Madagascar’s
Impact Enterprise
Ecosystem
STUDY
Analysis of Madagascar’s Entrepreneurial
Ecosystem and Recommendations for Developing
an Impact Enterprise Accelerator
BY IMPACT AMPLIFIER
SEPTEMBER 2015
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This study was commissioned by the Deutsche Gesellschaft für Internationale
Zusammenarbeit (GIZ) under its “Responsible Mining in Southern Africa” project.
The findings and views shared in this report are Impact Amplifier’s, which was
solely responsible for generating this research and content to advise the GIZ. This
report is not a reflection of GIZ’s opinions or experiences.
Table of Contents
Executive Summary4
Introduction and scope of work12
Methodology14
Framing “Impact Investing” in Africa18
Madagascar’s Entrepreneurial Ecosystem22
State of Madagascar’s entrepreneurial sector
23
Social impact39
Ecosystem comparisons: Madagascar’s African peers
40
Snapshot examples of entrepreneurial opportunities in Madagascar
44
The Accelerator rationale47
Introduction to accelerators48
Differentiating between accelerators and incubators
46
Accelerators and incubators in Madagascar
49
Recommendations51
Proposed solution: a growth stage agri-business accelerator
52
Design and set-up of the proposed accelerator
61
How this model compares to other relevant
accelerators on the continent69
Next steps71
Appendix72
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ACKNOWLEDGMENTS
This project was funded by the Deutsche Gesellschaft für Internationale
Zusammenarbeit (GIZ) under its “Responsible Mining in Southern Africa”
project. The purpose was to conduct a study of the entrepreneurial ecosystem of
Madagascar with the purpose of determining the feasibility of building an impact
enterprise accelerator to enhance local business capabilities. Impact Amplifier
was asked to map the ecosystem, access the viability of an accelerator, and
make a set of recommendations, which could direct the development of a GIZsupported accelerator in Madagascar.
This report was made possible by the generous contributions of many experts
in Madagascar, Africa, Europe and the United States. The GIZ team based in
Madagascar, and Cape Town provided thorough support, guidance, and expert
assistance to Impact Amplifier throughout the process. We would like to thank
those involved in the interviews for their wealth of experience, understanding,
and critical feedback.
GIZ Advisory Team
Danny Denolf, Senior Technical Advisor
Stephanie Ranaivo, Technical Advisor
Lena Koever, Consultant
Impact Amplifier Editorial Team
Maximilian Pichulik, Partner
Pascal Fröhlicher, Partner
Jessica Pothering, Consultant
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EXECUTIVE
SUMMARY
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Impact Amplifier conducted a study to review the entrepreneurial ecosystem of
Madagascar with the purpose of assessing the feasibility of building an impact
enterprise accelerator in the country. The aim of such an accelerator would be to
enhance local business capabilities that ultimately contribute to Madagascar’s
economic development through job growth, skill development, improved incomes
and livelihoods and greater economic opportunity for the local population.
Impact Amplifier was requested to map the ecosystem, assess the viability of
an accelerator, and to make a set of recommendations which could direct the
development of an accelerator in Madagascar.
The report below offers key findings from Impact Amplifiers’ desktop and field
research on the state of Madagascar’s entrepreneurial sector, focussed on:
direct, partially-direct and indirect factors, based off of the Aspen Network of
Development Entrepreneurs’ ecosystem mapping framework.1 These include:
challenges and opportunities in accessing finance and business support
services, existing support structures that promote entrepreneurship growth and
development; and political, economic and cultural trends.
The presentation of this research is not intended to serve as a complete
“entrepreneurial map” of Madagascar, rather this report highlights the trends
and gaps in the current ecosystem. To provide context, this report also ties
in comparative research on entrepreneurship in other Sub-Saharan African
countries; provides an explanation of “Impact Investing” and a brief overview
of how the movement is taking shape in Africa; offers an explanation on
Accelerators and Incubators; and finally, includes three short case studies /
profiles of on impact-oriented and high-growth companies currently operating in
Madagascar.
A second part of this report identifies areas of opportunity for catalyzing the
growth of impact enterprises in Madagascar, as well as Impact Amplifier’s
recommendation for which is the most feasible opportunity to initiate a business
acceleration programme and a roadmap for (on) how to do it.
1. http://www.aspeninstitute.org/sites/default/files/content/docs/pubs/FINAL%20Ecosystem%20Toolkit%20
Draft_print%20version.pdf
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Summary of findings
Current high growth entrepreneurship activity in Madagascar, outside of
necessity-based or lifestyle businesses, is very limited due to a combination
of factors. Broadly, these include: lack of available investment capital; lack
of effective support structures like incubators, accelerators and mentorship
programmes, business networks and business development services;
a challenging (though improving) political environment; poor physical
infrastructure; cultural norms that challenge local businesses’ ability to succeed;
and corruption. Each of these factors and its ties to the broader ecosystem
is explored more fully in the main body of the report. What is clear is that
Madagascar has produced very few successful high-growth and/or scalable social
enterprises to date, while, entrepreneurs who have been successful are often
difficult to identify, because of cultural and political pressures to not showcase
their wealth and success.
Three sectors in Madagascar stand out from others as having experienced
relative success with entrepreneurial activity, these include: agriculture, textiles
and microfinance.
• In textiles, a small number of families have created successful businesses
from artisanal, hand-crafted products to larger scale plants, thanks in part
to trade agreements with Southern African countries and the United States.
While there is scope for more entrepreneurial activity in this sector, the sector
has taken a hit in recent years, primarily because of the interruption of
the AGOA (The African Growth and Opportunity Act), a non-reciprocal trade
agreement with the United States, between 2009-2014 (a direct repercussion
of the political coup in 2009.)
• In microfinance, a number of institutions are successfully operating in
Madagascar. However, the institutions are rarely driven by a social mission
and would not necessarily represent an impactful, high-growth opportunity
from the acceleration standpoint, and as such, Impact Amplifier does not
recommend focusing on this sector. In recent years, a lot of criticism has
been laid upon high growth micro-finance institutions, and their role in
increasing large consumption debt levels amongst lower income customers
thereby creating negative social value.
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• In the agriculture sector, there is a host of economic activity, some of
which are supported by development agencies, but mainly focused on
primary agriculture. Some more advanced agricultural companies have also
successfully tapped into export markets at significant scale. In addition there
is available and skilled labor, owing to the country’s largely rural population,
much of which engages in small-scale agriculture. What’s more, there appears
to be unmet demand for agricultural products from other commercial
enterprises within Madagascar – for example mining companies – suggesting
that there is a commercial opportunity for small businesses in this sector.
Impact Amplifier has provided two case studies demonstrating the potential
to structure successful enterprises around Madagascar’s majority smallholder
farmers and the commercial need for high-growth agricultural ventures
catering to larger companies and export markets, particularly where there is
value add / processing activity.
The obstacles to cultivating an active and diverse entrepreneurial sector in
Madagascar are not unique, however. Indeed, Sub-Saharan African (SSA)
countries with the strongest entrepreneurial ecosystems still report a lack
of available capital at every level of growth in a business - particularly those
capital requirements that have outgrown microfinance institutions; but are
too small for commercial lenders, private equity or international development
finance institutions. This problem is even more prevalent in countries with weak
entrepreneurial support structures, since there are fewer players supporting
enterprises’ investment readiness or providing transaction advisory services. Poor
infrastructure and corruption are also commonly cited problems in other SSA
countries. What is clear, however, is that relative to larger African hubs of highgrowth/social-enterprise and impact investing activity, such as Nigeria, Kenya
and South Africa, and even to smaller, emerging pockets of activity such as
Tanzania - Madagascar’s ecosystem is behind the curve.
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Given that there are only a handful of impact investors active in the country
and that many are still strongly concerned about the political and business
risk of investing in Malagasy businesses, it appears that in the short-term,
local organizations committed to supporting development and improvement of
Madagascar’s entrepreneurial environment will have to rely primarily on financial
support from development finance institutions and philanthropic organizations.
This applies also to business acceleration programmes such as the one Impact
Amplifier proposes below.
Madagascar’s entrepreneurial limitations have curbed active impact investing –
investment for both social/environmental and financial returns – in the country,
but this is not so different from many of its African peers. As this report explains,
impact investors across the continent struggle to identify “investment ready”
businesses to support for a host of reasons. These include the entrepreneurs’
difficulty to reach viable, sustainable business paths and milestones, but also
investors’ ability to understand local and regional nuances, and to develop
financial tools and models that are suitable in different African contexts.
What is apparent from this research is that besides a wide variety of isolated
investments and capacity initiatives in Madagascar, mainly driven and funded
by government agencies and foreign owned companies, very little has been
done to spur high growth potential start-ups and businesses at scale or through
a coordinated, long term approach. Most of the activities and players in the
ecosystem operate opportunistically or deploy programme funding for once-off
strategies developed outside of Madagascar.
There is, however, an opportunity to take the collective, somewhat isolated
existing resources investing into enterprises in Madagascar, along with
the learnings and experiences of incubators and accelerators across the
continent, to create a collaborative platform that will spur and increase in high
potential businesses in Madagascar. To provide context for Impact Amplifier’s
recommendation to develop a business accelerator in Madagascar, a short
primer on acceleration programmes, particularly outlining how they differ from
incubators, and what has previously been tested in Madagascar, is included as a
final section to the research piece of this report.
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Summary of the opportunity
In spite of the challenges and shortfalls of Madagascar’s entrepreneurial
ecosystem, there are clear acceleration opportunities and logical starting points
from which the ecosystem players can be galvanized to drive SMME growth.
In Impact Amplifier’s view, the most logical starting point is to focus on highgrowth, post-revenue businesses in a specific sector.
Businesses entering their growth phase require critical, yet relatively limited
Businesses entering their growth phase require critical, yet relatively limited
capacity and capital to unlock growth (compared to start-up or pre-start-up stage
businesses). Even in established ecosystems these opportunities are few and far
between. In the opinion of Impact Amplifier, there are sufficient opportunities
to not only accelerate high-growth businesses in Madagascar, but also to select
certain types of businesses (as in from a particular industry sector), which
could positively impact smaller and micro upstream and downstream businesses
through the acceleration process. Impact Amplifier believes the two sectors with
the most readily available opportunity for acceleration are the agri-business and
textile industries.
A sector-based approach to acceleration rather than a general acceleration
programme is recommended, as Madagascar’s entrepreneurial ecosystem is
complex, with higher risks of failure than other countries. A sector approach will
allow a more targeted focus, and build both market and investment expertise.
Further, outside of agriculture (and textiles), there appear to be too few existing
ventures around which a programme promoting high-growth companies could be
shaped. Either situation would present too many risks of failure and would likely
be unable to attract the necessary capital to fund it.
From Impact Amplifier’s experience and from our knowledge of other
acceleration schemes, an accelerator’s performance is largely based on the
expertise of the team behind it. This expertise becomes diluted when the focus
is too broad, either by encompassing businesses at widely varying stages of
growth and development where the needs of the cohort are too wide ranging; or
by trying to serve too many different business sectors at once. Often the network
around which the accelerator is built becomes overly diluted as well, lessening
market understanding and being unable to predict and mitigate business risks.
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In the case of Madagascar, Impact Amplifier proposes developing an accelerator
for the agri-business sector for three reasons:
1. Madagascar currently imports a vast portion of its processed agricultural
products, so not only is there a large local market demand but there is also an
established and vast export opportunity into rest of Africa, Europe and the US.
2. It appears to be the strongest choice in terms of the number of commercial
opportunities available, the expertise of the local population, the availability
of land and impact potential. From the financing perspective we identified
investors and funding agencies currently operating in the sector thus also
presenting a strong case for an agri-business focused accelerator.
3. Finally, the sector is most closely aligned with GIZ’s experience, focus and
mission for this project.
Developing ‘local content’ is also becoming more of a concern to large local
businesses, as they increasingly look to build more efficiency in their supply
chains. Sourcing agricultural products locally could reduce cost and risk,
and also contribute significantly to local economic development. An effort by
one company to lead an agribusiness development project to serve its own
needs – presented as the Ambatovy case study in this report - exemplifies
this. Additionally, a discussion with the Minister of Mineral Resources in the
Presidency alluded to a coordinated government and mining industry initiative to
develop a framework around “local content” in the mining sector’s procurement
function. This would include agricultural goods. It highlights a convalescence of
public and private interest in supporting local production and manufacturing,
which could provide momentum for high-growth business acceleration.
What is promising is that there are examples – albeit few – of successful social
and/or high-growth ventures in agriculture that have flourished in spite of
Madagascar’s challenging business conditions2 that can provide valuable best
practises for a new crop of ventures in the space.
2. There are also examples in textiles and microfinance; however, the “market access” points are less clear and/or
urgent in these sectors, which is why Impact Amplifier recommends focusing on agriculture.
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Summary of recommendations
The final section of this report includes a possible framework/model for building
the pilot, as well as recommendations for which partners could be engaged.
With a strong facilitator like the GIZ leading an acceleration programme, a wide
variety of funders and ecosystem participants could be engaged as programme
partners, and their services managed and structured through the programme.
Impact Amplifier offers a roadmap for / on how to do this and a framework for
which partners / players would need to be engaged under GIZ’s direction. A list
of these potential partner businesses and organizations has been included in the
Appendix. It is clear that the proposed accelerator programme has the potential
of not only accelerating a number of businesses, but also become the center
point of a network which can spur additional ecosystem initiatives, and gauge
international interest in investing into Madagascan businesses.
Given Madagascar’s geographic isolation to the African continent and the clear
requirement for ‘market access’ as a pre-cursor for growth, Impact Amplifier
added a ‘market access support’ function to the programme that is not typical
to other accelerators on the continent. From the cost and efficiency standpoint, it
would not be feasible to launch an accelerator that aims to build businesses from
scratch; rather, the opportunity is in building / scaling existing agri-businesses
bolstered by a team that supports additional market access opportunities
to strengthen the business for access to capital. Impact Amplifier is of the
opinion that there are a sufficient number of agri-businesses to launch a pilot
accelerator programme. A complete roadmap and timeline for design, launch
and programme milestones has also been provided.
It should be noted that while the negative ecosystem factors like the lack of
entrepreneurial role models, corruption, predatory taxation practices, and an
unreliable judicial system may pose considerable risks to any growing businesses
in Madagascar the influence of these factors relative to positives like market
access, availability of capital and support infrastructure is unclear. Thus Impact
Amplifier recommends piloting an acceleration programme that will test very
clear hypotheses, and susbsequently recommends re-evaluating to determine if
a larger, accelerator model is feasible. It is also important to note that, given the
mitigating factors above, a successful accelerator in Madagascar would require
additional effort and time from accelerators in other parts of the continent.
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INTRODUCTION AND SCOPE OF WORK
Impact Amplifier was engaged by GIZ to conduct a study reviewing the
entrepreneurial ecosystem of Madagascar with the purpose of assessing the
feasibility of building an impact enterprise accelerator in the country.
GIZ, as part of an ongoing partnership with mining company Rio Tinto, is
focused on identifying and implementing sustainable development initiatives
to promote economic growth, opportunity and inclusiveness in Madagascar.
Specifically, the aim is to understand how a growing mining sector and the
companies operating therein can engage local communities and support their
development. Meanwhile, mining companies also have an incentive to support
local economies and businesses as a channel for procuring goods and services
(“local content”) they need in their day-to-day operations.
Presently, lack of local businesses’ sophistication and maturity pose major
constraints for mining companies procuring local content and most rely on
expensive and logistically challenging imports. Regional isolation, high local
illiteracy rates and lack of market-oriented skills have precluded mining firms
from partnering with Malagasy businesses on the whole.3 Nevertheless, there
is growing momentum within the mining sector (and government) to support
development of reliable local content channels.
Impact Amplifier was requested to map Madagascar’s entrepreneurial ecosystem
and assess the viability of a business accelerator for high impact businesses.
Impact Amplifier was also asked to make a set of recommendations to inform
the development of an accelerator in Madagascar.
In its review and recommendations, Impact Amplifier was specifically asked to
provide:
1. A “map” of Madagascar’s entrepreneurial ecosystem, with trends in the
sector, existing support structures, challenges and opportunities around
access to finance, and examples of successful “high-growth” companies; this
section further includes an analysis of the investor and business support
ecosystem in Madagascar, as GIZ also requested.
2. A brief comparison of Madagascar’s ecosystem to regional African peers.
3. Rio Tinto, GIZ factsheet. Responsible mining for a better future in Southern Africa. December 2014.
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3. A concrete proposal and next steps to creating an impact accelerator in
the country based on the assumption that this is a need, as other support
programmes have been attempted and launched in the past; the focus should
be on how a more efficient and successful programme could be implemented.
4. A comparison of the proposed accelerator to other accelerators on the
continent.
To guide its research and accelerator strategy approach, Impact Amplifier
conducted its review with several tenets of GIZ-Rio Tinto’s partnership in mind:
1. The goal to promote local economic development around its mining sites
specifically by providing business opportunities for local communities. This
includes the development of small-scale manufacturing and services linked
to Rio Tinto’s business needs, which would allow small businesses to become
suppliers to the company. It also includes supporting “inclusive livelihood
interventions” for local communities in agribusiness and tourism.
2. The goal of reinforcing capacities in the public and private sector on local
content and inclusive business models.
The first part of the below report offers key findings from Impact Amplifiers’
desktop and field research on the state of Madagascar’s entrepreneurial sector,
including case studies and comparisons to other African countries. The second
part identifies areas of opportunity for catalyzing growth of impact enterprises in
Madagascar via an impact accelerator and Impact Amplifier’s recommendations
on how to do it.
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Methodology
Measuring entrepreneurial ecosystems with an established framework
In examining the prevalence and success of entrepreneurship in a specific
geography, it is important to initially understand the factors that enable
entrepreneurship. These include the business visionaries themselves, other
players; and environmental factors that facilitate the launch, development
and growth of their businesses. Combined, these factors make up a so-called
“entrepreneurial ecosystem”.
An accepted study by the Aspen Network of Development Entrepreneurs has
identified eight key factors that influence a given ecosystem.4 To the extent
possible, Impact Amplifier has applied this framework to evaluate Madagascar’s
entrepreneurial environment.
The key factors identified by ANDE include:
• Direct influence: finance and support structures
• Partially direct influence: Policy, markets, human capital, infrastructure
and research & development
• Indirect influence: entrepreneurial culture
For every factor, there are actors that play a vital role in driving the specific
aspect required for the entrepreneurial ecosystem to thrive. These include:
• Direct factor actors
*Finance: banks, venture capital, angel investors, foundations,
microfinance institutions, public capital markets, development finance
institutions, government
*Support: incubators, accelerators, industry associations/networks, legal
services, accounting services, technical experts/mentors, credit rating
agencies
4. While other assessment frameworks exist, ANDE’s encompasses the key tenets of a majority of them. Indeed,
while other research studies may include different numbers and identifiers for the key factors influencing entrepreneurial ecosystem health, most recognize the need for a multidimensional approach to understanding and measuring activity. More literature on entrepreneurial ecosystem mapping is available in this report’s Appendix. http://
www.aspeninstitute.org/sites/default/files/content/docs/pubs/FINAL%20Ecosystem%20Toolkit%20Draft_
print%20version.pdf
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• Partially direct factor actors
*Policy: national, state and local governments
*Markets: domestic and international corporations, consumers,
distribution networks, retail networks, marketing networks
* Human capital: universities, technical training institutes, high schools,
community colleges
*Infrastructure: electricity providers, transport providers, communications
(mobile and internet), other utility providers (gas, water)
* Research and development: public research centers and laboratories,
private research centers and laboratories
• Indirect factor actors
*Culture: media, government, schools, professional associations, social
organizations
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Understanding the role that each of these factors and actors play individually
and in relation to one another in an ecosystem is helpful to pinpoint relative
strengths and weaknesses of the system overall, and also to target areas of
effective intervention.
Given the scope of work of this project and the timeline required, it was not
possible for Impact Amplifier to provide an in-depth study into the impact
investment ecosystem in Madagascar, cataloguing all ecosystem actors and
their individual work and initiatives. Impact Amplifier therefore focused on
direct factors influencing the overall ecosystem based on inputs from the 20+
stakeholders engaged. The sections dealing with partially direct and indirect
factors were informed via desktop research and anecdotal information provided
by the stakeholders interviewed. Since Madagascar has a relatively opaque
investment ecosystem, with much of this knowledge confined within closed
networks and families on the island, it is possible that other investment players
exist, including those that take an impact investing approach. However, additional
on the ground field research would be necessary to uncover additional actors and
to learn about their activities.
Impact Amplifier’s approach to assessing Madagascar’s
entrepreneurial ecosystem
To understand the potential opportunities for entrepreneurial growth and
development in Madagascar (via a recommended acceleration programme),
Impact Amplifier undertook the following investigative activities:
• A review of thought leadership and existing frameworks for building thriving
entrepreneurial sectors, such as ANDE’s framework and others (see Appendix
for full references)
• A review of research/literature on Madagascar’s current entrepreneurial
trends and political and economic conditions
• A review of research/literature on other ecosystems in Sub-Saharan Africa for
comparative purposes (see Appendix for full references)
• Interviews of more than 20 stakeholders, including on-the-ground and
telephonic discussions with Malagasy business leaders, government
representatives and entrepreneurs; local universities, business associations
and intermediaries, and; investors and capital providers
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From this cumulative data and information, Impact Amplifier has compiled
a profile of Madagascar’s entrepreneurial ecosystem and the challenges and
opportunities therein. This insight has been used to guide Impact Amplifier’s
recommendations on how to leverage existing commercial opportunities within
the country to accelerate existing enterprises.
This research undertaking is as comprehensive as possible, given the scope​​
of work and timeframe for completing the project, along​w
​ ith​t​ he limited​​
time Impact Amplifier spent on the ground in Madagascar. It is not, however,​​
a complete culmination of existing research and field initiatives by existing
stakeholders to build and improve Madagascar’s entrepreneurial environment,
rather, it serves to identify, highlight and build off of existing research. What
Impact Amplifier has sought to establish from the existing literature reviewed
and qualitative interviews conducted is a strong picture of Madagascar’s current
entrepreneurial landscape. The key takeaway of this research is that there is​​
a strong need for ecosystem interventions to drive growth and development in
Madagascar’s entrepreneurial sector.
In the Appendix section, a full list of sources and interviews cited is provided,
along with a list of identifiable ecosystem players, including entrepreneurs,
funders, investors, and intermediaries.
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FRAMING “IMPACT INVESTING”
IN AFRICA
Finding and securing investment opportunities in Africa, which are focused on
social and environmental impact, is a relatively new phenomenon. Solutions for
pressing social and environmental issues have traditionally been the domain of
the public sector and civil society. However, entrepreneurs have recently emerged
as a powerful force for change. This phenomenon is emerging in the context of
a young but fast-growing movement happening all over the world called “Impact
Investing”. The concept promotes the idea of designing and investing in business
that garners social and environmental benefits in addition to traditional financial
returns.
As a nascent movement within the African continent that has just started
testing a social enterprise/inclusive business approach, the impact investing
marketplace has yet to find its feet. To date, few efficient mechanisms have been
created linking entrepreneurs with viable ideas and proven models with interested
investors. A number of issues throughout Africa has prevented these efficiencies
from being realized:
Entrepreneurship issues
The following relate to entrepreneurs’ challenges closing investment opportunities
in Southern Africa:
1. Entrepreneurs are not “investment ready”. A 2013 survey of 100
impact investors by JP Morgan and the Global Impact Investing Network
(an industry association for the impact investing sector) revealed that
34% of respondents that focus on Sub-Saharan Africa identified a “lack of
investable opportunities with a track record” as the biggest constraint to
scaling activity on the continent. Furthermore, only 20% of respondents
felt that there were “many” opportunities that could pass even a baseline
impact and financial screening. Geographic distance and a lack of local
market understanding also contribute to this unrealized demand. This
has also been Impact Amplifier’s experience: since Impact Amplifier was
launched, the team has not met a single “investment ready” entrepreneur
who was seeking investment.
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This issue stems, in part, from how these social enterprises have arisen. Often
they come from one of two distinct constituencies. The first are civil societybased non-profit organizations seeking alternative funding opportunities
outside traditional grant models. These organizations or individuals are experts
at identifying social/environmental needs and opportunities, but often lack
the skills or experience to convert these needs into financially successful
businesses. The second group consists of entrepreneurs who have identified
a market opportunity and designed a business to address it. While they value
the business’ social and environmental contribution, it is not always the core
focus or intention of their enterprise and they therefore struggle to quantify
this contribution or maximize impact.
2.Entrepreneurs struggle to implement their strategic path, especially
within the early stages of growth when introducing innovative products to
new markets. They also have difficulty in securing financing based on a
limited understanding of the needs of investors, “specifically key aspects
of the investor’s mandate”​, and what comprises an investable business
case. This lack of information, and consequent lack of capital, often leads
these entrepreneurs to get stuck in the “Pioneer” gap – the earliest stage of
business when a business is still little more than an idea – and never to realize
their potential.5
Investor issues
There is a growing supply of impact investment capital for high growth
businesses in Africa, including in Southern Africa. Investors seek opportunities
that can achieve both commercial returns, as well as social and environmental
goals. The following reflects some of the common issues investors are
confronting, which has some obvious cross over with the entrepreneurial issues
above, but enough which is unique and therefore worth noting:
1. Investors find it difficult to find investment-ready deals, which are
not coupled with untenable risks. Geographic distance and a lack of market
understanding make the costs of sourcing potential investments very high.
2. Many opportunities are early-stage and still require a maturation
process. This is often beyond the mandate of the investor or does not suit the
time frames and pressure to allocate capital.
5. Monitor Group, “Blueprint to Scale,” 2012.
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3. There is a perception of high investment risk. Once a promising
investment has been identified there is still a considerable risk associated
with it. Business support, close monitoring, and risk management is lacking,
which often results in failed investments or deterred investors.
4. Traditional fund management models rarely translate to impact
investing. The standard 2% fee and 20% carry fund management model
can be very restrictive to impact investment funds, especially for smaller/
earlier stage deals. This often means that deals under $1m don’t receive the
appropriate management support. Fund of funds, which are used to lower
fees in the listed/pension market, also struggle to deploy capital efficiently
even given lower cost structures.
5. Investors lack local market understanding. Many impact investors are
attempting to do unlisted deals from the US and Europe into Southern Africa.
On the smaller deals, they also use their own resources for the due diligence.
This often results in a large gap in understanding of the associated risks and
an inability to gain an in-depth understanding of market conditions. However,
the investment models don’t have the fee base to support alternative and
more costly due diligence processes.
6. Investors take a regional rather than local approach. Being a nascent
industry, and with the entire African continent to choose opportunities from,
many impact investors are choosing to tackle the large geography from a
regional basis (e.g. East Africa, with headquarters in Nairobi, Kenya). As
each country has very different markets and dynamics, it’s hard for Impact
Investors to do deals, outside of where they have staff on the ground. This
problem is especially persistent with smaller, earlier stage deals, which
require intense management and support.
Ecosystem Issues
The following reflects the broader ecosystem issues that exist throughout
Southern Africa and the continent:
1. Incubators / Accelerators / Business Development Services:
Although the need for investment readiness support is clear, the existing
support services available to most early/growth stage entrepreneurs in
the region is often caught within either a flawed delivery or inappropriate
compensation paradigm. What is available generally falls within three
categories:
• Large consulting firms. These​f​irms design services for large private and
public sector clients with fee structures based on time-versus-outcomes.
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As such, these firms are generally too expensive and poorly structured for
the services and support needed by earlier stage businesses. In addition,
they do not generally have the skills required to support social enterprise/
inclusive businesses, as these fall outside their existing expertise.
• Non-profit incubators/accelerators/training organizations. Generally grant
funded, these organizations are often under-capitalized, under-staffed,
and without the entrepreneurial skills required to support early stage
entrepreneurs and particularly commercially viable/high growth potential
social enterprise/inclusive businesses. • For-profit accelerators that use Silicon Valley models. These accelerators
generally provide a combination of seed equity and intense capacity
development to early stage tech enabled businesses at an idea or prototype
stage. They assume (as part of their sustainability):
* Ready supply of series A capital to exit/part exit themselves and/or;
* An early flow of dividends/revenue share.
Both assumptions seemingly do not work in an African context where there
are multiple capital gaps at every stage of the business’ life cycle, and
growth of these businesses takes longer than many expect.
2. Regulatory issues: Political and legislative stability where the rule of law is
both consistent, investor friendly and enforced; is often lacking in Southern
African countries. Corruption in the public sector is also a major issue. All
of this results in higher failure rates, diminished investor confidence, and
compromises business’ efficiency and effectiveness.
3. Network/inclusivity failures: The ecosystem network of social enterprises,
foundations, and impact investors is still relatively small and largely consists
of US/European-based investors (except in South Africa, where there is
a substantial local investor base). This results in many of the deals with
entrepreneurs being done with foreign expats, and not Africans. This can
result in innovations that may not be appropriate for the African context, from
an applicability and cost perspective.
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MADAGASCAR’S
ENTREPRENEURIAL
ECOSYSTEM
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State of Madagascar’s entrepreneurial sector
Entrepreneurial activity in Madagascar is low – particularly the number of social
enterprises - relative to other Sub-Saharan African countries, owing to a host of
inhibiting factors. The latest World Bank “Ease of Doing Business Report” (2015)
ranked Madagascar as one of the worst business environments in the world: 163
out of 189. Furthermore, according to its most recent entrepreneurship data
(2012), Madagascar has one of the lowest business creation rates in the world,
with only 1 of every 20,000 people registering a new business each year, compared
to 17/20,000 in Kenya, 18/20,000 in Nigeria, and 130/20,000 people in South
Africa. Meanwhile, in 2012, only 630 new businesses were registered compared to
17,900 in Kenya (2008 – most recent), 81,100 in Nigeria (2012) and 217,600 in
South Africa (2012).6 Madagascar’s African peer-group in terms of entrepreneurial
activity includes the Democratic Republic of the Congo, Ethiopia and Malawi rather
than more advanced ecosystems like those mentioned above.
Madagascar’s specific ecosystem constraints, according to the ANDE framework,
are explored below. In summary, the most significant inhibitors to entrepreneurial
activity appear to be lack of access to capital, particularly affordable capital; lack
of local skills and talent, weak entrepreneurial culture, poor infrastructure and
corrupt and/or predatory government policies and officials. Cultural, infrastructural
and government weakness will continue to pose long-term challenges unless
significant political and institutional change is initiated.
Financing constraints
There is a strong need for capital sources catering to businesses that have
launched, but which are trying to accelerate growth. Financing – particularly
investments of less than $300,000 – for businesses in this phase is severely
limited as upfront due diligence costs renders this scale of lending too expensive
for most traditional financiers. Also, it must often be accompanied by a high
level of business development services to ensure the business is able to meet its
financial obligations, which must either be structured into the financing or financed
separately though grants.
6. As a reference point, Madagascar’s population – 23 million - is about half of Kenya’s and tforty-five percent of
South Africa’s.
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Entrepreneurs focused on creating positive social impact through responsible
business (whether through job creation with improved wages and standards of
living, or by offering products and services that promote economic inclusion or
improved quality of life) play an increasingly prominent and important role in
developing economies. To succeed, they are dependent on an available supply of
mixed sources of funding over their lifecycle, particularly at their​s
​ tart up and
growth phases of development.
One promising trend is that international development agencies and
philanthropic organizations are increasingly looking for ways to support social
entrepreneurship in the developing world. Last year, the French Development
Agency (AFD), which primarily serves as a grant provider to a host of sociallydriven organizations in Madagascar, undertook a major research initiative
exploring the country’s social business landscape. It identified several roles the
agency could play in advancing the sector, including an investment fund of the
scope mentioned above and increased technical assistance support. The U.S.
development agency USAID is similarly making entrepreneurial support a priority,
although it has yet to launch any specific initiatives in Madagascar.
However, following a period of sustained growth until the political crisis in 2009,
Madagascar has faced a shrinking supply of donor and investor capital, owing
to perceived risk in investing in Madagascar. The withdrawal of state aid from
other nations and exclusion from established trade agreements, such as the
U.S.’s African Growth and Opportunity Act in 2010, contributed significantly
to Madagascar’s ensuing economic crisis and to investor skittishness more
specifically. While some development and trade initiatives have recently
recommenced (including Madagascar’s reinstatement into AGOA), the private
sector has not yet fully re-engaged.
Investment ecosystem
Madagascar’s investment environment is primarily composed of international
development agencies and a small number of private investors. The most
common source of capital is from development agencies like the Agence
Française de Développement, though the volume of financing available to
entrepreneurs remains limited and is often channeled via third-party investment
structures and funds.
There is an established but very small private equity investment sector operating
in Madagascar, which is comprised of a handful of investors who are also largely
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seeded by development finance institutions. Most of these are members of the
Association Malagasy des Investisseurs en Capital (AMIC), which is headed by
the managing director of Madagascar Development Partners (see below). The
organization appears to be a loose networking association for capital providers
in the country, which mostly holds conferencing and networking engagements for
self identified Private Equity / Venture Capital investors and advisors.
Impact Amplifier did not identify any entities that finance start-up stage
businesses; most investment mandates are restricted to companies that have
been in operation for two years or longer, with most preferring later-stage
companies. These established companies are often controlled by a handful of
families, or overseas interests, which limits the diversity of ownership of assets,
and the potential of innovation from the local majority population.
Investisseurs & Partenaires, based in Paris, but with representation in
Madagascar, is a notable exception with several very early stage investments in
its portfolio and a clear impact focus in its investments. The company primarily
targets one-to-two year old businesses that are chasing new capital sources
to help scale their businesses and improve/expand market access. It is an
equity investor that invests across francophone Africa with four investments in
Madagascar, and has recently announced a fifth. These include a 22% share of
NutriZaza, which produce and distribute fortified children’s food; a 22% share
in Phileol, a high-margin agricultural product exporter; ACEP, a Madagascar
microfinance company; and IOT, which grows sea cucumbers for international
export. I&P also recently announced an investment in Socolait, a dairy
manufacturer which procures milk from small-holder farmers.
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I&P takes a minority equity share in all of its portfolio businesses. It has
three investment vehicles, the first being a fund launched in 2002 that makes
investments in the €30,000-€800,000 range. It also has a “fund of funds” –
investing in other funds, rather than investing in businesses directly – and finally,
its IPAE Afrique fund, which was launched in 2012 and makes larger investments
between €300,000-€1.5 million. Its funds are raised primarily by international
development agencies and government agencies including: Proparco, BoA Group,
Credit Coopération and others.
Over time, I&P has migrated away from early-stage businesses towards more
advanced-stage companies. From conversations with Impact Amplifier, the
investor plans to increase its focus on infrastructure development and to raise a
second IPAE Afrique fund.
One of the notable features of I&P’s investment style is its support of technical
assistance to investee companies. Its focus is on bolstering companies
governance and finance structures and management, and funds up to 85%
of this technical support for the investee (15% must be contributed by the
business).
Madagascar Development Partners is a private equity fund manager operating in
the country since 2003. It raises funds from foreign investors, mostly in Europe,
to deploy in Malagasy businesses. However, it targets investments between €2-5
million, which means it is a more advanced-stage investor, not a start-up investor.
It claims to do deals for as little as €50,000 and up to €10 million. The company
has a general mandate, investing across a range of industry sectors. So far it has
closed 12 investments and deployed €40 million in capital. Among the challenges
it mentioned to Impact Amplifier about Madagascar’s business environment is a
lack of strong local business leadership and management. MDP also seems to
have very strong political ties in Madagascar, with the current President having
worked for MDP in the past.
Adenia Partners, based in Mauritius, focuses on larger, private equity investments
of between €5-€10 million. It is an equity investor funded primarily by
development agencies with 30% contribution from private family offices and
individuals. It primarily acquires a majority stake in companies, up to 100%,
and invests in reorganizing and restructuring over a four to seven year period.
It has raised three funds since 2003. Most of its target investments are in
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Madagascar – which it says comprises only about 20-40 viable companies – and
are run by a small number of local families with long-standing business ties and
strong connections to political leadership. In an interview with Impact Amplifier,
it explained that the challenge of investing in earlier stage businesses is a lack
of entrepreneurial education and support structures for young entrepreneurs in
the country. It noted that more technical assistance is needed. Furthermore, the
formalization of new businesses in the country is very difficult, particularly for
new entrants who lack strong informal networks.
Two other government-managed funds – Sonapar and Proparco – also engage
in the private equity space. Sonapar started in the early-1990s to manage
investment capital from the state. Since then, it has focused on investments
up to €1 million across a range of industry sectors, and co-invests alongside
other private investors and individuals. Sixty of 100 investments have been
“completed”, most of which were loans but Sonapar has also made some
minority equity investments (less than 35%). It does not appear to have
made any exits from these, based on Impact Amplifier’s conversation with the
portfolio’s manager.
Promisingly, recognizing a financing gap for young companies, Sonapar has
recently launched a SME-focused fund that will look to make 30-50 million Ariary
investments (loans) in early-stage businesses. Its target investment timeline is 36
months. It will focus on companies that have been in business for a minimum of
two years, and targets 100-200 investments.
So far, Sonapar has not done much active promotion of the new fund, has not
received any bids, and has not committed any capital. Due to logistical difficulty
marketing and managing in outlying regions, it will focus on businesses based in
and around Antananarivo only.
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The African Agriculture Fund, which is managed by South African investment
manager Phatisa, is a specialized investor and is also active in Madagascar.
It launched in 2009 with a Pan-African mandate and closed its capital-raising
efforts in 2013, having raised US$246 million from a number of European and
African development finance institutions. It is still in the process of investing this
capital. It has an SME-focused portion that is managed by Databank Agrifund
Manager and consists of US$36 million, which was raised in May 2014 and is
currently being invested in food production and processing companies across
sub-Saharan Africa. According to its website, it is an equity investor and will
take “either a majority or significant minority stake, where it seeks to have
board representation and other meaningful shareholder rights.” It has a strong
technical assistance component built into the fund structure.
One of the AAF SME fund’s Madagascar investments is Guanomad, an organic
fertilizer producer. When Guanomad was seeking new capital to grow its
business, the only two investors providing “early stage capital” for businesses of
its size were I&P and AAF SME, which highlights the shortage of seed- and earlystage capital for entrepreneurs. Guanomad elected to go with the AAF SME offer
because of the fund’s specialized focus on agriculture-based companies.
Grameen Crédit Agricole Microcredit Foundation, is a minor investment player in
Madagascar. The partnership between Crédit Agricole SA and the Grameen Trust
has been operating out of Luxembourg since 2008. Its key focus to date is to
invest wholesale into European micro-finance institutions operating in developing
countries. The foundations secondary key focus is to invest into Professor Yunus’s
definition of ‘Social Business’. The Foundation made over 11 social business
investments globally between 2010-2014, investing debt and equity in deal sizes
between €150,000 – €1.1m across sectors. Only one investment has been made
in Madagascar to date (see Phileol case study in the Appendix).
Finally, Business Partners – a South Africa-based small business investor – was
an active investor in Madagascar in the mid-to-late 2000s, having accumulated
a portfolio of 32 locally-owned small businesses in the country, it withdrew
from the country. Business Partners’ experience and decision to stop investing
in Madagascar highlights the perception of political and business risk, and why
other foreign investors have not engaged more actively in the country.
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During its active investment years in Madagascar, Business Partners targeted
Malagasy-owned businesses specifically, to support the local entrepreneurship
environment, and invested across a range of business sectors. It made quasidebt and equity investments in the US$150,000-$1 million range with an average
investment size of US$300,000-$400,000. The vast majority were royalty-based
quasi-debt investments, which were structured as low interest-rate loans with a
profit-sharing element that allowed Business Partners to get an extra payment
boost based on a percentage of the entrepreneur’s monthly profits. Five to six of
its Madagascar portfolio investments were traditional equity investments.
Business Partners, which was otherwise exclusively South Africa-focused,
made the decision to pilot an investment programme in Madagascar in a
plan to replicate its model to other parts of Africa. With funding support from
the International Finance Corporation, it selected Kenya and Madagascar for
the pilot, which were chosen for being on “opposite ends” of the business
opportunity and development spectrum. Kenya was favored because of the
prevalence of English-speaking business owners and an investment environment
similar to South Africa. Madagascar was selected in part for regional proximity,
but also to determine whether Business Partners’ investment thesis could work
in a culturally, linguistically and developmentally different environment.
Prior to the political crisis, Business Partners’ experienced relatively consistent
success with the small businesses in which it invested. Indeed, the fact that it
had identified more than 30 local small business owners to invest in suggests
that there was sufficient entrepreneurial activity in Madagascar at the time to
build a reasonable-size investment platform in the country. Business Partners
nevertheless felt that “in terms of [entrepreneurial] activity levels and standards,
the level of sophistication was distinctly lower” than its South African and
Kenyan portfolio businesses. Unlike the South African and Kenyan businesses in
which Business Partners was invested at the time, the Malagasy entrepreneurs’
business operations were more informally managed and less standardized.
2009 was seen as a “watershed moment”, after which the company’s portfolio
performance suffered enormously. Business Partners’ portfolio companies
struggled from an economic slow-down as a result of the political crisis. More
so, however, it pegged the problem on the collapse of legal and regulatory
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standards and negative attitudes to foreign-owned companies doing business
in Madagascar. Only five or six of its investees continued meeting payment
obligations to Business Partners. Business Partners offered 6-12 month
extensions to most of the others, after which about 10 completely reneged on
their contracts. Corruption in the legal system prevented Business Partners from
taking effective legal action against these business owners. In spite of a “slightly
noticeable improvement” in Madagascar’s commercial environment today,
corruption still persists in the legal system, according to Business Partners’
experience; by today it has recovered about 20 of its investments and taken a
loss on the rest.
Business Partners’ experience and key lessons learned are potentially significant
indicators as to why other foreign investors are not engaged in Madagascar’s
small business sector. Following its pilot expansion programmes in Kenya and
Madagascar, Business Partners has expanded into Kenya, Rwanda, Zambia,
Namibia and Malawi with another close to launching in Uganda. Its key
considerations for selecting new geographies include prevalence of English
as a business language (which lessens the cultural barrier) and supportive
legal structures; other issues that presented themselves in Madagascar, like
the (relatively low) pace and sophistication of entrepreneurial activity or
infrastructural challenges are secondary factors.
Outside of these, and a few other private investors, Madagascar has an active
microfinance sector that supports early-stage businesses. However, financing is
expensive (established players charge anywhere from 17 to 55% interest p.a. on
debt) and too small for most high-growth and social entrepreneurs (maxing out at
about up to €40 000). Meanwhile, commercial banks are typically inaccessible or
too expensive for most of these enterprises.
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Business Development Support (BDS) constraints
Note: The following section includes information on ecosystem-level
organizations, programmes and initiatives that are designed to support
entrepreneurs within Madagascar. Many of these are being funded with
support from international development agencies. These agencies
are also funding a number of business-building and support initiatives
for individual social entrepreneurs. The scope of work for this project,
however, does not make it possible to provide a full and detailed
catalogue of these one-off initiatives. Instead, the focus for this section
is the kinds of business support structures that have been/are being
developed for the broader entrepreneurial ecosystem.
There are few institutions dedicated to the promotion and growth of the
entrepreneurial sector in Madagascar. This is problematic as intermediary
support services are one of the crucial ingredients for an enabling environment
and corresponding entrepreneurial success. Most importantly, early stage
businesses need strong networks and resources to help them establish the right
financial and technical partnerships, as well as to get connection to markets and
distribution systems. Secondly, they require capacity development / incubation
support at an early stage of their development, including: business strategy
guidance, establishing clear governance structures, management advice, access
to capital / investment readiness, technical support, staff skills development,
financial and legal support. The support corresponds to a lot of great ideas
in the hands of talented individuals who have often never run nor scaled an
enterprise before. In more mature ecosystems, we often find a culture of serial
entrepreneurs who have gained those skills, networks and capital through years
of trial, error, failure and eventual success.
Presently, there are no established networks to specifically support high-growth
enterprises. The few existing initiatives catering to small and medium sized
entrepreneurs generally - helping mobilize knowledge, services and resources
- are small or have limited reach and seem disjointed. They are also typically
unspecialized, targeting small / micro businesses generally, rather than focusing
on their growth potential or a particular sector, such as agriculture, tourism or
textiles. This may limit their impact because small businesses need specialized
knowledge, resources and networks to successfully access and grow into
their specific markets, but also the skillset and services required to support
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high growth potential businesses differ from supporting micro/lifestyle small
businesses. What is more, these intermediaries’ interventions appear to be very
short-term; they do not appear to have the resources and support themselves to
commit to their entrepreneurs over a sufficiently long period to ensure success.
BDS ecosystem
The current programmes and support services available to entrepreneurs in
Madagascar, include:
ISCAM – a business school that has started an incubation space and programme
for early stage entrepreneurs and students that want to start a business. The
project is being initiated by Riveltd Rakotomanana, a lecturer at ISCAM, private
consultant for small businesses, and entrepreneurship activist. The incubation
programme does not officially launch until August 2015, however it had begun
hosting regular meetings with entrepreneurs on Fridays. It also appears able
to attract both entrepreneurs and potential angel investors. What is most
promising about ISCAM is that it proposes to do curriculum-based incubation
and create an access channel to international experts. Furthermore, it is looking
to establish a network of innovative entrepreneurs in Madagascar, which appears
to be the most valued aspect of incubation programmes to the participating
entrepreneurs.
Aga Khan Foundation – an agriculture-focused organization that provides training,
development and market access assistance for smallholder farmers; its focus
does not appear to be building capacity for high-growth agri-businesses. Its
main focus seems to be working via a network of global companies and also
serving as a smallholder extension partner with large agricultural processors and
institutions like the World Bank.
Exchange - a global volunteer organization where technical experts in the
northern hemisphere, build capacity and share knowledge/expertise with
businesses in developing countries, with a particular focus on agri-business and
the textile industry. In Madagascar, Exchange is currently building academies and
training centers focused on the textile industry.
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Gret – an NGO that oversees a network of micro-energy providers, takes
responsibility for mobilizing financing and technical expertise to assist the
individual entrepreneurs within its network and for engaging with municipal
governments as needed. This is an interesting support model, however it is
not widely available to entrepreneurs; rather, it was built as a work-around to
the lack of available support services in the country. This model allows the
entrepreneurs in its network to focus more energy on their individual business
operation and growth.7
Economic Development Board of Madagascar (EDBM) – a government created
organization that serves as a “one stop shop” for new company registration.
It has been successful in helping to simplify and navigate otherwise complex
business launch requirements (registry, tax reporting, etc.) in as little as four
days for new companies.
Habaka – An Innovation Hub for tech startups set up in Antananarivo, besides
technology networking events and training provided,their focus is seemingly on
the youth, and building their coding capacity, due to the shortage of qualified
developers in Madagascar.
A few smaller initiatives include:
• A collaboration between the French-Malagasy Chamber of Commerce and
HEC Paris to provide business education, though these courses and training
sessions are fairly expensive.
• CITE – an organization focused on supporting rural enterprises. Impact
Amplifier cannot speak to the scope or reach of the organization.
• A “train the trainer” programme fun by Microsoft called Build Your Business.
• Business networks and associations like GEM and FIVMPAMA, that host small
businesses – primarily small traders or farmers. These provide some basic
business training to members, though their primary function is to act as a
lobbying body. Their services are important to the business community at
large, including SMMEs, but they are not focused on high-growth companies
and therefore do not provide the specialized support they need.
• Impact HUB – a Madagascar extension of the global Impact HUB network,
which provides a shared workspace and community for impact-focused
7. AFD report, 2014
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businesses. HUBs provide a ready network for new businesses, linking them
to support services providers that are also part of the community; they also
host events and special seminars. The Madagascar HUB was, however, not
successfully funded to launch.
There are several student-centered entrepreneurship organizations, led by
Malagasy universities and other associations, but the scope of their work and
resources are limited. ISCAM is one, and it remains to be seen how effective the
initiative will be as it has yet to officially launch; another is CEERE, a student
entrepreneurs association, though this appears to be more of a “motivational
center” for students that express interest in starting their own business. It
organizes networking events and exposes students to entrepreneurs and other
businesses, but does not guide them through an enterprise launch process.8
Generally speaking, the link between academic institutions and the business
community in Madagascar is weak.
8. http://ceere.weebly.com/
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In all, the most glaring issue with the business support landscape in Madagascar
is heavy fragmentation and lack of focus on high-growth businesses. The current
scope of services at the ecosystem level lacks cohesion and connectivity, which
has left glaring holes that entrepreneurs must try to fill in other ways. Those
with private networks rely on these to access mentors or turn to international
networks for access to incubation and support programmes. Foreign
entrepreneurs often fare better, leveraging their home country ecosystems to
get the necessary support. Guanomad, for example, did not find any support
from local incubators or investors. It was all self funded by its founder, which
would be impossible for most Malagasy entrepreneurs. It has been financed and
received technical assistance from the African Agriculture Fund. It also had help
fundraising and assembling investment documents from FTHM, an organization
that receives funding from the AFD. For product testing, it worked with a local
university lab, (Fofifa Laboratory); however, this is not an enterprise-support lab.
As a final option, there are a handful of private consultants that work with
entrepreneurs to assemble business plans and provide various types of support
services, such as tax, legal or financial advice. Most of these are costly and overextended.
While there are several initiatives in play to change the current landscape, like
ISCAM, the current business support environment is comprised of a number
of one-off initiatives for impact-driven and high-growth companies and highly
fragmented ecosystem-level programmes and services.9
Policy/political constraints
Madagascar suffered a major developmental set back following the political coup
in 2009. Many international partners - in diplomacy, finance and business- either
froze or withdrew their involvement altogether, which resulted in the reversal of
decades of development and growth. On a GDP basis, Madagascar’s economy
fell back to 1960s levels within one presidential term (2009-2014).10
Last year’s elections have offered new promise for future change and reforms;
however, systemic problems will take time to reverse, which could continue to
challenge overall economic growth and entrepreneurship in the near-term.
Madagascar’s business sector has a long-standing dependence on political
9. http://ceere.weebly.com/
10. Presentation, Peter Hallinan, US Chamber of Commerce, 2013.
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connectivity, and favoritism and corruption are embedded in the political sectorbusiness sector relationship. The system tends to rely on social connections
more than formal processes and rules. For the entrepreneurial sector, this creates
competitive obstacles for new businesses trying to navigate the policies and
regulations around setting up and running their businesses
Anecdotally, stakeholders in Madagascar’s entrepreneurial ecosystem cite
rampant corruption as an enormous obstacle to business cultivation and growth.
Statistically, more than 65% of the population believes corruption is an issue
the government fails to substantially address.11 Tax collection by authorities
from successful businesses is reportedly highly targeted and predatory, critically
impacting many young companies’ ability to survive and grow. Import officials
are also notoriously corrupt and known for accepting bribes to let shipments into
the country, as a number of Impact Amplifier’s interviews revealed.
Market constraints
Market access is a significant challenge for Madagascar’s entrepreneurs. There
are three key market channels for businesses in the country: government (via
contracts), local retail operators (shop owners, restaurants, hotels, etc.), and large
commercial businesses (both local and international). Long-standing established
relationships between government and established business make it difficult for
new market entrants in key economic sectors, as previously mentioned. Catering
to local retailers is the most accessible channel. Partnering with larger businesses
may offer smaller ventures more consistent business or longer-contracts, however
many are wary about working with new or small local businesses because of
concerns about reliability. Many international companies with a presence in
Madagascar opt to import most of the goods and services they need to run their
businesses.
As for export markets, physical isolation and logistical challenges of getting
products to port are major constraints, owing to poor infrastructure.
Often, however, small businesses limit their own access to markets, being unable
to meet quantity and quality demands of potential (large) customers. In the mining
sector, for example, there is a growing interest in procuring locally produced goods
–agricultural produce in particular, for example. Without investment and capacity
development, however, most local enterprises will be unable to meet the demand.
Human capital constraints
11. Afrobarometer, 2015.
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According to Impact Amplifier’s interviews with entrepreneurs and ecosystem
providers, access to talented human capital is a challenge. Indeed, among the
interviews Impact Amplifier conducted, lack of qualified talent was among the
top challenges cited by business owners and other ecosystem stakeholders, after
access to capital and entrepreneurial culture. There appears to be an abundance
of willing and skilled labor but managerial and entrepreneurial education is poor;
as such, skilled management and technical knowledge seems to be in chronic
short supply.
As a result, European managers are often brought into locally owned Malagasy
businesses. This increases the cost of human capital immensely and also has
a more long-term cost if skills are not transferred. Furthermore, early-stage
businesses struggle to afford skilled employees, which makes Madagascar’s
already small talent pool even more difficult to access as they are unable to offer
competitive salaries. Across the board, employer-employee loyalty appears to be
low resulting in high turnover, which makes training costly to businesses.
Infrastructure constraints
Physical connectivity across Madagascar is an enormous challenge to the
country’s economic development, because its key economic drivers – agriculture
and mining – are spread across different regions over a large landmass. Poor
transit infrastructure (roads, railways) and energy infrastructure means that
established businesses are highly isolated from one another and the capital.
One informal estimate cited a need for 20,000-40,000 kilometers of new road
construction across Madagascar, while from an energy stand-point, it has one of
the lowest electrification rates and least reliable power systems in the world.12
More than 80% of the population in rural and urban do not have access to or
use the Internet.13 In short, resource sharing across economic sectors is not only
inefficient but nearly impossible.
Compounding the lack of physical infrastructure is the issue of Madagascar’s
failing urban centers. Cities are not receiving adequate investment, and culturally,
many of the country’s inhabitants still regard their rural villages as their social
and economic-safety nets. Indeed, the overwhelming majority of its 23 million
12. World Bank 2015 Ease of Doing Business report.
13. Afrobarometer, 2015.
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inhabitants live in rural areas, and deteriorating economic conditions following
the coup in 2009 propelled many to return to the relative security of their village
communities. This will be a difficult trend to overcome without more significant
action to promote Madagascar’s cities as centers of economic prosperity and
opportunity. For now, the latest Afrobarometer report (2015) cites that 65% of
the population feels it is faring poorly or very poorly in terms of their economic
and daily living situations. (On a more promising note, roughly 40% of both the
rural and urban populations reported they feel the economy will improve over the
next year and that similarly, their own life circumstances will improve.)
Additionally, poorly performing cities means Madagascar will face significant
difficulty in developing skilled human resources to participate meaningfully in the
economy in the future.
Cultural challenges
Cultural norms in Madagascar have inhibited entrepreneurship in several key
ways. For a start, with roughly 80% of Madagascar’s population living in poor,
rural villages, survival is dependent on community strength and sharing of
resources and individual accumulation of wealth is heavily stigmatized.
For entrepreneurs, however, generation of capital and growth potential is
dependent on their ability to accumulate a surplus of both finance and resources.
Those who have succeeded in doing this go to substantial lengths to avoid
attention or quickly diversify into other sectors or businesses to mask the size
of their operations. This is partly because of cultural pressure, but also fear of
corrupt government officials and predatory tax authorities targeting successful
business owners.
The follow-on impact of having an “undercover” class of successful entrepreneurs
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is that future entrepreneurs lack public role models to whom they can look for
motivation and guidance. In fact, very few self-made entrepreneurs are visible and
speak openly about their ventures, successes and failures.14 This perpetuates
Madagascar’s overall lack of entrepreneurial culture. A 2013 presentation
on “Accelerating Growth” in Madagascar identified this as one of the most
significant obstacles to creating a new class of high-growth businesses.15
Social impact
Although not part of the ANDE framework, an important part of understanding
the social enterprise sector is gauging how businesses (and investors in
businesses) identify target social impacts and benchmark outcomes.
In Madagascar, lack of data makes it difficult to qualify the social impact
businesses have had to date. Most existing high-growth or social businesses
conduct little or no impact measurement, owing to a lack of available resources
for collecting these statistics. A few impact-focused capital providers do some
measure of benchmarking – Investisseurs & Partenaires, for example; however,
there are too few examples of this to gauge overall impact in the social enterprise
sector.
That said, most of the proven impacts (that Impact Amplifier has uncovered) in
Madagascar’s entrepreneurial community appear to be in agriculture. Because
the vast majority of Madagascar’s population is unskilled and lives in rural
areas, these impacts are frequently small, amounting to basic improvements in
livelihood and basic local economic development. More complex issues around
improvement of health, education, access to goods and services are, for the most
part, unaffected by present entrepreneurial activities.
Ecosystem comparisons: Madagascar’s African peers
14. One notable exception is Ambinintsoa Randrianaivo, who founded a successful pizza chain called La Gastrono-
mie Pizza. He has been interviewed about the development, growth and success of his business: http://carrefourentrepreneursoceanindien.org/arson-ambinintsoa-randrianaivo-pdg-de-la-gastronomie-pizza/.
15. Presentation, Peter Hallinan, US Chamber of Commerce, 2013.
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African countries are in the early stages of developing infrastructure to support
active and viable small business sectors. The most common theme across SubSaharan Africa (SSA) is the lack of seed- and early-stage capital necessary
to accomplish this. A recent report from the United Nations Development
Programme estimated that the current financing need from small and mediumsized enterprises (SMEs) across SSA? is roughly $140 billion, but that there will
be a $100 billion annual gap for the next 15 years. The impact investing sector is
working to fill this gap, though to date, only $8 billion in impact capital has been
committed across Africa.16 The overwhelming majority of this is foreign capital.
Lack of available capital, however, is closely linked to a lack of accessible and
sophisticated business support services such as incubation, acceleration and
advisory services, which create investment readiness and produce a ready
pipeline of small businesses to attract investors – impact-minded or otherwise.
A few countries have fared relatively well in attracting a larger share of this
investment – primarily South Africa, Ghana, Kenya and Nigeria, and to a lesser
extent Côte d’Ivoire, Tanzania and Uganda – and in developing their own crop of
capital providers. Highlights of the entrepreneurial ecosystems in South Africa,
Kenya, and Nigeria are included below. Tanzania has been included because it
is a relatively less mature but growing market – particularly from the impact
investment standpoint – and some of the key challenges it faces in cultivating
entrepreneurship are very similar to Madagascar.17 Although a comparable study
has not been done for Madagascar, these snapshots should help contextualize
information presented in the previous section on Madagascar’s ecosystem. The
short summaries below also identify peer strengths and weaknesses according to
the ANDE ecosystem metrics.
South Africa
16. http://www.undp.org/content/dam/undp/library/corporate/Partnerships/Private%20Sector/Impact%20
Investment%20Final%20Report.pdf
17. Source for all country snapshots: http://ventureburn.com/wp-content/uploads/2013/04/Accelerating_Entre-
preneurship_in_Africa_source_Ventureburn.pdf
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South Africa’s formal economy is undoubtedly more advanced than its
African peers. Its established financial sector in particular sets it apart
from other SSA countries in terms of its business ecosystem. It also has a
highly active entrepreneurial and impact investing network, comprised of a
substantial number of impact investors, university curriculums dedicated
to entrepreneurship and inclusive/sustainable business; and a multitude of
business development services providers to guide entrepreneurs in growth
and strategy. Yet, across many benchmarks, South Africa falls short, and in
particular, faces substantial policy and human capital challenges. Legislative and
regulatory complexities are difficult for many small business owners to navigate,
while an overall lack of skills and talent tries many entrepreneurs during their
various growth stages.
Kenya
Entrepreneurship Assets
Business Assistance
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Policy Accelarator
Motivations
41
The overall view of Kenya’s entrepreneurial environment is positive across the
range of stakeholders, in spite of a few key challenges. Indeed, the strength of
its ecosystem has not only surpassed African regional peers but a number of
global peers as well.18 Among its core strengths are: a strong education system
(human capital), limited administrative burdens (policy) and a strong culture
of entrepreneurship (culture). Furthermore, from Impact Amplifier’s familiarity
with the sector, there is a wealth of business development service providers
supporting entrepreneurs’ growth, strategy, market access and fundraising.
There is also a fairly robust impact investor network seeking opportunities for
investment in Kenya. On the reverse side, however, Kenya’s challenges include:
costly and/or inadequate physical infrastructure and limited, and costly, access
to business support services.
18. http://ventureburn.com/wp-content/uploads/2013/04/Accelerating_Entrepreneurship_in_Africa_source_
Ventureburn.pdf
Entrepreneurship Assets
Business Assistance
Madagascar’s Impact Enterprise Ecosystem | STUDY
Policy Accelarator
Motivations
42
Nigeria
Though Nigeria is known for its thriving private sector, particularly in finance, it
continues to struggle on a number of fronts to cultivate a strong entrepreneurial
sector. In fact, it underperforms against its global peers on every ecosystem
metric except entrepreneurial culture, and there it underperforms or merely
meets the Sub-Saharan African average across these benchmarks as well. In
terms of entrepreneurial culture, in Nigeria unlike many of its SSA peers, owning
or starting a business is considered a desirable career path (rather than doing
so out of necessity). Inadequate infrastructure is the most commonly noted
constraint, while prohibitive financing requirements (finance); administrative
burdens and inconsistent government regulations (policy) are among Nigeria’s
top ecosystem challenges. Corruption and, increasingly, political instability are
also significant barriers.
Entrepreneurship Assets
Business Assistance
Madagascar’s Impact Enterprise Ecosystem | STUDY
Policy Accelarator
Motivations
43
Tanzania
Tanzania is on pace with overall SSA small business trends. Similar to
Madagascar, its key challenges for cultivating entrepreneurship include high-cost of
capital and/or lack of access to capital (finance), inadequate infrastructure and an
excessive and/or predatory tax structure (policy). Furthermore, on entrepreneurial
culture Tanzania lags behind global and regional peers. On the positive side,
an undeveloped commercial and formal business sector means there is a lot of
opportunity for entrepreneurs to seize new market share and fill existing gaps in
the market, much like in Madagascar. Furthermore, it appears the policy governing
the process of starting a business has been recently improved.
Entrepreneurship Assets
Business Assistance
Policy Accelarator
Motivations
Though these profiles represent more advanced entrepreneurial ecosystems
on the continent, the challenges they face are not dissimilar to Madagascar’s
challenges though they may seem less acute.
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Snapshot examples of entrepreneurial opportunities in Madagascar
In spite of their challenges, entrepreneurs in Madagascar have had some limited
success in three key sectors: agriculture, textiles and finance. Only agriculture
and finance (specifically, microfinance) have been identified as potentially
lucrative sectors for social enterprises, in recent research.19
Agriculture
Agriculture remains Madagascar’s key economic driver, accounting for over
a quarter of national GDP and is the main livelihood of more than 70% of
the population.20 This is in spite of the fact that there is little produced at
commercial scale and the country exports relatively few products.
Several factors lend promise to entrepreneurial growth in the agriculture sector.
For one, the country’s climate and terrain permit the cultivation of a wide range
of crops and livestock. Second, agriculture hosts a large and ready workforce, by
nature of the fact that so much of the population is already involved and semiskilled in it. Third, there is a demonstrated need and growing momentum to
increase locally-produced agricultural goods, both for the consumer sector and to
support businesses, namely the growing mining sector. Finally, there is potential
to tap into international markets; so far, the only agricultural export channels
that have seen any real success have been with a small number of high-margin
products, like essential oils, plant extracts, baobab, vanilla, and pepper.
A small number of creative and innovative social businesses have already
developed successful models in the agriculture sector. Examples and case
studies are elaborated on below.
Textiles
The textile sector, meanwhile, has a long tradition of artisanship and
manufacturing in Madagascar. With clear international market channels,
particularly in the SADC region and in the U.S., produced number of successful
small and medium-sized enterprises have developed in the sector. These
companies are, however, controlled by a small number of established families as
there appears to be very little support for new entrants. Furthermore, the sector
19. AFD report, 2014
20. http://www.new-ag.info/en/country/profile.php?a=2888; https://www.wfp.org/countries/Madagascar/Over-
view
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experienced a major setback with the suspension of the AGOA trade agreement
with the U.S. between 2010-2014.
Microfinance
Madagascar has a fairly robust microenterprise sector owing to its ability to
foster partnerships with international development organizations, like the
World Bank or the UNDP, as well as within the traditional finance and insurance
sectors.21 Most of Madagascar’s microfinance institutions appear to support
small lifestyle businesses and general consumption habits, however, rather than
growth-minded entrepreneurs. Furthermore, with few exceptions, their capital
is notoriously expensive - exceeding 20% interest rates and, in some cases,
surpassing 50% on small loans and lines of credit - which warrants questions
around their social missions and impact.
21. AFD report, 2014
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THE ACCELERATOR
RATIONALE
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Introduction to accelerators
Accelerators have gained popularity over the last 10 years globally. The source
of that interest arguably originated from the success of high growth technology
startups in Silicon Valley in the U.S., some of which went on to become multibillion dollar companies and recorded enormous valuations when they listed
on public stock exchanges. Accelerators like Techstars and Y-Combinator have
supported hundreds of successes, with many of the start ups being acquired by
larger technology companies or receiving follow on funding.
The distinguishing factor of these accelerators is that they are for-profit
commercial entities, investing a combination of capital and/or mentorship into
startup companies, in exchange for equity in their portfolio companies. Their
business models rely heavily on finding great technology startups, which are
scalable; have relatively low barriers to entry; and have low capital requirements
to launch their product/service. Often one of the founders and/or early staff are
highly skilled software engineers, who are compensated through stock options to
keep overhead costs low and incentivize the team to succeed. The accelerators
aim to quickly take these startups from idea stage to working prototypes, and
early stage market access - typically in 3-6 months - through intense group
cohort mentorship. The goal of most acceleration programmes is to prepare
these startups for follow on funding or even early stage acquisition, through what
they often term a ‘demo’ day for investors post the programme.
Compared to the African context, it is important to note that in the U.S. (and
particularly Silicon Valley), the ecosystem has:
• An accessible and large middle-income local market.
• A ready supply of talented engineers, management and employees, built over
decades.
• An established network of venture capitalists, investment firms and angel
investors ready to invest io startups and growth stage businesses, and
stimulated by public sources of funding
• A well-functioning entrepreneurial ecosystem and a strong culture of
entrepreneurship.
• A stable political system and well-functioning economy.
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Differentiating between accelerators and incubators
It is important to differentiate incubators and accelerators, as their focus and
services often overlap. Although agreement on the differentiation still varies,
incubators tend to offer co-working space alongside mentorship/business
development/training programmes, and usually have a longer timeline for
advancing participating businesses – typically 1 - 3 years. In Africa, many of
the existing incubators are either not-for-profit,projects implemented by large
consulting firms (see “Impact Investing” section above) or are driven by foreign
private sector entities. Funding for these programmes in Africa typically comes
from government entities or foundations in Europe or the U.S.
One noticeable difference between incubators and accelerators, in Impact
Amplifier’s experience, is that incubators generally attract micro/lifestyle
orientated early stage businesses from broad sectors, whereas accelerators
attract start-ups with high-growth potential and often run industry-centered,
thematic programmes (e.g. Health/Agriculture accelerators). Due to the longer
length of incubation programmes, their services tend to be broad business
support (finance, sales, HR, operations). Accelerators are typically very focused,
intense with clear outcomes at the end of the programme. It is also very rare
to see incubators taking an equity stake in businesses, especially ones that
are third-party funded. An exception in South Africa, however, is Raizcorp, that
managed to raise grant capital from a variety of public and corporate sources
and take equity in their participants in exchange for their incubation services,
access to networks and co-working space.
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There are many notable examples of successful incubation and acceleration
programmes alike. At the same time, in multiple research papers, forums
and networks, the value of incubators and accelerators has been called into
question. In Africa, it seems that thus far, the effectiveness and impact of
these programmes is not clear asvery few investment deals have emerged from
incubators/accelerators on the continent.
Accelerators and incubators in Madagascar
Although there are multiple private sector support mechanisms in Madagascar,
none of them can be described as an accelerator/incubator. More specifically,
Impact Amplifier did not find any early/growth stage acceleration programmes
which:
• Support group cohorts of innovative businesses to develop from an idea to
prototyping and getting their solutions into the market.
• Provide seed / growth stage capacity alongside investment capital.
• Support businesses in becoming ready for investment and accessing capital.
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RECOMMENDATIONS
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With the findings and the context of the study, Impact Amplifier recommends
piloting an agriculture acceleration programme for post revenue, high potential
agri-business (excluding primary agriculture) which are inclusive of smallholder
farmers within their value chain. Locally, the impact potential of an agricultural
accelerator is high, since the agricultural sector supports the livelihoods of 70%
of Madagascar’s population. This accelerator would locally source and select
a group cohort of agri-businesses to scale, with the intention of getting these
businesses ready for investment, and supporting them to raise capital.
Impact Amplifier recommend an initial 18-24 month pilot accelerator with
6–10 processing businesses as participants. This initial programme should
be seen as a pilot, and would allow for early learnings from a model that has
strong potential for success, but which has yet to be tested in Madagascar.22
These lessons can then be incorporated into the design of a larger and longerterm programme. The post-pilot programme would also benefit from having an
established local team and networks. The recommendation below, however, has
all the elements to make up a larger, long-term programme. All of these elements
listed would not be necessary for an initial pilot-stage programme, for instance
building a market access team or matching capital.
This section offers a possible framework for building the pilot; which engages
partners through the different stages; and the process for engaging them.
Proposed solution: a growth stage agri-business accelerator
Given the challenges and gaps in Madagascar’s entrepreneurial ecosystem,
Impact Amplifier believes there is an opportunity to set up a growth stage agribusiness accelerator in Madagascar with the following features:
22. There are other successful examples of agricultural accelerators in similarly “high risk” and under-developed
countries in Southern Africa. The global restaurant chain Nando’s successfully implemented an agricultural supplychain strategy around developing smallholder farmer networks in Zimbabwe and Mozambique, for example.
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1. Focus – The goal of the accelerator would be to catalyze growth into high
potential agri-businesses in Madagascar. With this goal in mind, the focus of
the accelerator would be to:
• Support high potential agri-businesses in getting ready to access capital.
• Secure growth capital for as many of those businesses as possible.
• Provide post-investment business development support, and strategic local
and international market access for their products.
• Possibly provide matching capital to the businesses in the programme.
2. Target companies/criteria for selection – Growth stage agri-processors
(e.g. dairy, fruit juice, essential oils producers, etc.) in Madagascar,
preferably headquartered in Antananarivo that are at least 2 years old and
are demonstrably cash-flow positive. The following criteria should also be
considered. The businesses will have:
• A strong commercial value proposition, and potential for international
expansion / export potential.
• A strong founder / management team.
• High potential for social and/or environmental impact, but also
demonstrate a clear intention to have an impact.
• Well-defined need for growth capital.
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3. Accelerator structure and delivery – The accelerator would be structured
as a ‘group cohort’ programme delivered to between 6-10 agri-businesses in
four distinct stages:
a. Recruitment and selection – During this stage the accelerator team would
market the programme, accept applications, and go through a filtering,
interviewing and selection process. This period usually takes 6-8 weeks.
b. Investment readiness - The accelerator would be designed as 8 separate
modules, each delivered over 12 days within a 4-month period (please see
the module breakdown below.) Each module would include a combination of
lectures, individual coaching, group discussions and presentations. Between
each module, there would be mandatory assignments to assess progress on
core subjects being reviewed. The idea is to combine expert and peer-to-peer
learning with pragmatic assignments that provide the basis for developing an
investment case to potential investors. Towards the end of the programme,
additional attention would be paid to final knowledge and marketing gaps
that often arise, such as the ability of the entrepreneur to pitch/communicate
their proposition, the strength of the writing of collateral, the strength of
the financial model, and the professionalism of design. These all need to
be completed prior to promoting these businesses to investors. Once these
hurdles have been overcome, an investor event for angel and institutional
investors would be arranged in Antananarivo.
c. Capital raising – The best/most viable deals from the accelerator would go
through an intense capital raising phase that would last between 6–9 months.
Getting these businesses in front of potential investors would first require
developing a list of prospective funders for each business. Ideally, these would
include the local and international investors who have been introduced to the
programmes during set-up and implementation phases. For those interested
in investing, the accelerator will support term sheets and shareholder
agreements being negotiated, taking the deal to closure.
d. Post-investment technical and business development support - Ensuring
that investors’ financial and impact targets are met will most likely involve
a significant amount of post-investment business development support and
technical assistance. This could include anything from ongoing mentorship
and strategy planning to support with supply-chain logistics.
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M1
2 Months
4 Months
Stage 1
Recruitement and
participant selection
•
•
•
•
•
•
9 Months
Stage 2
Accelerator
programme delivery:
investment readiness
•
•
Planning
Marketing
Call for applications
Interviews
Due diligence
Final selection
•
•
•
•
•
•
•
TBC Months M18
Stage 3
Capital raising
•
•
•
Impact model
Target market amd value
proposition
Critical path planning
Sales, marketing,
distribution, partnership
Financial model
Financial plan
Pitching
Draft investor documents
Market access
•
•
Stage 4
Post acceleration
support and exit
Final investor documents
Investor forum/event
Individual investor
Approaches
Negotiation support and
term sheets
Due diligence support
•
•
•
Exit strategy, future
planning and support
GEA alumni network
Monitoring, evaluation
and impact reporting
Accelerator course content
The investment readiness phase above would consist of 8 course modules
that would be provided on a web-based technology platform, which is where
homework/assignments will be delivered.
Stage 2:
Module 1
Programme
overview
Module 7
Financial
planning
Module 2
Impact
Model
Module 8
Investors
pitches
Module 3
Target market,
value proposition
Module 4
Critical path
planning
Module 5
Sales,
marketing,
distribution
Module 6
Financial
Model
Review
Week
Stage 3. Access to Capital
Investment
document
preparation
Investor
forum
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Investor
approaches
Negotiation
support
Due diligence
support
55
The target outcome of the 8-module course content is threefold:
1. To produce a bankable investment pitch deck.
2. A written investment teaser / business case.
3. A fully fledged financial model.
A breakdown of the modules include:
• Module 1: Introduction. The introduction module provides an overview
of the course and the field of impact investing, enables the group to get to
know each other and their enterprises, sets the core goals for the enterprises,
and requires a “beginning” pitch. This would be filmed and compared to the
“end” pitches in Module 8 and would be used to demonstrate growth and
development of the entrepreneurs.
• Module 2: Impact model. The environmental and/or social impact model
is at the core of what the enterprises do and why they do it. In this module
they would develop a 4-part description of their impact model that includes
mission statement, problem statement, solution description and impact
metrics. Addressing these elements early in the programme ensures the rest
of their business plan is developed to serve their impact goals, and not the
other way around.
• Module 3: Target market and value proposition. This module would
guide the enterprises through activities to determine their target market, the
segmentation of the target market, the competitive landscape within which
they are working, and finally, to determine their unique value proposition
for each of their target markets. Often social enterprises with differing
beneficiaries and paying customers have an added layer of complexity – in
such cases support will be given to understand the nature of both.
• Module 4: Critical path planning. This would be the critical juncture in
the programme; at this stage the enterprises would have fully assessed what
they are doing and why. The next step in the programme would be to identify
the most critical activities required to achieve this. The enterprises would
define their 3-year vision and the strategic objectives and initiatives that
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would deliver this. Based upon this, the enterprises would plan activities and
milestones that need to be implemented now, and in 3, 6, 12 and 24 months
time to achieve this.
• Module 5: Sales, marketing, distribution and partnerships. Once the
enterprises have identified their target market, this module would support
them in developing the most effective ways to reach and serve each market
segment. The 4 P’s of marketing (Product, Price, Promotion and Place) would
be developed for each segment of their market. Recognizing the strategic
importance of partnerships when growing enterprises, the module would also
explore which partnerships are required to best serve their market segments
and fulfill their marketing and distribution model.
• Module 6: Financial model. A robust financial model is essential to the
sustainable growth of any enterprise. This module would assess the flow of
money through the enterprise and create a financial model through a twostep process. The enterprises would have to undertake a value chain analysis
to understand the incentives received by each part of their value chain and
ensure they are appropriate and sustainable. Secondly, a full financial model
would have to be developed, outlining cost structure, unit economics and
revenue streams. Identifying the break-even point of the enterprise would also
be critical to appropriately setting sales targets and managing expenditures.
• Review week. Previous experience has shown that by this stage in the
programme, many of the enterprises have been through a significant rethinking of their operating model or long-term goals, or a range of new
opportunities or questions have opened up to them. They may require focused
time to revise their previous assignments, based on mentor discussions as
well. As such, a ‘review week’ should be included in which no new content
or tasks are introduced; instead, the session would consist of one-on-one
mentoring to focus on the key priority areas for each enterprise. This would
be complimented by individual working time to provide the entrepreneurs rare
away time from the office to focus on this work.
• Module 7: Financial planning and justifiable ask. Once the enterprises
have assessed and (re)developed their core business plans, they should
be close to ready to seek the external investment they require to catalyze
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growth. To do so, they require a long-term financial plan and to understand
exactly what type of investment they should seek. This module would outline
financial planning principles, ensuring key requirements are included and
common mistakes are avoided. It would also support the development of a
3-year financial plan. Following this, the enterprises should be able to distil
their pitch, which should clearly define the investment they require: the type
of capital they need and how much, how the funds will be used and what the
financial, environmental and/or social returns would be to the investor.
• Module 8: Practice pitching to investors. The final group session is
meant to prepare the enterprises to pitch to investors. Through group practice,
feedback and final filmed practice pitches, the enterprises would be able to
develop their individual pitch presentations, dialogue and pitching style that
clearly demonstrates the impact and commercial proposition they are offering,
as well as the passion, leadership and commercial astuteness they bring.
Strategic Market Access
Once the accelerator candidates have been selected, a market access team
would overlay the programme with the core focus on sourcing sales/pipeline
opportunities for the businesses in the programme. Early stage businesses often
need help in getting in front of potential buyers and customers, framing their
value, proving the quality and reliability of the goods and services they provide.
The goal for the market access team would be to strengthen the sales pipeline
of the businesses with local and international market access, particularly with
retailers and distributors.
In the case of agri-processing companies, achieving market access means
securing regular buyers for their goods. The particular acceleration model
Impact Amplifier proposes intends to help agri-businesses in Madagascar unlock
untapped market channels by securing contracts with companies in need of a
fixed, regular volume of agricultural products. The accelerator’s objective would
be to then ensure the participating businesses are equipped with the right tools
and skills to meet these contractual obligations.
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Mentorship
Not all entrepreneurs are experts in running a business; rather, many are
technical experts in their field who have identified a new product or potential
market opportunity. Others are successful in launching their businesses, but
need support and direction in putting sustainable management, governance
and accounting functions in place, amongst others. Others need guidance in
reshaping and realigning their strategies during periods of growth.
In the case of the accelerator participants, these entrepreneurs have most likely
never raised external capital, particularly from institutional investors. To ensure
they are able to take advantage of market opportunities, they will most likely
require capacity to suitably scale up their operations and ensure good business
practices are maintained, and business advisory services around strategy
planning, financial management, staff support and recruitment, and marketing.
The entrepreneurs selected for the accelerator programme would receive intense
mentorship throughout the curriculum. Increasing the capacity of Malagasy
entrepreneurs to access capital is a key goal for the acceleration process.
Experienced business strategists with strong investment expertise would provide
the mentorship.
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Matching capital
Once the businesses are through the investment readiness phase and are ready
for capital raising, the accelerator could present deals to impact investors
along with matching capital (the degree of matching capital would need to be
determined). Impact Amplifier believes that a matching grant or low-cost loan
capital will be a necessary addition to some of the deals, especially earlier-stage
or higher-risk deals. Some of the more mature deals could be offered purely on
commercial terms.
Matching capital is not essential for the pilot accelerator, though it would
mitigate some of the risk of doing business in Madagascar identified though
the research phase of this project. It is possible that investors would not choose
a commercially attractive deal in Madagascar unless there was a ‘sweetener’
provided in the form of softer, matching capital.
Technical assistance
Multiple Technical Assistance partners could be engaged in the programme
during the investment readiness phase, and possibly integrated as partners to
the businesses in the post investment phase. They include:
• Farmer Support: Providing farmer training and knowledge management
supply and management of agricultural inputs and aggregation of the final
produce to sell to the processor. Depending on the number of technical
assistance companies on the ground in Madagascar, different organizations
may be outsourced to support these different functions. For example, one
provider may handle farmer training while another purchases the agricultural
inputs (seeds, fertilizers, pesticides, etc.) and sells these to the farmers. The
latter could be a financial partner who secures returnable capital to finance
these inputs. Aga Khan is one locally-operating organization that could be
recruited to provide farmer assistance.
• Agribusiness Support: Overseeing essential health and safety compliance
and processes for the agri-businesses to ensure they meet mining companies’
standards.
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The impact case
There are two possible impact layers to the businesses in the accelerator. Firstly,
job creation from the smallholder farmers ethically integrated into the value
chains of the agri-processors; and secondly, positive environmental impacts
through sustainable farming at the smallholder level. The impact case would have
to be clearly defined through the acceleration process, along with specific impact
metrics, which are aligned to an internationally recognized impact framework
(e.g. SROI or IRIS). It is therefore imperative that the businesses understand
the broad set of potential impact risks and opportunities and set targets for
themselves to address them in the investment case developed.
Design and set-up of the proposed accelerator
Partner engagement for the accelerator
The critical part of the accelerator’s design phase is identifying which partners
need to be engaged and building the model around these roles. For an agribusiness accelerator shaped around investment readiness and market access
support, Impact Amplifier has identified the following partner roles that would
need to be filled for the programme to succeed:
• A Programme Director who oversees the programme’s donor and investment
capital, budget, stakeholder relations and governance. It is this organization’s
responsibility to engage and get the other partners on board, agree contracts,
find additional opportunities to build the accelerator, set and report on key
milestones, and report to a Programme Governance Board. (See details
below.)
• An Acceleration Service Provider (fulfilled by a Programme Manager)
who is contracted by the Programme Director to set up and implement the
acceleration programme.
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Programme Manager
Accelerator Coordinator
Programme Director
Giz
One Acceleration Programme
Mentor
Mentor
Group Cohort
Enterprise
Enterprise
Enterprise
Enterprise
Strategic Advisor
Strategic Advisor
Strategic Advisor
Strategic Advisor
Strategic &
Technical Partners
Enterprise
Graphic Designer
Enterprise
Communications
and Media
Fellows/
Interns
The following roles have been identified in the accelerator:
Programme Manager: To manage the programme as a whole across all cohorts,
including the annual planning, reporting, budgeting and finance. The Programme
Manager may also act as an Accelerator Coordinator for one cohort.
Accelerator Coordinator: To manage each accelerator cohort on a day-to-day
basis, including organising the workshops, venues, group communications,
technology platform, module materials, programme budget and financial
administration.
Mentors: To deliver the workshops, including the development of any new module
content required. To guide the entrepreneurs between each workshop, review
their learnings and advise them on how to apply this to their enterprises. To
review and feedback on the fortnightly assignments. There should be 2 mentors
per accelerator and each enterprise would be allocated a dedicated mentor,
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meaning each mentor would support up to 5 enterprises. The Programme
Manager could also play the role as one of the mentors.
Strategic Advisors: These would be successful, local entrepreneurs dedicated
to supporting other entrepreneurs. They would meet with the enterprises at
strategic junctures during the programme to provide high-level input and
impartial advice from an external perspective in a way that a mentor may
be unable to, given their close working relationship with the entrepreneurs.
The strategic advisors would also serve as ambassadors for the programme.
Each Strategic Advisor would guide 1-3 enterprises. Strategic Advisors should
complement the mentors’ experience.
Strategic Partners: To provide additional support to the enterprises, such as
access to networks or expertise on specific technical areas, or can support in
content delivery across marketing, business development, etc. They would also
be guest speakers at the workshops.
Fellows and interns: To provide additional support to the businesses in
developing their financial models, business cases, pitch decks etc. These would
most likely be foreign graduate students coming to Madagascar for 3 – 6 months.
Graphic Designer: To support in the development of professional investment
documents, including investment teasers and pitch presentations.
Communication and Media: To support the writing and editing of the final
investment documents, to profile the enterprises in the national and local press.
Attracting local talent to the accelerator
Working with local partners is of utmost importance in building local capacity
and driving the sustainable success of the accelerator. The role of locally
engaged partners in this capacity would be to:
• Project Manage and co-ordinate the accelerator.
• Provide strategic/business development support throughout acceleration
programme.
• Provide objective, third-party, high-level mentors with entrepreneurial
experience and networks.
Key partnerships to support the accelerator’s activities
Strategic market access partners
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Engaging strategic market partners (retailers, buyers, wholesalers) during the
design phase will be an important component of the accelerator. If possible,
it would also be worthwhile to understand the partner’s volume demand
requirements across a variety of crops, to ascertain needs. This ‘agricultural
assessment’ will be valuable when it comes time to selecting businesses which
potentially fit those needs.
It is hoped that the market access partners would take a long-term view
when negotiating contracts and agree to a multi-year contract to purchase a
guaranteed quantity of products from the agri-processors in the programme
at a fixed, sustainable price. It should be understood and communicated in the
contract that in addition to supporting their businesses, the goal of this initiative
is to improve local livelihoods as well. For this part of the partner engagement
process, it is important to have buy-in from these partners’ top-level executives,
to ensure the procurement teams are held accountable to the agreement over the
duration of the pilot.
Technical Assistance partners
Multiple Technical Assistance partners could be engaged and integrated into
the programme through the businesses selected for the accelerator programme.
Typically the partners would support any inclusive supply chain initiative, which
integrates smallholders into their agri-processors’ supply chains. They include
farmer and agribusiness support providers – for the sake of continuity, it would
be preferable to continue working with the same partners that were engaged
in the investment-readiness stage of the programme, provided they supplied a
satisfactory level of service.
A technology partner would also be needed. A technology partner would provide
real time mobile data collection and reporting against a pre-determined set of
metrics for the purpose of managing the smallholder farmer value chain, and
obtaining reliable data for impact assessments. As most agricultural technical
assistance partners use paper based systems for input provision, technical
assistance monitoring and financial exchange; it is often difficult to obtain
accurate reporting and monitor issues in real time ensuring that the inputs and
transactional data is accurate. Therefore, the key purpose of the technology
platform would be to gather real time input utilization, technical assistance
data, training content, yield, transactional and impact data from the smallholder
farmers for the processor.
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Governance/Advisory Board
Given that each partner will have different roles and interests, the recommended
approach for managing the programme’s goals and operations is to set up
a governance/advisory board comprised of the representative parties. The
Board will ensure there is a forum for reporting progress, reassessing direction
and goals, if necessary, and dispute resolution. There are 2 possible levels of
governance. In the proposal, we have only detailed governance of the accelerator,
via the Programme Manager (which represents the acceleration service provider),
to the Programme Director who is responsible to the primary funder.
Other government agency partners
At a Project Director level, Impact Amplifier recommend that this initiative
be used as a platform for creating collaborative engagement and support
from varies government funding agencies operating in Madagascar. There
are numerous funding opportunities via this programme directly and across
Madagascar’s entrepreneurial ecosystem broadly – this pilot could serve as an
entry point for government funders to identify tangible ways to build and support
the small-business sector. In short, it is offers an opportunity to begin shaping
a more effective business ecosystem via a small but well-orchestrated multistakeholder platform.
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Investor Partners
Finally, engaging with local and international investors at the early stage of
the programme design is important, given the goal of developing investment
ready enterprises which will require capital post the acceleration programme.
Introducing potential future investors to the programme and its process at the
offset and maintaining a relationship with them over the project’s 18-24 month
timeline will increase the likelihood of these businesses attracting investment
offers at a later stage.
Once all of the partners, roles and opportunities are identified, the accelerator’s
costs need to be assessed, potential funders identified and the fundraising
process initiated. In all likelihood, the accelerator costs would have to be grantfunded. The costs that would need to be taken into account include:
• The setup cost and running costs of the accelerator programme (assuming
a 24 month pilot). If an accelerator pilot were to be implemented in
Madagascar, the availability of relevantly skilled local talent in Madagascar
is very important, though some of the accelerator resourcing (particularly
strategic mentorship roles) might have to be brought in from outside, at least
initially.
• An (optional) budget for matching capital for the processors to use for
investor engagement in the later stage of the programme. The goal of this
would be to incentivise impact investors to invest into the Malagasy market
with viable opportunities.
• Fundraising entities could also be budgeted for, and contracted during
the implementation phase. These would most likely include foundations,
development and government agencies and philanthropic organizations.
Set-up and business selection
Once funds and partners are in place, the actual accelerator setup process would
include establishing a local office and selecting the acceleration team to work on
the ground in Madagascar. This phase would also require recruitment of local
administrative staff for the Accelerator team and set up of tools and operating
systems needed in line with the project timeline.
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Next, recruitment and selection would commence. This will necessarily include
working with local business networks and associations to identify target
acceleration businesses. Once applications have been reviewed, the final
companies would be registered in the programme and the implementation as
outlined above would commence.
Monitoring, Evaluation and Reporting
To ensure that business development support is aligned with the financial and
impact return targets along this acceleration pathway, a Monitoring & Evaluation
process is essential. This guarantees that impact and financial targets are on
track, but also allows for the capture of key learnings to modify the acceleration
approach or to incorporate into a programme extension. The Programme
Director would be responsible for collecting data over the course of the
programme for analysis and dissemination to the programme stakeholders at the
end of the pilot.
Programme Director
Accelerator Programme Reporting
Annual Plan
Financial Statements
Previous
Quarter Actuals
Future Quarter
Budget
Month 1
Month 3, Month 6, Month 9, Month 12
Advisory
Board
Monitoring
Evaluating and
Impact Reporting
Month 12
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Report
Month 6
67
M&E is essential to learning, building upon and improving the programme
structure and content. Similarly, understanding and quantifying the impact
created will be central to the communication and marketing for each new
programme cohort. M&E would be undertaken at a high-level for the programme
and accelerator cohort. Accelerator level objectives and metrics will be
established and agreed with the GIZ/funders in an Annual Plan. Results would be
reported to the GIZ/funders through a mid-year Progress Report and a year-end
Monitoring, Evaluation and Impact Report. These reports would be assembled as
follows:
• Annual Plan (Month 1): Setting the strategic focus on the accelerator for
the upcoming year, including the objectives, metrics and targets. Detailing the
operational plan to deliver this and the required budget.
• Progress Report (Month 6): Reporting on the outcome of Stage 1 (the
marketing and participant selection phase). It will include information on the
number and type of applicants, those shortlisted and interviewed, and those
successfully selected.
• Monitoring, Evaluation and Impact Report (Month 12): Reporting on
achievement against agreed programme level objects and targets, reporting
on the outcome of each accelerator cohort and capital raising stages. It will
include:
* Significant gains of the enterprises during the programme, including
securing new clients, contracts, markets or partners, press and media
coverage, direct investment or other significant recognition.
* Assessment scores and feedback comments from the accelerator
participants on the quality and relevance of the programme, and the extent
to which their capacity was strengthened.
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* The value of investment opportunities presented at the Investor Forum, the
number of investors present and the number of direct investor approaches
made.
* Feedback from investors on “investment-readiness” of enterprises
showcased.
* The number of investor negotiations and due diligence processes
supported.
* The value of investment opportunities secured.
* The overall outcome of the capital raising process.
Financial Statements (Quarterly): Detailing the budget for the upcoming
quarter and the actual spend for the previous quarter. Reporting spend to date
against annual budget.
How this model compares to other relevant accelerators on the continent
Impact Amplifier’s proposed model draws some features from other models on
the continent, in addition to relying on the team’s own experience in Southern
Africa and insights gleaned from engaging with Madagascar’s ecosystem players
specifically. The following are a few examples of other acceleration models for
high-growth and social businesses active in Africa.
Village Capital
Village Capital offers 12-week acceleration programmes globally. The selected
companies participate in workshops in which they are offered mentoring advice
from other entrepreneurs, investors and professionals. These entrepreneurs then
assess one another against 6 criteria, with the top one/two ranking companies
receiving between $50,000 – $100,000 each.
The Village Capital programmes are typically once off and short-term with
light mentorship provided. In Africa, it seems Village Capital has a mix of
local accelerator partnerships, and employ their own resources locally. Their
programmes typically do not cater to additional capital raising with other impact
investors post the accelerator program, as they prefer to invest directly with one/
two additional investment partners.
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Green Pioneer Accelerator
The Green Pioneer Accelerator is a group cohort programme piloted in Kenya
and South Africa in partnership with HIVOS, VC4Africa, GrowthAfrica and
Impact Amplifier. This 4-month programme is focused on the environmental
goods and services sector. It prepares entrepreneurs with the skills, knowledge,
documentation and support required to secure investment for their businesses.
This programme doesn’t specifically cater to capital raising or market access
support, which is suggested in the recommendations above. However, the
investment readiness phase of Green Pioneer Accelerator will be relatively similar
to what is recommended for Madagascar.
Inclusive Business Accelerator (IBA)
The Inclusive Business Accelerator is a partner driven platform for accelerating
investment ready deals to impact investors globally. Formed by a consortium of
Dutch organisations, the platform connects local accelerator programmes and
deals into a global investor network leveraging an online platform developed by
VC4Africa. This online platform allows investors and entrepreneurs to connect,
supporting deal flow.
IBA is currently in pilot phase, setting up in two countries (Vietnam and
Mozambique), leveraging their core partners SNV, Nyenrode University, VC4Africa
and BOPinc. IBA could be a potential partner to an accelerator in Madagascar,
as both the values and intentions align. However, as the IBA is at a very early
stage and their web platform is in beta phase, a partnership would need to be
progressed over time.
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Global Social Benefit Institute (GSBI)
GSBI is one of the most established accelerator platforms for social enterprises
globally. Their accelerator is run out of Santa Clara University, and includes
a combination of online and residency accelerator programmes for social
enterprises. With a very well designed curriculum, and technology driven
process; which allows remote mentorship, they have supported hundreds of
social enterprises. They also have close partnerships with technology executives
in Silicon Valley who serve as mentors and advisors. Impact Amplifier has
worked closely with the GSBI on amending their online accelerator curriculum
to combine both in class and online facilitation. The Malagasy accelerator could
collaborate with the GSBI to localize and amend their curriculum to something
applicaple to Madagascar. The GSBI could also play a very important role in
supporting the deals, finding investors through their well-established investor
networks and relationship with TONIIC, an early stage impact investment angel
network in the U.S.
NEXT STEPS
The immediate next steps would be to begin to cost out the accelerator, engage
potential partners more substantially, and develop a detailed project plan, and
proposals for funding, should GIZ wnat to move forward with the proposed
framework, or a modification of it.
It would also be appropriate to being talking to potential funders and government
agencies to initiate a collaborative engagement process.
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APPENDIX
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APPENDIX
Case studies74
Phileol: an agricultural processor that demonstrates the
risk of operating in Madagascar’s difficult ecosystem
74
Ambatovy Harenasoa project: a mining company’s local agricultural
development project to promote economic development and it’s own
supply needs75
Socolait: an agri-business built around a network of smallholder farmers 77
Madagascar’s Ecosystem Player Index79
References97
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CASE STUDIES
Phileol: an agricultural processor that demonstrates the risk of operating in
Madagascar’s difficult ecosystem
Phileol was started in 2008 by a French chemical engineer, who partnered with
two local Malagasies. They identified a large market opportunity for castor oil,
especially for the flooring and chemical industry, which was being brought in
from India.
After completing a feasibility study, they produced 24 tons (only for seed) in
2008, and 60 tons in 2009. In 2010, they began producing oil. Phileol currently
produces 300 tons of grain, and 100 tons of oil (They also produce: Moringa,
Amarula, prickly pear, baobab and jatropha). They only have one client in France,
which has an annual​demand for 10,000 tons of ​product?
Currently Phileol generates €200,000 in revenue per annum, where 55% is Gross
Profit. They have done multiple rounds with investors which include: European
Investment Bank (€3,000 grant), I&P in 2010 (€45,000 equity, debt €70,000),
UNDP (€ 70,000 grant), Grameen & Kredit Agrical Fund (€50,000 equity, €70,000
debt). Phileol’s latest round is with SOFISUD (€50,000 equity, €70,000 Debt).
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Phileol’s main challenges include:
• The business took many years to get to breakeven, with a number of investment
rounds, which have left the business in significant debt, and the business
founders / drivers have been forced to dilute significantly. Although Phileol has
significant product demand, their issue has been to produce at scale.
• Phileol manages over 6000 out growers in the south of Madagascar.
Organising the smallholder farmers over such a large area has been
logistically challenging and costly.
• Improving productivity has also been the major challenge for Phileol mostly
due to the low quality of seed. The farmers’ average yield is 150kgs / hectare
/ season, and as each farmer is on an average of 0.2/3 hectares, each
farmer’s average earning is 20,000 AR per annum. Consequently the social
impact has been low.
Phileol is in the process of shifting their strategy by shortening the value chain
significantly, shortening the production and processing logistics (moving it closer
to Antananarivo), and is also seeking another round of investment capital. With
the amount of capital invested into Phileol to date, its seems that the investors
have not yet been able to make a return, with significant gearing in the business
and the shareholders needing to dilute further to grow the business.
Ambatovy Harenasoa project: a mining company’s local agricultural development
project to promote economic development and it’s own supply needs
In 2014, Ambatovy launched a poultry-farming project in 4 towns along the
mining company’s pipeline in Madagascar. Beginning at its site in Moramanga,
about 80 kilometers east of Antannarivo, the company has built 48 barns, which
dot along the path to Toamasina. Having started construction on the barns in
January, by August, 8 of the farms were breeding 4,000 chicks, with 1,000
chicks added to the programme every 40 days thereafter. Once the chickens have
grown enough to be sold for consumption, Ambatovy and its partner Agrivet,
purchase the birds from the farmers.
The project was started as one of a number of Ambatovy’s community
development initiatives to create and improve livelihoods for local residents
around the company’s mining operations. Among these is a farming schools,
Ambatovy’s Local Business Initiative (ALBI), created in 2010 to support former
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pipeline construction workers obtain stable work once their contracts with
Ambatovy ended. The Harenasoa poultry project is another. If the project reaches
full capacity, it could create up to 800 jobs, supporting 300 poultry farmers in
160 chicken breeding barns. The farmers contracted through this project are
expected to earn 2,500,000 AR per year, which is nearly double the average
income of 80% of the population who live on less than $1.25 per day.23
What’s more, the project was designed to be mutually beneficial to Ambatovy and
its partners. It was launched as one of the company’s “local content” initiatives
– one of a series of projects which are intended to boost the production capacity
of local businesses from which Ambatovy can purchase goods it needs – and
financed by its US$25 million Social Investment Fund (SIF). Most of these
are focused in the agri-business sector, because of the company’s needs for
agricultural products and because it fits the existing skill-sets of the rural
populations living around its mining operations. For example, within the first 2
years of its farming school, 3,000 local residents had participated in the training
programme, while thousands more registered for classes. Outside of the school,
the company has a programme for building local farming associations and has
established bulk purchasing centers in Toamasina and Moramanga, where up to
8,000 regional farmers sell their products to Ambatovy and other customers. On
a weekly basis, Ambatovy purchases 80,000 eggs and 6,000 chickens though
these centers, which highlights the impetus behind the Harenasoa.
Now closing it’s first year, the future of Harenasoa is uncertain; Impact
Amplifier’s conversations with stakeholders familiar with the project reveal that
Ambatovy may not continue funding the programme. Regardless of the eventual
outcome, the initative speaks to both the need and impact of mining companies’
local engagement, particularly in the agriculture sector.
23. UNDP Human Development Index. http://hdr.undp.org/en/countries/profiles/MDG
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Socolait: an agri-business built around a network of smallholder farmers
In spite of Madagascar’s high employment level in agriculture (estimates
vary between 70-80% of the population), the sector is challenged by the lack
of commercial activity in the country. Most of the agricultural products in
Madagascar are grown by small-scale farmers and sold to small agri-processing
companies. All of the involved parties remain small-scale because of limited
technical knowledge and the logistical difficulty of sourcing the goods from so
many producers in a country with poor infrastructure.
One company has proven that not only can this model work, it can be sustainable
and socially impactful.
Socolait started as a Nestlé instant milk production plant in the early 1970s,
then after changing hands several times, eventually was bought by two private
investment funds: Adenia Partners, which owns the majority, and two technically
savvy partners, Philippe Penouty and Antoine de la Porte. Under their direction,
Socolait shifted focus from powdered milk to local collection of fresh milk, which
is cheaper and more price-stable. With a €2 million investment, the partners
rebranded the company, financed their product development and set up a
procurement chain with 1,400 dairy farmers, all of whom own only 1 - 2 cows.
Socolait’s system works on daily milk collection, daily farmer payment. According
to its materials, it does not contract directly with any of its farmers; rather,
Socolait works with community leaders to enforce farmers’ supply commitments.
This local individual is responsible for gathering milk from each of the farmers
via 6 collection points. It is checked for quality and then transported to Socolait’s
facilities where the quality is checked again. The collector is paid, and then
the remaining funds are distributed among the farmers each day. Socolait has
built an annual production capacity of 2.6 million litres of milk per year on this
model. Meanwhile, it provides regular, fair income to the farmers in its network,
which would be difficult for them to achieve otherwise, given that most of them
operate on a micro-scale.
The company acknowledges challenges along the way that it is trying to address,
however. Not having direct contact with the farmers has posed a problem with
milk quality at times.
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Since they do not have fixed contracts with the farmers, the farmers will
sometimes sell their milk elsewhere, impacting Socolait’s supply reliability.
Furthermore, some farmers may dilute their product. To remedy some of these
issues, Socolait is working to establish more touch-points with the communities,
via more collection centers. This will also allows the company to increase its milk
intake from farmers. It is also expanding its technical assistance programmes
and developing financing initiatives to help farmers buy more cows and cover the
costs of farming inputs.
Socolait has proven that a smallholder farmer network can work, provided the
operation and logistical set up is properly structured. What’s more, this model is
being formally recognized: Socolait recently brought on a new financial partner
– impact investor Investisseurs & Partenaires, which has made an undisclosed
investment into the company via its third investment fund. Although Socolait
operates solely in Madagascar, there are significant market opportunities in
Madagascar, the African continent and the other Indian Ocean Islands. Socolait
could also become a strong acquisition target for private equity firms and other
larger dairies.
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MADAGASCAR’S ECOSYSTEM
PLAYER INDEX
ENTERPRISE PROFILES
Ambatovy Harenasoa
project
Project: 4,000 chicks have been distributed to
farmers under the Harenasoa poultry project, funded
by Ambatovy’s Social Investment Fund. 48 Farms
have been constructed, 8 of which are operational.
Impact: Operational farms serve as pilots to allow
inexperienced farmers to learn the techniques of
modern farming. Approximately 50 farmers are
employed, with guaranteed sale of their produce to
a partner of the project.
Of interest: This is one of the social project funded
by the Social Investment Fund (SIF).
Bionexx
Company: A Malagasy company whose core
competence is the extraction and purification of
medicinal and aromatic plants.
Product/service: Flagship product artemisinin delivers commercial grade artemisinin to customers
such as Novartis.
Impact: Company employs 365 persons and
provides employment to 270 field soldiers, 700
nursery specialists and 10,000 outgrowers over 7
geographic zones in Madagascar.
Coldis
Company: A cooperative of farmers specializing in
global food exports from Madagascar
Product/Service: Organically grown, reasonably
priced spices with medicinal properties such as
cinnamon, cloves and pepper.
Impact: Guarantees members will be paid at least
market price for their crops while providing them
with access to information such as up-to-date
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farming techniques and savings programmes.
Advance payments to farmers for harvest during
lean season.
Fruit’Iles:
Company: A litchi export businesses located at the
port of Toamasina
Product/Service: Buying litchis from collectors,
processing the fruit, and exporting.
Lecofruit
(Légumineuses
Condiments Fruits
de Madagascar S.A.)
Company: Subsidiary of the French company
Basan. One of the few European companies that
buy vegetables directly from the farmers before
exporting them to Europe.
Product/Service: Procures directly from farmers of
the Malagasy highlands, primarily for the supply of
green beans. Around 10% of these are produced
organically.
Impact: Lecofruit and GIZ support highland
communities to increase the productivity of their
farming activities through efficient irrigation and to
diversify their incomes.
Madagascar Litchis
Export
Company: A litchi export businesses located at the
port of Toamasina
Product/Service: Buying litchis from collectors,
processing the fruit, and exporting
Madecasse
Company: Ssocial agriculture enterprise that focuses
on sustainable vanilla production and export.
Nutrizaza
Company: Produces Koba Aina – a food supplement
enriched flour. It is distributed via a network of
restaurants, conventional food distribution channels
and partner NGOs.
Product/Service: Koba Aina; Nutritional Education
Impact: Addresses malnutrition. The aim is to make
the product as accessible as possible while
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achieving financial profitability.
Of interest: In partnership with Hotelin Jazakely
restaurants, offers a dual function of dining and
counseling centers for nutrition education.
Socolait
Company: A leading dairy product manufacturer.
Products are distributed throughout Madagascar
via a network of wholesalers, large retailers and
small shops. Has been operating in Madagascar for
decades.
Product/Service: Sweetened condensed milk,
baby and infant powder, milk powder, fresh dairy
products such as yogurts and cheeses, and snack
products
Impact: Procures from 2000 small-holder dairy
farmers around its Antsirabe factory.
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ENTERPRISES: Aquaculture
Blue Ventures
Company: In partnership with IOT and others,
focuses on connecting marine conservation to
community benefits.
Product/Service: Small scale fisheries
management, support in managing large marine
areas, establishment of sustainable aquaculture
and ecotourism businesses, family planning for
communities.
IOT
Company: Breeds sea cucumbers in the South of
Madagascar to be dried, packed, and exported.
Product/Service: Sea cucumbers
Impact: The breeding technique does not have
adverse effects on the environment; the only food
required is the natural waste in the sand, therefore
it has the benefit of cleaning the water.
ENTERPRISES: Energy
HERi
Company: Aims to connect rural people in
Madagascar with products and services that
are innovative, efficient, and environmentally
responsible.
Product/Service: Works with local entrepreneurs to
launch solar-powered kiosks that are sustainable
and scale-able, offering products and services such
as lamps, phone chargers, printers, and more. HERi
currently has 7 operational solar kiosks and 25 staff.
Impact: Kiosks become centers of commerce and
information exchange, fueling social, health, and
economic development in the communities.
Jiro-ve
Company: Jiro-Ve’s mission is to make renewable
energy available to all people in Madagascar.
Became an independent company in 2014.
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Product/Service: Lights are distributed through a
team of franchisees.
Impact: Franchisees have been selected and trained
and now earn a decent income from their new
businesses. Replacing kerosene and candles has
positive health and safety, as well as environmental
benefits. Serves 1500 families/day.
Reseaux
Hydroelectriques
Villageois, Energie
Et Respect De
L’environnement
Company: Network of companies supervised by the
NGO GRET.
Product/Service: Design, test and extension of
development mechanisms of rural power grids
powered by micro-hydro
Impact: Electricity supplied to over 14 000 people
in three regions of Madagascar.
Startle
Company: Designs and grows businesses that
deliver social, environmental and economic benefits,
with operations in Madagascar and Kenya. Madabased venture is focused on bamboo charcoal.
Product/Service: Bamboo charcoal for cooking in
low-income households for which gas or electricity
are too expensive. Currently scaling first plantation.
Funding in place for 30 hectares; aims to grow to
100 hectares.
Impact: The informal charcoal trade is also one of
the primary drivers of deforestation in precious
natural rainforests; offering an alternative will curb
deforestation.
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ENTERPRISE: Water & Sanitation
BushProof
Company: Madagascar-based company specializing
in water supply solutions for remote and difficult
environments.
Product/Service: Private sector solutions such as
cost-effective drilling, locally manufactured hand
pumps and custom water supply technologies
for remote areas. Technologies and professional
services chosen for tough and remote environments.
Impact: Provides access to clean and safe water.
Loowatt
Company: Eco-friendly, off grid and financially
sustainable toilet solution. Offices and operations
in the UK and Madagascar.
Product/Service: A simple, patent-protected
mechanical sealing unit to contain human waste
within biodegradable film in the most efficient way
possible, with a unique odor-inhibiting system.
Periodic emptying, depending upon level of usage
and capacity. Built into toilets of any shape, size
and specification, using off-the-shelf parts and local
materials.
Impact: Ecofriendly sanitation solution, cogenerated biogas. Energy from biogas will increase
the value of toilet ownership. Fertilizer products will
feed value back into the whole system.
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ENTERPRISES: Microfinance
Adefi
Company: Microfinance institution with a network of
33 credit agencies.
Product/Service: Credit access for microentrepreneurs
Impact: 15,783 loans to more than 8,600 small
businesses in 7 years
Of interest: Offers customers free health insurance
contributions to encourage them to ensure that risk
and prevent repayment failures.
ACEP Madagascar
Company: Microfinance institution with a network of
33 credit agencies.
Product/Service: Credit access for microentrepreneurs
Impact: 15,783 loans to more than 8,600 small
businesses in 7 years
Of interest: Offers customers free health insurance
contributions to encourage them to ensure that risk
and prevent repayment failures.
Anosy Region
Financial Institution
(IFRA)
Company: A microfinance institution focusing on the
South of Madagascar.
Product/Service: Classic microfinance to microenterprises in rural areas as well as refinancing
to microfinance institutions (MFIs) in southern
Madagascar.
Impact: IFRA also provides technical assistance,
advice and training to the refinanced MFIs in order
to promote their structuring and development.
Of interest: A founder of the CECAM Network.
CECAM
Company: CECAM is a cooperative agricultural
microfinance institution – founded by farmer
associations - which provides access to credit
services to farmers.
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Product/Service: Savings and loans for the rural
population.
Impact: Allows a population traditionally excluded
from the financial system to access financial
services. Strong ties to farmers, proximity to
members, and innovative financial products.
Fanasoavana
Company: Overseen by the Aga Kahn Agency for
Microfinance, Fanasoavana is a credit guarantee
scheme extended through commercial banks.
OTIV
Company: One of the first microfinance institutions
in Madagascar.
Product/Service: Credit access for
microentrepreneurs
Impact: Allows a population traditionally excluded
from the financial system to access financial
services.
Premiere Agence de
Microfinance
(PAMF-Madagascar)
Company: Established by the Aga Kahn Agency for
Microfinance. A private limited company currently
operating in rural areas and small cities of the Sofia
region. The programme plans to extend credit in
Antananarivo.
Product/Service: Microfinance loans, SME loans,
current accounts, savings, and deposits.
Impact: Integrates financial education/skills for
people to graduate to formal financial markets.
Strong focus on getting credit rates down.
Solidis
Company: Specialist in securities and financial
guarantees.
Product/Service: Guarantees for bank loans
to SMEs. Clients include banks, businesses or
professionals who use the guarantee for reliable
credit operations or secure contracts, projects and
transactions.
Impact: Assists traditionally excluded population of
the financial system to access bank financing.
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ENTERPRISE: Waste-To-Fertilizer
Guanomad
Company: Produces certified organic fertilizer sold
on the domestic market and increasingly in African,
Asian, and European markets.
Product/Service: Bio-based fertilizer made from
bat droppings (guano) harvested from caves in
Madagascar.
Impact: Social investment in communities; soil
protection through organic fertilization methods.
Of interest: The company was the winner of the
Africa Entrepreneurship Awards 2013.
Madacompost
Company: Venture which has partnered with Gevalor
(technical support) and Goodplanet Foundation
(financing). Additional financing from AFD, FFEM
grants, and pre-sold carbon credits.
Product/Service: Uses the organic portion of
household waste – more than 70% of the total – to
make natural fertilizer used by farmers.
Impact: Addresses landfill waste in Mahajanga.
Aim to convert 12 000 tons of organic waste into
compost every year, avoiding150 000 tons of CO2e
over 10 years. Fertilizer produced significantly
increases farmers yields.
Of interest: Also reuses other forms of urban waste.
Creating paving stones from plastic, using shredded
horns to add nitrogen to fertilizer, and making
briquettes from green and woody waste to replace
charcoal.
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ENTERPRISE: Materials
BambooBasicst
Company: Combines the supply of bamboo for
construction with technical advice.
Product/Service: Sustainably treated bamboo;
advice on proper design to protect bamboo and
ensure appropriateness for each project.
Impact: Sustainable, salt-based treatment process
reduces insect attack and improves moisture
resistance, increasing the lifespan up to 30 years.
An affordable method with a low environmental impact.
Newpack
Company: The largest cardboard producer in the
islands of the south west of the Indian Ocean.
Product/Service: A wide range of carton and
printing formats (corrugated cardboard).
ENTERPRISE: Data & Technology
DataWinners
Company: Data collection service for development
professionals. Developed by Human Network
International (HNI) in collaboration with private
sector companies, academic institutions, and nongovernmental organizations.
Product/Service: Web platform to collect and
analyse questionnaire data submitted through SMS,
Smartphones, or the web.
Impact: Promotes the free flow of information
between vulnerable groups and the humanitarian and
development professionals dedicated to helping them.
ENTERPRISE: Hospitality
Hotel du Louvre
Company: 4-star hotel in downtown Antananarivo.
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ENTERPRISE: Other
Le Relais
Company: Sells products such as textiles, tourism,
or rice, with a focus on ethical value chains.
Product/Service: Various (textiles, mechanical
manufacturing, waste, rice, responsible tourism,
and waste sorting and disposal.
Impact: Works to ensure benefits of production
accrue to communities. One project deals with
waste in illegal dumps, reaping ecological and
health benefits.
Soccha
Company: Outsourcing company focused on youth
employment; focuses on two stages: training and
hiring of young and under-qualified jobseekers and
the prospection of companies that are interested in
professional outsourcing services; based in Belgium
with a field office in Madagascar.
Impact: Aims to contribute to the employment of
underprivileged people by offering them trainings
and work opportunities.
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INVESTORS
Adenia Partners
Description: Private capital management firm
investing in promising businesses across the West
Africa and Indian Ocean region.
Investments: Three funds developed in 2003, 2007,
and 2012, investing across a range of sectors
including agribusiness, manufacturing, financial
services, ICT and telecommunications, and finally
tourism and hospitality.
Of interest: Madagascar portfolio includes:
Socolait, Fruid-iles, Madagascar Litchi Exports.
Ambatovy Social
Investment Fund
Description: In September 2012, Ambatovy created
its Social Investment Fund (SIF) in a partnership with
the Government of Madagascar. It will deploy $25m
to support sustainable development activities.
Investments: Investments in infrastructure and social
development programmes, carried out until 2014.
Investisseurs &
Partenaires (I&P)
Description: A family of investment funds created in
2002 with a mission to contribute to the growth of a
sustainable private sector in Sub Saharan Africa.
Investments: Invested over €10 million in 30
businesses in 12 countries. Seven of these are
microfinance institutions. All have a social vision.
Of interest: Mada portfolio includes: ACEP
Madagascar, Nutrizaza, Phileol, IOT.
Madagascar
Development Partners
Description: Foreign Venture Capital/Private Equity
companies operating in Madagascar and in the
Indian Ocean.
Investments: Bridges OECD investor to local
investment opportunities with a social or
environmental dimension.
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Phatisa Group
Description: Fund manager of the African
Agriculture Fund (AAF) - a food and agri-focused
pan-African private equity fund.
Investments: Closed at US$ 246 million with 8
investments (excluding follow-on deals) across 14
countries, Madagascar included.
DEVELOPMENT FINANCE
Agence Française de
Développement
Description: French Agency for Development. A
public development finance institution working in
the French Overseas Provinces for 70 years.
Investments: No direct support to entrepreneurs but
to sectors: guarantees for SME loans from banks;
supporting microfinance.
Of interest: Microfinance support paid operating
capital for Nutrizaza for years.
CDC Group
Description: UK’s Development Finance Institution
(DFI) wholly owned by the UK Government; created
in 1948.
Investments: Across industries.
Of interest: Has invested in MLE.
European Investment
Bank
Description: Bank of the European Union; finances
and provides expertise for sustainable investment
projects that contribute to furthering EU policy
objectives; more than 90% of activity is focused
on Europe but also supports the EU’s external and
development policies.
Of interest: Work in Madagascar involved funding
Business Partners Madagascar SME fund (no longer
active in the country) and infrastructure projects.
PROPARCO
Description: Investment and Promotions company
for Economic Cooperation. A Development Finance
Institution created in 1977 partly held by ADF and
private shareholders.
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Investments: Focus on the productive sector, financial
systems, infrastructure and equity investment. No
investments listed in Madagascar currently.
SONAPAR
Description: equity portfolio management company
partly managed by the Malagasy Central Bank;
mission is promoting public private partnerships,
encouraging investments in sustainable development,
financing sustainable development, and contributing
to the improvement of the financial system.
USAID
Description: US development agency. Focus for
Madagascar is agribusiness.
Investments: Assisting farmers with improved
production techniques, expansion of their
agribusinesses, and rehabilitation of farm to-marketroads.
Of interest: Since the 2009 military coup, all nonhumanitarian aid to the country has been suspended.
DEVELOPMENT FINANCE
Aga Khan Madagascar
Description: Microfinance and Agricultural technical
assistance.
Interventions: Examples include: a programme to
increase rice yields by 100% by training farmers
on cultivation techniques; and Première Agence de
MicroFinance in Madagascar (PAMF-Madagascar), a
microfinance company.
Aga Khan Madagascar
AGRIVET
Description: Part of Groupe SMTP which focuses
on technical assistance in Agriculture through
5 specialised companies: Agrivet (technical
assistance) Agrifarm (poultry supply chain), Agrival
(feed supply chain), Agrima (supply chain of pulses
and cereals) and Agrifeed (beef supply chain).
Interventions: Seeds, pesticides, fertilizers and
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agricultural equipment (sprayers, tractors) at
lowest cost possible without compromising quality.
Education through distributing fact sheets and
support for farmers in their adaptation.
Ambatovy Local
Business Initiative
(ALBI)
Description: Provides support to local businesses
and entrepreneurs through training, mentoring, and
capacity building programmes.
Interventions: Works with purchasing, supply and
contracts services to identify local companies
capable of responding to company and market
needs. The aim is to maximize local procurement.
Agence Universitaire
de la Francophonie
(AUF) incubator
Description: The Francophone Virtual Incubator
for Entrepreneurship (IVFE) is a digital support
system for entrepreneurs. Supported by the
“Innovation programme by information technology
and communication for education” of the Agence
Universitaire de la Francophonie (AUF).
CAP Export
Description: Support programme led by the Chamber
of Commerce and Industry of France Madagascar
(CCIFM). Aims to strengthen the capacity of
exporters Funded by the Directorate General of the
Treasury and AFD.
Interventions: Training, compliance to international
standards, grants, participation in international trade
fairs, and the development of communication and
marketing tools.
Ex-Change
Description: Belgian capacity development
organization – volunteer based; facilitates the
exchange of knowledge between entrepreneurs
and professionals in the North and the South with
the aim of empowering companies in developing
economies and creating measurable growth for them.
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GRET
Description: Designs and implements field projects;
provides technical, methodological and managerial
support for development projects. Expertise in
projects and organization, policy development, and
scientific knowledge.
Interventions: Runs networks of expert actors
and researchers, speaks in international forums,
advocates for sustainable development, and manages
financing allocated by donors.
HELVETAS
Description: Swiss development organization
Interventions: To combat poverty and to improve
the nutritional situation of people in Madagascar,
HELVETAS Swiss Intercoperation is helping rural
smallholders and actively striving to protect natural
resources.
ISCAM
Description: Commercial school in Madagascar that
is developing a co-working space, business incubator
and alumni network to support entrepreneurial
activity and a network of entrepreneurs.
Madagascar Trade
Description: Export consultancy and agency
specialising in trade with Madagascar, but based
in South Africa. Its focus is on accelerating the
development of business enterprises and economic
infrastructure in order to expand global trade and
investment resulting in job creation and improved
economic growth.
Technical and
Economic Information
Centre (CITE)
Description: NGO working for the economic, social
and entrepreneurial development in Madagascar.
Interventions: Professional training courses for
artisans; information centre including library.
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ASSOCIATIONS & NETWORKS
AMIC
Description: A 10 member Private Equity group
by Geoffrey Tassinari (Madagascar Development
Partners), and including Adenia Partners and I&P.
Collectively represent over US$400 million.
Of interest: Also aims to establish best practice in
ethics and corporate governance rules and stimulate
innovation through relationship with associations,
universities, or schools.
CEERE
Description: Students-Entrepreneurs Association.
Trains youth in entrepreneurship.
Interventions: Organizing conferences, training,
meetings with entrepreneurs, company visits,
business plan contest, English club.
Chamber of
Commerce
Description: Supports the development of business
and enhancement of competition nationally and
internationally.
Economic
Development Board of
Madagascar
Description: Aims to facilitate foreign direct
investment by improving Madagascar’s business
climate conducive to companies developments;
serves as an intermediary between the government
and private sector, and prioritizes the following
Sectors: Tourism, agribusiness, light manufacturing
industry, ICT, infrastructure, and mining.
Entrepreneurs without
Borders
Description: Partnership between faculty, staff
and students at the University of Illinois. Focuses
on enabling entrepreneurship in impoverished
communities around the world.
Interventions: Research, teaching, and social
initiatives on subsistence marketplaces.
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ENTREPRENEURS
Haingo Rasolofonjoa
Position: Managing Director, Teledirect
About: MS Civil Engineering; MBA; Twenty Years
experience in management, investment advisory,
sourcing, negotiating and executing large financing
transactions including manufacturing facilities, real
estate development, call center, natural resources
and other large assets with strong business
expertise in Middle East and Africa. Further
experience in Project development and leadership.
Richard Anderson
Position: CEO Anderson Expeditions.
About: Based in Johannesburg, South Africa.
Designs and guides expeditions for his clients and
explores unique and exciting destinations to add to
the Anderson Expeditions portfolio.
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REFERENCES
Research and reports: entrepreneurial ecosystems
Aspen Network of Development Entrepreneurs. “Entrepreneurial Ecosystem
Diagnostic Toolkit.” December 2013.
(Website: http://www.aspeninstitute.org/sites/default/files/content/docs/
pubs/FINAL%20Ecosystem%20Toolkit%20Draft_print%20version.pdf)
Babson College. The Babson Entrepreneurship Ecosystem Project (BEEP).
(Website: http://entrepreneurial-revolution.com/)
Council on Competitiveness. Asset Mapping Roadmap. (Website: http://www.
compete.org/publications/detail/33)
George Mason University. Global Entrepreneurship and Development Index.
(Website: http://www.thegedi.org/)
GSM Association. Mobile for Development Network.
(Website: http://www.gsma.com/mobilefordevelopment/)
Koltai and Company. Six + Six Model.
(Website: http://www.stevenkoltai.com/about-us)
Organisation for Economic Co-operation and Development (OECD).
Entrepreneurship Measurement Framework.
(Website: http://www.oecd.org/industry/business-stats/)
World Economic Forum. The Entrepreneurship Ecosystem.
(Website: http://www.weforum.org/)
Research and reports: Africa; Madagascar
Afrobarometer. Madagascar Results. 2014.
(Website: http://www.afrobarometer.org/results/results-by-country-a-m/
madagascar)
Agence Française de Développement (AFD). “Étude Sur le Développement de
L’entreprenariat Social à Madagascar.” January 2014.
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Agence Française de Développement (AFD). “L’AFD à Madagascar et le Social
Business.” 2014.
Endeva, Heri. “Etude sur les Modèles d’Agrobusiness Inclusifs à Madagascar.”
2015.
Hallinan, Peter, US Chamber of Commerce. “Accelerating Growth in Madagascar.”
(Presentation). January 10, 2013.
Omidyar Network, Monitor Group “Accelerating Entrepreneurship in
Africa: Understanding Africa’s Challenges to Creating Opportunity-driven
Entrepreneurship.” 2012.
UNDP. “Impact Investing in Africa: Trends, Constraints and Opportunities.” 2014.
News and other sources
Ambatovy. “Rapport annuel 2014 pour l’O.N.E. (Office National pour
l’Environnement): Les Activites du Departement Chaine d’Approvisionnement.”
2015.
Le Carrefour des Entrepreneurs de l’Océan Indien. “Arson Ambinintsoa
Randrianaivo PDG de la Gastronomie Pizza.” (Interview).
(Website: http://carrefourentrepreneursoceanindien.org/arson-ambinintsoarandrianaivo-pdg-de-la-gastronomie-pizza/)
Rio Tinto, GIZ. Factsheet: Responsible mining for a better future in Southern
Africa. December 2014.
USAID. “U.S. Global Development Lab Launches Three Public-Private
Partnerships to Grow Impact Investing and Create Pathways to Scale.” (Press
release). September 4, 2014.
(Website: http://www.usaid.gov/news-information/press-releases/sep-42014-us-global-development-lab-launches-three-public-private-partnerships)
World Food Programme. “Madagascar: Overview.”
(Website:https://www.wfp.org/countries/Madagascar/Overview)
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