The second annual Africa Growth Conference gathered at UCLA Anderson on Wednesday. Delivering the conference’s keynote address was Tom Epley, a partner at Vance Street Capital who specializes in corporate turnarounds, and who sits on UCLA Anderson’s Board of Visitors.
Epley, in an intense three-year period kicked off by a visit to an at-war Sudan in 2005, researched, thought, and wrote about the legacy and lessons of Africa’s recent era of receiving general aid and development support from the international community. The result of his efforts was The Plague of Good Intentions: We Broke Africa, Here’s How to Fix It, a book that critically examines those external efforts at aid and development and their results.
Epley used his keynote to provide those interested in doing business in Africa with food for thought based on the lessons articulated in The Plague of Good Intentions.
While acknowledging that his book focuses on the effects of government- and organization-led efforts, Epley’s advice to conferees came “based on both my experience as an investor and my experience in writing the book,” and was presented as a set of cautious rules for embarking on business in Africa. Among these rules:
Don’t underestimate the fragility of economic progress. Epley sees that for many African countries, growth in GDP can often be attributed to singular causes like oil and gas deposits, and doesn’t necessarily portend sustained growth. “Don’t just rely upon ‘this country’s done really well over the last couple of years,’” he said. “Look at ones that have distribution of the GDP growth, not just oil reserves.”
Don’t underestimate the colossal cultural differences. In the United States, 60 to 70 percent of corporate mergers fail, Epley says, “primarily because of cultural differences.” These differences, he points out, are “small gaps” compared to the differences between foreign investors and local cultures. As he notes of the New Coke backlash of the 1980s, “the best market-research institution in the world … if they can’t get it right, how do I, when I go to Kenya, really know what’s going on with the thinking process of the people there?”
In spite of his cautions, Epley decried easy stereotypes that might deter businesses from heading to Africa. “It is unfair and incorrect to use the aspect of corruption as an excuse not to go there,” he said.
Since publishing The Plague of Good Intentions, Epley has become a partner in Vance Street Capital, which acquires and operates medium sized companies in the United States and Europe, but primarily California. He currently manages a collection of five acquired companies, all in technology based manufacturing. In addition to the UCLA Anderson Board of Visitors, he also sits on the Board of the Broad Stage, and on the Board of Trustees of the Rand Ph.D. Graduate School of Public Policy. Learn more about The Plague of Good Intentions here.
The annual Africa Growth Conference aims to provide participants with an enhanced understanding of the trends shaping Africa’s growth and the key drivers moving Africa forward. It also provides a platform for participants to build networks, exchange ideas and learn how to position themselves to take advantage of the emerging opportunities that the continent offers.