Our commitment to Africa

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Participants during the YouthConnekt Africa Summit 2017 in Kigali last month. Timothy Kisambira.

Editor,

On July 19-21, 2017, the inaugural YouthConnekt Africa summit was held at the Kigali Convention Centre. One of the main themes of the conference was, “What Is Your Commitment to Africa?”.

During the keynote session on the first day of the conference, the moderator passed the microphone around the audience and asked them what their commitment to Africa was. Jack Ma, founder and executive chairman of Alibaba Group, also stated his commitment at the session on the third day of the conference; that he was to launch a $10 million fund for young entrepreneurs.

During all the sessions throughout the summit, one question kept on coming to mind, “What is DMM.Africa’s commitment as one of the Japanese investors in Africa?”

DMM.Africa is committed to investing 10 billion Japanese yen (roughly $100 million) on the continent over the next 5 years. As our first investment project, DMM.Africa has invested in two Rwandan companies: HeHe Labs (renamed DMM.HeHe after the acquisition) and AC Group in March 2017.

Looking at Japanese companies, especially big enterprises, few are aggressively investing or creating business in the African market. Even though many Japanese companies refer to Africa as “the last frontier”, we still don’t see as many of them investing in projects in Africa as in South East Asia, India and China.

There is a gap in expectations between investors and companies. As presented in the session “Access to Finance: Where Is the Money?”, most of African companies seeking money to grow their business are tech-startups, often categorised as “Seed” or “Series A”.

Japanese companies interested in African market are looking for bigger size projects, which are relatively stable. Those companies are mostly public companies and have their own internal decision-making process termed “Ringi”, which often take long and muti-tiers regardless of size of investment. And also with company internal evaluation system based on lifetime employment system, the project managers tend to avoid working on high-risk-high-return projects.

DMM.Africa believes that this “gap” provides us a great opportunity. We are eager to invest in “Seed” and “Series A” size companies and to work together with them in order to maximise their business potential.

We hope this gives a new insight to other Japanese companies as a new way of getting into the African market.

Nobuhiko Ichimiya

DMM.HeHe / DMM.Africa