Skip to main content
Management in Practice

What Does Entrepreneurship Look Like in an African Context? 

Get creative about data. Be resilient when the electricity cuts out or a supplier doesn’t deliver. These are two pieces of advice for doing business in developing countries from Hakeem Belo-Osagie, a Nigerian entrepreneur and investor. At an event at Yale SOM, he took questions from Professor Mushfiq Mobarak and students in the audience, covering the relationship between private and public sectors in Africa, the role of Chinese businesses on the continent, and lessons the developed world might take from the way business is done in Africa.

Lagos, Nigeria. Photo: Ariyo Olasunkanmi/

  • Hakeem Belo-Osagie
    Former Chairman, United Bank of Africa and Emerging Markets Telecommunications Services

With cooling commodity prices, Africa’s economies are no longer seeing the rapid growth that led to hopes of a continent-wide rise just a few years ago. Nonetheless, there’s a promising trend: young Africans who went overseas for their education returning with advanced degrees and a determination to make a difference.

Surveys found that 70% of African MBA students from top U.S. and European business schools and 90% of African PhD students plan to return to work in Africa. “There is a sense of responsibility,” said Guy Kamguia, a Cameroonian-American with a Harvard MBA, talking with Quartz, “There’s a genuine sense that if you’re not going back to fix Africa, who is going to do it?”

While the “brain gain” may be picking up its pace, it’s by no means a new phenomenon. A generation ago, Hakeem Belo-Osagie earned a law degree from Cambridge University and an MBA from Harvard. In a conversation at Yale SOM, he talked about applying business school tools effectively in a developing economy context.

Belo-Osagie is a serial entrepreneur, investor, and philanthropist. He worked across sectors including for the Nigerian government as well as in energy, finance and telecommunications. He is the former chairman of the United Bank of Africa and Emerging Markets Telecommunications Services, a mobile-telephone company. Belo-Osagie serves on the Yale University’s President’s Council on International Activities.

Hakeem Belo-Osagie spoke at Yale SOM on October 24, 2017. Questions came from Professor Mushfiq Mobarak, who moderated the event, as well as audience members. The discussion has been compressed for readability.

Q: What’s similar and what’s different about doing business in a developing country?

The essential building blocks of business are similar—accounting, marketing, production management. But there are very big differences, and it’s very important that you appreciate these differences and make adjustments.

First, there is much less data. I find many young MBAs are accustomed to running numbers and coming up with a solution. But in Africa, they are almost crippled when there is insufficient data. They spend a lot of time searching for data that doesn’t exist.

How much data did Ford, Carnegie, Rockefeller, or any of the great founding figures of 19th- and early-20th-century business have? Not much. Nonetheless, they moved forward.

When you don’t have data, find a proxy. For example, when we were going into the mobile phone business, there wasn’t any data, so we found numbers on beer consumption. It may sound crazy, but we figured that people would like to use a phone as often, or more often, than they would like to have a drink of beer. The analysis was effective. It turned out that people actually cut down on beer consumption to make more phone calls. Finding creative approaches to data is very important.

The second big difference is that you will need much more resilience. I use that word carefully. Resilience is the ability to cope with disappointments, sudden upsets, the fact that everything is not there laid out for you. You have infrastructure problems. The electricity stops working. The person who was supposed to deliver the marketing study hasn’t done the marketing study.

Some people pack up the minute things go wrong. Other folks have the ability to bounce back and find a way around it. You’ve got to be very resilient. If you think you can hit a benchmark in two years, shift expectations to year three, and if in year four you are still at it, you should not find that alarming. Press on. Data and resilience come immediately to mind. In addition, the role of government is far more important than it is in the United States or Europe.

Q: Could you expand on that?

Depending on the industry you are in, that will tell you how much interaction that you have with the government. Oil and gas has heavy interaction. In the mobile phone industry, once the license has been given, there’s not much interaction. For some tech startups, there’s very little interaction with the government at any point.

However, I think that anybody who is in business in an emerging market must be keenly aware of the activities and policies of government. The government plays such a huge role in terms of the macroeconomic context and specific regulations relevant to each industry, you have no alternative. A lot of people are deeply worried about that, but it’s not as difficult as you may think. It is no different from remaining close to your customers, suppliers, and other stakeholders.
You have to involve yourself in government to protect your business, to always know what is happening, in a very short-term self-interested fashion.

I also believe, in a less narrowly self-interested manner, all citizens, especially privileged individuals, have an obligation to be engaged and give back to the larger community. Private business has responsibilities to the larger community everywhere. It’s particularly important in Africa.

Q: How important is the private sector to development?

There are at least two engines of economic growth in the developing world: government and the private sector. I believe they both have very important roles to play.

I’m very skeptical that the private sector in Africa, or in any third world country, can take on the full burden of responsibility for growth. For all it says to the contrary, the private sector is relatively risk-adverse. It has relatively short time horizons. Often, it sits on a base of government support that it does not acknowledge.

For example, what the government does in education, in railways, ports, roads, in health, is as crucial, if not more crucial to the growth of African economies as what the private sector is doing.

Look at Asia: Malaysia, Singapore, Korea, even Japan. What I find stunning is the very dynamic role that the government played in working with and providing the basis for the private sector. The role of the development banks, the role of low-cost credit, are not fully appreciated.

In some areas, I think the government should leave. I’m not sure the government runs consumer banking very well. So let the private sector take the lead in that area. But I don’t want to be understood as believing the government should somehow get out of the way entirely to allow the private sector to thrive, which was very much the Washington consensus for many years.

Q: How big a player is China now?

China is becoming a more and more important player in Africa. I think it is, broadly speaking, a very good thing. I think that the Chinese bring several things.

One is companies like Huawei delivering equipment that is twice as powerful at half the price. There’s a huge price advantage. Secondly, the Chinese are much more willing to be involved in infrastructure. A lot of companies in the United States and Europe regard it as a social matter and such a long-term investment that they don’t want to be involved; the Chinese are willing.

Thirdly, there’s a lot of similarity between China and Africa in the sense that there’s a first world, second world, and a very poor third world, all there in one country. Because rural poverty is not strange to the Chinese, they don’t have a fear of working in rural areas. The kinds of problems that Alibaba is facing working out the logistics of e-commerce in rural areas is much closer to Africa than what Amazon is facing in the United States.

Q: You studied business in the United States and have interacted with international organizations through most of your career. Are there lessons you bring to how you approach business in Africa?

Something I admire from the American approach is the systematic analysis of business, not seeing success as a chance event. Business is something you examine and study. Perhaps that’s because the United States was quite early in treating business as an academic subject. Even in Europe the academic approach only arrived in the 1960s and ‘70s.

Often, I meet people who have not gone to business schools who try a business simply because they’ve heard that it went well for someone else. They have no clue that there might be a crucial first-mover advantage.

That ability to think through, why am I in this market? Where is money made in this business? Why is it made in that area? What are the crucial personality types or functional specialties that I need to hire? That systematic analysis is what I find very impressive about American and European business.

Q: What about the inverse? Are there elements of how business is done in Africa that are particularly important and might be worth applying elsewhere?

In a lot of European and American businesses, there’s a very sharp distinction between, shall I say, your working-hours relationship with your staff and your off-time where you no longer have a relationship with your staff. There are certainly benefits—people need a hinterland, people should not be totally involved with work all the time.

But often in Africa a boss has social responsibilities and obligations. If a worker’s mother, cousin, or sister is extremely ill, if there are issues with a child’s education, it is quite normal to seek support from a boss in those situations.

I think that is a good thing. Whether or not you characterize it as corporate social responsibility, I don’t know. But, I very much believe in a more expansive definition of business’ role in society, and in the individual business leader’s role, as well. That tends to happen much more in Africa than elsewhere, and I think it’s a good thing.

Q: What guidance do you have for young people who went to the U.S. or Europe for advanced study and now want to return to Africa to start a business?

A lot of young MBAs come back to Nigeria or Ghana or Kenya to start a business. They hire people like themselves, other MBAs. They all speak a certain language. They form a mutual admiration society. But you’ve got to understand that there’s a reason why things are the way they are. It’s not always because of irrationality. Therefore, you will need, working with you, people who understand how things are. People who understand how to get things done. You need to have some people who are very different from you.

In fact, it’s often the coming together of the very analytical MBA who understands global best practices with the guy who has street smarts that makes for the most productive enterprise.

At times, my most important ally has been a high school graduate who worked his way up through the bank. He understands customs. He understands how to sort out a problem at the passport office. When suddenly nobody’s taking my goods and nobody is explaining why, he understands or can find out better than I can.

Q: Do you have other advice for those young MBAs starting out their careers?

Your life is going to have its ups and its downs. You’re going to learn as much from the downs as from the ups. We all have, in our lives, dark moments. I have had mine. You get up, you learn, and you go on. Whenever you meet people who have been successful, just remember that we’ve all had setbacks, things that have not gone well. They are things that are never mentioned when we are introduced, but they are there. Remember, when you have your setbacks, it’s nothing unusual.

My life has consisted of a series of zigzags, not a straight line. Do not be surprised if that is your experience, too. When I decided I wanted to start an entrepreneurial venture, I saw that the opportunities were in finance. Finance was an area in which I placed closer to the bottom of the class than the top at business school. It was the one area that I thought I would never get involved in. And my very first venture in finance was an unmitigated disaster. But failing was probably one of the best things that ever happened to me because nothing teaches you better than failing.

My next venture was a securities trading company and produced the best return on investment in my career, so from a big setback came a great success. The company survives today, though I stepped down to do other things.

Q: What role do you see luck playing in your career?

Luck is crucial. Anybody who doesn’t say that is just not telling the truth. Luck made a huge difference to me. I got into a very big argument with my boss, a partner at Boston Consulting Group. I ended up resigning. Because of that, I didn’t have a job in December of my second year of business school, so I went back to Nigeria for the Christmas holiday.

As I walked into our house, on TV the president of Nigeria was swearing in the presidential adviser on petroleum and energy. The swearing in should have happened a month earlier but there had been delays, so I was there watching TV. That was lucky.

I turned to my father and I said, “Do you think that guy needs a special assistant?” My father was the president’s sister’s gynecologist. I would like to say to you that I got my first job out of sheer hard work, but the honest truth about the matter was that there were a whole series of events, which had they not happened in the way they did, I would never had gotten the job.

Luck is always there. You can’t instruct it, you can’t order it, you can’t command it. The one thing that you can do, though, is to be prepared to take advantage of it when it comes. You will go through periods in which you have a string of bad luck. You hit a brick wall. You do your very best, but things just don’t go your way. You have to persist. So that when luck does go your way, you seize that opportunity and make the absolute best of it.