General

Venture Capitalism is a wonderful thing, if you know how it works and how to get in safely. By the time you finish reading this, you should have just enough information to be a pocket venture capitalist right here in Accra, Ghana. This is the same information that makes so much money for Mark Cuban, Goldman Sachs, the many rich people of Wall Street, and soon, you. The reality is that, in the good old days, the rest of us could wait for a tech company to go public before we buy and own a piece of it. Back then, companies went public relatively very early. Microsoft went public not when it was valued at a billion dollars. Oracle went public not when it was valued at a billion dollars; same for Apple, and Amazon. If you bought those stocks back in those early days, and you held them till now, you’d be a multi-millionaire by now, maybe even a billionaire.  The problem is that these days, there are many valuable companies that have great prospects and easily demonstrate that they are the next trillion dollar businesses in the near future. But you and I are not invited to invest when it really counts. It’s not open to the public until the big guys get the most out of it, then they say “oh hey come buy shares in this company and hope things go well”. A venture capital is a form of private equity financing that is provided by venture capital firms or funds to startups, early-stage, and emerging companies that have been deemed to have high growth potential or which have demonstrated high growth. Private equity financing means you’re giving the startup money in exchange for ownership shares. Everybody knew very early that Uber was a game-changer. I wish I bought into Uber when it was only a few years old. Uber waited from 2009 when it was worth about $5M, till it was worth over $76 billion in 2019 before going public. Since then it’s stock has moved from just over $40 per share, to just under $60 per share. That’s not exciting at all. THE REAL MONEY WAS MADE BY THOSE WHO BOUGHT INTO UBER WAY EARLY BEFORE THE COMPANY WENT PUBLIC. THE BIGGEST VALUE IS IN EARLY STAGES OF THE JOURNEY, NOT 10, 20, 30 YEARS AFTER. That is why I advocate for increased venture capitalism activity in Accra. Because there really is a simple way so that you and I and the regular working guy can create or buy into private companies the way that the big boys and the big girls do, before they go public. How do you get started? Let’s get very basic. HOW TO IDENTIFY A STARTUP We toss around this this term a lot, but it’s really important to understand how a startup differs from a publicly traded company since venture capitalism targets startups to invest in. I have three main ways to rank startups: the business model, the scale, and the ownership structure. The Business Model: Don’t think of this as the actual business model that the startup has. It’s if there is a business model that’s already been established, fairly tested and that is ready to scale, but hasn’t been scaled yet.  A publicly traded company already has a business model that is working to some relatively high level of capacity and now in a public market. In fact that is why the company is now in the public market: to raise funds to scale the more. Unlike a startup, a publicly traded company has already solved a bunch of their major problems and now they’re looking to take it to the next level. A startup on the other hand, hasn’t really figured that out yet.  A startup is still looking for that repeatable and scalable business model, and so when you invest, you might be investing in the potential of a future business model that hasn’t really been proven out yet. Imagine investing in Uber before the company tested out and confirmed that the same model used in San Francisco, California can work in Ashale Botwe, around Madina. The Scale: Scale is really the size and the amount of impact that this company is already having. Think of ‘impact’ as from the perspective of impact on the world, or financial impact.  It is very common for a startup to make zero revenue; we call that a pre-revenue company, meaning it has yet to make any sales. Or, a startup might make a little bit of cash in a month but the size of “little bit of cash” depends on what they do. Point is, for their sector, its considered little. On the other hand, a publicly traded company is often times doing hundreds of millions, maybe billions in revenue or profit, just per quarter. So the scale we’re talking about is several orders of magnitude difference. It means a repeatable business model has already been found, and it’s really being put to work and that’s why it’s really showing in the scale. The Ownership Structure: Another core difference when it comes to investing is the ownership structure. So when you’re investing in a publicly traded company, the company is by definition “public”. In other words, when you invest in a publicly traded company like MTN, you are trading stocks and actually becoming a part owner. You also have the ability to transfer this ownership in a public market.  The ownership structure in a startup is private. In other words, only the founders or a few investors have control. And you can’t easily transfer shares in a startup company on a public forum like you can in a publicly traded company. WHY YOU SHOULD INVEST IN STARTUP COMPANIES To support the vision of company: Again, using Uber as an example, as an early investor some 10 years ago, you would have had the bragging rights as being one of the few to have spotted the great vision and contributed with your hard earned cedis, or dollars. You can’t really say that now if

As businessmen and entrepreneurs, we are all constantly trading in futures, in a sense. We trade in our time and resources every today and bet that at every tomorrow, we shall get fair value in return. That’s the contract we have with Life. Once you’re living and breathing, you are constantly altering the set of events that are most likely to happen to you the very next minute. The problem with an invisible futures contract with Life is this: the contract and its terms are invisible. You still have influence over the probability of things ultimately going in your favour, or not. Knowing this, if we want to get the best out of every next tomorrow, we have to reverse engineer the desired result to get the required contribution to offer every single today.  I hope the above is understandable because it leads to my main point below. For a species so terribly apprehensive about our imminent death, our vast majority do very little to slow down the inevitable dying of every single one of us. We always hear “health is wealth”. Yet, being wealth-chasing entrepreneurs and businesspeople like you reading this very text and myself, we fail to see how fundamentally true that is. So, if health really is wealth, and we desire wealth, it is obvious then that what we need to do is to strive for good health. You need a good, healthy body for good health. And that brings us to the heading of this writing. Being businesspeople and entrepreneurs, we would be addressing the topic in a way we are familiar with. Like with any business, being able to properly manage means you have to communicate clearly what you want, motivate your team, and plan operations efficiently. That is how to make any company flourish. We need to apply similar concepts like these to our healthy living agenda. These aren’t new ideas but they are really helpful to me and to many others. When you think ‘Exercise’, think ‘Money’. Mining cryptocurrencies like Bitcoin is very real and popular now. Bitcoin miners receive Bitcoin as a reward for completing “blocks” of verified transactions which are added to the cryptocurrency’s blockchain. So, it shouldn’t be hard to think of being rewarded with abstract cash after you have completed exercising. The reward of completing exercises is an improved state and improved movement capabilities. That has value. Ever since you started moving as a child, you have been building up your ‘motion reserves’ to be able to move about the way you do now. People that spend many years in a coma cannot move right because their reserves are depleted; it’s like getting back to square one. Within the construct of your body being your business, Exercise is Cash/Money and Movement is Expenditure. And as we all know, cash is king. Whenever you complete an exercise, you get rewarded with more movement capabilities and then increase your proverbial cash reserves, just like the cryptocurrency guys do. As you continuously sweat and improve your limits, you’re able to buy motions that you previously couldn’t buy. The rich ones can buy the Lamborghini of movements, like run an entire marathon. In real life, if you buy anything without money, that gives you debt. It’s the same here. Without the exercise that gives you the proverbial cash to purchase a greater range of movements, you will then have debt that you pay afterwards by way of pain or injury or even death. As grim as that sounds, it’s the truth. Your bank account needs to always have enough cash such that when you need to make a sudden withdrawal, you’ll be ready and set to go. That is why when you’re out of shape and you suddenly sprint, you feel pain and discomfort. That is why when you stretch yourself too much without prior exercise, you risk injury or worse. Build a good team. The secret to any great business is a good team. If your body is your business then your body parts are the team members. You must learn to build a good ‘team’ by making sure that you take very good care of your body parts. You do this by operating just as you would with your company’s team. Communication is key within a team. When targets very well communicated and understood, the team can then understand what the end-goal of their endeavours should be. Targets shouldn’t just be about monetary milestones. It should include the type of culture you’d like to encourage in your business, the business environment you’d want to foster, and even the pace and stress limits that would be most optimum for growth. With your body as your business, that would translate to setting clear goals from the beginning with respect to what you want from your exercises. As you exercise, there are various outcomes that can come out of it and depending on your lifestyle, these exercises should fit well into that. It also means you should consider the environment of your exercise. If you target exercising at home, or at the gym, or outdoors, or even in the office, setting targets help you manage expectations better and gets the most out of your efforts. Your boss recognising your good work and giving you a bonus sure feels goods. It makes putting in the work a little easier. Frankly, it also pushes you to put in that extra work that wasn’t explicitly required of you. When a team member is disgruntled, you start having issues in the flow of operations. For companies that have different parts dependent on other parts, it can be a real problem. Have you ever exercised with a targeted number of repetitions and then when you get there, you like “I could go a couple more”? That’s what’s going to happen when you reward your body after good exercises; it gets ready to put in more work. You reward your body by, for example, giving it good, healthy food that

Learn How to Embrace Failure and Make Your Startup Thrive In the start-up world we often hear phrases like ‘fail fast,’ ‘celebrate failure’ and that failing can be the best thing that ever happened. But let’s be honest: failure sucks. At the very moment “the failure” hits you, often the last thing you’re thinking about are the positive takeaways, let alone documenting the failure – your heart is pumping faster, your face and ears getting hotter, your legs going so weak you momentarily question if they can even support your weight. Failure can be a wrenching feeling. Thoughts and memories of everything you have risked on this venture, and all the promises you have made on the hope of its success come flooding through your mind, bringing with them intense feelings of pain, hurt, loss, anger, vengefulness, embarrassment…anything but logic or rationality. However, time does heal, and reflection will heighten your perspective. That’s not to say the pain ever fully goes away, but that the value of the lessons learned because of that pain increasingly outweighs that initial emotion over time. This value becomes apparent in the new found clarity and focus – plus a touch of the confidence that experience brings – with which you take on another approach or venture in the future. While the initial high of success and winning may be euphoric, there is little long-term learning that comes from it. The emotional reaction to a loss, however, with perspective and hindsight, are far more instructive. You want to understand why you failed, and successful entrepreneurs will doggedly delve as deeply as it takes to understand “why” to ensure their next steps add way beyond the value of a win. “If, one day, you look in the mirror and see only success, know that you have in fact learned nothing, any humility has evaporated, and greater failure is on the way.” –Simon R Turner, Managing Director, Founder Institute Ghana (FI Ghana) The Topic of Failure A lot has been written on the topic of failure, and several studies (e.g., CBI Insights) have pinpointed the top three root causes of startup failure being product-market-fit, running out of cash and disharmony in the team. When we look at ‘failure’ from a distance, it is easy to romanticise and sugarcoat it with inspiring quotes about the struggles entrepreneurs and scientists, such as Walt Disney or Thomas Edison, who had to go through several failures before reaching success. But what does failure actually feel like for entrepreneurs, especially in an African context? How did they manage it, and how did they bounce back? To look at this with an African lens, FI Ghana held a virtual event with seasoned and serial entrepreneurs who have experienced successes and failures firsthand, with ventures spanning Ghana, Kenya, USA, UK, Nigeria and Côte d’Ivoire We dived deep into failure as a potential fast track for finding purpose and success while providing some practical advice on how to manage failure, especially when it comes to losing people’s trust and money.  Accept failure as part of the entrepreneurial journey FI Ghana Mentors and panelists invited us to challenge the way in which we think about failure. It is not something we can control, but is part of the process of becoming a successful entrepreneur, not a deviation from what you’re supposed to be doing. “By default, you’re meant to fail to get where you need to be and, by default, it allows you to reprogram your mindset and get ready for it. Don’t shy away or avoid it but get through that as quickly as possible.”  – Samuel Baddoo, Founder, Fleri To build resilience in the face of failure, an important learning and mindset shift required is the decoupling of your own personal success from the success of your startup. That means the failure of a startup or project does not equate to personal failure, but might, in fact, be propelling you to your next personal growth phase. The “Founder First” principle, ie “Great companies start with great people, not great ideas,” is what makes a great entrepreneur, not just your successes but also your expertise built over years of trial, error, success and many failures. This is the reason why Silicon Valley entrepreneurs and venture capitalists are increasingly talking about ‘celebrating failure’, because it is inherently linked with expertise. This is true in business as much as in any other discipline. Like physicist Niels Bohr once said, while studying the structure of atoms: “An expert is a man who has made all the mistakes which can be made, in a narrow field.” Failure is part of any journey, and is arguably what makes it worthwhile, exciting and interesting, just like a Titanic movie without an iceberg would be as boring as watching a cruise ship cross the Atlantic (Sam). A mindset shift around failure is an essential starting point, but how can we prepare ourselves for the time when we hit that iceberg and the cruise ship starts to sink? Marco Rovagnati, Innovation Consultant and Founder of Poa Poa Soaps talked about the importance of setting up guardrails and intentionally designing functions in your organisation that allow you to experiment with failure, shifting the narrative from failure to prototyping. “After launching several businesses and at least half a dozen pivots,” he said, “I think about failure in two buckets: “avoid it at all cost” and “actively embrace it”.” The bucket of things to “avoid at all cost” are those that have been tried and tested, and that you can teach yourself online (which can be immensely time-consuming) or with fast-track, sprint programmes like Founder Institute. admin, operations, customer support, digital marketing – those are “basic hygiene” factors in business that are (relatively) easy to get right because they deal with the tangible management of the present. How to go about this is down to you, your team, and company culture. In the second bucket are all the future-focused activities, such as new product development, prototyping and testing new features, finding your next expansion