How to learn more about Third-world entrepreneurship

I (from US) want to learn more about moving to a less developed country (esp. sub-Saharan Africa region) and starting a startup/business venture.

Hours of searching have proved mostly unsuccessful, as I cannot seem to find anything other than MSM articles that do very brief overviews on the topic.

Anyone out there know of any resources I could use to learn more about this under-talked about topic?

 

Typical yankee mindset. I'd suggest to watch Empire of Dust - SSA is horribly undeveloped for a reason. You won't find any data or information. Hot industries in the region include:

- Mining & oil

- Building materials: cement, etc.

- Brewery

i.e. capital intensive sectors

 

10 years ago I hit up an interesting conversation with my taxi driver (a guy from Ethiopia) while I was unemployed in SF.  As I was getting dropped off, I mentioned my wife was traveling in Asia as was at the Canton Trade Show for work.  To my surprise, he said that his brother was there too.
 

Anyways, we both felt we should continue the conversation and I ended up meeting him for coffee.  Talked about business in Uganda and Ethiopia.  I never pursued further but this was an example of a chance encounter.  
 

I was mostly curious.  Not very trusting.  I did see him and his kid at a playground, randomly, 3 or so years later and he seemed like a nice guy.  

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A while ago I listened to a podcast on Masters of Scale by Reid Hoffman about the “Uber of Africa” if I remember correctly. I don’t have much more info than that because I’ve never looked into this topic. I’d second what thebrofessor said, get intel from people actually living there

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I was born in a third world country in South America and my family had a large sized business that thrived before political issues made it a death sentence to continue living there. This may not help a lot but the way of doing deals in my country is similar to what i would imagine happen in a region in Africa.

Firstly, all the information online is usually garbage. Financial data on companies is not going to be simple as pulling up edgar to read the 10k as many are private and family owned. All the reports and data is flowered with generic buzzwords because the nuances of owning a business is never discussed about unless you are well connected. All the important info is through word of mouth. I grew up playing squash and the club was the only place where politicians would openly accept bribes and entrepreneurs would be comfortable giving you insight into their plans for growth. I can imagine that you would have to establish a similar connection through a club or sport that would make them comfortable around you while trusting you enough to support your business. 

Secondly, barriers to entry are extremely high. Old world businesses specifically natural resource plays are impossible to establish given the capital requirements and competition so your best bet is tech. Nothing too crazy here but most of the old guys are more interested in telecom that has a physical infrastructure play not SAAS, Fin tech, Cloud computing and AI. This is the only option i can see that would actually work assuming the internet penetration is growing and the connectivity is stable. Ideally you develop a great product or service and become a fast growing company that establishes a monopoly. Easier said than done but you get my drift. 

Finally you will need deep pockets. I doubt it is possible to grow into a large business without filling the pockets of politicians who will allow you to skirt the law, avoid regulations, gain the best information and avoid paying taxes. 

For more info you need to go to the source. I recommend finding someone in the alumni database or any other mutual connection from SSA or works in SSA that would be willing to discuss the landscape with you and provide a much clearer picture than I could or anyone on wso could that is not from SSA.

 

https://www.justice.gov/criminal-fraud/file/1292051/download 

Take a gander through the Foreign Corrupt Practices Act. Incredibly limiting for anything you would want to start in SSA for instance. Quite literally, your inability to uh "grease" the wheels of commerce will make your startup neigh impossible

Even in more developed SSA like Zambia or Botswana, you must either be a massive MNC that will get an audience at the highest levels politically or be a small player that is incredibly well connected with locals

Look at the costs to move one TEU across Lagos, the FT said it was something like 4,000USD. The secret ingredient is crime. 

 

Reaching out to non-profits that are active in the region is a great way to get information from people who know what things are like on the ground. If you're an entrepreneur or plan to be a successful one, you are or will likely be on the board of a non-profit one day anyway. They are ideal candidates for strategic partnerships as well.

I happen to be familiar with Inkululeko ("Freedom"), they are focused on education for grades 8-12 in South Africa and a fantastic organization:

https://www.inkululeko.org/

 

Our dept has an area named "impact investing" and this is pretty much what they do. Not only focused on African countries, but all of the developing market. they reach out to entrepreneurs, brainstorm business ideas, and explore investment opportunities. They have contacts in the United Nations where there is a team handling investments towards smaller startups.

Chambers of commerce also help building bridges and they know people on both sides.

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Most Helpful

Don't bother.

My uncle is a Businessman in Egypt, with an Oil field services firm that does work in Egypt, SA, and Libya.  Business was passed down since its inception as a tiny firm almost a 100 years ago when it was a tiny accounting practice.  Business in developing/3rd world countries is all about your connections, network and political power, then after all that your business acumen.  As a foreigner you won't have any of that, and not only will you not have any of that, locals are likely to be hostile to you if you even attempt to develop any of that in the first place.  Business in the 3rd world tends to heavily be capital intensive as one previous poster suggested as well.  These businesses have usually existed in family hands for quite some time now, and are usually the main economic players in any developing economy.  While I wouldn't say there is a dichotomy between old money vs new money in egypt anymore, the vast majority of businesses are either inherited or are created by immense state support (politicians/military give you the resources and green light to do a joint venture with them, and protection from other hostile elements, of which there are many).

Laws in third world countries can be skirted easily, and as a foreigner you won't be able to maneuver around or survive any legal issues.  The business opportunity that does exist in developing nations (and there is a TREMENDOUS amount...in egypt at least) will primarily be swallowed up by a small group of people which include children of oligarchs who have family capital, well connected gov't/military types, and your occasional hard working striver from a lower middle class background who got into Harvard/Oxford against all odds and managed to do IB PE in the US/UK and a top MBA before returning home with all that experience and cred.  You as a foreigner don't really have a chance.  Even the third type of person often gets completely destroyed, and tends to end up packing their bags and settling down in the West for good. 

I grew up in Egypt, and Europe and had a very high level gov type father (a very much upper class background--not to gloat just the reality) and a businessman uncle so It is different for me, but I wouldn't even encourage normal egyptian- americans to go back to egypt to try their hand in business.  Again you have to be extremely well connected, which is not the case for the vast majority of second generation diaspora kids whose parents fled for economic prosperity in the first place.  Language skills are a must, which they don't have (and if they do have its with a heavy accent which immediately flags the foreigner alert in people's mind), and I doubt someone who grows up in the safe functional society of the US/EUR can easily transition to the heavily corrupt and double dealing culture present in Egypt and other Third World countries. 

Not to be rude but a metric ton of people leave places like Egypt, Libya, DRC, Nigeria because they have no objective future there.  Business opportunities are significant, but are only seizable by a growing but still SMALL minority of elites.  I know it sounds cool with all this "sustainable investing" and "impact investing" and other assorted gassed up bullshit buzzwords floating around, but the economic opportunity (not outlook as I will stress again) is non-existent for most regular people in said countries let alone some foreigner with romantic ideas in his head.  

If you are going to do some business in the developing world, you will need to have a local partner who is very influential in his market. 

 

It's a shame, Saleh was probably too nice of a person and that thug took advantage. When I first heard about the story, I thought maybe there was a chance he was contact killed or somthing like that by some Africans or South Americans whose business' toes were stepped on by Saleh. But no, it was just a typical thug crime.

 
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I (from US) want to learn more about moving to a less developed country (esp. sub-Saharan Africa region) and starting a startup/business venture.

Hours of searching have proved mostly unsuccessful, as I cannot seem to find anything other than MSM articles that do very brief overviews on the topic.

Anyone out there know of any resources I could use to learn more about this under-talked about topic?

Its probably under talked about because all the third world people are trying to move to the US and you want to move there. First of all, the prices (and potential revenues) are low in any third world country and you may not be able to do business there without a work visa or something of the like. 

You haven't mentioned what area of business you are trying to pursue, which is key. Your best bet might be to work with government entities for you to provide irrigation or water to certain communities. Unless you know someone, there will probably be a lot red tape before receiving any government funds, especially during this Covid vaccination time. 

All in all, your options are probably the greatest if you stay in the US. But, its hard to say as you have not mentioned the region or area of business.

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee
 

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