Interview: Tapfuma Musewe, Convener, Afrifursa Fintech Summit 2021
Tapfuma is a trade and investment executive who is focused on increasing the connectivity between African markets and other regions of the world. He grew up in Canada but his passion for Africa has led him to spending most of his career travelling and working across Africa. His consulting specialises in connecting advanced and emerging economies through strategic business development. Tapfuma has over 11 years’ experience in developing market intelligence in data-scarce environments across various sectors including clean technology, infrastructure, agriculture, mining, oil & gas and communications technology.
He helps client with deep market analysis, enabling them to make research and data-driven decisions.
“I was studying malaria because I knew it would provide me with an opportunity to do research in some African countries.”
Could you please share your background ?
I am an international trade and investment professional who is very passionate about Africa’s socio-economic development. I am currently based in Toronto, Canada, where I was raised, but most of my working life has been on the continent – mainly in South Africa and Ghana. While there, I worked in community development, business development, entrepreneurship and market intelligence. Since coming back to Canada, I have founded two organisations, Eschaton Solutions and Afrifursa, both of which are focused on increasing international engagement with African markets. I am also a Managing Director of a private equity firm called Raygan Mills, with roots in West and Central Africa. We invest in growth companies across Africa
What has the switch from the sciences to strategic investment consulting been like?
It has been quite a journey from the time I left the sciences more than 10 years ago. Interestingly, I was studying malaria because I knew it would provide me with an opportunity to do research in some African countries. Transitioning through various careers and fields of work, the focus on African development was consistent and has been very fulfilling. I would say that I have the sciences to thank for equipping me with a foundation for critical thinking, process orientation and detail orientation; these skills have been critical and have transferred with me throughout every career transition, including into the private equity space.
Also Read: Afrifursa 2021 Summit to Strengthen African-Canadian Fintechs’
What policies do we require to enable even more investment in the fintech space in Africa?
Investment in fintech in Africa has done really well this year, shattering records to obtain more than US $800 million in funding in the first half of this year alone. With Wave Mobile Money recently joining the unicorn club, the fintech industry is attracting investment from local and international investors, some of whom are venturing into African markets for the first time. While this investment activity is growing, it is important that capital markets also mature rapidly. For private equity investors (the space I operate in) this is critical because part of validating a deal is the probability of a good exit. At the moment, exiting growth companies through IPOs on the continent is not a realistic option due to a lack of large, efficient exchanges. If this were to change, investors would have other viable exit options beyond trade sales and secondary sales. This in turn would increase investors’ appetite for private equity investing in African fintechs.
What are the major barriers to leveraging fintech for economic growth and social impact on the continent?
One challenge is the pace of innovation as it relates to policy; with such a pace, regulators and fintechs are navigating new policy spaces all the time. There are key areas which require oversight that is both enabling and protects the most vulnerable – areas such as data protection and cybersecurity, for example, are critical to the consumer. Forward-thinking regulators will enable African fintechs to leapfrog while establishing policy frameworks that protect all stakeholders. If legacy policies and infrastructures do not adapt quickly enough, fintechs will seek markets that are more favourable to them.
With cell phone penetration (unique mobile subscribers) in Africa at approximately 45%, there are still large numbers of the population that do not have access to feature phones or smartphones. This presents a financial inclusion challenge for a large segment of the population; if they are engaged in the informal sector, they most likely also cannot access financial services which would be critical for personal and business wellbeing. Greater mobile penetration is key to enabling impact and economic development across Africa through fintech.
Also Read: Building an Inclusive Digital Economy in the Wake of Covid-19
What key lessons can Africa draw from the Canadian fintech ecosystem ?
The lessons are not one way; we seek to create a space where conversations between Canadian and African stakeholders can take place on equitable terms. These are two asymmetric regions, which each come full of their own nuances, so not all lessons will be transferable. However, I do believe that complementary and synergistic avenues can be found between these two ecosystems. The areas we have selected for breakout room sessions, including alternative currencies, economic development, investment and innovation, each have areas of strong synergy to explore. Please join us to find out more!