can see why that your old book may not be helping your strategy as what worked in the industrial age economy might crash in the web economy. Sure, you can call Facebook and Google the modern supplies. But you must know they have no factories to produce the items you consume on their platforms. Google depends on all open global sites in the world to do that “supply”; Facebook feeds on stuffs we post. So, it is clearly not the type of supplies which used to break banks to execute. If you can “supply” their types of supplies, you are in control of Demand!

Comments on LinkedIn on this Topic

In this era of abundance on the supply side, the game has shifted to demand, turning entities with capabilities to control demands into the newest emperors. The digital supply chain even supports this model, where your superiority and differentiation is on your ability to stimulate demand, and also going ahead to decide who gets what.

It’s a radical shift, because for centuries, many things have been rigged from the supply side: just create artificial scarcity, and suddenly – more billions in your bank account! Times have changed, inventories are managed better, with less losses, meaning that you can technically stimulate demand, control the levers, without having ‘leftovers’ anyway.

With the way many things have been democratized, aided greatly by internet and web, tearing geographic boundaries along the way; households are turning themselves into mini factories, schools, markets, consulting firms, etc, without needing to break banks just to manage assets.

Human capital remains the most valuable asset in this knowledge economy, everything else is just a supporting cast.

This is the greatest time to be alive, if you are not living now; I am sorry!