Moove, Flutterwave and LemFi: Inside Silverbacks Holdings Investment Strategy with Nana Appiah Korang

[00:00:00] [SPEAKER_00] You're listening to the Unlocking Africa Podcast.

[00:00:03] [SPEAKER_01] I got my start at Goldman. That was the first time that I experienced the investing world. Second Act founders are typically serial entrepreneurs. So folks who have built two businesses, three businesses, sometimes those businesses have failed, but they've picked up, they've learned from those lessons and they've gone on to build something else. We are continuing to tap into that export story. That's how we think about our sectors going forward. And I think for us,

[00:00:33] [SPEAKER_01] it's really visibility, putting the information out there so people can see the businesses that are

[00:00:38] [SPEAKER_00] coming out of the continent. Stay tuned as we bring you inspiring people who are unlocking Africa's economic potential. You're listening to the Unlocking Africa Podcast with your host, Terser Adamu.

[00:00:54] [SPEAKER_02] Welcome to the Unlocking Africa Podcast, where we explore the ideas, innovations and strategies unlocking Africa's economic potential. Today, we're examining what it takes to identify Africa's future category leaders, generate meaningful returns and build an investment portfolio capable of competing globally. My guest today is Nana Appiah Korang, Chief Investment Officer and Executive

[00:01:23] [SPEAKER_02] Board Director at Silverbacks Holdings. Nana has built an extensive career spanning private equity, entrepreneurship, portfolio management and institutional investment across Africa. She is also the founder and executive director of Amayi Foods Limited. Nana, welcome, welcome, welcome to the Unlocking Africa Podcast. How are you?

[00:01:47] [SPEAKER_02] Very well, Tessa. Such a pleasure to be here with you and really looking forward to our conversation. Me too. And it's a pleasure to have you on the podcast. And as always, I like to start from the beginning. So I was hoping you can give us a nice introduction into who Nana Appiah Korang is.

[00:02:06] [SPEAKER_01] Okay, great. So maybe what I'll do is I'll take you a bit back in terms of my journey and how it started. I think it'll give a good picture of who I am. So I really can't start talking about my journey without talking about my high school in Ghana. So born and bred in Ghana, I went to a school called SOS Henman Minor International College. The motto of the school was knowledge in the service of Africa.

[00:02:33] [SPEAKER_01] And, you know, as a 14 year old, you don't really understand how that experience will shape your life. But as I've come to realize, it really was the foundation on which I've built both my personal life and my career. So after high school, I came to the US for my education. I went to a women's college in Massachusetts called

[00:02:56] [SPEAKER_01] Mount Holyo College, where I got a maths degree. After college, I worked at Goldman Sachs, where I was introduced to third party capital investing through a group called the Real Estate Principal Investment Area. I enjoy the work, particularly fundraising, but I really wanted to explore opportunities in Africa, going back to the motto of the school, acquire this knowledge and use that knowledge to serve the

[00:03:23] [SPEAKER_01] continent. So just as I was finishing my second year at Goldman, I found out about an opportunity at a firm called Emerging Capital Partners. And I applied for the job and I got the job, thankfully. ECP at the time was one of a handful of African private equity firms, which later became one of the largest. I think at the height of it, it had about $3 billion of assets under management.

[00:03:52] [SPEAKER_01] I spent a total of 16 years at ECP. And my experience with the firm included fundraising, you know, finding companies who are investing, helping them grow, and ultimately selling them off. And you see how that ties into my current role. And I want to step back a bit and talk about the fundraising. So during fundraising, I noticed that there were not a lot of African institutional

[00:04:20] [SPEAKER_01] investors around the table. Most of the capital at the time was coming from outside the continent, right? Around that same time, I also found out about the Commonwealth Secretariat. They were conducting alternative investment sessions for African pension funds to encourage diversification of their investment programs, which I found very interesting. So I jammed on that bandwagon to help them educate the pension funds. I subsequently engaged with SNITS, which is the Ghanaian pension fund and worked

[00:04:49] [SPEAKER_01] closely with the management team and board to get a $10 million commitment for one of ECP's funds. So very, very, very excited about that opportunity. At the time, there weren't a lot of approaching pension funds for capital. So that was, you know, a first mover. Yes. You could call it that. So now I sit on the IC of a fund who has several local pension funds as

[00:05:16] [SPEAKER_01] investors. And for me, it is truly a special full circle moment. So just to go back to the ECP experience, I said I was there for 16 years, the last 10 of which was in Nigeria. And I mentioned Nigeria because it was also another pivotal point in my career. It was in Nigeria that I co-founded a company called Amayu Foods Limited with two women, Kutsai Hovei, Onome Alu. Kutsai actually worked with

[00:05:42] [SPEAKER_01] me at ECP. And Amayu Foods, it's a woman led innovative food systems platform. You know, sort of to round off my experience, I sit on a number of investment committees, a number of which are actually led by African women, very deliberate on my part. I also sit on local currency platforms in Ghana, again, deliberate on my part. I think

[00:06:05] [SPEAKER_01] if we're going to shape the continent or build the ecosystem, we have to have a diversity of platforms, right? And a lot of these platforms that I see that I sit on are deploying capital to SMEs. So now we come back to Silverbacks Holdings. So I'm presently the CIO, the Chief Investment Officer for Silverbacks Holdings. And for the audience who's listening, who may not know who we are,

[00:06:31] [SPEAKER_01] we are a private alternative investment firm. We were founded in 2019 in Mauritius. What we do is we back African born high growth and export oriented businesses in sectors like tech, sports, entertainment, and the broader creative economy across the continent. And in terms of what I do, again, going back to

[00:06:57] [SPEAKER_01] my early beginnings at ECP, I run the full investment engine from end to end origination, execution, portfolio management, exits and fundraising. And it's really such a pleasure to be able to bring the plethora of experience I have over the last 25 years to this role. So in a nutshell, that's who I am.

[00:07:19] [SPEAKER_02] Fantastic. Extremely impressive. You've given us a nice, I guess, walk through into your personal and professional life experience, which obviously has brought you into the world of investing. So just to take a few steps back, was there something specific that attracted you to the world of investment?

[00:07:39] [SPEAKER_01] You know, so I got my start at Goldman. That was the very first time that I experienced the investing world. And I think what was interesting to me was the idea of investing third party capital, right? The idea of fundraising from investors and investing that capital and having the authority to be able to

[00:08:07] [SPEAKER_01] determine what that investment plan or strategy would be. I think that was interesting. So for me, at that point, after the first two years at Goldman, I knew I wanted to remain in the investment world, but I wanted to figure out how it was done on the African continent. So that's how I got into the investment space. And I think the 16 years I spent at emerging capital partners further deepened my

[00:08:36] [SPEAKER_01] experience in the investment world. And as you can see, I haven't left. I'm still very much in it.

[00:08:42] [SPEAKER_02] Still here, still heavily involved. So having worked across a global finance and now African private equity, was there anything that you had to unlearn when you began, say, assessing businesses operating

[00:08:55] [SPEAKER_01] within African markets? I wouldn't say I had to unlearn anything. Again, as I mentioned, this was pretty much at the beginning of my career. So it was more learning, learning to understand the climate, learning to understand how businesses were done on the continent, really understanding how businesses were built, what makes a business successful on the continent. How do you actually

[00:09:24] [SPEAKER_01] evaluate if a company was deserving of the investment capital that we had to deploy? So I wouldn't say, given that it was very early on in my career, I wouldn't say there was a lot of unlearning. I think it was really learning, really appreciating the diversity of opportunities on the continent, really appreciating the wealth of human capital that was on the continent, and also really appreciating

[00:09:54] [SPEAKER_01] the fact that we can build things on the continent. And as you can see within our Silverbacks Holdings portfolio, not only can we build things on the continent, we can actually export what we build

[00:10:07] [SPEAKER_01] on the continent globally. So I think for me, that has been a very interesting career. I thoroughly enjoyed my time at ECP. I thoroughly enjoyed building a business on the continent. I think once you become an entrepreneur, you fully appreciate other entrepreneurs and what they strive to do as a vision and the strategy, etc.

[00:10:30] [SPEAKER_01] etc. And I think, you know, being at Silverbacks Holdings right now, I am continuing the learning, right, and continuing the opportunity to continue to create value on the continent and beyond.

[00:10:46] [SPEAKER_02] As you mentioned, you are also a founder of MIE Food. So how has building a company yourself maybe changed the way you assess founders?

[00:10:57] [SPEAKER_01] Yes, that is a great question. And, you know, I keep saying that I wish I had actually done entrepreneurship before going into investing, because you have a deeper understanding of what it takes to build a business, right? It's such a humbling experience. You sit on the other side of the table from investors, you're making decisions around managing working capital,

[00:11:26] [SPEAKER_01] you're making decisions around hiring, you're making decisions about firing, you're raising money to be able to build a business. And you're dealing most importantly with other people's livelihoods, right? You have employees that you have to worry about.

[00:11:43] [SPEAKER_01] And you're living through the pressure of hard pivots at times, when a strategy that you're putting in place does not work. Sometimes you have to be able to pivot and change course if that's what's needed. And we have lived through that at MIE.

[00:12:00] [SPEAKER_01] I think it builds resilience. And coming to this role at Silverback's Holdings, those are the kind of founders that we're looking for. We typically say that we're looking for second act founders. We have five pillars through which we look to select or assess the companies that come across our desk.

[00:12:21] [SPEAKER_01] And one of the pillars is that we're looking for second act founders. And we say this because experience is really the best teacher. I'm sure you've heard that saying many, many times. And we believe that founders who have been able to go through that pressure, who have been able to pivot, who have potentially even failed, right? And picked up are the kind of founders that we want to back.

[00:12:50] [SPEAKER_01] And in our portfolio, if you look at our portfolio, most of the companies that we back are founded by second act founders. And so as an entrepreneur, I bring those learnings, those skills, those know-how to the table in terms of how we select and how we assess businesses and founders that we want to work with.

[00:13:10] [SPEAKER_01] And that has been very, very useful. I definitely empathize. I definitely understand. I definitely understand the pain points. And I think it goes a long way as to how we assess our founders and how we work with them.

[00:13:27] [SPEAKER_02] So you mentioned something interesting there in terms of second act founders. So for people listening who aren't familiar with the term, can you please explain?

[00:13:35] [SPEAKER_01] So second act founders are typically serial entrepreneurs. So folks who have built a business, two businesses, three businesses, sometimes those businesses have failed, but they've picked up, they've learned from those lessons and they've gone on to tweak and build something else. And so that's what we mean by second act founders. We are looking for founders who have been in the trenches, have stuck with it, are resilient, don't give up.

[00:14:04] [SPEAKER_01] Founders who use whatever difficult or challenging situations to pivot and figure out the next play or the next company, I would say. So that's what we mean by second act founders.

[00:14:16] [SPEAKER_02] I guess that feeds into what you mentioned about resilience. I know investors often celebrate resilience in African entrepreneurs, but also resilience can also maybe disguise structural problems that should not be normalized. So how do you distinguish between, say, a founder who is resourceful and one whose business model is maybe absorbing something that's unsustainable?

[00:14:43] [SPEAKER_01] Mm-hmm. I think it all boils down to the due diligence that we do. And I'll probably go to our five pillars. So these five pillars are the standard that we use to evaluate businesses that we invest in. And I think when we follow these five pillars to the T, it helps us figure out, OK, the companies that are truly resilient or, as you said, companies that are potentially masking.

[00:15:11] [SPEAKER_01] So in terms of the five pillars, like I mentioned, we really look for second act founders. We're looking for founders who've already lived through an inflection point. We believe that founders who have done that are able to recognize the next one faster. One thing that we've come to appreciate is that the shame around being wrong or around pivoting is one of the most destructive forces for a founder. And so we look for people who've already learned to manage that pressure at least once.

[00:15:39] [SPEAKER_01] So a founder who has built several businesses, like I said earlier, potentially has failed, et cetera, but has bounced back and using those learnings to build other businesses. Number two, we're looking for businesses that have customers who have become investors. We're looking for corporate customers who have turned into investors because we believe that this is the biggest form of validation.

[00:16:08] [SPEAKER_01] If you have a customer who was on your P&O who has such an amazing experience with your products or your services such that, you know, they move on to your cap table. So this is a huge validation and we see this in a number of our portfolio companies. We have Uber, for instance, on the cap table of move. Uber started as a customer. Now Uber is on the cap table of move.

[00:16:32] [SPEAKER_01] We have other examples like Visa, MasterCard, you know, with Flutterwave. And then also we have Tether with a portfolio company called Lemphime. The other thing that we look for, and I think this one in particular is a very hard screen. We're looking for businesses that have had sustained growth over a three year period. And I think this is this directly addresses the question that you asked.

[00:16:59] [SPEAKER_01] So we're looking for businesses that have grown 60 percent year on year over that three year period, because at the end of the day, we're not looking at just one single good quarter. We're looking at backing a proven momentum. Right. And then the other thing that the fourth pillar that we look at is export oriented and hard currency revenue.

[00:17:25] [SPEAKER_01] So we typically want to have businesses to have at least a third of the company's revenue invoiced in hard currency. As I'm sure you know, local currency volatility, and I've lived through this as a private equity investor, can erode dollar returns. So you can build a pretty fantastic business operationally and local returns fantastic.

[00:17:51] [SPEAKER_01] But the dollar returns, depending on when you exit and depending on the volatility of the local currency, can erode part of the dollar return. And so we insist that the companies that we back have exports oriented business to it and obviously bringing in hard currency at least 30 percent of that. And then the last pillar is we're backing, as I said earlier, we're backing Africa origin companies.

[00:18:20] [SPEAKER_01] We're backing companies that are birthed on the continent, but companies that have a well articulated vision or strategy to expand globally. And so, again, Move, as I mentioned, is backed by Uber. Move started in Nigeria. But today, Move is operating across 29 cities in five continents. Move, right.

[00:18:48] [SPEAKER_01] So those are the five pillars that we use to evaluate the businesses that we invest in. And if you look at the five pillars, it definitely results in a very narrow approach. But for us, it's a very deliberate approach because it helps us to really target those resilient founders and companies I talked about earlier.

[00:19:09] [SPEAKER_02] Fantastic. So you've taken us through the silverback pillars. And I know part of that is that you describe yourself as backing outliers capable of becoming category leaders. So what does an outlier look like before the rest of the market actually catches on or recognizes it?

[00:19:30] [SPEAKER_01] So I think there are three things that we're looking at for those outliers. And this is our strategy in terms of our investment thesis. Number one, we're looking at technology enabled businesses or platforms. That's number one. Number two, as I mentioned earlier, we're looking at export oriented hard currency revenue businesses. And number three, we're looking at our ability to follow that business.

[00:19:59] [SPEAKER_01] We're looking at concentration. So we start off small. What we do in terms of our strategy is we typically will back fund managers. We work with about nine fund managers. We invest in those fund managers and we have the opportunity to look through their portfolio and figure out which companies are interesting.

[00:20:28] [SPEAKER_01] And so that's how we do the concentration. And as we look through the portfolio companies of the funds, we're able to do co-investments with the funds. And so we're able to back the companies in their portfolio that we believe are going to be an outlier or are going to be able to scale. And once we've done those co-investments, we have a direct link with the company.

[00:20:55] [SPEAKER_01] And we are able to further engage with the company. And once we are convicted that this company is going to be able to scale or this company meets our five, all of our five pillars, we then double down on that position. And so that's exactly what happened with Mo. For instance, we started off with a $750,000 check initially.

[00:21:18] [SPEAKER_01] And then once we were convinced of its potential to scale, we doubled down with a $30 million check. So that's how we work to spot outliers for our portfolio. So it's a very deliberate approach. There are a couple of things that we were looking for. It definitely has to have that technology ability. It definitely has to have that revenue, hard currency revenue, the export-oriented facing opportunity.

[00:21:48] [SPEAKER_01] And then we also set ourselves up in such a way that we are able to follow any companies that we think have the markings of what we want in our portfolio companies. And follow them through the funds that we invest in. We then do the co-investments. And then once we're really convinced of the scale, we then double down directly and work with them to create value.

[00:22:15] [SPEAKER_02] As you mentioned, your investment theory prioritizes technology-enabled companies that can capture export-oriented revenue in hard currency. Does this risk directing capital away from businesses that are serving, say, essential domestic needs? Or is hard currency revenue now kind of necessary for building resilient African companies?

[00:22:41] [SPEAKER_01] Look, I think we, I mean, I just want to caveat that this is the space that we have decided to play in. And then we, maybe I'll give you a bit of history in terms of how Silverbacks came to be. And I think you have a better understanding of how we decided to invest in these sectors.

[00:23:02] [SPEAKER_01] So about a decade ago, Africa had entered, if you, I'm sure if you recall, about 10 years ago, Africa had entered into an interesting fintech era. We had a number of young entrepreneurs who were actively starting companies and looking for capital to scale. So what we started doing, we started writing personal checks to support some of the early funds. And these are some of the funds that I'm talking about. Some of the early funds that were investing in some of these businesses.

[00:23:30] [SPEAKER_01] You know, it really gave us the opportunity to follow activity in tech broadly. And this evolved into media. It evolved into sports. It evolved into the broader creative economy. This also allowed us to do the co-investments, like I said. It allowed us to do the direct investments. And for us, we decided that this space was a space that we wanted to double down on. Right.

[00:23:58] [SPEAKER_01] As I mentioned, I sit on a number of investment committees. And those funds are doing your regular, you know, whether it's manufacturing, whether it's agri, whether it's climate. So those funds that I support are investing in those kind of sectors. But for us at Silverbacks, it's a very deliberate strategy. We have seen that it has worked well for us in terms of how we started out.

[00:24:23] [SPEAKER_01] And we have decided that we are going to stick to these particular sectors. The other thing, too, is that if you look at our portfolio, there's one common theme that you see across our portfolio. And that's export. Right. And at the end of the day, for us, if you look at the African story in general, I mean, historically, Africa has always exported, whether it's oil, whether it's gas, whether it's agriculture, you know, you name it.

[00:24:53] [SPEAKER_01] And for us, we see that the exports story continues. However, what is new is that we're seeing different sectors, you know, enter this export story. So, you know, you have fintech, you have the creative content, you have fashion, you have sports, you have media.

[00:25:13] [SPEAKER_01] Right. And I think what we're seeing that's making this export moment in these sectors possible is technology and media. We're seeing rising mobile penetration, digital payments, the AI tools. It means that, you know, businesses can reach global markets faster than ever. So for us, we are continuing to tap into that export story.

[00:25:40] [SPEAKER_01] But we're tapping into that export story with different sectors that have traditionally not participated in the export story. So that's how we think about our sectors going forward.

[00:25:51] [SPEAKER_02] If we look closer at the sectors that are silverback investing, technology, sports, entertainment, fashion and the wider creative economy, what would you say connects these sectors economically?

[00:26:07] [SPEAKER_01] So I think I'll go back to my previous point in terms of the export. If you look across our whole portfolio, it's what connects all our sectors together is really exports. It really comes back to exports. And it comes back to building an ecosystem of backers who believe in our approach.

[00:26:26] [SPEAKER_01] So I've already touched on the export story in terms of us being able to export the products and services of the companies that we support. Maybe I'll use Lemphi as an example. So Lemphi is an international payments platform. It serves North America and Europe. As I mentioned earlier, it's backed by Tether.

[00:26:51] [SPEAKER_01] And what Lemphi is doing is really providing services and products for the diaspora community. Right. So you have Lemphi. For instance, if you're sitting in London or the US and you look at it, you know, as an immigrant, you're looking to send money back to Nigeria or Ghana. Lemphi allows you to be able to do that. It's really in the space of MoneyGram or Western Union, but doing it in a way that is less fees

[00:27:21] [SPEAKER_01] and also doing it in a way that you can just download an app and log in, connect your bank accounts and able to send money fairly easily that way. So, you know, I think that is what is very common with our sectors in terms of technology, in terms of being able to export products and services beyond the African continent,

[00:27:47] [SPEAKER_01] and also really being able to attract backers, investors who believe in what we are doing and helping us to accelerate our platform.

[00:27:58] [SPEAKER_02] You mentioned Lemphi. I know Silverback reports partial exit multiples, including approximately, was it 29 times from Lemphi, 24 for Floaty Wave and 5 for Omni Retail. So what did Silverback recognize in these companies that other investors may have maybe overlooked at the time?

[00:28:21] [SPEAKER_01] It really goes back to our strategy and how we look at businesses and how we invest over time. I think our model of starting small or working with funds to really have access to a wide range of opportunities has allowed us to pick and choose or at least follow the companies that we think are going to be able to scale.

[00:28:50] [SPEAKER_01] For us, that has worked quite well and will continue to do that. I think it's also based on our own experience in terms of how to, you know, figure out companies, what companies are doing, how they are growing their strategy, how they are thinking about strategy. If you take Lemphi, for instance, you know, coming up with a solution for immigrants or for the diaspora,

[00:29:15] [SPEAKER_01] it's for us quite genius because up until then, you have companies like MoneyGram or Western Union. Lemphi was founded by, you know, Africans and they're providing solutions that work for the local market. They're providing solutions that work for the diaspora markets. And interestingly, once those solutions work for, you know, certain markets, you can actually deploy those solutions to other markets.

[00:29:45] [SPEAKER_01] And I make that case with Lemphi. Lemphi started off with remittances to mostly Nigeria, Ghana. Today, Lemphi is doing 70% of remittances to Ghana and 30% to Asia, to Thailand, to Philippines and to China. So it's really about backing investors who see a problem and try to solve that problem locally

[00:30:14] [SPEAKER_01] and then export those solutions to the diaspora and even export the solutions globally. And I think for us, that's what we look for. We look for founders and companies that are solving problems, but problems that exist otherwhere in the world. I mean, MOVE is a similar example as well. MOVE is really democratizing vehicle ownership. It started on the continents, Nigeria, Ghana.

[00:30:42] [SPEAKER_01] But vehicle ownership is not a problem that's peculiar to the continents, Nigeria, Ghana, etc. It's a problem, it's a pain point that exists in other markets as well, whether it's Mexico City, Mumbai, what have you. And so MOVE has therefore been able to export the solutions that have worked well on the continent to other markets. And so those are some of the themes that we look for in terms of selecting our businesses and founders.

[00:31:12] [SPEAKER_02] Interestingly, a lot of your exits have been partial rather than, I guess, complete or full exits. So how do you decide when to take money off the table whilst also retaining some type of exposure to a company's future growth?

[00:31:28] [SPEAKER_01] So, you know, one thing that is important to our strategy is liquidity because that is important. And then, you know, our strategy is also a secondary strategy. We're very comfortable doing secondaries. And so when there's an opportunity to take money off the table, we do that. We're very comfortable exiting an investor that has expressed the interest to be exited with an investor who wants to come into the investment.

[00:31:57] [SPEAKER_01] And so we do that very comfortably. And that is how we've been able to do the partial exits. However, until we see the business scale to the level that we underwrote, we typically would stay and be able to do the full exit at a time. And so if we see the opportunity, we're very opportunistic. If we see an opportunity to do a partial exit at a favorable valuation, we would do that. Lemphi was a partial exit.

[00:32:26] [SPEAKER_01] Flatterway was a partial exit. We've also had a partial exit of 5.1 times. But our goal is we back these companies. We see that the scale to be achieved, see that these companies are continuing to grow. And so we stay and have a full exit at the appropriate time when it makes sense.

[00:32:48] [SPEAKER_02] You've managed to have several successful exits, but we know that African venture capital is often criticized for producing impressive funding announcements, but very few exits. Do you think the continent is facing an exit problem? Could you call it that?

[00:33:09] [SPEAKER_01] Look, I don't think the continent is facing an exit problem. I think it's really a disclosure problem. You know, if we look at recent data, I think in the last year, Africa recorded 81 exits. And this was a 27% increase year on year. And most of these exits were within, I think the holding period was less than seven years.

[00:33:35] [SPEAKER_01] So I think really the issue is the disclosure, the information out there on the continent in terms of the deals that are being done, the exits that are being done, the transactions that are being done. And so that's one of the reasons why we have built our own media infrastructure at Silverbacks. I'm sure you're very familiar with our podcast, In the Valley.

[00:34:01] [SPEAKER_02] Yes.

[00:34:02] [SPEAKER_01] It has drawn 34 million views. We have a weekly newsletter, which has reached over 150,000 views just last year alone. And we didn't build In the Valley for visibility. We built it because we wanted to control the narrative, right? We want to, you know, we believe that narrative is economic infrastructure, as you know.

[00:34:28] [SPEAKER_01] And we also believe that the stories that are coming out of our portfolio and that are coming out of our continent, we completely believe that they need to be seen and they need to be heard and they need to be communicated properly. And so for us, that's our goal. As you can see, we communicate our exits very openly. And I think we need to do a lot of that. We need to really communicate what's going on on the ground. We need to change narrative.

[00:34:56] [SPEAKER_01] We need to really change the perception of what it looks like to do business on the continent. I'm not trying to create a rosy picture of things, you know, everything is perfect. That is not what I'm trying to paint. But I guess the simple answer is no, I don't think that there's an exit problem at all.

[00:35:20] [SPEAKER_01] You know, the other point is the data shows that on average, investments are being held for about seven years or so. And that is also at par with global levels, right? Global standards. So I think we need to be able to demonstrate that the exits are there. The opportunities are there. Africa is a very attractive continent and we need to change the narrative. And so that's what we seek to do with our podcast.

[00:35:51] [SPEAKER_02] Fantastic. And I guess from the podcast, what benefits would you say or what value would you say having your own independent media platform has provided?

[00:36:02] [SPEAKER_01] I think it has really given us the opportunity to showcase our founders and our companies. It has also given us the opportunity to talk about what we're doing. I think the evergreen model, the secondaries, not has not.

[00:36:22] [SPEAKER_01] We see a shift now currently in the ecosystem, but it hasn't typically been a model that has been run on the continent. Right. So in terms of secondaries and in terms of the evergreen model. And so it's really exciting to have a platform to be able to demonstrate the benefits of having different models for the continent.

[00:36:47] [SPEAKER_01] And I think our podcast, we seek to show what we're doing and how we're doing it and the successes that we're having. And more importantly, as I mentioned before, it's a great platform for our portfolio companies and it's a great platform for the ecosystem in general.

[00:37:04] [SPEAKER_02] So having the opportunity to showcase your portfolio companies, how much would you say that would contribute to the exposure, maybe the valuation of those companies? Or is it hard to quantify that?

[00:37:16] [SPEAKER_01] I think it's difficult to quantify that. I think visibility is great for our businesses. I think it's a great opportunity to expose our businesses and our founders to further investments. It gives us the opportunity to really showcase the vision, the strategy. And also it gives the opportunity to showcase the people themselves.

[00:37:41] [SPEAKER_01] Right. I think it's so powerful to be able to hear from a founder directly, particularly when they're not necessarily pitching to you, but they're just telling you what they're doing and how they're enjoying building their businesses. So I think visibility has been fantastic, but it's difficult to quantify, you know, valuation. And that's really not the goal, right? To be able to influence valuation.

[00:38:08] [SPEAKER_01] I think for us, it's really visibility and putting the information out there so people can see for themselves the businesses that are coming out of the continent.

[00:38:16] [SPEAKER_02] So going back to Silverback's theory and ambition, I guess one company that appears to embody that ambition is Move. Silverback has invested more than 30 million in the company. Yeah. And also recently participated in its $250 million Series C round.

[00:38:36] [SPEAKER_00] Yes.

[00:38:37] [SPEAKER_02] So what actually gave you the conviction to be so bullish in terms of your investment or backing of Move?

[00:38:44] [SPEAKER_01] Yes. Again, I think going back to our strategy, I mean, as you already know, Move was founded by Jide and Ladi. They've done a phenomenal job. Move started in Nigeria. Today it's in 29 cities. And it's important to note that it's also in five continents. For us, we've put a total of $37 million into the company cumulatively.

[00:39:11] [SPEAKER_01] It's our largest single asset investment with the $30 million follow-on that we did as part of Series C. And today that position is marked at $62 million based on the current valuation. And as I mentioned earlier, we've achieved a partial exit of five times already.

[00:39:37] [SPEAKER_01] And so what was interesting, I think, again, I go back to the five pillars, right? Second, Act Founder check. Go back to the hard currency revenue, at least 30%. That was evident when we wrote our first check. Also, in terms of the customer experience, that was also evident. Uber started off as a customer, but Move quickly became an investor.

[00:40:07] [SPEAKER_01] That was very important. I think the other thing that was very important to us was, again, I mentioned as part of our pillars, this articulated vision to be a global company or at least to expand or to export services outside the continent. That was a well-articulated strategy for Move. And I think for us, that's what led us to write our initial check.

[00:40:36] [SPEAKER_01] But even after writing that initial check, we wanted to be able to be convicted that Move could actually execute its strategy on a big scale. And once it did that for us, the next step was very easy for us. Writing that $30 million check was easy for us. So it really goes back to our strategy and really following through our strategy. And as I mentioned, we really stick to that strategy.

[00:41:03] [SPEAKER_01] So that, in essence, was what led us to double down on Move.

[00:41:08] [SPEAKER_02] By participating in the latest Series C round, I guess you're concentrating even more capital in a company where you already have substantial exposure. So at what point does strong conviction maybe risk becoming overexposure?

[00:41:27] [SPEAKER_01] So, I mean, there's always risk, right, when you're investing. So, but you take calculated risk. And for us, giving our knowledge of the business, you know, part of our work is to understand the business, to understand the market, to understand the viability of the scale of the growth.

[00:41:56] [SPEAKER_01] And again, I mean, like I mentioned, it's a calculated risk. And we're very comfortable with that risk. And so we double down on the businesses once we get to that point. And so for us, for Move, we're very comfortable doubling down with that $30 million check. We believe that the company is still going to experience growth based on its plans that we're privy to.

[00:42:25] [SPEAKER_01] And also, again, if we look at the investor base that they've been able to attract, it's also encouraging, particularly from an exit perspective. So we're very comfortable with that calculated risk that we're taking with doubling down on Move, for instance.

[00:42:46] [SPEAKER_02] And I guess connected to what you mentioned is what I find quite interesting about Move is that it began by addressing vehicle financing. Yes. But it's now kind of positioning itself as infrastructure for both driver-led and autonomous transportation globally. So would you say that's a natural evolution of the original business or is it something that's fundamentally different?

[00:43:10] [SPEAKER_01] No, I think it's definitely a natural evolution, right? I think it started off, as you mentioned, I think at the core of it is still democratizing vehicle ownership. But I think moving into AV, I think it's a natural evolution. That's where things are moving, right, in terms of the world, the economy. So I think it's definitely a natural evolution for the company.

[00:43:35] [SPEAKER_01] It's still deploying its strategy and expanding across products. But it is, for us, we see it as a natural evolution for the business.

[00:43:46] [SPEAKER_02] So if we go back to the beginning of Move, I know Silverback initially backed Move when it was still proving its mobility financing model. So what gave you the conviction to invest at that stage?

[00:43:59] [SPEAKER_01] As a management team, we've been in the investment space for a long time. And I think you are able to recognize trends, recognize know-how. For us, I think it goes right back to the second ACTS founder. For that, you know, we were very impressed with Jide and Ladi. I think also backing the various funds that we were in, you notice a trend.

[00:44:26] [SPEAKER_01] When you see four or more of the funds that you are backing, excited about a particular company, you take notice and you pay attention. And you figure out, you know, you learn for yourself. You do your own due diligence in line with your own set of strategies, right? And so for us, it was an interesting company to follow. And when we felt comfortable, we wrote that initial check.

[00:44:52] [SPEAKER_01] As you can see, it was relatively small compared to what we did later on. So for us, it was, OK, this is a company that is doing all the right things. It's in line with what we want to see a portfolio company do in terms of the sector. No mobility was very interesting to us. And so we put that initial check and we waited and we watched and we added value. We got to know the founders. We got to know the business.

[00:45:21] [SPEAKER_01] We got to understand the strategy in more detail. And like I said, at the right time, we doubled down with a $30 million as part of the Series C.

[00:45:29] [SPEAKER_02] So you also mentioned again in terms of backing the second Act founder. So what did you see in the move founders that gave you that confidence that they could achieve what they have achieved so far?

[00:45:42] [SPEAKER_01] Yeah, I think we saw resilience. We saw the desire to do something different. We saw the desire to grow the business across the continent, but also very early on, a well articulated desire to grow globally. I think we saw two individuals who were not afraid to do things that, you know, others probably thought were risky.

[00:46:11] [SPEAKER_01] And so that was very interesting for us as founders ourselves. I think you notice what somebody might call, you know, it takes a certain kind of person to do what the move folks have done or to do what LevFar is doing.

[00:46:31] [SPEAKER_01] It takes a certain kind of founder not to be deterred by potentially what others may deem as very risky business, right? And so for us, that was interesting. It was definitely an, oh, wow. Okay, let's see how these guys do.

[00:46:53] [SPEAKER_01] And very, very, very, very excited about what they've created, very excited about what the future holds for a move. I mean, if you look at the initial raise, they raised their Series A1 at a post-money valuation of $85 million, right? And at their last raise, which is the Series C, which just closed, it was at $2.1 billion.

[00:47:21] [SPEAKER_01] And this is all within a period of six years.

[00:47:25] [SPEAKER_02] So would you say they have achieved or surpassed what you initially expected them to achieve?

[00:47:32] [SPEAKER_01] Look, we definitely think that they have done very well. I think everybody would agree with that. But giving sort of where they want to be, I think that there's still growth that's to come. Fantastic. So we're very excited about, but they've built a solid foundation from which they can grow. I think the model has been tested. The model has been proven.

[00:47:59] [SPEAKER_01] The model has been proven that it can actually be deployed at scale. And so that's very exciting for what's to come in the next couple of years.

[00:48:07] [SPEAKER_02] If we were to have this conversation in, say, five to 10 years time, looking specifically at Silverbacks Holdings, where do you see the company? What impact will it be making within the Africa investment space?

[00:48:21] [SPEAKER_01] So I think in the next five years, I expect that we've been able to really demonstrate that there is a strategy around secondaries. I expect that we've been able to put together a vehicle to do that.

[00:48:39] [SPEAKER_01] And I expect that we've been able to also undertake some interesting exits for our investors to really prove the point that the strategy that we're rolling out works. Yeah, I think it's an exciting time for us as a team. Really exciting group of folks that we've put together to work on this strategy.

[00:49:07] [SPEAKER_01] And it's really an exciting time for us as well, giving some of the portfolio companies that we have still in our, you know, I've talked about Lemphi. I've talked about Wave. I've talked about, I mean, I have, we also have, you know, fashion investments. And the future looks good. The future looks good.

[00:49:32] [SPEAKER_01] And I'm very excited to be able to be part of this team to look at sectors that I personally had not invested in before in my previous career. But sectors that are equally impactful, sectors that are able to prove that African businesses can both expand on the continent and also expand globally.

[00:50:00] [SPEAKER_01] And, yeah, I think it's going to be an exciting time for Silverbacks Holdings over the next five years.

[00:50:05] [SPEAKER_02] Fantastic. And I look forward to seeing it taking shape. Last question. Quote of the week. As people, we often have, say, quotes, philosophies, mantras, affirmations that keep us going when times are difficult or when times are good. Is there one that has stayed with you throughout your journey that you still kind of fall back on?

[00:50:27] [SPEAKER_01] Yeah. So there's a proverb that my dad, my dad used to say in, as I mentioned earlier, I'm from Ghana. And I'll say it in my local language and I'll tell you what it is in English.

[00:50:42] [SPEAKER_01] In my local language, which is Chi, it says, and it directly translates to the one who's paving a path or the one that's paving a way does not know that the path behind him is crooked. And I've been pondering on that recently because it basically talks about partnership. It talks about the people that you surround yourself with.

[00:51:11] [SPEAKER_01] You know, as you're moving forward, do you have folks around you who are telling you, OK, you know, you need to actually look back and make certain changes and make sure that the path you're creating is straight?

[00:51:25] [SPEAKER_01] And for me, as I ponder on that, I'm just so very grateful to the people that I've partnered with over the course of my career, whether it's my food business, whether it's solar box holdings, whether it's the investment committees that I sit on. I think these are individuals that are true partners. These are individuals that one can build with.

[00:51:52] [SPEAKER_01] These are individuals that would caution you that, OK, this may not necessarily be the right way to go or you need to do things differently. Or these are individuals who will pick you up when you've made some mistakes and you need to course correct or you need to pivot. And so for me, I think it's really, really important, particularly at this stage in our lives, to make sure that we are surrounding ourselves with the right people.

[00:52:17] [SPEAKER_01] And we are depending or creating sort of a personal board of directors or, you know, a community, a village around us to make sure that we stay on that straight path. Even if it's crooked at times, we can always cause correct and stay on a straight path.

[00:52:34] [SPEAKER_02] Fantastic. And thank you for sharing that. I can honestly say that's the first time I've heard that proverb. It's a beautiful one. So thank you for sharing it. Oh, thank you. Thank you. So we've come to the end of the conversation. It's been a fantastic conversation, Nana. I've really enjoyed it. We've covered so many different areas and the time has just flown by. It's very rare where I'm actually upset a conversation has come to an end. So we've done very well.

[00:53:01] [SPEAKER_02] So yeah, before we finish, could you please tell our listeners where they can learn more about server backcoding and follow your work?

[00:53:10] [SPEAKER_01] Yes. So Silverbacks Holdings, you can look us up online. You can also check us out on our podcast In the Valley. And please also look out for our newsletter. You can look out for us also on LinkedIn. And there's a ton of information there for you to be able to follow us. Looking forward to engaging with your audience. They can shoot us a note on LinkedIn and we'll be happy to respond. Thank you.

[00:53:40] [SPEAKER_02] Thank you to everyone who has listened and stayed tuned to the podcast. If you've enjoyed this episode, please subscribe, share or tell a friend about it. You can also rate, review us in Apple Podcasts or wherever you download your podcast. Thank you and see you next week for the Unlocking Africa podcast. In the Valleyhave cloud! We'll be happy to join the other podcast. you