Saturday, June 23, 2007

Africa Entrepreneur Delivers

My friend Jim Miller points out a great example of entrepreneurship in Africa. One local man invested his time and money and brought more benefit than a dozen people sacrificing their time working for nonprofits. Billions of dollars - hundreds of billions - in aid poured into Africa since colonialism was ending. Did the aid to Congo (now Democratic Republic of Congo, ex Zaire) provide adequate infrastructure for telephones? In 1997 there were about 25,000 telephones. In 2006, Vodacom Congo had more than 1.5 million subscribers (wireless). Aid? No! One man - a business man! From the NY Times:
In 1997, Mr. Conteh recalled in an interview, he heard Laurent D. Kabila, then the country’s president, deliver a speech in which he called upon his countrymen to rebuild Congo’s infrastructure after the 30-year dictatorship of Mobutu Sese Seko. Mr. Conteh, who had no experience in telecommunications, said he was inspired. He decided to build the nation’s first GSM (Global System for Mobile communications) digital network. At the time, according to Mr. Conteh, fewer than 10,000 people living in Congo — mainly business people, foreigners and government employees — had mobile handsets. They paid $7 to $10 a minute to make a call, using an older technology. Less than 15,000 homes had a telephone landline. Mr. Conteh said he went, cap in hand, to the minister of communications to ask for the country’s first GSM license. In January 1998 he got it — but he first had to pay the government a license fee of $100,000. Over the years, and with little explanation, he said, the government, which is often terribly short of money, increased the license fee, first to $400,000, then $2 million. Since, at first, no Western investors had any faith in the country’s mobile market, Mr. Conteh said he wrote the first checks to the government. And he paid $1.5 million to Nortel, the telecommunications equipment provider, to help create his network. To help raise the money, he had to sell his coffee trucks. In February 1999, Mr. Conteh introduced the Congo Wireless Network, with just 3,000 subscribers. Throughout the early days of his company, Mr. Conteh faced challenges unknown to Western businesses. Once, after equipment providers declined to send engineers to Congo during a dangerous time in the country’s unending civil strife, he encouraged the citizens of Kinshasa, the capital, to collect scrap metal and weld them into a cellphone tower. In 2001, he sold 51 percent of the company to Vodacom, South Africa’s largest mobile service provider, to get the capital to expand the mobile network to millions of Congelese. By the middle of 2006, Vodacom Congo had more than 1.5 million subscribers, according to Vodacom’s annual report...
The entrepreneur did what the nonprofits could not do.

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