Briefing - BVCA admin

Q&A
As the new CeO of AVCA, what are your immediate/
short-term priorities?
AVCA aims to become the principal knowledge centre and service
provider for the African private equity and venture capital industry.
In time, we will be known as the pre-eminent advocate for the
industry and a catalyst for private sector growth on the continent.
As CEO, my number one priority is to deliver for our members
through advocacy, training, conferences, research, industry news
and seminars on topical events.
In the short term, my first task is to revitalise the association and
build it to become a successful and self-sustaining organisation. This
process includes a number of key initiatives:
• Building on the recent restructuring of our leadership and
governance structure to rebuild our membership base and
establish AVCA as the leading source of quality information on
all matters related to private equity in Africa. Our board was
recently strengthened with two high level appointments: Runa
Alam (founding partner and CEO for Development Partners
International) as Co-Chair and Simon Walker (Director-General
for the Institute of Directors and ex-CEO of the BVCA) as Special
Advisor. Runa and Simon are invaluable contributors to AVCA,
bringing a wealth of experience in private equity and corporate
reorganisation, deep connections in Africa and a demonstrated
commitment to Africa’s private sector growth.
• Establishing an affiliate of the Secretariat in London, giving
AVCA greater connectivity with London-based African GPs who
currently represent more than 50% of funds under management
across the continent.
• Developing peer-to-peer networks and negotiating collaboration
agreements with international, regional and national associations
such as EMPEA, SAVCA and others. We have recently signed a
Memorandum of Understanding in Lagos, Nigeria with the BVCA
which will provide administrative support for the Secretariat,
assistance in event organisation and training, as well as guidance
on governance, amongst other areas of cooperation.
• Embarking on a major recapitalisation initiative to ensure that
AVCA can adequately deliver on its goals.
• Communicating with our members, informing them of our new
leadership structure, our goals and projects, and generally what
we’re planning to do to better support them. Incidentally, I want
to take this opportunity to announce that on 22-24 of April 2012,
AVCA will hold its first annual conference in Accra, Ghana after a
two-year hiatus.
30 Autumn 2011 BVCA Briefing
with
Michelle Kathryn Essomé
CEO, African Private equity & Venture Capital
Association (AVCA)
And what about the longer term plans for the
organisation?
We are hearing from our members that there’s a need for greater
Africa-specific data. In our first year, AVCA has already begun
to undertake an investment activity report, launching the first
performance benchmarks for Africa and will roll-out Africa-specific
case studies for our training programmes, developmental impact
and ESG studies.
we have had two large funds targeting Africa raised this
year from Carlyle and helios, but why now? what makes
Africa an attractive investment destination?
Quite simply, LPs are constantly seeking greater diversification,
minimal positive correlation and attractive returns over traditional
assets. Africa private equity is a new asset class that can deliver high
returns, particularly in a very low interest rate environment such as
the one prevailing today.
In the 2011 Coller Capital/EMPEA survey, about 45% of LPs surveyed
now viewed Sub-Saharan Africa (SSA) as an attractive market,
compared to 21% of respondents last year.
African countries have experienced average growth rates of 4.9%,
positioning the continent as one of the fastest growing regions in
the world. Six of the world’s ten fastest-growing economies were in
SSA over the past decade according to the Economist.
We also are now seeing strong growth rates in companies operating
in the financial services, agriculture and manufacturing sectors
whereas historically Africa was largely a commodities play.
In addition, Africa has a population of approximately 1 billion people,
many of whom are becoming a burgeoning middle-class consumer
base.
When you look at all of these facts, Africa definitely needs to be a
part of an emerging market portfolio. It is natural that global buyout
firms are now looking to Africa with new eyes.
what sort of impact has private equity had so far on
African companies and economies?
The role of impact investing - which seeks to make an impact be
that social or environmental ‘beyond a positive financial return’
– has been and continues to be a way that private investors and
foundations such as Heirs Holdings, the Rockefeller Foundation just
to name a few, can effect catalytic changes in African economies.
AVCA is actively working to partner on these initiatives.