Pre-GrowthAfrica: AIESEC and Uganda IT startup going global

The story about GrowthAfrica starts a number of years before it is operational in 2002. It travels via the international student organisation AIESEC and a Ugandan IT startup.

Johnni Kjelsgaard, founder of GrowthAfrica, ended his leadership positions with AIESEC in 1998. Inspired by the vast opportunities that Africa holds Johnni went on to establish one of Uganda’s first web development firms together with the Danish partner NetGuide and local AIESEC friends.

The company rebranded to Metrocomia and received investments from the then leading Danish ICT venture fund 2M Invest to aggressively expand its presence across Africa and South East Asia.

Patricia Jumi and Ian Lorenzen (partners in GrowthAfrica) join Metrocomia in 2000 and become members of the “frontiers” team spearheading the expansion into new emerging markets. In 2002 as the dot-com bubble bursts 2M Invest goes bust and Metrocomia is sold.

Founding GrowthAfrica: Growing business in Africa

Following the dot-com collapse of Metrocomia, Johnni Kjelsgaard left the company and founded GrowthAfrica in Kenya.

GrowthAfrica offers market and business consulting services aimed at Danish/Nordic companies interested in exploring and doing business in Africa. The idea is to leverage the hands-on and strategic experience from Metrocomia, opening offices and setting up operations across Africa.

The mission is to grow Africa through the development and enhancement of business. Facilitation of technology and know-how partnerships with Danish companies is to become critical activity.

Wildly ambitious GrowthAfrica offers at its inception to help international businesses into Africa. The company successfully executes assignments in South Africa, Ghana, Tanzania, and Uganda across various industries in the early years.

ICT4D and partners coming onboard

Patricia Jumi formally joins GrowthAfrica. Client interests and activities are increasing.

The company wins a tender to develop the Danish participation at the first UN combined conference and exhibition on ICT for development (ICT4D) in Geneva, Switzerland.

From his base in Denmark Ian Lorenzen joins the planning and execution of the ICT4D project bringing the team together again.

In miraculously short time, the team managed to put together a very lean concept, which got the approval of the Ministry. A group of 25 Danish private, public and nonprofit organisations and projects were successfully recruited to participate in a joint stand.

The team drove 2,900 km from Denmark to Geneva at the end of an almost snowing December loaded with 45 m2 exhibition stands. Facilitated by GrowthAfrica 500+ meetings were executed at the stand and the participants rated the event a 92% success.

Growing and moving

As the company grows it moves from its small one room office into a new larger office at Umeme Plaza, Dagoretti Corner.

Our first interns are onboarded. A Dutch girl Judith responds to an internship opening posted in Denmark. Judith is joined by our first Kenyan intern Carol. They come to form the internship model that we are using as of today teaming Kenyan interns up with international interns.

From the successful, the ICT4D participation in 2003 GrowthAfrica is hired to plan and execute the Danish presence at the follow-up event ICT4all in Tunis, Tunisia.

It was a first time experience with Tunisia for all suppliers and partners – and a political system to whom democracy, freedom of expression etc. where undebatable issues. A 90 m2 flagship stand served as a noticeable meeting and hosting center for 12 Danish participating companies, which successfully managed to run 200+ meetings.

Incubator feasibility study

We want to place more emphasis on supporting Kenyan entrepreneurs – and build a pipeline of exciting local partners for the international partners we are bringing into Kenya. We go on to explore the feasibility of starting an incubator for Kenyan startups

With the support of two Danish interns, the sustainability of setting up and running an incubator in Kenya is validated. The conclusion from two workshops and the interaction with 30 key stakeholders is that it is not financially viable at the time to run an incubator.

We had for some time with great interest followed the free newspaper battle being fought in Copenhagen. When an opportunity presented itself to help two young struggling Kenyan entrepreneurs and their free ad paper with simple mentorship we were quick to jump on. The mentorship grew into an investment, then a majority holding and ultimately the running of Nairobi’s premier free advertising paper. The business ultimately collapses as the entrepreneurs through illegal means tried to take over the business.

Financing entrepreneurs

GrowthAfrica continues to proactively pursue opportunities to work with Kenyan startups following the research conclusion that it is not feasible to establish a startup incubator.

The team is determined to leverage private sector growth for social and economic development. The focus is on strengthening local businesses and scaling them for growth, so they can create more employment in the local communities and become more sustainable businesses – on all levels.

Through its network GrowthAfrica is introduced to the Danish entrepreneur, Mads Kjær and his newly founded peer-to-peer micro-lending platform MyC4. As access to capital was one of the key obstacles highlighted in the conducted incubator feasibility study the decision is made to become MyC4´s first Kenyan loan provider – and one of its very first in Africa.

Expanding: Lending and offering serviced offices

To accommodate the growth in GrowthAfrica Capital, the lending business offered with MyC4 we move from our 45 m2 office at Dagoretti Corner to 3 full floors and 900 sqm opposite Yaya Centre in the heart of the entrepreneurship neighborhood Kilimani.

To accommodate the growing interest there is from international businesses and the lack of smaller office space 70% of the space turned into and rented out as serviced office space. It is expected that some of our international clients will be interested in the space as a platform for their Kenya activities. Though we achieve a very good occupancy rate through the years we never achieve a significant synergy between the serviced office space and our core businesses.

Pivot: Refocus to achieve African growth

We are now serving 1,500 small urban businesses with a total loan value of USD 3.5 million.

A survey is carried out among the lenders to get data on their business performance, targets and ambitions. The vast majority of the businesses have no ambition to grow significantly beyond their current operations and they do not intend to reinvest their profits into scaling the business.

We are simply put not achieving the growth that we believe is required to move the continent. It is time to restrategise.

Rather than working with a large group of small businesses with very limited ambition to grow the focus is turned to innovative and ambitious entrepreneurs with scalable startups.
The portfolio and lending activities are sold off to the Kenyan microfinance company MicroAfrica (now Letshego) at the end of 2011.

Accelerating business in (East) Africa

The lesson learned is that the truly ambitious and committed entrepreneurs who are to build the next generation of successful African businesses need access to capital – but that it is not their primary need.

GrowthAfrica launches its impact accelerator “The GrowthHub” early 2012 to deliver ambitious entrepreneurs with access to knowledge, exposure, a guiding hand and a critical friend, some thought-provoking events, managerial and practical tools, networking, and structured experience sharing with their peers. And then facilitated connections with investors.

In partnership with leading European startup accelerator Startupbootcamp a well attended ideation kick-off event is executed.

In partnership with the US based Village Capital 19 startups out of 212 applicants are recruited for the first acceleration programme.

The agribusiness experience

After another successful accelerator cohort in partnership with Village Capital and an incubation cohort funded by a Dutch family office, a 18 month partnership with Danish family office, Bestseller Fund, is struck. The focus this time is explicitly on agribusinesses, and the programme consist of an ideation, an incubator and an accelerator component.

Over 18 months in 2013 and 2014 a total of 603 enterprises are interacted with as potential participants and applicants in the various activities. The ideation component manages to support 8 startups, the incubator another 12, while the accelerator successfully supports 11 early-stage enterprises boost their growth trajectory.

The ideation component and the incubator programme, the second for GrowthAfrica, leaves us with the realisation that our efforts are more effective with entrepreneurs who have managed to commercialise their first product or services; and a decision is made to focus on “post-revenue” acceleration on the startup side of the business.

Platform for regional expansion

As a consequence of realising GrowthAfrica should not offer incubation services, the 900 sqm office near Yaya Center is replace with a new beautiful 500 sqm office at the nearby Lenana Towers. A handful of investors and ecosystem players join GrowthAfrica at the new premises with a clear desire to be close to “where the magic happens”.

The first accelerator cohort out of the new premises is in partnership with Dutch organisation Hivos and VC4Africa; and is run in parallel in Nairobi and Cape Town, where Impact Amplifier is our local implementation partner. The programme dubbed Green Pioneer Accelerator engages 22 Kenyan and South African early-stage businesses in green/clean tech, renewable energies and sustainable agribusiness.

Mid-year, our budding partnership with the Dutch family office is solidified and Argidius is officially made Anchor Partner with a 3-year budget support and a commitment to support the regional expansion in East Africa and beyond during 2016, 2017 and 2018.

Refocusing our resources: Advisory services

With the acceleration programme at the core, the organisation was positioning itself as the leading accelerator on the African continent. This was cemented with the expansion of the acceleration programme into Uganda and Ethiopia in 2016 and then into Zambia in 2017.

GrowthAfrica was taking on its own growth prescription and scaling its programme from a single location setup to a multi-country platform which ultimately could also serve our entrepreneurs expanding beyond their domestic markets.

There was an increasing interest and requests from donors, foundations and corporates for GrowthAfrica to assist them in designing, developing and implementing programmes and activities in Kenya. To cater for this opportunity to scale our impact, the organisation established an Advisory arm to focus on opportunities outside the core set acceleration programme.

Malawi, incubator-in-a-box and Norad Partnership

UNDP Malawi approached GrowthAfrica to design and deliver Malawi’s first ever accelerator programme in partnership with the country’s leading tech hub mHub. The 12 months programme was to include a grant component providing the 12 participating ventures with a grant of USD 10,000-40,000. This was designed to then be matched by 20% commercial capital or own cash contribution.

GrowthAfrica had for a while seen the challenges that many African incubators were having in regards to programme content and methodology. An incubator capacity building resource titled “incubator-in-a-box” was developed and used in building the capacity of the new incubator – Incubar at CoELIB / Egerton University in partnership with a Dutch consortium.

Towards the end of 2018 a consortium of venture builder Antler, Seed Forum and GrowthAfrica secured the support of Norad for an exciting tri-party partnership programme.