Young Malian talks about impact investing in francophone Africa
Issam Chleuh is the 27-year-old Malian national and founder of the Africa Impact Group, an advisory, research, data and news service provider that specialises in impact investing in francophone Africa. Impact investing refers to investments made into companies or funds with the aim of generating a social or environmental impact, alongside financial returns.
In 2011, Chleuh was responsible for launching an impact investing task force at EY while working in the firm’s Boston office. In April 2012, he left the company and moved to the Republic of Congo to launch Africa Impact Group. He has since assisted companies, such as the Dangote Group in the Congo, with their corporate social responsibility (CSR) projects, philanthropy and private capital to develop impact investing business models and initiatives.
Chleuh, who grew up in various countries across francophone Africa, told How we made it in Africa about investing in the region and why he sees an opportunity for entrepreneurs to be innovators in Africa’s French-speaking countries.
Where do you see investment potential specifically in francophone Africa?
We are interested in what we call impact industries: agriculture, education, health, real estate, energy, water, social entrepreneurship, microfinance, etc.
In addition to these, two areas of focus of ours are CSR and digital impact investing. We believe CSR holds huge potential to boost socio-economic development in Africa and beyond. Also, we believe there are tremendous market and impact opportunities at the intersection of mobile technologies (phones, apps, etc.), disruptive innovations, impact investing and youth entrepreneurship. This is what we call digital impact investing.
Are there business challenges that are unique to francophone Africa?
Francophone Africa is lagging behind anglophone Africa. This is a fact. Francophone Africa accounts for only 19% of sub-Saharan Africa’s average GDP while anglophone Africa (excluding South Africa) accounts for 47%. When we look at the World Bank’s Doing Business report, the English countries always rank more favourably than the French ones: it is easier to start a business or obtain payment from debtors, for instance.
There are various reasons – or hypotheses should I say – to explain this. I personally think the English were better colonisers than the French. But this is my opinion.
What do you think are some of the common misconceptions surrounding business and investment opportunities in francophone Africa?
The main perceptions and myths surrounding business and investment opportunities in francophone Africa is that some investors think they are not worth investing in. Most investors would rather invest in anglophone countries, especially in the ones experiencing the highest growth: South Africa, Nigeria, Kenya and Ghana to cite the main ones.
These perceptions and myths are slowly becoming overrated as we see more and more investors entering these markets. With countries like Côte d’Ivoire back on the map after a decade of political instability and the visionary leadership of its leader, investors are rushing in to Abidjan for deals. Democratic Republic of Congo is a country that is receiving and will receive more and more investments as it has tremendous natural resources. Also, Kinshasa is the third largest urban area in Africa after Cairo and Lagos and the second largest francophone urban area in the world after Paris.
Africa has always been victim of the perception-reality gap, and francophone Africa particularly. People perceive Africa or francophone Africa in a certain way, but the reality is actually different. The good thing is this gap is narrowing and investors appreciate the opportunities in these markets.
What are some of the challenges you faced starting the Africa Impact Group?
We faced a couple of challenges in the early stages of the organisation. First, the biggest challenge was how to start and grow a pioneering organisation in a brand new field. We had no precedents. Like Harvey S Firestone said, “the way of the pioneer is always rough”. We are pioneers.
Second, how to build a name and generate a pipeline of clients, entrepreneurs and potential investments with limited funding. The way we were able to address these challenges is through resilience and never quitting. We had to complete pro bono work for potential clients to judge our capabilities. Also, we have invested in business development by attending various relevant events (forums, conferences and roundtables, among others) to build a network and source deals but also to keep aware of the latest developments in finance, development and Africa.
Do you have any advice for entrepreneurs in Mali, or francophone Africa in general?
Dare to risk and innovate. In the developed world, it is hard to come up with innovative business ideas to address market needs. Every need seems to have been addressed, at least for the most part. This is the feeling I have walking in the streets of Boston. However, when I am in Bamako, Brazzaville or Bujumbura, ideas keep popping in my head. I am sure you too have experienced the same thing. This is why my first advice is dare to innovate in Africa. If you do not do so, a fellow Chinese, American or French entrepreneur will do it. As a result, the idea you have spent the last couple of years working on, could already be brought to market in your own country. I am sure it will make you mad.