Former President of Nigeria speaks to AB2020 creator Akosua Annobil…
Fred Swaniker is a great friend of mine. Not only do we both originate from the centre of the earth (Ghana), we both had stints at Stanford University – though, at different times, writes Eric Osiakwan (pictured below).
And, like me, he quickly returned to Africa to start the African Leadership Academy (ALA) in his quest to solve the African leadership conundrum. Fred reckons African leadership has deteriorated and is determined to reverse the trend.
Recently, he was named a pioneer in TIME100 for 2019 for leading this charge. We were also both fellows of TED Global and were both utopia 10 years ago and so were the other African TED Global presenters like Dr. George Ayittey who postulated the “Cheetah Generation”, Patrick Awuah who dreamed of a new African tertiary educational system, William Kamkwamba who would harvest the wind to solve Africa’s power crisis – which were all part of ‘The Next Chapter’.
In 2011, ALA partnered with the Mastercard Foundation to establish the Anzisha Prize – and now Anzisha Summit. The goal for both was to bring together the relevant stakeholders to not only discuss the issues around youth entrepreneurship and innovation, but, more importantly, award the entrepreneurs with prize money to help them get off their feet. Some of these stakeholders include government, academia, private sector and civil society who were all represented at the summit. You can find the recent winners of the Anzisha Prize here
As destiny would have it, along the way, I also became friends with Josh Adler. He was part of Fred’s team that was building the African Leadership Academy as Vice President for Growth and Entrepreneurship. Josh and I had numerous conversations about growth and entrepreneurship in Africa and how we should infuse that into the next generation of African leaders that they were grooming. We concluded that it was important to give the entrepreneurs in their academy a head start.
Africa’s educational system does not do enough to turn the entrepreneur’s urge on, and there is little to no infrastructure in educational development for those who want to express themselves in free enterprise. So, the majority of Africa’s entrepreneurs have had to figure it out themselves by dint of grit and following their nose.
On 1 February 2019, while in a board strategy session with one of our portfolio companies, my phone starts ringing off the hook. There was Josh with the pleasant news that they have now developed an entrepreneurship program at ALA that they were going to launch at the Anzisha Summit. He wanted to discuss how we could work together because the dream has taken shape.
On 15 April 2019, ALA held the one-day Anzisha Summit at Hilton Hotel in Johannesburg which I attended and took part as a participant on the investor panel. You can find more details about the summit from CNBC Africa live coverage and the Anzisha scenario page.
Through a series of back and forth, Josh and his team at ALA have put together an amazing program to not only educate but also accelerate young entrepreneurs on the path to private enterprise.
The program – dubbed ‘The Young Entrepreneurs Fund’ – developed in partnership with Omidyar Network – was announced at the Summit. It is modelled on Endeavor’s Catalyst Fund and based on a matching model: It will match – dollar for dollar – any investments into high potential young Africans by angels and early-stage investors. The fund will never lead a funding round. Instead, they will rely on the matching investor to have evaluated the merits of the business case.
They will also do limited due diligence on the entrepreneur. Per Josh, some of the areas for due diligence include: ‘the (entrepreneur’s) good standing in the community; the business has to be registered; can we get our money in/out’. Investments will also be limited to alumni of ALA’s diploma program and Anzisha Prize.
In cases where there are other shareholders, the alumnus has to be a significant shareholder or founder. The Young Entrepreneurs Fund is looking to contribute not more than 49% of a single funding round with a preference of around 25% with the ticket sizes ranging from US $5k to $50k.
Although the fund is primarily looking at equity investments, they also have a preference for doing some sort of debt instrument. Overall, the fund hopes to deploy around $500,000 in the next two years as they continue to evaluate its feasibility.
‘The idea is to drive liquidity into the age group, and encourage our strongest young leaders to go into entrepreneurship as well as hesitant investors to take a punt with us in the collective corner of the entrepreneur they will back,’ says Josh.
This is very important for African entrepreneurship because young Africans will now have access to Capacity, Community and Capital to give them a head start, which is an important foundation for their entrepreneurial journey.
By providing young Africans with follow on capacity, community and capital to build leading African multinational enterprises, The Young Entrepreneurs Fund complements what we are already doing at Chanzo Capital. Ten years later, Fred and my utopianism seem to have found some expression in real life – at the intersection of Josh Adler!
Eric Osiakwan is the Managing Partner for Chanzo Capital