Our Approach

Successful introduction of technologies into markets requires a holistic concept. After many years of practical experience in African markets we have identified Six Keys to Success:

1. Technology

Identify technologies solving key problems in Africa and select the right technology partners. There are four possible situations:

  • Proven technology – existing market
  • New technology – existing market
  • Proven technology – new market
  • New technology – new market

    • Existing market means many products from many providers competing with each other. Intense competition, crowding out and low profit margins characterize this environment.
    We introduce proven and new technologies into new markets, where these or comparable technologies have not yet fully penetrated a given territory, or is not yet present at all. This means low competition, few market players and high profit margins, which offset by far the obstacles a first mover typically needs to consider. It is a lot easier to compete against non-consumption than against entrenched rivals.

    2. Market

    Deep knowledge of countries and local presence in them lead us to select the best target markets for introducing a given technology.
    At the same time, we detect local needs for specific technologies and create partnerships with the best relevant technology providers.

    3. Access

    Accessibility is key:

  • Access of the technology to the market
  • Access of users to the technology / its products
  • Access of the company to finances
  • Access of investors to the investment target via appropriate investment vehicles

    • Creating simultaneous access along all four dimensions is at the core of our mission.

    4. Business model

    Each business requires the right business model for success. A good business model will carefully consider:

  • Production: Control as many parts of the value chain as possible.
  • Processes: Should be as simple as possible.
  • Pricing: The technology must be affordable for the local people.
  • Profit: The margin of the business must be big enough to buffer time delays and adverse market conditions.

    • We are focusing on resilient business models that can easily be adjusted in face of changes in the business environment. Our forecast for economic, political and financial developments suggests:

  • Focus on “must have” and avoid “nice to have”.
  • Choose sectors such as water, food, energy, healthcare, security, and housing. They are nearly immune against escalating financial crises.
  • Prefer hard assets over financial assets when investing surpluses.
  • Keep it simple. Reduce complexity to a tolerable minimum.

    • A portfolio of such resilient businesses is the best safeguard against adverse developments in an increasingly fragile world.
    Direct investments in such opportunities, grouped together in a well-balanced financial portfolio, are Resilient Investments.

    5. Financing

    In Africa, lack of financing is the most important limiting factor of business development. This scarcity of cash can be seen everywhere in Africa. The converse argument is that if you do have cash in Africa, you are leading the pack.

    Properly financed projects can gain momentum very quickly in this environment and deliver superior ROI.

    There are four major sources of financing:
  • Equity: The investor gets shares of the investee company and participates in the corporate profits.
  • Debt: The lender becomes a creditor of the borrowing company and gets interest on the loan.
  • Grants: The donor is giving money which the company does not have to pay back.
  • Alternative sources: I.e. barter contracts, asset collateralization, dealing with alternative currencies; non-financial capital.

    • Within the classical sources of financing, there are also some transient forms:

  • Convertible loans; profit-participating loans; silent partnership; mezzanine capital (intermediate between equity and debt)
  • Subsidized loans; no-interest loans (intermediate between debt and grants)
  • Impact equity; social investments (intermediate between grants and equity)
    • We primarily focus on equity investments, and on combinations of equity with the other sources.

    6. People

    We operate our businesses in Africa from Africa. Our key persons have comprehensive market expertise and dispose of excellent contacts in business and politics in more than 30 countries. Furthermore, we are well connected in Germany, Switzerland, Austria, Sweden, the United Kingdom, Israel, the United States, and the United Arab Emirates, among others.
    Our permanent local presence enables us to develop, lead, and monitor our various business activities from short distance.
    In Africa, relationship precedes business. Trust networks play a vital role in African business. We have invested many years to build strong relationships with our key people. We are family. Regarding people and connectedness, we have a solid foundation for conducting our various businesses and for developing new projects.
    Africa is our passion and we want to make it the passion of our clients, too.