The rising stars of African finance
Africans are reclaiming their future and flocking back to a continent that many left in search of a better life. Home is where the heart is, but now it’s also where the opportunity is. Euromoney’s rising stars are grabbing the opportunities Africa has to offer and setting the standards for others to follow.
The diaspora is returning to sub-Saharan Africa. “Even until the late 1990s, Africans who had left to study or work abroad were not coming back to the continent. Political, social and economic concerns riddled Africa to various degrees in many places. The continent was in crisis and there was nothing there for those who had left,” says Acha Leke, director at McKinsey & Company, Lagos.
“At first, we all had this idea that we would return when things got better. But whose responsibility is it to make things better? It is ours – the Africans who have been privileged enough to get the best education and the best experience that the world has to offer. We have an obligation to come back to our continent, reclaim it, make a difference and convince others to do the same.”
Leke is one of Euromoney’s rising stars, part of a growing generation of financial and economic experts in Africa that have taken it upon themselves to ensure that sub-Saharan Africa continues to develop according to global best practices while leveraging on the region’s idiosyncrasies. These are a group of people shaping ideas to solve African problems.
Leke has made the list not only because of his achievements of expanding McKinsey’s business throughout the continent, but because of his dedication to mentoring young Africans whom he believes to be the continent’s future leaders through his private endeavours. Leke is determined to have a say in how Africa should be led.
“Even from a commercial point of view, it’s essential that as Africans we come up with the innovative solutions that our continent needs,” says Ladi Balogun, CEO of First City Monument Bank in Nigeria. “This way we can reinvest the profit derived from meeting the needs of the continent to continue on our path of economic development rather than rely solely on international investors who will seek to repatriate profits or reallocate resources when priorities change from Africa. Only we can champion our cause and ensure the continent prospers.”
Balogun is nominated for his dedication towards inclusive growth through microlending and microfinance initiatives through the development of the retail sector of his bank. While giving the unbanked access to funding, Balogun is setting an example for others in Nigeria to do the same while growing the profits of his own business.
Our rising stars come from a range of backgrounds. Most have studied and lived abroad. Some work for international investment banks, some in government and others at investment funds. The youngest of our stars is 27, the oldest are in their late 40s. Although many of them come from the more developed economy of Nigeria, we also have individuals from Ghana, Kenya, Zimbabwe, Ethiopia and Rwanda, offering a cross-section of some of the most exceptional individuals the continent has to offer. Only two of our rising stars come from South Africa – evidence of just how far the rest of the region has come.
|Jo-Ann Pohl, Standard Chartered|
“South Africa used to see itself as a class apart from the rest of sub-Saharan Africa,” says Jo-Ann Pohl, CFO of Standard Chartered in Africa. “Now the country is a little less arrogant about its position, following the positive economic strides regional economies have achieved over the last decade. For South African businesses to continue to grow and progress, it is important for them to start looking north before they fall behind.” In her position at Standard Chartered, based in South Africa, Pohl has made it her mission to deepen the connections between her base in Johannesburg and the rest of the region. What all of Euromoney’s rising stars have in common is a formidable sense of empowerment that they strive to pass on by setting examples, an attitude that is reinforced by a changing and vibrant economic and political climate.
The presence of local-content laws that countries including Nigeria, Ghana and Uganda have started to adopt are central to the idea of empowerment, as these laws provide locals with much more control over the country’s natural resources. “In Nigeria, for example, concerns arose as foreign oil companies made huge profits in the oil and gas sector whilst, it was argued, local Nigerians experienced very little benefit from the country’s oil wealth which they believe to be rightfully theirs,” says Joshua Siaw, lawyer and director of Africa practice at White & Case. “But since the enactment of local-content laws in 2010, Nigerians are given first consideration in the award of oil and gas-related contracts, employment and training. Now it is in the interest of foreign companies to partner with local Nigerians when bidding for oil-related contracts – this, in turn, will help to develop the skills and capacity of Nigerian oil companies.”
Siaw’s nomination comes from his ability to bridge the gap between global and local players. For example, in 2012, his firm advised Standard Bank of South Africa in connection with a $765 million financing to Shoreline Natural Resources Limited (SNRL) for the company’s acquisition of an interest in an onshore oil-producing block in Nigeria. SNRL is a joint venture between UK-listed Heritage Oil and its Nigerian local partner, Shoreline Power Company.
The hope is that as other countries in sub-Saharan Africa, such as Kenya, Tanzania and Mozambique, have started to discover natural resources on their territories, they will adopt similar laws and have greater control over their country’s natural wealth.
“Only a diverse and broad domestic non-bank investor base, with a long-term investment horizon or outlook, can sustain the development of the local capital markets. This is a prerequisite and necessary to ensure consistent growth of economic activity on the African continent,” says Kobby Bentsi-Enchill, head of debt capital markets for west Africa at Stanbic IBTC Bank, who is set on deepening the capital markets in the region to create a vibrant and, importantly, local investor base. “The participation of international investors is helpful in creating a liquid secondary market, but locals are essential to providing the building blocks,” he says. “We have an important responsibility as professionals to leave a legacy of excellent standards and success such that it sets the pace in the countries we are active in and for the continent in general to follow. We are the ones that need to raise the bar and improve standards to push the boundaries of development for the continent.”
This is becoming essential in Africa as companies strive to reach international best practice, expand their presence throughout the region and even compete at an international level. Patience Akyianu, managing director of Barclays Bank Ghana, earns her position on the list because of her dedication to global best practices in the financial institutions she has worked in, including Standard Chartered and Barclays Bank. Akyianu’s commitment to transparency and efficiency has transformed Barclays Bank Ghana from a loss-maker into one of the leading institutions in Ghana while – again like others in our list of rising stars – setting the standard for other local banks to follow. Akyianu is a driving force in the changing landscape of Ghanaian banks.
For Ishmael Nwokocha, head of corporate treasury at MTN in Nigeria, best practice and governance is of the utmost importance as well, especially in a country that has a reputation for corruption and inefficiency. “Because we are heavily dependent on equipment and services from Europe, the Americas and Asia, we have to make sure our contracting terms are 100% compliant to Nigeria’s forex exchange regulations and to ensure that all obligations that arise in forex are settled as and when to avoid unnecessary currency exposure,” he says. “Once you don’t have a strong governance culture and documented and robust business processes, it means you can’t run a business in an efficient manner. What ordinarily would take three to four days to go through, you instead find yourself running around after for two weeks.”
What is changing in some key markets in sub-Saharan Africa, Nigeria especially, is that the local financial markets have grown in sophistication. African prospects are pulling Africans back to the continent.
“The local capital markets are now deeper and offer access to longer-term fixed-rate funding in local currency, better macro policies have over time resulted in lower interest rates and inflation, and regulatory reforms have provided an enabling environment for the markets to develop further,” says Bentsi-Enchill, who was drawn back to west Africa because of these changes.
Yinka Odeleye, director and head of corporate finance for Citibank in Nigeria, identified a similar pattern: “In 2008, I took a break from my Wall Street job and I travelled to Nigeria for a holiday. The difference in Nigeria from 10 to 15 years earlier was absolutely clear. When I was in Nigeria working at Guaranty Trust Bank in the late 1990s and early 2000s, the biggest deal I worked on was an $8 million financing deal for an indigenous oil firm. Now people were talking about doing deals more than 10 times the size of that. Nigeria was going through a period of financial exuberance. I remember going back to my office in New York, watching Nigerian deals on the Bloomberg ticker and I just kept thinking about how well things were going over there. I knew I had to be a part of this.”
In April 2008, Odeleye made the change and took up a position at Citibank in Lagos where his international banking experience proved useful. Slowly, other Nigerian friends he had made in New York came back to join him. “We all used to get together and go out in New York. Now we are all meeting up for drinks in Lagos,” he says.
Odeleye is shortlisted because, like Bentsi-Enchill, he is keen to develop local capital markets. During his career, Odeleye has worked on various landmark deals, including Nigeria’s first Eurobond in 2011. Most recently, he has worked on Zenith Bank’s $500 million debut Eurobond. International issuances by local Nigerian banks highlights their ability to act at the next level, something Odeleye will continue to support.
Although international experience has provided our rising stars and others with valuable experience, it’s their ability to translate processes used elsewhere and adapt them for an African context that is crucial. “If you take a pre-existing idea and bring it to any African country, the idea will need to be tailored to fit the country,” says rising star Eleni Gabre-Madhin, CEO of eleni llc, a privately run turnkey company that aims to develop commodities exchanges in Africa and other emerging markets.
Gabre-Madhin makes the list because of her expertise in setting up the Ethiopian Commodities Exchange, which she hopes to replicate across other frontier markets through eleni llc. Next on the list for Gabre-Madhin is Ghana.
“The Ghanaian commodities exchange will be run differently to the one in Ethiopia,” she says. “For a start, it will not be wholly government-owned, because riding on the back of the success of the Ethiopian exchange, private investors are keen to get involved. And Ghana already has a regulator and a clearing system for the stock exchange, so we may even merge the commodities exchange into that instead of starting from scratch. Knowing what a country has to offer in terms of infrastructure and expertise that already exists is really important. And that’s something you can only truly get from being on the ground. We are amid a creative moment in
|Eleni Gabre-Madhin, eleni llc|
Africa because there are so many opportunities here. The trick is to find a gap and to fill it.” Filling the gap comes easily to some of the private equity and venture capital investors that have made the rising stars list. Sangu Delle, the youngest of our rising stars, who runs his own venture capital firm out of Accra, has most recently invested in mPharma, an online retail pharmacy that provides an electronic prescription service for caregivers, patients and pharmacists and a platform for doctors to interact with patients after consultation. It also gives health ministries access to pharmaceutical data. The project is being piloted in Zambia, Ghana and Tanzania with international telecoms company Bharti Airtel providing the network.
“mPharma will revolutionize how pharmaceuticals are prescribed, monitored and delivered in Africa,” says Delle. “Counterfeit medication in Africa is common, often leading to people getting the wrong care, and government monitoring of this is often nonexistent.”
mPharma and other mobile-phone-based services follow in the footsteps of M-Pesa, the mobile payment system championed by Safaricom in Kenya and heralded as the best mobile payment system globally. Mobile-based services are well suited to certain African countries. In Kenya for instance, there are 30 million mobile phones for 20 million adults, Nigeria has around 120 million mobile phone subscribers for 170 million people and Ghana has 91% mobile phone penetration. In such a vast continent, where the majority of the population still live in rural areas with little access to banking, health services and even education, mobile phone services could be the key. mPharma has the potential to go far.
Danladi Verheijen, CEO of private equity firm Verod Capital Management, won his place on the list because of his keen eye for great investment opportunities in Nigeria and turning them into national champions.
One of his successes was GZ Industries, an aluminium-can manufacturing company that doubled its output from 600 million cans a year to 1.2 billion between 2009 and 2013 with the help of Verheijen’s capital and expertise. Because of Verheijen’s investment and support, GZ now provides the entire country’s need for cans, whereas before they had to be imported from Spain.
One of the latest companies Verod has invested in is Spinlet, an online music distribution company – something Verheijen compares to Spotify. Verod bought it from a Finnish company. “I would imagine it’s the first time a Nigeria-based private equity firm has bought a Scandinavian technology business, but in a way it also shows how African businesses are becoming a lot more sophisticated,” he says. “There is a lot of pirated music in Africa, so introducing Spinlet was a way to overcome this. Local artists are really interested in being part of the platform.”
As Verheijen is quick to point out, Africa is underserved in many respects so there is still plenty of opportunity to find a good idea and adapt it for an African market.
|Joshua Siaw, White & Case|
And the solution can be extremely simple: “When KFC first entered Africa, for instance, it did well as a brand because it used local spices to season its chicken,” explains Siaw. “It was an African solution to a somewhat African problem.” Verheijen says: “In any case, if you can’t think of an idea, someone else hopefully will and you can invest in them. There are hundreds of interesting businesses out there looking for investment. But in my opinion, there aren’t enough people actually investing on the ground, or people who have the ability to execute on great ideas.”
Although diaspora Africans are pouring back to a continent laden with untapped opportunity, bringing with them the skills and experiences they have developed abroad, some of our rising stars stress that there are still limits to human capital that hinder indigenous development. Education north of South Africa has been criticized because it doesn’t come close to international standards, and that is why, given the opportunity, young Africans often travel abroad to get a better schooling.
Bentsi-Enchill studied actuarial science at City University in London, now Cass Business School. “Getting a work permit for the UK at the time for a foreign student with no work experience was really difficult so I had to set my sights elsewhere to begin with,” he says. Bentsi-Enchill was lucky enough to be accepted onto the international graduate trainee programme with Standard Chartered after university. He travelled between the UK, Ghana and Singapore working on product development assignments before finally settling in London to work in Standard Chartered’s newly created Africa debt capitals markets team in 2002.
“Being in London was purely a result of where my bosses were based at the time. Given that the business was young – and more of a pioneering effort at the time – the view was to keep a core execution team in London until such a time when some countries would have critical mass of business origination opportunities, and then the bank would relocate members of the team to the regional hubs,” says Bentsi-Enchill.
Nevertheless, there was and still is a distinct advantage to being based in London. It is well known as a hub even for Africa capital markets and finance conferences as a result of its first-class infrastructure and accessibility. “It may be easier to travel from one African country to another via Europe than trying to connect directly or transit through other African countries,” Bentsi-Enchill says. “Sadly, that still hasn’t changed much.”
If any of our rising stars is aware of the limits of education in certain African countries, it is Delle. “The only meaningful education I had about HIV and AIDS when I was a child was outside of the curriculum, we weren’t really told about it at school. I also remember I wrote a piece of work for an English assignment and I got beaten for using a ‘made-up word’,” says Delle. “The word was serendipity.”
Delle had set his sights on Harvard from a very young age. “I had always been interested in the US and was always reading books about America – anything I could find in my father’s collection. I actually read a lot of philosophy because I preferred Plato to children’s books,” he says. “When I asked my father what Harvard was – something I had come across in my reading – I was told that it was one of the best universities in the world. I was determined to go. At the age of five years I wrote my first letter to the head of the university and, to my father’s surprise, a couple of months later I got a reply from him. Our correspondence continued from then.”
Even with all the hard work Delle put in to realize his goal and study at Harvard, encouragement was scarce. “I remember a meeting I had with a European ambassador to Ghana while I was still in school. I was told that I was foolish to think that an African could get into Harvard.” Luckily, Delle proved the diplomat wrong, went on to complete his degree at Harvard and subsequently set up his own, thriving business.
Martin Ganda, CEO of investment consortium Tamuka Group, found paying for school in his native Zimbabwe a struggle – his father had a modest job in a paper-manufacturing company. Luckily, Ganda was offered a lifeline from Caitlin, an American penpal who would send money she earned from her babysitting job to help pay for his school fees. Ganda’s education in Zimbabwe set him up for a successful education in the US, where he was awarded a scholarship in economics and mathematics at Villanova University in Pennsylvania, and then an MBA at Duke University.
Akyianu, however, is adamant that countries including Ghana, where both she and Delle were schooled, can provide first-class education. Akyianu completed her secondary education at a top girl’s school in Ghana before moving on to the University of Ghana to achieve first-class honours in administration and accounting.
For Akyianu, the problem is with perception and access. “When I travel to places, even when I travel to South Africa, I am always asked if I studied abroad. Some believe that, with my expertise, I couldn’t have been completely schooled in Ghana. But I was and I can hold my own against any others who have studied in Europe or in the US,” she says. “But I do agree that not all Ghanaians will have the same opportunities that I had. I was one of the lucky ones. We cannot hide from the fact that more people could be better educated in Ghana and that literacy levels aren’t as high as they should be. But the human capital deficit is exaggerated. There are plenty of talented individuals on the continent.”
With the diversity of our rising stars, one thing they are keen to point out is that Africa is by no means a homogeneous region. The continent is neither a resounding success story of inclusive economic development nor completely war-torn, riddled with disease and stricken by poverty. “Africa is made up of 54 very different countries all at different stages of development,” explains Akyianu.
“People assume, a lot of the time, that because I hold a senior position at an African bank, I am the authority on Africa. I’m not. I know a lot about Ghana, a country which may or may not share certain characteristics with its neighbours.” Language is one of the easiest examples to prove the point: While western Africa is dominated by French-speaking countries, this is no hard and fast rule. Ghana, for instance, uses English as its official language, which can make communication with its neighbours difficult. Equatorial Guinea lists Spanish and Portuguese as well as French as its official languages.
“The one key mistake you can make about sub-Saharan Africa is to assume anything,” says Pohl. “Africa is made up of credible, bright and sophisticated people that are transforming the economy and transforming lives. It’s just that some of them are still finding their feet.”
Understanding the nuances within the continent and the increasing number of unique opportunities it has to offer makes for a successful career in Africa – qualities that thoroughly characterize all of
Euromoney’s rising stars.