Consumer-Led Growth Play
Together, a number of factors are unlocking a consumer-led growth play in sub-Saharan Africa today:
Venture Capital Fueling Breakthrough Consumer Businesses
The largest segment of consumers in Africa are at the base-of-the-pyramid (BoP). They spend their growing, hard-earned income on basic goods and services like housing, education, energy, information, healthcare, and transportation.
Enterprises with innovative business models and adapted technologies can profitably satisfy market demand at the base of the pyramid. When they do, they grow very large, quickly. In so doing, they widen access to basic goods and services, improve quality and reduce cost, thereby generating large scale benefits for BoP consumers.
New, innovative business models require rapid iteration in the early days, and the discipline and courage to make changes based on market feedback. That’s why venture capital and the experienced support that comes with it are fundamental to entrepreneurial success. While Africa is attracting an increasing flow of private equity funds providing growth capital to established businesses, few investors are focused on venture stage opportunities with consumer-facing businesses.
That’s where we see the opportunity to do well and good at the same time.