Aug 29, 2020
3 ways to become rich in Africa (quickly)
Two years into moving back to the African continent, some things are becoming clear:
Living in Africa and reading about it can be quite different.
One of the discoveries I’ve made is the complexity of entrepreneurship. Don’t get me wrong: entrepreneurship has never been easy anywhere. In most countries on the continent though, it is a herculean undertaking.
Still, if you’ve been getting fed African entrepreneurship news via media outlets and social media, you’d think everyone and their grandma are making a killing being entrepreneurs in Africa.
Nothing could be further from the truth. It seems some leaders are championing the entrepreneurship bandwagon in Africa because they’ve simply failed to solve the unemployment challenge — shifting the entire responsibility of fostering jobs to the people.
In a well-functioning society, do you really have to compel people to become entrepreneurs? People everywhere have a natural tendency to gravitate towards activities that are rewarding.
If entrepreneurship is not the quickest way to become rich in Africa, then what is? Read below and be aware that the list is not reflective of what’s ethically correct. Instead, it illustrates the unfortunate reality in our countries.
1. Become a politician
“Politicians own private jets in Africa”
When it comes to wealth, Donald Trump can humbly take a back seat when compared to many African politicians. In Africa, there still isn’t an activity that generates as many millionaires and billionaires as politics. Literally overnight, someone can secure generational wealth via an election win or a nomination.
People often don’t have an idea of the African political leaders’ wealth until a corruption scandal is revealed in the media. Political players in Africa have so much money that when someone is elected or nominated, close friends and family members celebrate as if they’ve just closed a lifetime business deal.
Politicians are not considered in popular wealth rankings. If they were though, the first 100 would certainly be all Africans. Most African politicians are also involved in business activities, so it becomes a chicken-and-egg situation. They used politics to create companies or their business activities channeled them into politics? It’s a gray area.
People like to tout Aliko Dangote as the wealthiest man in Africa. In an ethical sense, maybe. Realistically speaking though, he’s not. Politicians are.
2. Work in a state entity
In Africa, particularly, state entities are intimately tied with politics, but it’s worthwhile isolating them for the purpose of this article.
State entities often pay modest salaries in Africa, especially for lower-ranking employees. Nevertheless, many people who work in the public administration own assets that even top workers in the private sector can only dream of: luxurious vehicles, real estate abroad, fancy vacations, etc. Parastatal employees own it all.
Yes, this is perhaps due to embezzlement and mismanagement, but you’d be surprised that many managers in state entities are able to become famously wealthy because there are many loopholes in the law. Due to years of experience, they’re able to tap into loopholes in regulations and can “legally” become very wealthy.
Small anecdote: sometimes in April 2017, media outlets reported a financial crime jackpot in Nigeria. The Economic and Financial Crimes Commission of Nigeria discovered US$ 43M in cash in an empty Lagos apartment. Yes, that is forty-three million United States dollars in cash. Who did the apartment belong to? The wife of the Nigerian spy chief at the time (Nigeria’s equivalent of the FBI boss). According to him, the money was being stored in the apartment for the spy agency’s covert operations.
3. Work in multilateral organizations and large NGOs
Perhaps, this isn’t unique to Africa, but large NGOs and multilateral organizations tend to pay decent money. Due to the significant income gap in Africa though and the relatively lower cost of living in most of the countries, decent money becomes very good money.
I personally know people who could care less about the development of the African youth, education, or any development issue for that matter, yet they work in organizations dedicated to development. Why do they do it? These organizations pay a lot more than most private sector firms do in Africa and they offer terrific benefits and perks to their employees.
True story: I know a tech entrepreneur in an African country and we met for coffee. He told me how he tried to convince a mutual friend — who resigned from a company— to join him so they could grow his firm. He candidly said: “when she told me the salary a development institution offered her, I really would have abandoned my company if I were offered the same job.”
Is Africa still a viable place to create and build a lucrative business? of course. The continent has potential and everyday determined entrepreneurs are breaking barriers and making miracles. Many women and men have established businesses in Africa and are among the very wealthiest in the world.
From left to right starting from first row: Aliko Dangote; Strive Masiyiwa; Patricia Poku-Diaby; Mike Adenuga; Bridgette Radebe; Bola Shagaya; Sam Jonah; Nassef Sawiris; Tabitha Karanja; Folorunso Alakija; Baba Ahmadou Danpullo; Patrice Motsepe.But the point I’m making here is that entrepreneurship in Africa is infinitely more difficult than we want to admit. The reality is that creating a business is risky and uncertain. But when the business environment is not favorable to innovate and grow, there’s only so much you can do no matter how skilled you are. No sane person wants to be called an entrepreneur just for the sake of it. You’d also want to be financially rewarded for taking risk.
Political leaders, NGOs, and multilateral institutions all seem to believe entrepreneurship is the panacea to solving the unemployment challenge in Africa. Give a woman a goat and watch her make money and send her children to school. This happens in documentaries and utopians movies. I don’t see it happening in the real world. Let’s encourage entrepreneurship in Africa, but most importantly, let’s create an enabling environment for businesses to flourish.
