Tech Entrepreneur Thrives in Ghana
A self-described “geek and gangster”, Chinery-Hesse already has an excellent track record. Often called the “Father of the African Software Industry”, in 1991 he co-founded theSOFTtribe – the largest and most successful software company on the African continent. At its peak, theSOFTtribe had annual revenue of more than 1 million US dollars. Some of the 80 programmers and software engineers employed by Chinery-Hesse have gone on to start their own companies. Today, he is still the CEO and chief shareholder of theSOFTtribe, but Chinery-Hesse is turning to bigger challenges.
African entrepreneurs can use technology – especially cell phone technology — to leapfrog over traditional marketing and distribution systems, Chinery-Hesse believes. His system will permit Africans who have no computer, website or bank account to send and receive money electronically, buying and selling products online. The digital world of the 21st century creates a level playing field where small businesses and markets that have traditionally been left behind, can survive – and even thrive.
Today, Chinery-Hesse is actively seeking American and European investors for BSL, an innovative start-up. He plans to revolutionize the way business is conducted in Africa within 5 years, and claims that Ghana is the next Singapore.
Experts agree that the untapped African market is enormous. Many parts of the continent have low employment – because the average worker is in business for himself or herself, selling everything from fresh fish to computer programming services. According to one study by Friedrich Schneider, an Austrian economist, the hidden potential in Ghana alone is 44% of the country’s GDP. That amounts to more than $13 billion in 2008.
The new company, BSL, will provide the infrastructure for entrepreneurs across Africa to sell products and receive payment through their cell phones. Currently, growth of ecommerce is hindered because PayPal doesn’t operate in Africa.
“This technology enables a craftsman – or woman — in a remote African village to export 20 sweaters a week at $10 per sweater,” Chinery-Hesse says. That’s $200 per week in revenue, in a country where the average per capita income is just $646.
The BSL system will permit a buyer in New York or London to purchase a scratch card – like a prepaid phone card – in denominations from $5 to $1,000. The buyer will then send a text message including the code to the seller in Ghana. The seller can pick up his cash at a post office or have it deposited directly into a bank account. For a 10% commission, entrepreneurs from all 53 African nations can have their products listed and collect payment electronically on the BSL website, www.shopafrica53.com.
BSL has a built-in market in the $28 billion that Africans living abroad send home each year.
A tall, affable, talkative man with a bear-like physique, Chinery-Hesse has succeeded in one of the most demanding business environment on the planet. According to World Bank, Ghana ranks #138 on their list of easiest places to start a business – after Venezuela, Serbia and Iran.
Yet, Ghana’s GDP grew 6% in 2007 and in just 6 months during 2008, the value of publicly traded companies increased 56%. More than 2.7 million Ghanaians bought cell phones last year alone. This explosive high-tech growth has piqued many investors’ interest.
Chinery-Hesse believes that change brings unprecedented opportunity. He is not alone. Vijay Mahajan, professor at the University of Texas, recently noted, “The opportunity in Africa is at least as great as the opportunities in China and India.” Mahajan adds that Africa’s per capita GDP is $200 higher than in India. Mahajan blames the American media for the perception that Africa is a continent starved for opportunity.
Like the new breed of entrepreneur that he represents, Chinery-Hesse has a global background but an African focus. The son of career diplomats, he attended an exclusive private school in Ghana while spending holidays with his parents stationed in Tanzania, Switzerland and Sierra Leone. After attending Texas State University in San Marcos, Chinery-Hesse returned to his native Accra permanently in 1990.
Chinery-Hesse says that the exponential growth of American suburbs awakened him to the potential of entrepreneurship. “Every aspect of underdevelopment requires a business. I realized that the opportunities in Africa were everywhere.”
TheSOFTtribe’s major products included customer management, accounting, inventory control and payroll programs for international conglomerates including Nestle, Guinness and Unilever. By the late 1990s, the company boasted a 70% market share, with nearly every computerized payroll system in the country using its products.
If Chinery-Hesse’s new company is as successful – and there is every reason to think that it will be – it will help transform several African economies, projecting it to the center of the world stage in a single step.