I’d love to see more people pursuing the entrepreneurial career path, especially when there are so many opportunities to solve really important problems on the continent. But at the same time, we can understand the desire to pursue the corporate career path, given the prestige and security that corporates on the continent bring to the table, especially for many people (in South Africa, in particular) who do not come from generational wealth. The reality is, founding a startup is a privilege.

What that means though, is that there are many people who may make great entrepreneurs, but who have not necessarily been given the opportunity to pursue entrepreneurship, or feel that it is too risky to pursue.

To be sure, EF and Antler are looking for a specific caliber of entrepreneurs, and to fund specific types of businesses - those with high-growth potential and the chance to deliver venture scale returns. And to that end, these companies are looking for high-skilled individuals and those who have an opportunity cost to what they would otherwise be doing if they were not building (and scaling) a startup. 

Both Antler and EF, in turn, are looking for two types of individuals - those with technical expertise and those with domain-specific business expertise. And importantly, putting those two types of individuals in a program together ensures that the participants are founding startups with complementary skill sets and, in most cases, at least one technical co-founder.  

A core belief amongst EF and Matt, in particular, is that “entrepreneurship should be mainstream - in the same way that being a Doctor is mainstream”. These are highly-skilled professionals, though just like not everyone should be a Doctor, not everyone should be an entrepreneur, either. 

Further, this may impact the perceived risk of pursuing the entrepreneurial career path amongst the highly-skilled professionals in question. As Matt argues, “Startups are risky. The entrepreneurial career path is not”. 

And EF and Antler de-risk the initial journey of highly-skilled professionals, upon acceptance to the program, through a living stipend, and by taking them through a rigorous, regimented program that shortens the distance to finding a co-founder, testing and validating a value proposition, and raising a seed round. 

With Antler in Nairobi, we have seen program participants maximizing optionality. As Selam shared with me in our interview, some of their participants have even taken unpaid leave from their current jobs to go through their 11-week program. 

And talent investing, as a business model, is a relatively cheap way for investors to create optionality for themselves, as well. For EF, in particular, the program stipend (which they view, effectively, as a grant) buys them an investment option they can choose to exercise or not, after the individuals have participated in the program for the first three months. Invariably, it also gives talent investors more data points around a prospective seed investment, having worked together with their entrepreneurs throughout the program before choosing whether or not to invest.

Why Africa?

So why talent investing in Africa? Apart from compelling talented individuals from African corporates - many of whom have solved for scale or distribution, and are innovators in these markets (i.e., telcos), the main reason is obvious - opportunity is not evenly distributed, both globally and also across the continent. 

For Antler, having already launched on the continent, it’s an opportunity to target and grant additional exposure to prospective African entrepreneurs, in particular. As Selam shared,

The idea of building a company itself is so new [for many Africans] and it requires a lot of pre-existing conditions for you to be successful…  

This, Selam believes, is a contributing factor to the number of foreign entrepreneurs we see funded on the continent, and particularly in East Africa. It’s not surprising - if European or American entrepreneurs have had more exposure to entrepreneurship, technology businesses, and fundraising then as a result, we see that the images of those who have raised $1m+ is not representative of the markets in which they are operating. 

What outcomes will we see if more and a more diverse group of people are given resources towards starting companies? And what outcomes will we see with more regimented and curated matchmaking processes within and amongst a diverse group of individuals, including those with multinational experience as well as those with a better understanding of local dynamics, cultural contexts, and so on? 

And as I wrote about last week, if more (romantic) relationships are being started online, and if a curated matchmaking process is leading to stronger and longer-lasting relationships, we can see how a similarly curated and rigorous process for the development of co-founder relationships can create positive outcomes, as well. 

I’m also particularly interested in the opportunity for talent investing in Africa born out of geopolitics. EF has had success targeting academic talent pools and compelling some of those with certain technical or domain expertise to consider the entrepreneurial path. Their Singapore cohort has found success with Iranians graduates from the National University of Singapore, in particular, who are unable to attend universities anywhere in the US or Europe. 

How may similar global forces shape the opportunities in Africa, whether it be visa considerations or cultural considerations, like what we’ve seen with members of the Diaspora increasingly interested in moving back to the continent (through initiatives like Ghana’s Year of Return or in general, amongst rising racial tensions in the US)?

Backing global winners

A key feature of EF’s model, in particular, is their endeavor to back what Matt calls “global winners” - companies with relevance and applicability on a global scale. EF looks to invest in deep tech companies - AI, robotics, biotech, etc. - and in identifying and funding individuals with expertise in these domains, they are not only creating more professional entrepreneurs, they are avoiding the adverse selection issue. Not just anyone can build these businesses. 

Equally, given that this talent is being identified outside of the tech bubbles, namely Silicon Valley, it gives talent investors pricing power in the form of geographic arbitrage. Consider the opportunity for talent investors to back equally skilled entrepreneurs in Bangalore, to build a deep tech company for 4, 5, 10 times less (in terms of valuation and opex) as in other markets. 

This raises the question of which African markets are a fit for talent investing, with a high enough concentration of talent to make the model work. To be sure, I believe that talent in Africa abounds, but the talent investment model is contingent upon requisite volume and scale, as well. 

After launching in Hong Kong, EF subsequently pulled out of that market, citing the “need  higher volume to make a site work at scale”. For the benefit of my argument, and for the opportunity in African markets, I hope that the Hong Kong protests played a bigger role in this decision than we are led to believe. 

Meanwhile, perhaps we ought to further consider what global winners could look like. After all, if 85% of the world’s population lives in emerging markets, herein lies the opportunity. And as Facebook invests in Jio and Gojek, Stripe backs Paystack, Paga expands to Mexico, and so on, I believe global winners will increasingly be companies built in emerging markets and serving emerging markets.

And to that end, I, for one, hope to see more explicit, intentional initiatives to compel (and facilitate) smart people in Africa to build things.