Africa has a long path to economic prosperity. According to the World Bank, seven of the ten most unequal countries in the world are in Africa, especially the Sub-Saharan region. Why? Value creation on the continent is far from its potential. It’s why Ekiti, a state in Nigeria — Africa’s largest economy — made only $14 million in IGR in 2022. For context, Taste of Texas, a steakhouse with only one location and 54 employees, recorded annual sales of $23 million in the same year.
But the answer to this problem is not simply about creating more businesses. Africa needs enablers: people who make it easy for others to create value. And in many cases, these enablers are businesses. Not all heroes wear capes, some build pitch decks. That’s why Ventures Africa spoke to five finalists from the ongoing Africa’s Business Heroes competition. These founders have built brands that solve crucial problems in their communities and beyond.
The Africa’s Business Heroes (ABH) competition is a philanthropic program sponsored by the Jack Ma Foundation and Alibaba Philanthropy. ABH aims to identify, support, and inspire the next generation of African entrepreneurs who are making a difference in their local communities, working to solve the most pressing problems, and building a more sustainable and inclusive economy for the future. From November 23rd to 24th, the top 10 finalists will compete for a share of $1.5 million in grant money. The Grand Finale will be held at the Kigali Convention Centre in Rwanda.
The first sign of Africa’s value creation problem is the trade sector. There are 29 French-speaking countries in Africa, 21 being officially Francophone countries. You’d expect trade to be seamless between these countries. But that’s not the case. The trade sector is still largely informal and fragmented.
This problem inspired a Moroccan couple —Mr. Ismael Belkhayat and his wife, Sophia— to start Chari in 2020. Chari is a business-to-business (B2B) e-commerce app allowing traditional proximity store owners to order anything they need for their stores and get delivery in less than 24 hours.
“About 200,000 convenience stores are selling more than 100 billion dirhams worth of goods each year,” Ismal Belkhayat told Ventures Africa. “I was inspired to create Chari to meet the needs of these entrepreneurs by ensuring a regular supply of consumer goods and offering them financial services. Our core mission revolves around driving sustainable growth and nurturing balanced entrepreneurial ecosystems.”
Chari’s revenues went from $0.2 million in the first year to $1.8 million in 2021, scoring an impressive compound annual growth rate (CAGR) of 92%. In May, the Financial Times ranked the startup 10th among Africa’s fastest-growing companies for 2023. “We’re revolutionising the way essential goods and services reach informal retail stores, making the process more efficient and cost-effective,” Belkhayat said. “Our platform digitalises these points of sale, enabling them to source products online, access favourable payment terms, and extend financial services to their end consumers.”
Chari opened its first warehouse in Casablanca in and the second in Tangier in the fourth quarter of 2021. Then, the startup adopted an aggressive acquisition strategy over the past two years. In 2022, it acquired Karny.ma, a credit record service used in over 50,000 sales points in Morocco. It also bought Diago, an Ivorian retail app, in June 2022. In the same year, it acquired Axa Credit, the credit arm of Axa Assurance Maroc, for $22 million.
However, Belkhayat believes this growth could have happened faster. “Like all other entrepreneurs, we faced challenges with financing, which hampered our growth and expansion,” he said. “Being an ABH finalist has opened us up to greater exposure and recognition. The potential for new opportunities, the connections and the learnings through ABH can only boost our business further.”
Bathu (South Africa)
Fashion is big business in Africa, but not big enough. Euromonitor estimates Sub-Saharan Africa’s footwear and apparel market at $31 billion. But that’s not very far off from Australia’s $23.2bn. And that makes Africa the lowest contributor among all continents to the global $1.7 trillion fashion industry. As a result, Africa is the primary destination for used clothing and shoes from the global North.
In 2015, Theo Baloyi recognised the extent to which Africa was missing in the fashion value chain and made an ambitious plan to influence this narrative. So, he founded Bathu, a South African sneaker brand. “In 2015, I realised that Africa lacked a sneaker brand that truly told the African story,” Baloyi told Ventures Africa. “That year, I founded Bathu and launched 100 pairs of shoes in Alexandra, Soweto, Midrand, and Thembisa. My motivation was to create opportunities for others and serve my community.”
But that dream wouldn’t come on a platter. “We faced rejection from multiple factories,” he said. “After months of feasibility studies and rejections, our Mesh Edition Sneaker was born. Our unique designs incorporate elements of South African street culture, music, and art.” Then, Bathu rolled out a strategy: innovative marketing, community engagement and gradual expansion. It also balanced a strong brick-and-mortar presence with digital strategies such as using Shopify POS. It paid off. In 2021, Bathu emerged as one of Africa’s most recognisable brands.
Today, Bathu operates 35 stores and employs more than 400 people. “Our business solution has made a significant impact on our local community,” Baloyi narrated. “Through initiatives like Walk Your Journey, we have distributed over 50,000 pairs of school shoes to local schools. We are committed to donating one million pairs of shoes to schools across the country over the next decade.”
Now, Bathu has its sights on new borders, and according to Baloyi, being an ABH finalist is levering it toward this goal. “Being an ABH finalist has significantly influenced our business trajectory,” he explained. “It has allowed us to connect with like-minded entrepreneurs and potential partners.”
Easy Solar (Sierra Leone/Liberia)
Energy access is one of the biggest hindrances to the ease of business in Sub-Saharan Africa (SSA). According to the World Bank, the world has 733 million people living without electricity. 600 million of them are in SSA. In West Africa, where Nthabiseng Mosia resides, only about 42% of the population and 8% of rural residents, have access to electricity.
So, in 2015, Mosia and Alexandre Tourre co-founded Easy Solar with hopes of improving access to affordable energy for residents of Sierra Leone and Liberia. “We recognised that the absence of electricity was a significant barrier to education, healthcare, and economic development,” Mosia told Ventures Africa. “Seeing the potential of solar technology, we founded Easy Solar with the vision to make energy, financial services, and life-improving products accessible to all, particularly in rural areas. We aimed to create a sustainable commercial ecosystem around renewable energy, believing that access to reliable energy can transform the lives of Africans.”
But Easy Solar was not flush with funding in its early days. And so, it had to boost its coffers through revenue. “We offered flexible payment plans, allowing customers to pay for solar systems and appliances in weekly or monthly instalments,” Mosia said. “By accepting both cash and mobile payments, we made it convenient for our customers to access our products, ensuring affordability and accessibility.”
Easy Solar has reached over a million people today, with a network of more than 400 agents and outlets across Sierra Leone and Liberia. “The recognition from ABH has instilled confidence in our stakeholders, empowering us to innovate further and invest in cutting-edge technologies,” Mosia said. “Our focus is on further expanding our product offerings and reaching even more remote communities.”
Financial inclusion might sound like a buzzword to many people. But it’s a real-life problem. Many opportunities are out of reach for those without access to financial services. In Ghana, Andrew Takyi-Appiah’s home country, over 40% of the population is financially excluded. So, his firm, Zeepay, aims to bridge this gap through its remittance solutions.
Takyi-Appiah started Zeepay after multiple failed stints at building startups as an undergraduate student and during his stay in the United Kingdom. “I took up a role at Nestlé which eventually landed me in the banking sector,” he narrated to Ventures Africa. “One time, after closing a deal in South Africa, I thought about the possibility of building a payment system that would be independent of the mobile network and then came Zeepay. My wife and I nurtured this new baby until 2016 when I had investors come on board and officially launched the company on the 4th of May 2016. Zeepay was named after my wife — Zoe Takyi-Appiah —to appreciate her efforts for the company.”
Today, Zeepay serves 1.3 million customers across 20 African markets. It also provides jobs to over 60,000 women and youth across Ghana. “Unemployment is a problem in this continent and being able to generate employment is something we take pride in,” Takyi-Appiah said. But according to him, there’s still room for Zeepay to make more impact in Africa. That’s why they joined the African Business Heroes competition. “Entrepreneurs need access to capital and exposure as this opens us up to wider markets and bigger profits. But more importantly, Africa’s Business Heroes is built on the very same ethos we are pushing. We are ready to provide support and guidance and invest in any innovative fintech idea with a lot of potential that aims to benefit the ordinary African.”
Agriculture is Sub-Saharan Africa’s largest economic sector, accounting for nearly 15% of the region’s GDP. Yet, productivity is low. Smallholder farmers, who represent 80% of SSA’s farms, face difficulties scaling because they don’t have access to financial services that can boost their outputs. There’s also little guarantee that they can maintain their productivity levels because of unpredictable challenges like pest infestations and droughts. SSA alone accounts for more than three-quarters of the world’s drought-induced crop and livestock production losses.
“In the event of crop failure, many of these farmers face financial ruin due to failure to access the investments they need to grow their yields and income,” Thomas Njeru, CEO and Co-Founder, Pula Advisors Limited, told Ventures Africa. “As a solution to this problem, I co-founded PULA in 2014 with Rose Goslinga, which we officially launched in 2015. We offer smallholder farmers access to innovative insurance and risk mitigation products, protecting them from the financial losses associated with crop failure. This, in turn, enables farmers to invest confidently in their agricultural activities, knowing they have a safety net in case of adverse events.”
But Njeru and Goslinga quickly discovered that reaching out to smallholder farmers directly was a Herculean task. Most smallholder farmers lean more towards subsistence, and as a result, would not buy insurance. So, Njeru and Goslinga designed a strategy that targets large organisations working with farmers, including governments, input providers, banks, off-takers, etc. “We do not sell to farmers directly; instead, we identify aggregated farmer demand,” Njeru said. “As part of our services, we also provide wide-ranging campaigns of insurance promotion and awareness, both digitally and in the field to ensure that farmers understand their insurance and perceive the benefits.”
The model worked. Pula has now supported 9 million smallholder farmers in around 20 markets, according to Njeru. Yet, he doesn’t believe the company has scratched the surface. “Millions of smallholder farmers worldwide lack access to affordable, high-quality insurance, and their farms are often too small and remote. The World Bank indicates that providing insurance helps farmers increase crop income by up to 41% and up to 83% in bad years. Our goal is to reach 100 million farmers around the world.”
Africa’s Business Heroes is inviting entrepreneurs, investors, and other business enthusiasts across Africa to be part of the 2023 ABH Summit and Grand Finale happening on the 23-24 November in Kigali, Rwanda. Register here to attend the 2023 ABH Grand Finale.