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Ashish Thakkar, Africa’s youngest billionaire

 

 

wEEKEDN SPECIAL

 

 

 

 

 

 

 

By Phillip Chichoni

 

Last month Trevor Ncube and his Alpha Media Holdings group brought to Zimbabwe Africa’s youngest billionaire entrepreneur. Ashish J. Thakkar is the Founder and Managing Director of Mara Group. He is a serial entrepreneur who started his first company at the age of 15.

Ashish considers himself a native son of Africa with strong Indian roots, of British nationality and a resident of the United Arab Emirates. Thakkar’s paternal great grandfather moved from Gujarat to Uganda in 1890 to trade in maize, cotton and other commodities. But his family had to leave Uganda in 1972 when the country’s dictatorial leader Idi Amin ordered the expulsion of Asians. His parents moved to the UK, where they set up a business trading women’s fashion goods and that is where Thakkar was born.

The family was itching to get back to Africa so they moved to Rwanda in 1993, only to be forced to leave again two years later by the bloodcurdling genocide there which claimed over half a million lives.

How he started

A year after the family relocated to Uganda in 1995, Thakkar dropped out of high school to sell computers and their parts like hard drives, floppy disks and CD ROMs which he would buy from Dubai where he would travel on weekends. His dream came to fruition when he was able to get a $5,000 loan. Within a year, he transitioned from a high school student to a full-time entrepreneur.

Three years later, Mara ventured into the packaging business. “I had this crazy fascination with being an industrialist and wanted to get into manufacturing,” says Thakkar, now 32.

With plants in Uganda and Kenya, Riley Packaging makes corrugated cardboard boxes for fast moving consumer goods and agro products. Though Thakkar is loath to discuss Mara’s financials, when asked if group revenues could be $200 million, he says they are higher.

Growthmara-group-tanzania.png

Since starting out in 1996, Ashish J. Thakkar has built a conglomerate of businesses as wide-ranging as telecoms infrastructure, packaging manufacture, hotels, conference centres and shopping malls, a paper mill, and thousands of acres of prime agricultural land. He has operations in 19 African countries and 21 countries worldwide, employing over 8,000 people through his investments and operations.

To help fund such stellar growth, Mr. Thakkar has brought in outside partners along the way. In the partnerships, Mara Group typically contributes the “on-the-ground” experience of doing business in Africa, while the other party brings in investment and expert knowledge about a certain business field.

Mara is developing two real estate projects in Tanzania and Uganda, totalling over 4 million sq ft and valued at $720 million. Thakkar also has big plans for financial services.

Personal motivation

Ashish devotes much of his energy to commercial and philanthropic initiatives in Africa. He has advised several heads of state in sub-Saharan Africa and has been profiled by several publications and media outlets including Forbes, The Economist, CNN, Africa Business Journal, Ventures Africa, San Jose Mercury, Reuters and the BBC.

Naturally ambitious, Mr. Thakkar says he pushed himself to grow the business by measuring himself against others.

For example, when his first packaging plant in Uganda had grown to produce 30 tonnes of cardboard a month, he visited a facility making 3,000 tonnes.

“That made me realise I was still just a drop in the ocean,” he says. “I am still a drop in the ocean but I am on my way to being a splash.”

Mr. Thakkar also highlights his desire or curiosity to learn from others.

“I bugged everyone I met about their businesses and how they did what they did,” he says. “It’s a vital lesson that I want to pass on to anyone that will listen.”

Despite leaving school at just 15, Mr. Thakkar says he has no regrets about not staying on to gain qualifications or go to university. Instead he jokes that he should have quit school earlier.

In the near future, Ashish J. Thakkar will represent East Africa on Virgin Galactic’s mission into space, thereby making him Africa’s second astronaut.

Recognition

Mara Group has received global recognition for its achievements and contributions not only in Africa but also worldwide. In 2010, Mara Group was identified by the World Economic Forum as a dynamic high-growth company with the potential to be a driving force for economic and social change. Ashish J. Thakkar was appointed as a World Economic Forum Global Young Leader.

Opportunities in Zimbabwe

When asked by Wilson Mudzungairi of the Newsday why he was coming to Zimbabwe and if he would be interested in doing business in the country, Thakkar said:

“I wouldn’t be coming to Zimbabwe if I didn’t think that this is a very exciting place with tremendous potential. I am confident that the business environment is improving and will continue to do so.”

His advice to young Zimbabwean entrepreneurs: “Never give up. Don’t take “no” for an answer. Learn from your mistakes. Learn from others around you as well. I would also encourage them to sign up for Mara Mentor by going to www.mentor.mara.com. This is one of the projects run by Mara Foundation, and it is an online facility that encourages knowledge-sharing and interaction between young and ambitious entrepreneurs and business leaders from all over the world.

It is a kind of social network with a purpose, where you can follow other entrepreneurs in your field, but you can also access training materials on building a successful business; participate in thought-provoking discussions; and they can also get valuable advice from business leaders from across Africa and the world.”

Speaking at the Alpha Media Holdings (AMH) Conversations in Harare on 3 April, Thakkar said the creation of an enabling business environment for the SME sector was key in addressing the unemployment scourge.

“Unemployment in the country will not be solved by bringing in more investment or the creation of big industrial projects,” said Thakkar. “There is need to nurture SMEs for young entrepreneurs and to create an enabling environment.”

Thakkar gave the example of South Africa where he said 65% of private sector employment was generated by SMEs.

He said that most investors would rather seek to automate their industries and consequently employ less people as they seek to compete with countries such as China and other big nations on the global scale.

“The key question is how to encourage the informal sector to enter the formal sector by creating tax breaks and related incentives. There is need to take SMEs seriously, this is the answer to unemployment,” said Thakkar.

He pointed out that the competition and good corporate governance would also serve to create a better investment climate for the country.

Partnership approach

In 2013, Mara announced the formation of Atlas Mara Co-Nvest Ltd — a joint venture with Atlas Merchant Capital — a firm founded by Bob Diamond, former CEO of Barclays. The entity raised $325m ahead of its London Stock Exchange listing and intends to acquire and build a trading African financial services business. In 2013, Mara also established Mara Capital Partners to source and execute growth equity investments in Africa on behalf of third parties.

Atlas Mara has injected $210 million into ABC Holdings to acquire a majority stake in the regional banking group.

Words of advice

Thakkar advises would-be entrepreneurs that the road is not an easy one.

“As entrepreneurs we do have to be different, we do have to be daring,” he says. “It is an exciting journey, but you have to be prepared. It isn’t easy. You’re going to get knocked down so many times. You need to get up, you need to dust yourself off, and you need to get back to it.”

Question: Entrepreneurs have long avoided Africa for a variety of reasons, including geopolitical conflict and other perceived trade barriers. How have you managed to crack the continent?

I think it’s an amazing emerging market. We have more than one billion residents, so we’ve got so many opportunities, from basic stuff to technology. How we identify opportunities is by looking at the basics and realizing that there are so many things to be done. In agriculture, real estate, and hospitality, we just saw so many gaps in so many areas. We thought, How do we solve this? How would we as consumers have wanted this service? But the only way you can measure opportunity is by really feeling it in a literal sense. I’m based in Dubai, but I spend 20 days a month on the continent.

Question: What are the barriers to starting and scaling a new venture in Africa?

I don’t think there are barriers. The key thing to understand is that we’re not India or China; we’re not one country of a billion people.

We’re 54 different countries as a continent and as sub-Saharan Africa, we’re 46 countries. So how do you truly plug into the local state and then replicate it to make it multicountry? I think that’s where the opportunity lies. Everything is doable. The skill sets and the infrastructure in Africa are better than what people envision. The opportunity is more appealing because the barriers are perceived to be higher than they actually are.

Question: In what sectors do you see the greatest opportunity in Africa?

We’re seeing a lot of online and mobile-technology-related innovation. We have more mobile phone users than North America and Western Europe combined. So we truly have the ability to leapfrog. Having your bank account on your mobile phone in Kenya is normal, where the rest of the world still has credit cards or whatever else. I think that’s where the opportunity is.

Also, organic food processing will be another huge industry. People are complaining about food shortages in parts of the world. We have I think 60 percent of the world’s rain-fed arable land.

Question: Are there any sectors that entrepreneurs should stay away from?

I wouldn’t say people should stay away from any particular industry, but there are sectors to be more sensitive about, like natural resources. I think foreign companies coming in and tapping into natural resources must be very cognizant of the fact that these resources belong to our country and the people of our countries. Extracting our raw materials and taking them elsewhere is not the way to do it. The way to do it is to look at adding value locally and then taking it to the next level.

Question: Reports show that corruption is a big problem for businesses in Africa. How do you work around this?

That’s a great question. As I mentioned earlier, everything we do is above board. We do face some bureaucracy here and there, but it’s such a two-way street. If you entertain it they’ll take it, if you don’t entertain it, like we don’t, you’ll still get things done. When we genuinely face bureaucracy, I scream and shout and name and shame when I have to. I make sure that point is really made. So there are ways to kind of avoid it completely. Business can be done in a straightforward, ethical manner.

A lot of governance is improving. I’ve seen it firsthand. I’ve been there for the last 20 years and I’ve been traveling the continent extensively, so I get it, I understand it. It just needs to be done properly and you can do it.

Social responsibility

Mara believes that being a successful business does not preclude a principled and socially positive investment approach. To this end, in 2009, Mara established Mara Foundation — a social enterprise that focuses on encouraging, mentoring and supporting young entrepreneurs in Africa.

The Foundation works to create sustainable economic and business development opportunities for young business owners via its Mara Launchpad incubation centres and Mara Launch Fund.

Based primarily in Uganda, Tanzania and Nigeria, since it was launched in 2009, more than 160,000 entrepreneurs have received mentorship from established business leaders.

For Mr Thakkar it is all about helping a continent that is “ripe for entrepreneurship because of its huge population of young people nourished on the idea of helping themselves”.

Magazien CoverThis article appears in the May 2014 issue of BusinessLink magazine. Get your copy here.

 

wEEKEDN SPECIAL

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