They came to Rwanda armed with ivy league college degrees and have had working stints in places as far as Kenya,Angola,USA and Indonesia. Having made a firm decision to settle in Rwanda,the duo is positioning locally as social entrepreneurs. Fred Oluoch-Ojiwah of The New Times talked to Sachin Gathani from Kenya and Dimitri Stoelinga from Greece/Holland on why they have chosen Rwanda as their next frontier of doing business.
What is Laterite?
Laterite is one of the first social enterprises of its kind. Our mission is to give Rwandans access to high quality, affordable, and local advice services by starting-up and investing in economic and management advisory ventures that address gaps in the market here. Laterite’s pilots which are currently at the early stage include three firms focusing on economic policy, market intelligence and management coaching.
How did you come up with this idea?
Our experiences working with large multilaterals convinced us of the need to transform the way consulting is done in Africa. It is no secret that government, donor and private sector contracts in developing countries are often awarded to large international consulting firms, which sometimes have limited in-country experience. We want to make sure that the local firms in countries like Rwanda can compete in terms of quality with these international consulting firms. We want Laterite’s ventures to be a showcase of how this can be achieved.
Let us talk about the seemingly interesting idea known as Rwanda business confidence index. What is this index and what is its value to the economy?
The RBCI is a product we are developing through one of the ventures created by Laterite. Typically, business confidence indexes are a good way to take a pulse-check of the state of the economy. The RBCI will be based on a quarterly survey of Rwanda’s top executives and will focus on their expectations of investment, employment, profitability and costs. Policy makers and investors can use its findings in their decision-making and economic forecasting. We expect to launch the first RBCI by early August.
To what extent is Rwanda having skills deficiency which you foresee as an opportunity within your areas of doing business?
We hope that we will be able to help Rwanda tackle its skills gap through Laterite. We will create new ventures within the advisory services field and invest significant resources in training and building the capacity of local professionals within these firms. Our objective is to eventually transfer ownership of our ventures to local professionals and investors.
Share with us the key points of your business plan over say the next 3 years.
Over the next 3 years, we want Laterite to establish itself as new type of social enterprise and a recognized model internationally. Unlike the traditional social enterprise model that focuses on the provision of products and services to the base-of–the-pyramid (BoP) market, what Laterite offers is access to high quality and affordable services to governments and firms thereby enabling them to better service the needs of the BoP group.
The objectives for our ventures are to be established market leaders with a cumulative turnover of at least USD$1million, innovative service lines and a robust client base.
What do you foresee as being some of the major impacts of your intervention in Rwanda over the next 3 years?
We hope that our work will prove that Rwandan firms are able to provide high quality advisory services competing with international consulting firms. We will fill a gap in the market that currently constrains investment and policy decision-making and train Rwandan professionals to run and manage advisory service firms.
While talking about investor support services within your market research venture, I am very sure that this sort of service is offered for free by Rwanda Development Board (RDB).
Our market intelligence venture will provide three types of services: market research, investor support and a business confidence index. The investor support services we offer will be complementary to those provided by RDB as we will provide investors with market analysis and feasibility studies for the introduction of new products and services in Rwanda. We also see RDB as a potential client for market research services such as industry and consumer behavior analysis.
Share with readers why you chose Rwanda in the first place after quitting your previous work stations.
Rwanda has an enviable reputation as a place for doing business and starting new enterprises (it took us 25 minutes to register Laterite!) and we know that the government and private sector want the economic policy services and management coaching that our ventures specialize in. We have also seen a clear gap in the advisory services market here as opposed to relatively better-developed markets such as Kenya.
Shed light on your network of global partners.
For each of its ventures, Laterite is committed to partnering with a leading international firm or organization specialized in the relevant service area. Our partners, who have the option of taking an equity stake in our ventures, participate in capacity building, product development and service delivery, and ensure that the services provided are on par with international standards. We are currently in discussions with a number of companies in the US, Europe and Kenya that have indicated an interest in joining our network.
Kindly elaborate on this idea of spinning off successful ventures.
This is the essence of the Laterite model. We create new firms, build their capacity to operate through training, R&D and performance management, and gradually transfer ownership to local professionals and investors. The latter is what we call “spinning off successful ventures”. As founders of Laterite, what would make us proud is to see the firms that we started thrive independently and transform the way consulting is done in Africa.
Any concluding remarks?
Laterite is a new way of thinking about “social enterprise”. The majority of social enterprises directly address the needs of customers at the Base-of-the-Pyramid (BoP) but we want to prove that you can have an equally lasting and measurable impact by increasing the access of the public and private sectors to affordable, technically sound and locally informed advice. We see this as the next social enterprise frontier.