Local Capital Should Take Its Place

I read a thread the other day that was very shocking and it hit me differently. The author argued that the funding pouring into Africa from foreign investors is merely a test to see if the continent is a viable market.

Once this test is deemed successful, many of these investors will pour their money into Africa, buy up local companies, and own all the equity. In essence, they will take over and sell us products that were locally built but are owned by foreign companies. They have realized that they can’t just come to Africa and start an all-white company. They need Africans in their workforce to come up with the ideas and build them out with the help of outside capital.

Local vs. Foreign Capital

While the West has a lot of capital laying idle, they have a model of using it. They are big on investing in the big visions of startups and will walk with founders to make these visions possible. This is very different from how capital in Africa works. Wealthy Africans tend to prefer buying shares in large corporations, investing in government bonds, hoarding land, and building rental apartments. African capital is conservative and uncreative in its deployment. It only sees a zero-sum game and looks for avenues to preserve itself and not take risks, despite the massive potential returns. That’s why local capital always follows trends. When we hear that someone is making it big in agriculture, we want a piece of the pie. When we hear that real estate flats are profitable, we are all taking loans to buy. It’s not that we don’t have money, we just don’t want to think very hard on how to deploy it.

Confused and Misled

Let’s face it, building new and innovative things is hard, and this is the arena of the young, bold, and entrepreneurial people. Sadly, we don’t even give them a chance. We say that there should be entrepreneurs and innovators, but we give them neither the time of day nor the capital to build. A critical element in innovation is a conducive environment for it. If we don’t have the right environment, we are fooling ourselves.

If we really cared about innovation, we would advertise digital innovation hubs for young people. Just as we have massive campaigns for alcohol and betting, we should advertise our innovators. If you want to know what a country cares about, look at its billboards.

We are a confused and misled society in a world that knows what it wants. When an American comes to Africa, they see so much potential. When you talk to an African, they only see problems. How can two people see things so differently? The Chinese see wealth in Africa and they are making moves to come and get it. They give us loans to rope us into their web. If we let them, we will be caught and eaten alive. Just as the Europeans did, the Chinese will do the same. They are not our friends. They may say they are, but when it comes down to it, they will choose their own over us. That’s not being pessimistic, it’s just human nature.

The Nature of Human Groups

As humans, we have an innate tribalistic nature that compels us to defend our tribe for survival. We dominate the world today because we learned to coordinate ourselves in large numbers to overcome nature. However, studies have shown that each person can only effectively communicate with a maximum of 150 people at one time. To bring more people together, we developed abstract ideas and stories that cultivate a shared identity and allow larger groups to work together. There are numerous benefits to being part of a larger group, such as increased productivity, safety in numbers, and a larger pool of potential mates who share similar beliefs, norms, and values.

However, such groups must be defended and continually evolved to meet changing realities. Each individual’s survival within the group depends on enforcing, evolving, and propagating these shared ideas, whether through knowledge or by having children. Groups often prioritize their survival and success even at the expense of other groups, and history is full of examples of genocide, mass killings, enslavement, colonization, and annihilation of entire civilizations. We should recognize that we are privileged to live in the 21st century, and many people of the past would be envious of the problems we face today.

If We Do Nothing

The latest problem facing Africa is the capture of the continent by capitalists through equity, debt, and consumerism. It is critical that we act quickly to put Africans first in building our own continent. Many in the West are seeking to make a fortune in Africa, and they are working tirelessly to develop the latest strategies for exploiting the continent. Having already exploited their own markets and created wealth, they now seek to extract the low-hanging fruit from Africa. Once they have taken that, they will continue to climb up the African tree until all the great fruits are gone. This will leave us with only subpar fruits to fight over, perpetuating a zero-sum game mindset and causing infighting.

We need to reverse this trend and play them at their own game. African startups should eventually be in a position to buy American startups, as China is doing. While China has its own issues, they are proving that it is possible to change the power dynamic, and we should follow their lead. A while back, I read an article about how controversial it was for a Chinese company to even consider buying a power plant in Britain. This exemplifies the West’s mindset that they are entitled to buying up our companies, but we should never think of buying up theirs. We should learn from their pride in owning their stuff and adopt the same mindset.

My Ask

I am urging local capital to be more creative in deploying itself. Experienced generations should invest in young people and support them in pursuing their big dreams instead of funneling them into corporate jobs. Young people do not need handouts, but they need a hand up. This takes courage and acknowledges our weaknesses as a people, including our adoption of the previous generation’s concerns about poverty, zero-sum mindsets, and the need to escape our realities. We often say things like, “I will just make my money and mind my own business,” but there are vultures out there doing everything but minding their own business. They are buying up property, companies, land, tenders, exclusive rights, and more.

Sitting in your nicely furnished house may give you a false sense of security, but have you not noticed the shows your children watch, the apps you use, or the beer brands you drink? Who built these things, and who has benefitted the most from their distribution? It is highly unlikely that an African is the first person on that list. If this does not concern you, I do not know what will.


You are a slave to products run by foreigners. They invaded your home and you couldn’t even see it. Your false illusion of security has blinded you. In fact, you are the nobility of the fools as you flaunt your status with trinkets handed down by your puppet master. A shame, a real shame.

If we want to be free as Africans, we need to control our own systems of production. We have the tools, the knowledge and the determination. We as Africans need to start supporting ourselves, instead of eating each other.

We have so much potential. What the Mzungu sees, we can also see. We just need to start thinking differently about ourselves and what we are capable of doing. If they can do it, we can do it too.

Written on April 19, 2023