I wrote this post in french. It has been translated by John James (BBC Correspondent, Ivory Coast). John is the guy behind the Drogbas’s Country blog.
If you’re part of the African diaspora and you want to do business back home, I’d be one of the first to encourage you. Having done the same thing myself, I’ve been able to identify several things that will boost your chances of success, or at least reduce the risks of failure. The advice that I’ve written below come from personal experience. These won’t of course be exhaustive or apply to every situation, but I think you’ll find them useful as a starting point.
From 2005 to 2008 I worked as an application developer and then a research and development engineer with Java/J2E with a focus on mobile technology and the web. I gained particular experience in the banking, energy and media sectors. Then, I made the leap to start my own business. I’ve been business-minded since college, at school and during my university studies. But till then, these had been actions with friends and held little financial risk. Creating my start-up in France was made easier thanks to some training given by the Chamber of Commerce in Creteil (south east Paris). But when it came to setting up the business in Cote d’Ivoire, there were a number of obstacles.
It’s then I had to study for what I call my “MBA in on the ground IT business in Africa”. I always thought that it would take at least three years to really get to know the business environment in which I was launching. I knew that no formal academic study would give me the knowledge I would need. So, I decided to get stuck in at the coal face. Instead of being a mere spectator, I launched AllDeny and then the NGO Akendewa. I plan to come back on my journey in another series of articles.
Below you’ll find a non-exhaustive list of the things that are worth bearing in mind to avoid the mistakes that I made:
Set yourself up as a sole trader
You can set your business up as a limited liability company and get more credibility with the big players in your country. But how much is the extra credibility really worth if you don’t have any income at the start? If you’re an entrepreneur, it means that you know about taking calculated risks. Believe me, you’ll gain by committing the minimum amount of money possible at the start while you deepen your knowledge of the business environment in the country you’ve chosen. The taxes and other charges are very high in the majority of African countries, above all in francophone Africa.
In the case of Cote d’Ivoire for example, you’ll have to spend at least 2,000,000 fcfa (around 3,000 euros) to properly set-up your company, whereas with a sole proprietorship, the start-up costs won’t be anymore than 100 euros (65,000 cfa). To avoid later tussles with the tax officials, do everything you need to, to have traceable receipts. In Cote d’Ivoire, these are called “factures normalisées”.
Take the time to study your sector
You can’t just export an idea that works well in the West and think it’ll be an automatic success in Africa. Africans have very different ways of living and thinking. There’s no point for example setting up a payment service that uses voicemail, because in Africa, very few people use their voice mail – almost none are activated. However sophisticated and well-developed your technological solution is, it won’t succeed if it’s out of step with local needs. Of course, you can always create new needs and change the way your future consumers behave, but believe me, the risk of failure will be high, as will the costs if you need to educate and change your potential customers.
If your business offers a service for local enterprises, I advise you to come up with several different input forms so that your clients can clearly communicate to you their needs. The majority of small and medium sized businesses in Africa find it difficult to clearly grasp their technological needs. Unlike Europe or America, company bosses may not even a minimum understanding of technology and may not be able to describe what they need.
One of our clients once asked us to find a dedicated server for their website. After several conversations, I realised that he had wanted to carry out certain Unix commands on the shared server that hosted his site. But he found that he didn’t have permission to carry out these commands. If we’d have set-up a dedicated server, we could have sent him a large bill and made a healthy profit. But, the client in question would then have faced numerous security issues which would have required a degree of skilled intervention and extra cost that in fact was totally unnecessary. You can imagine how our relations would have then deteriorated, without even discussing the poor reputation that we could then have gained.
When coming back to your home country, don’t hesitate to bring your old equipment with you
This will help you to avoid looking for equipment in a place where the prices will be far higher and the selection limited. For example, if you need a particular type of printer, it’s far from clear that you’ll find the one you need in your homeland. Arriving already equipped is also a way to save money while at the same time making sure you have the best equipment. In country, you also risk finding equipment that has a host of hidden problems.
It’s worth being aware that the taxes on IT equipment are very high in certain African countries. Kenya is the exception in this domain thanks to a clued-up government. But most countries including Cote d’Ivoire use IT equipment imports as a way to increase tax revenue, something that has a big impact on the price of these goods. This situation doesn’t look like it will end soon as countries depend heavily on these customs duties.
Sub-let your office from another business or individual
There are quite a few businesses and individuals who have space to spare. If you decide to rent your own office (equally for your home), you’ll have to pay at least five months rent upfront as a deposit. There’s no shame in lodging with someone else. On the contrary, this will help you concentrate on the key thing; the service that you intend proposing to the market.
Africa could benefit by copying the garage start-ups in the US (e.g. Apple). Like in the 1970s with the PC and the 1990s with the internet, this current decade will see technology giants come from obscure beginnings. In Kenya there’s already the example of Ushahidi, which was set-up in 48 hours by David Kobia and which has since become a veritable gold mine.
Take on the services of a cook for your and your team’s meals
If you have at least five people in your business team, it’s a good idea to employ the services of someone to shop and cook your meals. Of course, this person will take a cut and you’ll need to watch out for overcharging. But still, these sorts of services are more and more popular in Africa’s main cities. Take the time to establish things on a good basis and help everyone participate in the choice of meals. If you can make the process fun, your collaborators will enjoy getting involved. Some of them will even bring along vegetables and fruits as their contribution.
Avoid signing staff contracts in the first year
At the start, it is best to employ your staff on a freelance basis. Avoid establishing fixed contracts. Of course, you shouldn’t keep your staff in a precarious position. But experience shows that our homelands aren’t overflowing with a strong professional ethic. The majority of employees only pick up such things when they’re in their first year of employment.
There is also a big problem with regards to the respect (even understanding) of the idea of upholding delivery schedules. Certain people struggle to understand that you can lose a contract (even one already signed) if delivery is late.
Put in place a transport budget
This will avoid hearing “boss, I didn’t have enough money to come to work”. The key idea here is to send a strong signal to your colleagues so that they understand the importance of being conscientiousness. Take the time to work out how each employee comes into work in order to help decide the best way for him/her to get there. Even better, you can give them an advance each week equal to the transport costs for that period.
There are also possibilities for providing transport. Find out if you can sign-up to something for your workers. It might also be possible to set-up car-sharing schemes for the company. Encourage those who transport their colleagues with fuel vouchers and other gifts. It’s the thought that counts. This can also help improve the team spirit at the business.
Personally, I don’t hesitate to transport my collaborators all the way to their homes. It’s a good occasion to chew the fat and get to know each other. But be careful not to go too far in your relations outside of work. This can turn against you. Don’t use your employees to do your personal errands – don’t abandon the positive things you picked up in the West. Your employees aren’t your domestic servants or your personal assistants, unless you’ve specifically employed them for this.
Use free software
I’ve seen that even the largest companies in Africa often use pirated versions of Windows and others software without a licence. It’s best to avoid these sorts of practices – if your produce is aimed at western markets, you’ll run into the problem of using unlicensed software. If you don’t have the means, use free software. You’ll need to put in a bit of time to get up and running on the free software. But you’ll make important savings. If you haven’t had experience of this software before, do your research and put in the effort in the first month to really get to know these tools.
There are numerous schools in our countries training competent users of these free software tools and this is an opportunity to seize. I’m not saying that you need to abandon other software, but as the next section makes clear, you need to be a role model in your organisation. If you haven’t the money to pay for software, it’s best to use free software legally. Coming from the diaspora, you shouldn’t be one of those promoting violations of copyright and intellectual property.
Keep in mind that you represent a leadership role model
As an African entrepreneur, you should keep in mind that you represent a leadership role model. Africans are little by little starting to become interested in leadership outside the domain of politics. You have a responsibility to embody the moral values that others that come after you can follow.
Personally, I started an adventure to build the local IT community at the same time as my professional activity in Abidjan. With 10 local entrepreneurs, we put in place Akendewa to “emulate the mobile and internet industry in Africa”. At the beginning this was just a simple gathering of people passionate about technology, but it’s become a real platform which has had an impact in almost every part of life in Africa. We were able to save lives thanks to the #civsocial project and we keep encouraging the technological activities of companies and individuals. You have the possibility of being part of such a movement, which exist in each African country.
Unless you’ve got tons of energy and a plan over several years, I would advise against setting up a new association or club in the country you decide to invest in. Just get involved with what’s already in existence and launch initiatives under its banner. If you can’t find an association that fits, then perhaps you can launch your association/organisation/club. But as soon as you’ve started, be ready to respond to the concerns of everyone who takes an interest in the initiative. Among these people you’ll find the right people to help you with your own projects.
One morning in 2010, I received a message from a certain Cyriac Gbogou. He wanted to encourage me in my work with Akendewa and also Yefite!, a community guide to great African hotspots that we launched under the AllDenY banner. In fact, he’d been following our online activities for a while and had decided to join forces with us. After several exchanges on Facebook, he started to work on behalf of Akendewa without having met any of its founder members. Several months later, everyone who knew about Akendewa knew Cyriac and how much he’d taken on board the vision of the organisation.
Be careful of espionage
Do be careful with the work you’re undertaking. A common practice is that people get themselves employed somewhere just to know what you’re doing and then to copy it. It boils down to espionage. Protect yourself from your colleagues by giving them access only to the information they need to carry out their work.
The art of delegation is of course one of the key things for any entrepreneur to cultivate, but if you create software and applications, I advise you to write the initial code yourself and then make use of an API that your collaborators can then use. With time, you can identify those you can see yourself working with for a long time, and open a bit more your secrets.
In any case, you do of course need to give your colleagues what they need to help advance the work. It’s not about holding back all the information – something that will lead to inevitable failure.
Don’t move back to your home country
I imagine that you may be shocked by this one. Me too. But the truth is that you have more chance of success in a country that isn’t your own. This doesn’t mean you’re forbidden from returning to your home country as your investment destination. When you head back, the family will be very happy to see you. But without wanting to, they can then become a distraction to you and stop you achieving your objectives. You risk losing time by meeting their needs at the same time as trying to make your business function.
And, let’s be honest, in Africa the entrepreneur is often considered as the big boss. Any big boss will of course have a certain financial power, so people think you’ve got plenty of resources. You’ll have a hard time explaining that you’re trying to create value and not expenses.
Personally, I’ve had some difficulties with certain members of my family who struggle to accept that they may see me on television talking about IT before I’ve passed by to spend a day with them visiting. Where it’s possible, I do try to meet as many people as possible. But if – like me – you have a large family, you risk losing a lot of time. It’s best to keep these visits to your holiday periods.
There are some countries in Africa that are more dynamic when it comes to IT than others. When I think about the evolution of the sector and the plans drawn up by different countries, it’s clear that certain countries will be more propitious for start-ups. If you don’t have too much money at the start, I advise you to head to one of the countries that I’ll recommend in a future article called “The diaspora and the IT ecosystem in Africa”.
Never trust verbal agreements
This applies to your collaborators as well as your eventual partners and local clients. Voluntary amnesia is a common disease. Keep a physical record of the agreements you draw up – it will help you avoid later disappointments.
When you present the written agreements to your collaborators and partners, they’ll see how important you regard the promises. The step of drawing up the agreements will show your seriousness and oblige your collaborator to make sure they fulfil his/her part of the deal. If you don’t do this and leave your collaborators fairly free, you’ll find that they’re not very committed to the work. But if you take the time to write things down in an official document, you’ll be surprised by the difference in productivity. It’s not a question of exploiting people. For example, with the heat in Africa you will need to allow your collaborators to take at least an hour for lunch.
Make sure you get hold of a copy of the law on the workplace in the country that you move into. Contrary to what some people think, the judicial administration in most African countries is very zealous when it comes to the non-respect of professional contracts. You’ll need to make use of a legal advisor in case of problems.
Keep you project plans secret
Don’t give away your project plans to someone who says they’ll find you local markets or international partners. Keep secret your implementation plan. Draw up project presentations that are clear, but don’t expose this level of detail. Certain people will have no scruple in using your documents as if they’d written them themselves. And when the damage is done, you will have little chance of upholding your property rights.
I can remember an unfortunate incident that happened to a Swiss entrepreneur originally from Cote d’Ivoire, who had updated a computer with an operating system based on Unix (the same base as Linux and mac OS). I spoke to him in August 2009 in Abidjan. And during the presentation of his product at Hotel Ivoire in Abidjan, he had one of his three prototypes stolen despite the presence of security.
Say goodbye to poor collaborators
Without any hesitation and for the fundamental survival of your business activity, say goodbye to collaborators who don’t respect working hours, deadlines and the rules that you establish. Any indulgence for incompetence will cost you dear. Unless you have a big budget for training your collaborators, don’t waste time with personnel who don’t bring much to the business.
Technology is a sector that’s part of a global market. Even if you’re in Africa, your competition could be European, American or Indian. I know of several European companies that create application for Africans. And coming from the diaspora, you know that these European details pay plenty of attention to the details.
Even if your solutions are simple, try to avoid spending time supporting your staff in their work. For this, work with collaborators who know the importance of doing a good job. They should be ready to take the time to document almost all that they plan to accomplish.
Don’t come back to settle in your homeland
In any case, not in the first year. This could seem like it’s against the spirit of getting involved in entrepreneurship in Africa, but it’s best to be honest. Africa is an incredible continent. But someone who left several years ago will have undergone some sort of modification in the way they see things back home. I wouldn’t say that he’s forgotten everything, but several years in a new environment changes you.
To avoid disillusion, entrepreneurs from the African diaspora should take the time to rediscover Africa. Personally, I started with visits of 3-4 weeks per year. Four years later, the weeks have become months. You need to take the time to make real contacts and develop a strong understanding of the market. Most importantly of all, you’ll come to understand the “new needs of Africa”. It’s these new needs that you should help answer with your business. Once you’re aware of them, you are in a stronger position to decide on the merits of a definitive return home.
Stay humble and respectful, but not submissive
Once you go back, you’ll find that some people will try to catalogue you as “their kid” and will want you to call them “big brother” or “big sister”. Don’t let these people influence your decision making.
Where possible, try to find a balance in your relations with people. Don’t hesitate to return favours – perhaps people will say that they help you for nothing, but as an entrepreneur you know that nothing is for free. Being prepared to say ‘No’ won’t lose your friends if these people respect you. On the contrary, when someone distances themselves from you because you said no, you are separating yourself from someone who would have slowed down your progress and reduced your professionalism.
Keep a blog
As incredible as it may seem, Africa needs you as a content producer. The different sections of IT in Africa are very poorly documented. It’s difficult to know what’s going on. By keeping a blog, you are providing information that will be invaluable to others. What do you gain? Everything! You’ll have the chance to position yourself as an expert of the section that you yourself have chosen. You’ll agree with me that an entrepreneur who knows the ins and outs of his sector will have a future advance over (future) competitors.
Take the time (25 – 40 minutes each day) to write about what’s happened. After several months, you’ll see that what you have written constitutes a real resource of knowledge.
Personally, two years ago, I reoriented my personal website (this one) towards blogging to share my entrepreneurial experiences with other internet-users. This has allowed me to build contacts throughout Africa, even Anglophone Africa. Even if the blog is in French (I did try initially to publish in English, which lasted several months), numerous English-speaking readers and entrepreneurs in Anglophone Africa read what I write thanks to Google Translate. Some have even told me that they translate my tweets. We are of course talking about my publications on IT in Africa and my initiatives. The result of this interest is that I will soon be one of the speakers at the Mobile Web Africa conference, which is the most important mobile event on the continent. This will allow me to make known what we’re up to.
Get involved in mobile technology
Keep an eye out on this blog for a new series of articles entitled “The diaspora and the IT ecosystem in Africa”, in which I’ll speak about the opportunities offered by mobile technology in Africa. I’ll use this to get into the detail of the biggest technological industry in Africa. I also plan to speak about what’s going on in Kenya, Nigeria, South Africa and some French-speaking African countries.
Africa can appear to be difficult terrain for entrepreneurs. Yet, it’s the place where the ROI (Return On Investment) is the largest in the world. Everything depends on the way in which you can attract the confidence of the main operators and also your capacity to adapt to the different habits.
As I said at the start of this post, there are obviously numerous recommendations that could be made and I’m interested in hearing your own. Don’t hesitate to comment on this post with your recommendations or suggestions to people in the diaspora who are thinking of coming back home for business.