Ernest ARMAH’s thoughts…. The African entrepreneur and COVID-19: …Where do we go from here?

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The new coronavirus, the disease known as COVID-19, is a reality staring us in the face. It has disrupted how we live, how we work and even how we close a business deal – try shaking a business partner’s hand. According to Johns Hopkins coronavirus resource center, COVID-19 has reached 188 countries with active presence in most African countries. As at May 23, 2020, Africa had over 103,875 cases, 3,184 deaths and 41,576 recoveries.[1] Countries with high frequencies and severity of the disease, had to put public health first by declaring lockdowns to track infection rates and manage cases.

This hit their economies very hard. Some say recession awaits these countries in a few months. But for developing but delicate economies like Ghana, the choice of public health over the economy was not a question of political dilemma apparently. Economies die several times and still come back to life. Humans only die.

Small and medium scale enterprises (SMEs) are among the worst hit by COVID-19 and its associated lockdowns. According to the Economic Commission for Africa, “firms and businesses in African cities are highly vulnerable to COVID-19 related effects, especially SMEs which account for 80% of employment in Africa”.

To avert this economic tinderbox is a GHS600million stimulus package by the government for small and medium scale enterprises to maintain cashflow, and weather the retrogressive effects of the pandemic. This is the most the government can do in the heat of this moment whilst it attends to the heavier matter of firing up the economy through responsive policy and legislation.

When things got critical, government chose health over wealth because essentially health is wealth. The pandemic presents a similar scenario to entrepreneurs – to queue and jostle over a piece of a stimulus package? Or to tap into an underlying entrepreneurial mindset which have kept them going despite existential credit access problems long before COVID-19 arrived on the scene?

On 15th May 2020, I moderated a conversation on the topic: The African entrepreneur in the age of COVID-19: Coping Strategies for Today’s Reality. This conversation humanized the International Labour Organization’s estimate of the 2.7billion[2] persons affected by the pandemic. My guests and I had the opportunity of listening to a story of four African entrepreneurs, one that speaks to resilience, anxiety, transition and grit. It opened with an account of a woman who delights in making people look good. Theresa Brown, the Chief Executive Officer of MBA Mode Institute, has been offering elegant, bespoke and affordable unisex apparel for the Ghanaian middle and upper class for over 7 years in addition to training an average of 15 aspiring fashion designers the skill, practicalities and business aspects of the profession annually. Last year, she graduated 17 students in the usual fashion of ceremonial splendor.

This year, she is graduating none. Of more concern to her is the lost opportunity to offer the practical aspects of lessons to her students in person, in close proximity. She estimates that COVID-19 has eaten 90% of her business. She is retaining all her employees but cannot afford to pay them in full. The 10% she is subsisting on comes from the production of facial masks. However, interestingly, Theresa believes that COVID-19 has opened her eyes to an evolving Ghanaian ecosystem from one that is opened – where you can target the whole market – to a closed one – where you target specific market segments; making her to consider shifting a reasonable part of her school online and to diversify into other market segments in light of changes in consumer tastes and preferences.

The opportunity for introspection and re-strategizing is also a view Mawule Messan shares in. He is the Managing Director of Sacrefilms, an Accra-based media company that tells stories of brands through short videos and documentaries. “Although most part of our work with clients can be done online, ultimately you will have to meet clients in person to finetune key concepts and establish consensus on production related issues”, he explains. The lockdown truncated a many high budget productions in the works; some documentary projects have been postponed, others canceled outright but Mawule remains optimistic and is considering a venture into live streaming and social media marketing.

If we were to be under lockdown for two straight years, what will the African entrepreneur do? This question by Vannel Dzigba, an entrepreneur and a startup coach who joined the conversation virtually from Michigan, USA sent us into deep contemplation. It represented a fascinating integration of thought on entrepreneurship crisis management and a resilience spirit to remain grounded during a crisis.

It immediately struck a chord with Henrietta Adjetey, the Creative Director of Brand E, a branding and packaging company. Whilst Theresa and Mawule had cause to pause and reflect, Henrietta got more orders from clients. A consequence of the lockdown and the ban on social gathering meant people could not sit in restaurants to eat. This accelerated demand for food deliveries which also cascaded into more demand for food packaging materials.

Analogous to the story of Henrietta’s is that of Vincent Okeke, the co-founder of Agriple, a Nigerian based online farm market that connects farmers with consumers and off-takers in real time to minimize food waste. Agriple transacts business with clients almost entirely online except for deliveries by their logistic partners. Business might have slowed for Agriple, but it is certainly not in dire straits; on the contrary, its growth prospects are boundless and seems to be on course in reducing the 1.3billion tons of food that go waste every year.

Through these stories, we were exposed to entrepreneurs who have been affected in ways they did not anticipate – for good. When we think of entrepreneurs, often, what readily comes to mind is a lucid picture of a garage filled with brilliant minds, iconoclasts, and prescients who have got the present and future figured out. But we can all agree on one thing – COVID-19 was not a threat most of us considered in our SWOT analysis going into 2020. We have been hit by a surprise and as Emmanuel Awumee, a startup business development analyst expounded at some point in the conversation, there has been a shift in our normal patterns of behavior. The work of the entrepreneur is to make sense of this shift and make a business out of it.

Ernest Armah is the Country Manager of enpact e.V.

enpact e.V is a global non-profit organization founded in 2013 to empower entrepreneurs, ecosystems and international cooperation. Through a variety of products and services, enpact supports founders and startups in Europe, Africa, Asia, Latin America and the Middle East. The goal is to create a global network of startup ecosystems that facilitates the exchange of ideas, solutions and support. At present, enpact’s network consists of 1,000+ startups, 300+ mentors and 50+ support organizations in 20+ countries. 5000+ jobs have been created as a result of enpact’s work with startups.

 

 

 

 

 

[1] https://www.africanews.com/2020/05/19/coronavirus-in-africa-breakdown-of-infected-virus-free-countries/

[2] https://www.ilo.org/wcmsp5/groups/public/—dgreports/—dcomm/documents/briefingnote/wcms_740877.pdf

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