The problem of Entrepreneurship in Africa

Recently I was challenged by a colleague as to the real reasons why fortune 500 level entrepreneurship is such a daunting or unheard of affair in Africa. Except for the aggressive small scale entrepreneurs in the form of vegetable sellers, traders, consultants, startups etc. conspicuously missing are mega brands that are truly African owned. Kenya, Nigeria and South Africa, have a couple of brands to boast about, but still nothing comparable to the West. American and European owned brands stand tall whilst proudly donning the entire African landscape; from Coca Cola to Pepsi to BMW to Mercedes. After an hour long debate, I conceded defeat and agreed of a serious problem in African entrepreneurship. Based on my interactions and experiences, I picked out six reasons for this menace:

1.      Lack of funding. Funding is not easy for African entrepreneurs and believe me not, colour is most often a key factor in what funding you may successfully get for your venture(especially where disruption is involved). To make matters worse, Africa owned lenders would be more at home funding traditional ventures e.g real estate vis a vis disruptive high risk untested ventures. As for the West based lenders(VCs, Banks etc), they are more forward looking with no hesitation to fund any venture that is bankable and poised to disrupt the world.

2.      A rush to Make It faster. The journey to a thousand miles begins with a single step. Unfortunately there’s a belief in some African quarters that you can become the next Bill Gates within a few years. Please note, it’s taken Coca Cola almost 130 years to be where they are today and Ford Car has taken around 105 years. Be patient, persevere, hold on and persist for as long as it takes you to make it!

3.      An adhoc approach to Management and Processes. Managing a business is a mix of science and art, requiring good management practices, world class processes and a good management structure. Run it like a village kiosk and you will forever stagnate before eventually folding up. With good management and processes, no single cent will go to waste and no single idea will be lost. It will be a continuous learning with month by month growth.

4.      Village level thinking. The fact that the people who buy your goods and services are located only within your locality, doesn’t mean that you can’t market and sell beyond. Think about markets far beyond your current location. Nothing to be scared about and you only limited by your thinking. Think the rest of Africa, think Asia, think Europe, think Latin America!

5.      Lack of specialization. Mister, you can’t do everything and run everything within one roof. Some specialization is critical. Do small, do it well and be focused. On the down side, we have a tendency to start other ventures in the middle of other ventures that are yet to mature, and sometimes nowhere close to maturity. Apply the 80-20 rule. Do the 20% well to get 80% of the results.

6.      Big man syndrome. This is a big big problem. There’s a trend in Africa, whereby the richer you become, the more dominant, domineering and bossy one gets. With that, humility goes off the window and what follows is pride, arrogance and domination. Keeping a good team ends up being difficult and eventually you surround yourself with “Yes men”. You lose friends, people avoid you and pride sinks in deeper and deeper. Humility is such a critical factor towards building an empire and the faster we master this truth, the better it shall be for all African wannabee millionaires and billionaires.

It’s not all that bad in Africa, but truth be told, we have some serious issues that need fixing! If any of above six reasons apply to your situation, purpose to change, rise up and endevour to build the next Coca Cola of Africa, that will be enjoyed by the world 200 years from today! God bless this lovely continent. Mother Africa!