My experience in strategic finance, planning, tech analysis – Bakinde

Akindeji Bakinde, is a seasoned finance professional with over 10 years of experience in strategic finance, planning and analysis in technology and product-led companies, spanning SaaS, Fintech, Edtech, and PaaS sectors. In this interview with ENE OSHABA he shares insight into his journey and challenges, with over eight years of expertise in diverse financial domains.

How has your Nigerian heritage influenced your approach to financial planning and advisory services for early-stage tech companies in Africa?

Growing up in the small city of Ile-Ife on a university campus, I observed my parents and community members attempting various businesses. Unfortunately, most of these businesses struggled to scale and eventually closed down. Witnessing this, I became curious about the serial business failure plaguing Nigeria’s SMEs and potential solutions to them.

I recognised the lack of formal knowledge of management and accounting for SMEs as a barrier to small business growth in Nigeria. This realisation fuelled my interest in pursuing a degree in management and accounting.
Similar to my parents’ experiences, I had my fair share of setbacks while running startups as well. These businesses initially looked promising but ultimately failed to thrive.

This frustration led me to believe that the solution lay beyond my immediate environment, and I needed to broaden my horizon. I joined AIESEC (an international student organization) to gain exposure to a new environment where I grew through the ranks and received an award of excellence for facilitating internship programs between Nigeria and other African countries.

My experience in AIESEC made me discover my purpose of enabling early-stage companies to succeed. My fulfilment comes from witnessing the success of founders rather than pursuing a career in a publicly traded company.

As a finance professional with a decade of experience, can you share some key differences you’ve observed between the fintech ecosystems in the U.S. and Africa, and how these disparities impact your work?

The difference between the tech ecosystem in Africa and the US lies in the enabling environment. Interestingly, a tech founder has a higher chance of success in Africa if they have the enabling environment that exists in the US. The tech industry in Africa is still a green field.

Companies in Africa face similar challenges. I have worked with tech founders in different parts of Africa, and the challenges they face are almost identical. Capital to scale, regulatory hurdles, ease of doing business, biases towards black founders, and access to talent are their top five challenges.
Did you know that a tech founder in Nigeria can’t access bank credit because they lack tangible assets as collateral?

Tech companies typically have intangible assets, mostly intellectual properties, which banks are not allowed to use as securities. Tech companies’ shares are not publicly traded; therefore, credit can’t be extended to them.

As a result, most tech companies rely on capital from family, friends, and a few angel investors in Africa, which is not enough to scale. Thank God for foreign investors from the US and Europe who understand the tech investment game.

I spent most of the last 5 years engaging with banks and writing proposals and white papers on why they should consider funding tech companies.

In a nutshell, the biggest gap between Africa tech companies and US ones is access to capital.

Given your unique position as a finance professional with a focus on Africa, how do you adapt your financial strategies to the diverse regulatory environments across different African countries?

Adapting financial strategies to the diverse regulatory environments across different African countries is a critical aspect of my role as a finance professional with a focus on the continent. The business environment in Africa is quite similar, but the regulatory landscape in Africa varies significantly from one country to another, presenting both challenges and opportunities.
Firstly, I approach this by conducting thorough research and analysis of the specific regulatory frameworks in each country where my clients operate. Understanding the legal and financial requirements allows me to tailor financial strategies that not only comply with local regulations but also leverage any advantages or incentives offered by the respective governments.
Additionally, building strong relationships with local regulatory authorities and staying abreast of any changes or updates to the legal landscape is crucial. This proactive engagement helps in anticipating and adapting to regulatory shifts, ensuring that financial strategies remain compliant and effective.

Can you share any experiences where cultural nuances played a significant role in your financial advisory work with early-stage tech companies in Africa, and how you navigated through them?

Certainly, navigating cultural nuances is integral to successful financial advisory work in Africa, especially with early-stage tech companies. I am actively engaged in communities and the tech ecosystem in Africa. I am always in one incubation lab or program, facilitating training for tech founders on their financial strategy.

What motivated your decision to specialize in financial planning and analysis for early-stage tech ventures specifically in Africa, considering your background and the global nature of the finance industry?

I began my professional journey in a startup incubator and later joined Venture Garden Group in 2015 through an Entrepreneur in Residence (EiR) program. Following the program, I seized the opportunity to become part of the Corporate Finance team and joined as the employee 001 of Greenhouse Capital (a Venture Capital fund), with aim to enable Tech Entrepreneurs in Africa.

Over the past 10 years, we have provided financial advisory services to the African Tech ecosystem. Our advisory efforts have empowered tech founders in fundraising, business valuation, growth and jurisdiction expansion, product pricing, and corporate planning.

Our “Cash investment plus Advisory” approach has facilitated numerous founders in scaling from the idea stage to achieving valuations exceeding a hundred million USD.

Today, I am proud to be part of a company that has invested in over 50 companies in Africa and the Middle East and built an ecosystem of tech companies across Africa.

How have you been able to work across these geographical regions and collaborate across multiple time zones?

Operating in the tech space, remote working has been ingrained in our operations, predating the era of Covid. Even before my relocation to the US, I always favored working with a global team.

Our diverse and globally dispersed team members, spanning Nigeria, Kenya, the UK, Dubai, the US, and Canada, contribute to our inclusive and globally attuned approach, ensuring that we address challenges beyond our immediate environment.

In fact, my first two manager 2014 – 2015 worked remotely. One was working from Brazil and the other in the United States.

Given the dynamic nature of the tech industry, how do you help your clients navigate uncertainties and market fluctuations, particularly in the context of the African business landscape?

In order to guide clients through the uncertainties and market shifts within the ever-changing African tech industry, I utilize a strategic and adaptable approach.

This involves conducting thorough risk assessments, creating flexible financial models, ongoing market surveillance, advocating for diversification, cultivating strategic partnerships, embracing a customer-centric mindset, facilitating access to funding, prioritising regulatory compliance, and bolstering organizational resilience through capacity building.

The objective is to equip clients with the capability to adeptly address challenges and leverage opportunities within the dynamic business environment.

We have had cases of some tech companies failing despite securing capital from both Venture Capital and Private equity investors outside of Africa?

Yes, it’s indeed unfortunate and very painful for both founders and investors. Many factors contribute to this trend:
The fault often starts from the due diligence process at the point of investment. Due diligence is not just about financial assessment; it requires thorough examination of legal, market, and technological aspects, as well as an understanding of the personalities of the founders. This cannot be effectively done from an office in San Francisco or New York; local presence or experienced local partners are essential.
Corporate governance is often weak in this part of the world. Few successful companies with good investor returns had to reinforce their corporate governance structures.

There are cases of capital mismatch as well. Some investors are not in for the long-term play, and the profile of investors from Seed to Series C differs over time. Investor expectations need to align with the growth phase of the company.

We need to prioritise founders as well. VC investment is about taking a bet on the founder, not just the company. At GHC, we have experienced companies going down, but founders who pivoted into new businesses still provided value, showcasing the importance of backing strong founders.
Lastly, macroeconomics have not been favourable. Currency instability poses challenges, particularly when returns are expected in USD. This instability makes it difficult to plan, and investors may be sceptical about investing in Africa. Securing exits becomes challenging in such uncertain economic conditions.

As someone who has successfully carved a niche in financial advisory for African tech startups from the United States, what advice do you have for other professionals seeking to make a similar impact in the industry?

For professionals aiming to influence financial advisory for African tech startups while based in the United States, I recommend developing cultural empathy, acquiring in-depth knowledge of local markets, building a strong network, embracing flexibility, leveraging technology for communication, forging collaborative alliances, staying informed about regulatory environments, refining remote management abilities, dedicating oneself to ongoing learning, and emphasizing the cultivation of trust with clients.

By integrating these principles, individuals can effectively navigate obstacles and make meaningful contributions to the success of the African tech industry.

My story encapsulates the essence of success in financial advisory for African tech startups. His journey is a testament to the importance of cultural understanding, adaptability, and a proactive approach to the unique challenges within the African business landscape.

As professionals and aspiring individuals, we can draw inspiration from Akindeji’s commitment to continuous learning, strategic collaboration, and client-centricity. His wealth of experience and insightful advice provide a roadmap for navigating the dynamic intersection of finance and technology in Africa.

The strategies he employs to help clients navigate uncertainties and market fluctuations reflect a nuanced and forward-thinking approach. From comprehensive risk assessments to fostering strategic partnerships, Akindeji’s methodology is grounded in resilience, agility, and a keen awareness of the unique dynamics within the African tech ecosystem.

In the rapidly evolving tech industry, Akindeji’s story serves as a reminder that success lies not only in technical proficiency but also in embracing change, building meaningful relationships, and staying attuned to the diverse contexts of the markets we operate in.

To all those embarking on similar journeys or seeking to make a meaningful impact in the African tech industry, let Akindeji’s experiences be a source of motivation. In his own words, “stay agile, stay informed, and stay committed to making a positive impact