How to Successfully Invest in Africa Without Getting Scammed

A guide for foreign investors into Africa

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Africa is not a country

Africa is a continent with 54 countries. The continent has vast potentials and untapped resources. Europeans majorly took advantage of the continent in the past with brute force. But now, things are different. The old ways won’t work anymore.

1. Make friends with people living where you want to invest

One of the biggest mistakes of foreigners is to make their intentions known and go straight into business. That may work in Europe, but it doesn’t work in Africa. The thinking in Africa is very different.

2. Use an African to front your investment

African governments love working out big contracts with foreigners. However, you need at least one African on your side. This is because you need someone who speaks their language.

3. Do not pioneer anything

You are a foreign investor. If you don’t plan to waste your funds, then don’t pioneer anything. You need to trust me on this one.

4. Make friends with politicians but stay away from politics

If your investment is over $1M, you need to make friends with one or two key politicians pertaining to your industry. If your investment is over $100M, you need to be friends with a handful of politicians.

5. Stay away from publicly traded companies

In my opinion, the African marketplace is not well developed to the extent of getting foreign investment in publicly traded companies. For one thing, I don’t trust such companies.

6. Have multiple sources of confirmation

There are a lot of scammers in Africa, sadly. But there are also real and truthful people. Many foreign investors often fall into the hands of the scammers first. And then they take it as a bad omen for doing business in Africa.

7. Own your backward integration

If your business is in any way dependent on another business to function, make sure you own that other business. What that means is to own the company supplying your raw materials.

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