Scaling in Africa: The Art and Science of Scaling Commercial Ventures in Sub-Saharan Africa with Scott Walker

[00:00:00] You're listening to the Unlocking Africa podcast. It's how an organisation changes as it grows. And I think this huge opportunity over the next 10, 20 years, the rise of Africa will surprise a lot of people. Stay tuned as we bring you inspiring people who are unlocking Africa's economic potential.

[00:00:48] You're listening to the Unlocking Africa podcast with your host, Terser Adamu. Welcome to the Unlocking Africa podcast where we find amazing people who are doing amazing things to unlock Africa's economic potential. Today, we have Scott Walker, who is CEO and founder of Systemic Innovation,

[00:01:12] which is a systems change innovation practice solving wicked systematic challenges through a collective intelligence model that connects people, ideas and insights. Welcome, welcome, welcome to the podcast Scott. How are you? Yeah, great. Thanks for having me. It's a pleasure to have you on the podcast.

[00:01:34] I like to start from the beginning. So tell us a bit more about Scott Walker. Sure. So I'm the founder of a company called Systemic Innovation. We've worked across the world doing very different types of innovation systems

[00:01:50] change types projects last 10 years or so done a lot of work in Africa for different types of projects in East, West, South Africa. Often at the interface of looking at government challenges, looking at the entrepreneurship ecosystem, seeing how certain new interventions can make the system work better

[00:02:11] for improved development outcomes. So you mentioned that you've worked across the world focused on Africa for the last 10 years. So what was the inspiration or idea behind starting systemic innovation? So the systemic is almost being a combination of the network that I've built up over the years

[00:02:34] and looking to see how different projects could be developed that attack really intractable wicked sticky problems. And by bringing in people that I've worked with over the course of my career, you know, the right people at the right time for the right types of projects

[00:02:55] is a different type of consultancy model. And so be fortunate enough to work with a variety of different clients which governments and private companies in order to help them think about what is changed they want to affect and importantly ways in which they can do it

[00:03:14] that is perhaps not traditional, but allows thinking about what is a proper diagnostics. How do you then bring policy or way of approaching a problem that then leads to a coherent set of actions, interventions but more importantly it's not here's what we think should do.

[00:03:32] Innovation, the hard yard is really rolling up your sleeves and helping implement that type of change. And so what we try and do is offer a full service starting with helping understand what the problem is to try and solve that problem.

[00:03:49] And often the projects we have are long term projects, they're not short one-off things. The system change requires a longer commitment and you know it's hard, it's difficult, it takes time but it's the right way that we believe that we need to think about change

[00:04:05] as opposed to more episodic or more thin actions. You need a long term view and sustained effort over a period of time to make change happen. So you mentioned our systemic innovation came about through the network that you built over the years

[00:04:21] so given the interconnected nature of your work I was wondering if we could go into greater detail in terms of how you approach solving these systemic challenges through the intelligence model that you have that connects people, ideas and insights.

[00:04:40] Sure so as I mentioned I think that ultimately to think through different types of challenges we need a range of different perspectives and people with experience who've done different things over the course of their career that ultimately

[00:04:54] the goal is to see how one can draw from that pool of the network that I've been fortunate after the up over the course of 25 years and find individuals who are the right or well placed, who've got experience which is adjacent or relevant to certain types of projects

[00:05:13] and see often it's not necessarily available but attract them into certain projects that allows diversity of thought finally a kind of having a collective as it were a pool which we can bring in top talent that can help an organisation think through things in ways which

[00:05:35] as I said is not necessarily traditional that by having this kind of this fortunate network we're able to pull together a team that is with global experience but most importantly works with local players so we understand

[00:05:51] in effect what's going on on the ground and it's the combination of those things which I think are really really important. The other thing to add is obviously when working in particular in Africa having local partners really really matters so

[00:06:03] you know we would not attempt to be kind of say operational and having local partners that can help solve with us and work with us allows a transfer and knowledge and you know local insights which are also appreciated and particularly useful to getting things done so

[00:06:22] it's always looking at kind of global expertise with local partnerships local insight is the combination of those things which actually is really really valuable. Brilliant so I guess looking at this from an African perspective a piece of work that you published mentions that African scale-ups are born global

[00:06:42] I was wondering if you could elaborate on this and potentially the challenges that African scale-ups do face when expanding across multiple countries. Yeah so I mean I think almost let's give some context to it a couple of years ago having seen kind of a significant amount of activity

[00:07:00] in support of African firms looking to kind of grow and scale what we're seeing is that few firms who are actually scaling and growing despite tremendous support being on offer and I think when looking at the evidence and the data and the research

[00:07:17] it wasn't possible to actually really understand this from a system perspective how these different kind of challenges impediments barriers how do they relate to one another so there's a problem in one space how does it affect an attempt to expand internationally

[00:07:32] and so we managed to get some funding from the UK government to do a piece of research work called Scaling in Africa that was a full systems examination of the different context barriers pathways that would help firms scale and grow

[00:07:50] ultimately scaling is one of those words which is really often used but not particularly well understood so our goal was to ask can we put much more precision around what scaling is what it isn't you know expansion and growth to other territories

[00:08:04] is something which is really relevant in Africa because ultimately even though they're wide large populations actually they're reasonably small markets in terms of consumers that are able to afford and pay and therefore what we find is basically companies are looking to grow

[00:08:22] and expand they often need to kind of internationalize early and that brings with it a whole range of complexity to a business very early on in its life and I think that one of the challenges is working out if one is to expand an attempt to cross borders

[00:08:40] it is particularly difficult in 54 different countries very different languages, different contexts, different systems you know scaling and growing is hard enough but in Africa it's particularly difficult due to a range of different I guess fundamentals around enabling business environments, regulations, currency controls

[00:08:59] other factors that just makes growing a business harder but in particular when expanding to other countries it is particularly difficult because of the nature of the markets and the emergent structures, foundations, legal enablers that allow that expansion to happen easily, smoothly, quickly

[00:09:22] and also at low cost given large populations but actually reasonably small markets so that's one of the areas in which we investigated a part of our Scania in Africa thesis along with say a number of different areas around the ecosystem itself

[00:09:38] looking at growth management strategies, looking at talent, looking at investors we tried to look across the piece and say how do all of these things kind of connect and what is the evidence and data that allows us to start to really understand scaling from a more scientific perspective

[00:09:56] noting that you know scaling is always going to be an art it'll always be you know some founders which have huge motivation, experience that can actually move up the curve but it isn't easy and our assessment is in Africa it's even more difficult

[00:10:14] and it takes longer to scale and therefore should we rethink about basically what is needed given the fact that the data tells us it is different what do we need to do to change the way that we provide support given the data and what that tells us

[00:10:30] Yeah so you mentioned that you identified a few firms actually scaling and growing so when it comes to scaling ventures what would you say are the factors entrepreneurs should consider in deciding between say a global, regional or local approach Yeah it's a good question

[00:10:50] as part of you know more sections of our report which is africanscaleparfer.com we look at kind of international growth place in terms of basically whether because Africans can be almost forced to be kind of born global

[00:11:06] what do they need to do in terms of predicting where they should go how they should go about it having a playbook as it were so they can actually start to repeat and replicate certain activities there's not a great deal of evidence and literature around

[00:11:21] kind of international activities or scale-ups in Africa but we know that going across markets is really hard because of the complexities and the costs associated in each of those different markets so for each company is them asking what is their particular strategy that they want to decide

[00:11:39] and that will determine basically the speed scale and the scope of their internationalisations and ultimately each company will be different about basically what they do and how they approach it you know we made a number of different suggestions which factors that should be considered when prioritising

[00:11:54] basically whether they should stage expansion plans I think there are 10 different facts in our report around you know just avoiding uniformity each industry and market dynamic is going to be different as it's developing products and services to localise and ultimately it works here

[00:12:10] it will work there doesn't necessarily exist the lick and stick or cut and paste model has its potential limitations I think there's necessary to take a lot of do your diligence research around basically what you're planning and kind of anticipate some of those hurdles in advance

[00:12:28] so market and consumer research is obviously clear planning out what your strategy should be understanding different local factors being able to kind of talk to a lot of people to still triangulate the truth and check the evidence and advice how quickly and often you should move

[00:12:45] to one to the other I think it will always be dependent on the business but getting one country right before you get to the next one I think is probably decent advice and it's also finding right local partners to work with to lead the process

[00:13:00] it is not easy having the right partners the right networks building out the kind of institutional memories so you when we do it understand basically what's worked why it's not being successful kind of be able to document that

[00:13:14] I think is really really important so I think there are some organisations that can really help that process you know the work and you point to endeavour as having kind of really strong networks and local support good lawyers good accountants good people they can put people

[00:13:31] in touch with those things are really really important and so you know it's not easy but there is assistance and support for businesses I guess the more mature end when you're at a very early stage the hope is we can move we can grow really quickly

[00:13:46] but actually what you do is you end up adding much more complexity and that is especially for a business working already in challenging conditions that can sometimes really buckle or be problematic for a business I think because it introduces a lot of complexity

[00:14:03] very early on in the business and that is always quite unique for Africa having to kind of expand early and given the other complexities of running a fully operational scaling business in Africa it just adds more challenge at a certain

[00:14:18] time in the business and there is a note of caution before going ahead and doing that but businesses need to expand and gain customers so there's a paradox there that exists it's not easy necessarily to find a straight line

[00:14:32] So would you say that these are possibly the most predictable expansion pain points to African scale-ups encounter and I guess if so how would you say they could be addressed or prevented? Yeah I mean let's say there are some things which are predictable and other things

[00:14:50] which there's the uncertainties around it particularly when it comes to kind of government or policy or other factors I think we're seeing a degree of recognition that getting the enabling environment and attracting as part of kind of foreign-owned investment countries are starting to understand that this is

[00:15:06] important I think you know aspects around improving visas just to allow travel enabling conditions. Ultimately if you look at the way that the EU stabilised over time it took a number of years right away from the Single Market Act in 1980s through to basically a number of different

[00:15:25] visions that allowed increased free movement of people, of services that enable trade and I think that you can see that this infrastructure being started with ACTA but I think that these things just take time and in particular in emergent markets where there's lots of

[00:15:42] uncertainty and other factors and things are perhaps less predictable means that there will be more challenge and more the business needs to be somewhat adaptive and that requires a certain agility in the business to enable itself to react to change and that's really important because it isn't static

[00:16:05] and you're working in environments which are challenging for different reasons you know especially if you're looking to build out infrastructure it requires real understanding in terms of what's happening locally having local partners which are strong other aspects that will be really important and you're also facing

[00:16:24] competition from either you know local incumbents or from the mothers who have also seen a market opportunity so it doesn't make it easy to expand out especially early on as I mentioned. You touched on a key point regarding creating an enabling environment and

[00:16:42] how the EU stabilised so if we look at the African continental free trade area agreement what specific challenges do you think businesses face in navigating say for instance regulatory frameworks you know dealing with trade for an exchange and just a general starting

[00:17:03] and running a business. Well yeah I mean I think there are system structural barriers would it be these complex regulatory frameworks would it be certain barriers to entry certain incumbent monopolies that already exist. I think that there is a flow of kind of pro-business kind of

[00:17:22] multilateral agreements that you know you know would be African continental free trade and national legislation other kind of startup hacks which are kind of coming into play and I think that's really really important so as a person who's not investing in the right

[00:17:36] environment I think that the only a very small amount of trade was intra-african trade only 17% or so percent so how many kinds of going to very historically a challenging environment where it's difficult to trade within the borders to your neighbours as it were

[00:17:52] and I think that policy alone is one part but it also needs the enabling environment in terms of being able to register a business at a low cost that business process is not cumbersome and not taking an extraordinary amount of time having

[00:18:06] kind of hidden costs or other corruption issues that basically prevent or don't enable those active provisions to work at an operational level and that's one of the challenges basically and I think there's quite a lot of work that's still needed to create the kind of right enabling environment

[00:18:22] to allow well-held ventures to scale into new markets. I think that ultimately there are still bottlenecks and I think if you look at some of the integration work in terms of the indexing work and how things are going there is still the private sector has a negative

[00:18:36] perception around trading goods which is a bit odd but ultimately small work needs to be done to remove tariff non-tariff barriers allow detailed engagement with the private sector business associations so reliance on policy and legislation and government communications alone isn't enough and I think you

[00:18:54] also need facilitated marketing systems innovation to basically make it work. Ultimately regulation is complex, it's costly it's inconsistent across all of the different countries and I think that there are major issues where they'll be looking across tax departments exchange controls that exist there's local currency depreciation

[00:19:18] that happens so we end up basically having kind of a very messy system and I think ultimately much more work is needed to continuously push what is an enabling environment at a policy level and also an operational level to allow firms to basically get on

[00:19:38] and do what they need to do because of growth and that's where the role of an entrepreneurial state can be particularly beneficial right, the government should be setting the conditions putting in place kind of strategies that enable not just startup acts which are important but actually

[00:19:56] from a more practical sense what are they doing to ensure policy levers, convening and other activities can be bit in place that allow the operating environment to be conducive as possible. Yeah I agree so for organisations that have a remit to enact say after how do you believe

[00:20:18] they can contribute to a clear strategic implementation that supports scaling ventures in Africa? Yeah, that's a good question can we collect data around certain firm level dynamics? I think that's something which is invariably missing but is really important so you can see

[00:20:40] what are the individual and firm level traits to make possible to actually really understand what's going on on the ground. I think that's something which has been kind of missed as it were. I think you still need more public deliberation and debate around basically what is needed

[00:20:54] in these different areas and all to support whether it be areas to help like policy which comes to improving reforms to labour laws or how do you put in place kind of quality innovation infrastructure or what does that look like? I think there are examples in Africa where

[00:21:14] there's been efforts such as in Botswana as a ministry of entrepreneurship where you get really high level commitments. I think the work that's been done in Rwanda is really pioneering and you see a government that really has put innovation at the heart of its agenda

[00:21:30] and a lot of activity, a lot of thinking to kind of top down is a good example of when a government is taking it seriously now Rwanda's case because they don't have any scaling firms and they are positioning themselves on the launch pad for other firms to

[00:21:48] affect pilots and then scale once they've started in Rwanda I think it's an interesting strategy but what it shows is basically the government has you know, if you're serious about innovation and enabling a growth environment you've got to put the resources investment and infrastructure

[00:22:06] in place and that's really pleasing to see because there are not many examples I can think of in Africa where you've got such a concerted effort to use the weapon of innovation to help that country move up the gears in effect to become and have a long term

[00:22:26] vision, 2050 vision about where it wants to go and to move towards becoming a more high income country so I think this is a good example and others can follow basically looking at from trying to make good bets and putting place structures that will enable firms to grow

[00:22:46] because the environment is healthier and more conducive You've given a great example of the work done in Rwanda to support innovation so from your opinion what role do you believe governments play in enabling or hindering innovation and scaling ventures? I think it's really important

[00:23:10] to have a background in government public affairs but ultimately looking at it from a place where there's typically been an under investment in innovation across Africa, there is no doubt about that if you look at the overall kind of contributions to the overall investment spend GDP

[00:23:26] as a percentage towards innovation is really very low so the first thing to point to make is a plane catch up massively when other countries are investing far more and have to sterically already got a head start so actually, historically, Africa is falling behind even though

[00:23:42] that's uncomfortable to hear but that's the truth if you look at kind of the innovation index and look at it's a relative ranking but we're not necessarily seeing kind of this is a global competition and so governments need to take this stuff seriously and should be committing

[00:23:58] more towards innovation improving their national systems of innovation and their role as ecosystem support catalysts they are the enablers that will allow companies to grow, flourish and also be attracted to work in those particular countries so you know, to what extent they are

[00:24:18] important I think it is vital they can't underscore it enough and I think that ultimately there are multiple levels what should they be doing you know, I think the development around subs is great but I think you almost let's start from a question of can you

[00:24:34] create an optimally calibrated innovation ecosystem does that mean getting better performance frameworks in place so you can understand basically coordinate certain government incentives or programs that work with actors to help them achieve common goals under clear defined metrics can you monitor and evaluate different actions to say

[00:24:58] what is working or not typically there isn't a performance framework in place so you end up with lack of monitoring evaluation in terms of what is working why which is really problematic you have a lot of activity but it is just activity it is all

[00:25:14] you see a lot of outputs not necessarily outcomes and not necessarily then follow up to impact because we are just doing activity we are not basically understanding whether it is working or not and I think there is a real knowledge gap around try to understand what efforts

[00:25:30] are attributable or contributing towards success or not that is really problematic because you end up basically not having knowledge or lessons learned around best practice what is happening how do you connect innovation systems to new technologies or markets outside borders you end up basically with more guess work

[00:25:50] as opposed to designing in a way that you say this is going to give us more optimal results so how do you get different actors working in sync how do you collaborate in a way that you understand what an ecosystem is what is not what is missing

[00:26:04] once you have got a better frame then you can basically start to work out how to put in place certain frameworks targets and other things so you can coordinate incentivize make sure that you create a system whereby certain companies almost incentivize to create market or opportunities that

[00:26:26] allow certain economic or social challenges to be solved and that for me the thing that is really interesting is not just about growing companies for the sake of allowing kind of growth at all costs it's you want a way that you are collaborating in ecosystem so you're solving

[00:26:44] social human development goals right and that's where you should be targeting but if you don't actually measure any of this stuff if you're not targeted around basically what outcomes you actually want in directing and shaping the ecosystem then what can you expect as a result

[00:27:00] it's a free fall right it's very messy and I think that can you play a role in deciding dictating or helping certain outcomes of course you can so government's role is to basically to put in place certain visions set the environment and incentivize and convene

[00:27:18] the right people together and get us a system in place that allows entrepreneurship to flourish in the right way looking at it from a different direction given the complexity of regulatory frameworks what can be done to streamline the process and possibly make it more attractive for foreign direct

[00:27:40] investment that can support innovation and scaling ventures in African countries well big question yeah I think that when it comes to regulation and it's spent some time in a regulated environment regulation is quite complicated you know ultimately both entrepreneurs and investors want certainty

[00:28:00] when entering into markets they need processes that are almost cooperative that have a degree of transparency that are somewhat standardized we have kind of clear timelines to decision makers so they can be held to account that allows businesses basically to plan and allocate resources right

[00:28:18] and so if your regulatory requirements are not those things and are uncertain then it's problematic and when you end up with a situation where different countries differ and sometimes really quite wildly differ from one another even regions it is more difficult to open a company

[00:28:40] harder to get a visa, a bank account whatever it might be and ultimately it depends on which population is a very broad work but it depends on which vertical you're working in so ultimately there's different complexities that are involved and costs in different markets if you

[00:28:58] require certain licenses or agency agreements, customs clearance ranking, regulatory approvals whatever it might be and those compliance requirements basically increase cost and reduce competitiveness so one of the comments we had from our interviews was that ultimately regulators can be a bit reckless in Africa

[00:29:18] and I think that avoiding these policy summer solstice and having certainty is really, really important there's been some good work being done tech hub did an online business regulatory toolkit which helped businesses navigate the environment at different stages of the environment that's one toe in the water

[00:29:36] as it were and various different countries who are to adopt supportive mechanisms and direct attention in ways to say how can we make our environment attractive to businesses that are coming in. I think the examples elsewhere in the world where that's worked quite well

[00:29:56] I think innovation agencies within those countries basically have a role in terms of basically trying to create that type of environment I think the look at regulation right, the question is you know it's quite complicated but it doesn't go after the event and so understanding

[00:30:12] kind of when to regulate and when not to is something which regulators themselves will always you know sometimes you have to let the market happen and then regulate afterwards as opposed to before which stifles and stimmies the market and I think there's lots of talk about

[00:30:28] let's put in regulatory sandboxes and these things but ultimately they are not necessarily proven and they're not a panacea what you want is basically going back to what the UK government has around kind of its own principles around what regulation should be, it should be targeted

[00:30:44] it should be portioned, it should be accountable, transparent all those things basically help a market and the actors working within it and I think that there's still some work to do let's put it like that Yes, yes so in an ideal scenario how would you envision the collaboration

[00:31:02] between the public and private sector to create an enabling environment that is helpful to the growth of businesses or scaling ventures in Africa? Yeah it's a big question I think that you know how do you bring public and private actors together in ways that enable better coordination

[00:31:24] and collaboration right and at so many different levels there isn't necessarily partnership or collaboration happening, I think it's a lot of rhetoric, a lot of people talk about collaboration but actually don't walk the walk as far as actually finding themselves developing kind of partnerships

[00:31:42] which are kind of mutually beneficial there's a lot of there's a bit more zero sum you know what's in it for me at the expense of others. Collaboration is something which takes time and it is something that sometimes earned and you know I think

[00:31:58] there's still ways in which collaboration can be incentivized better I think there are examples of public-private actors coming together to support the ecosystem I think there is examples of those kind of hybrid approaches when you look at kind of the way that entrepreneurship support organizations which ultimately are

[00:32:16] private organizations but working in a public interest are playing in ways that allow for this kind of mutual win-win. Is that happening enough I think in terms of you know successful partnerships I think there's with all these things

[00:32:30] I think there's a lot of learnings of course more can be done but I think we're seeing progress in terms of different actors coming together and cooperating in ways that perhaps they weren't. I think there is still ways in which say academics can do more

[00:32:44] have a public interest and the private sector could work better with academia and I don't think that's happening enough and it's a way in which those types of collaborations are forged will be more beneficial going forward. Ultimately this collaboration is still fragmented. It requires kind of mind-shifts, shifts

[00:33:04] in order to allow for more dynamic aggregated informed networks and partnerships that allows us to be more integrated around sort of what is the planning and possibilities that allow an alignment between those different partners and I think that when you have kind of quite disparate or non-cohesive

[00:33:28] efforts you end up being quite shallow in terms of what those partnerships are. The more you can move towards having a deeper level of partnership, much more open the structure that is ongoing, sustained that you've aligned those incentives then that would be beneficial

[00:33:44] but I think that we still see the ecosystem as emergent and these things can sometimes take time but it requires concerted efforts to as in any partnership to allow a partnership to work and that's understanding the needs of different parties being able to allow or support

[00:34:02] how those needs are solved and helped and I think these things just sometimes take time and resources in order to point in the right direction. Thank you for that Scott we've spoken about governments and investors if we look at it from the perspective of the

[00:34:20] entrepreneur. This is a very open question. What advice would you give to entrepreneurs who are looking to enter the African market and scale their ventures successfully? Well I mean I think that I'm extremely positive about the opportunities in Africa and I think that it's so vibrant

[00:34:38] I think it's incredible talent and there's huge opportunities which await I think there's also a management of expectations around it is not necessarily simple and easy. I think there are challenges in terms of understanding what is the contextual environment in which we're kind of working

[00:34:58] and the advice I give I mean yes people will look at say 1.4 billion people huge markets but actually these markets are a large but highly fragmented and diverse in terms of language culture norms all those other aspects and you need a large market

[00:35:14] so that's the first thing to identify that but even within that look about what is an addressable market I think that there is challenges with respect to the income levels are low the low income penetration is improving and there are other constraints that actually makes it more

[00:35:30] difficult but you see large markets but actually consumers are high sensitive, limited purchasing power and I think that that's a challenge so look at addressing or solving kind of big problems I think that's where I would always put an encouragement look at

[00:35:46] defining what actually is a kind of scalable model I think that's critical I think do your diligence around basically what is your unique point, competitive edge as it were, that technology or unique skill or whatever privileged relationship you know what do you have that is distinct and different

[00:36:04] I think there's huge opportunities to impact work because of just the nature of the markets we're operating in and you know to be laser focused on what your customer needs provide a way that solves a real and urgent need better than what's out there

[00:36:20] the lights your customers, you know collect feedback, focus on solving their pain points, solutions that actually really work for them is always going to be caught to any business function and it's easy to forget but it is essential so you know very optimistic around the possibilities

[00:36:38] it isn't easy but what has always impressed me about African entrepreneurs is their incredible resilience and their ability to solve when challenges are in fact the systems infrastructure against them yet they still can be very successful so you know hats off to those which have made progress

[00:37:00] because I think it's incredibly impressive and I think there's huge opportunity that over next 10, 20 years the rise of Africa will surprise a lot of people. So if we can go into those points in more detail in your view what do you believe are the key success factors

[00:37:18] for scaling ventures that are operating in Africa there's a number of different ways in which you know there are certain attributes we can point to in terms of ways in which kind of those scaling founders have done or approached things in certain ways. For Africa I think

[00:37:36] you see there isn't a playbook where you're setting your own direction and ground and I think that being adaptive and way finders as it were is really really important because it hasn't been done and you're setting new ground and territory. I think being able to anticipate and be

[00:37:52] early internationalists as it were to think have an international kind of outlook expansion is going to be important because of just the nature of the market so for a lot of the markets are actually small or the ones which are larger are actually

[00:38:06] bigger. I think that you know what's really interesting in Africa is those founders which are building infrastructure whether it be a kind of vertical or horizon stacks, the lay pathways that governments and essay failed to build so in effect there's a new generation

[00:38:20] of type of start start up they're building the infrastructure as well as the business and that that's super interesting because it allows you know see examples of some of these successful businesses being able to build off a different revenue streams that

[00:38:34] are told basically you know be a logistics business or other aspects which basically didn't attend to but as a result of being able to create new markets and I think that makes it really really really interesting because there's an adaptability which

[00:38:48] you don't necessarily see that in other markets and that's very exciting. I think there is limited kind of I guess experience when it comes to kind of the mechanics of operating and growth business in Africa there just aren't enough and I think that there's a lot of people

[00:39:04] who are kind of still working it out in terms of how to do that and I think there is a need for more successful entrepreneurs that is important and I think there is fantastic talent in Africa but we don't see kind of experience talent there is a shallow

[00:39:20] input and I think that Paul has provided pulling into the right networks getting advice from people who are have been there done it investors and give guidance etc etc it's really really important because the kind of institutional know-how of what to do real life experience matters and I

[00:39:38] think that being under capitalized and neglected traditionally by kind of finances or you know institutional finance means that you know you need to bootstrap it pretty much so you know I think those are kind of some attributes of founders some of the things I see

[00:39:56] in terms of basically those entrepreneurs that are being successful because they're doing it in ways that are required because of the environments they're working in are different to say the ones in North America or in Europe. Thank you for that so if we look at these factors and

[00:40:16] maybe the trends that they create are there any current trends that you're seeing with regards to how African ventures are currently successfully scaling Yeah good question I think there is a clear trend at the moment is basically there's less money available and so the focus

[00:40:36] always comes down to building a business which is back to basics in terms of understanding you know you can't be reliant on external funding and therefore focusing around kind of the basics around you know unit economics making sure the business is basically operating effectively system structures process

[00:40:54] all those you know operational factors it's clearly something which is I see that trend because of the environment I think some recognition and I see where there will be more activity going forward is to start to really understand firm dynamics from a data

[00:41:12] perspective much better. I think one of things which has been not unsurprising especially given there hasn't been a lot of funding historically coming into Africa now more money is a lot of people very much focus on investment rounds how much one has raised and

[00:41:26] thinking that is a signal to the ecosystem as to basically scaling it's not because you know how much you've raised is not going to necessarily relate to the traction and whether you actually spend that money in a way that actually affords or

[00:41:42] allows you to grow and I think given there's less money around I think then there will be an increasing need and a trend of multi-basically looking at firm dynamics so understanding what's really going on below the surface of that particular venture you know ultimately scaling

[00:41:58] you know it's not about how big a company goes as such it really matters is basically how an organization changes as it grows so as it starts to move from the start up towards an enterprise that we put in place systems structures the organizational leadership

[00:42:18] that allows that change to transition towards maturity to occur and I think there will be an increasing need to look at data around what are those firm dynamics and I think that's loathed you so we move away from the headline X has raised X to come out

[00:42:36] what is the performance of that firm so they move towards profitability not just growth as such Fantastic so if we move from current trends to the future in your opinion what will the African venture scaling space look like in the next five years Yeah

[00:42:56] I'm not necessarily into predictions but I think there's a few different things what is the support that's on offer from around scaling should improve and that's the hope you know there's a lot of help out there incubation acceleration but it's not necessarily scaling support and

[00:43:14] I would expect an increasing demand for expert scale up support people put scaling in their marketing but I think we move away from more standardized kind of just incubation offerings towards much deeper dive customizable support being provided by experts and I see that being something where we'd see

[00:43:38] more effort around thinking around certain aspects of what you're missing around say governance around professionalizing teams and optimizing systems process production those are things that's really really important and I think the right type of scaling support is it often means it's expensive due to

[00:43:58] bespoke nature but I see that being something that is more important and I expect that there will be more nuance or more specifics around basically what that kind of support is offered to firms being offered into the market it's something which I've seen in other countries

[00:44:16] where you have different kind of categorization for the kind of business support services and I think I would expect to see some maturity around the market in terms of various different things being offered that you'll get more segmentation around the type of support and also expect going forward

[00:44:34] the work that we're doing is to start to shine a clearer light on data looking much beyond investment data to really understand firm dynamics what's working, what's not I expect aspects around performance frameworks to be thought through in terms of basically how you incentivize different support actors

[00:44:56] in different ways I think there's a maturity that can happen ultimately does that then lead to a kind of more of a pay for result basis and slightly clearer targets set by government or other actors so you can focus on job creation priorities potentially

[00:45:14] hopefully and I think that we can expect to see some maturity there's a lot of activity but I think ultimately it should become clearer particularly using data in terms of basically who's performing well if you can shine more transparency into that and more reporting and accountability

[00:45:34] then I think gradually you get to towards a more professional mature ecosystem and that's something which I would hope to see if that's something which is a trend or predictable I like to be optimistic, I'd like to see that to be in the trajectory and direction of travel

[00:45:52] If we look closer to home I know you've slightly touched on this but where do you see yourself in systemic innovation in five years time how will you be supporting ventures in Africa? We'd be fortunate enough to have some great

[00:46:06] projects working with the UK government at the moment around a project in a range of different countries in East Africa I think that that in some ways just getting going with that around building foundations for understanding kind of what data is needed, what that looks like

[00:46:20] working with governments and other partners around what is an enabling environment I think there is an opportunity to think about this at a can African level I think that there's lots of pockets of examples of activity and good things which are taking place

[00:46:38] and I think there is a role or function to develop some knowledge or resource which builds on the African work that we've done and starts to operationalize that in ways that allows access to information support in ways that is not an offer but could should be

[00:47:00] and I think by coordinating a number of different actors around shared goals is something which I think is definitely of interest whether we can generate enough support and coordination around that I think that's something which I would like to be involved in I've been working around Africa since

[00:47:16] 2006, nearly 18 years so I don't plan on going anywhere I think that in some ways we're just getting going with some of these activities and always open to as it should be an innovation to serendipity and uncertain things coming onto one's desk I think that

[00:47:32] keeps us on our toes and very much open minded to new ways in which we can do work that really genuinely tries to create impact doing things in ways that haven't necessarily been done that attacks the challenges that are seen to be hard

[00:47:50] to tackle but others don't want to go to and to do it whilst enjoying it as long as that's happening then I don't see a direction of travel as it were there will be any difference Brilliant, brilliant, brilliant

[00:48:04] Last question, it's a bit different to the rest of the question Scott Quote of the week Quotes, mantras, proverbs or affirmations that keep us going when times are challenging or when times are good Do you have one that you can share with us today? Well I think

[00:48:24] my own hope and ambition is to just keep doing work which I enjoy with which is challenging with people that I'm learning from and to try and improve every day that's my own mantra and I think when I'm inconsistent with that then I should go

[00:48:42] and do something else but at the moment I'm fortunate enough to be in a position where I'm still very much relishing I wake up every day, I'm excited to get on and do my work, I'm never bored fortunate enough to work with great people

[00:48:54] and may long that continue Fantastic thank you for sharing that and it's definitely a great way to go by day by day and look into the future As we've come to the end of today's conversation I was wondering if you had any closing remarks

[00:49:10] any final course or action for people who are interested in the work that you're doing Yeah, I think we take the approach of working very openly everything we do, always happy to to help share information and we may transparent around the work we're doing

[00:49:26] especially with government and around data you know more than happy to reach out I always take the view that if I can help I will, if people want to reach out and chat I'm always very open to those conversations and would be

[00:49:40] you know more than happy to facilitate wherever I can congratulations for you for one I think being a LinkedIn voice influencer you've got a new categorization if I'm not mistaken which I think is well deserved I think what you're doing is great

[00:49:58] giving people the opportunity to say a few words and to facilitate this is really welcome so thanks to you for inviting me and I look forward to catching up in person hopefully at some point they're not too distant from you Definitely Scarf, thank you for joining us

[00:50:14] and discussing the complexities of scaling ventures in Africa and how you're going about addressing the systemic challenges through innovative intelligence models so yes it's been an absolute pleasure having you on the podcast and we will speak soon Great, loads of pleasure thank you and look forward to connecting

[00:50:36] against you Fantastic, thank you Scarf, speak soon Thanks buddy, see ya If you're the one 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 Podcast

[00:50:53] or wherever you download your podcast Thank you and see you next week for the Unlocking Africa Podcast