Africa Trek 2017: Oxford MBAs visit Rwanda
A group of 2016-17 Oxford MBAs go on the annual Africa Trek. This year’s destination: Nairobi and Kigali
Part 2: Rwanda
Rwanda is a small land-locked country, with a population of 11.2 million. For most, the atrocities of the 1994 genocide come to mind when the country is mentioned. However, the government is trying hard to overcome this history through pursuing a strong development agenda, leading to impressive annual GDP growth of 6.9%.
Arriving from Kenya, the contrast between the two countries was immediately stark. During our cab ride from the airport I noticed the perfectly manicured shrubs along the side of the road and the immaculately clean streets, with workers out-and-about sweeping, cleaning and repairing. I also noticed the beauty of the city – rolling green hills covered in terracotta houses, transitioning into new skyscrapers as we neared the city centre.
Another defining feature of the city are the thousands of motorbike taxis that swarm up and down the hilly roads ferrying commuters to different parts of town. A highlight of the trip was using this mode of transport to get between company visits, with a group of nearly twenty suited-up MBAs pulling up concurrently.
Jumia Food is part of the Jumia group, a leading actor in online commerce in Africa with an ecosystem of online services and marketplaces including: Jumia (online shopping site for electronics, fashion and more), Jumia Market (allows users to sell their products online), Jumia Travel (African travel bookings), Jumia Food (food delivery service), Jumia Deals (classifieds), Jumia House (real estate), Jumia Jobs (recruitment), Jumia Car (vehicle marketplace), Jumia Service (e-commerce fulfilment and delivery).
Jumia Food launched in 2013 in Rwanda and was the first food delivery service in the country. Operations manager Albert Munyabugingo described the various tech components of the business, including the customer, vendor (restaurant) and dispatching software, and how these all had to integrate seamlessly to ensure a good customer experience.
The business model is based on the 10% – 35% commission paid by the restaurants to Jumia, with higher commission getting restaurants more visibility on the platform. The restaurants are given twenty minutes to prep the orders, something we believed would be quite a challenge given the more relaxed approach to service we had experienced. Also interesting to hear was their strategy to grow their middle-band customer, as they saw a higher customer lifetime value here than targeting wealthier, ex-pat clients who are more likely to leave the region in the future.
Munyabugingo spoke about some of the issues of doing business in Kigali, including internet outages (which necessitates Jumia staff manually phoning through orders to restaurants) and heavy rainfall which can affect delivery times.
The Office and Impact Hub Kigali
Jon Stever is an American expat who founded The Office in October 2012, the first open community working space in Kigali. Comprising a five storey-building in central Kigail, the space brings together makers, entrepreneurs and organisations that are working in social enterprise and civic and cultural arenas. Stever is also involved in running Impact Hub Kigali, a coworking space that operates out of The Office.
Stever gave the group a great overview of the entrepreneurial landscape in Kigali. In terms of issues, he spoke about the lack of trust and collaboration between local entrepreneurs and entrepreneurial support organisations which hampers collaboration and cross-pollination of ideas. He also discussed the high cost of internet connectivity and issues of down time. However, it was extremely inspiring to hear him talk about government efforts to improve business infrastructure, and the lives of Rwandan’s more generally.
Stever previously worked as an economist for the Ministry of Finance and Economic Planning and spoke about the passion of civil servants and the tight performance management practices used to hold all civil servants to account.
One Acre Fund
We visited One Acre’s Rwanda headquarters in Rubengera, a 2.5 hour journey west of Kigali on the edge of Lake Kivu, which separates Rwanda from The Democratic Republic of Congo. The journey was breathtakingly beautiful with lush rolling hills covered in thousands of small rectangles of cultivated land dotted with homesteads.
It was interesting to note that the further we journeyed from Kigali, the worse the roads became, eventually the jeeps we were travelling in were using the full width of the road to dodge the wide potholes that pitted the asphalt. This reminded us all of the transport and logistic difficulties companies and organisations face when working in the region. It also perhaps points to the tension in government spending between urban and rural areas.
One Acre’s headquarters are built into the hills over-looking Lake Kivu and comprise accommodation and work space purpose-built for their staff, 98% of whom live in the field. Each space has a deeply peaceful feel – the kind of place you might come to do a mindfulness retreat. The physical design of the space fits their purposeful mission: to support small scale farmers to increase yields and to move out of poverty. The organisation currently serves half-a-million small-scale farmers, with the aim of increasing their reach to a million by 2020. They deliver their highly-localised services through a field staff of roughly 5000, working in Kenya, Rwanda, Burundi, Tanzania, Uganda, and Malawi.
Jeremy Golan, Financial Advisory Services Manager for Rwanda, described One Acre’s offerings, which have been refined over their ten years of existence:
- Farming inputs, including high-yield seeds and fertilizer.
- Credit to purchase inputs, which is later collected via community-based groups to build accountability. One Acre also offers other finance products such as crop insurance.
- Distribution / delivery to bring the faming inputs to within walking distance of the farmers.
- Training on agricultural techniques.
- Market facilitation to increase profits.
Golan, who has a background in consulting, emphasised that the organisation is run very much like a private sector company, with many of the management team coming from corporates or consulting. This ensured that operations were kept lean and the organisation was constantly innovating to find better ways to serve their farmer clients. It was inspiring to hear that some of the best minds, pulled from the likes McKinsey & Co, where now channelling their skills and energy to help those most in need.
What struck me most about One Acres work was the level of trust they need to develop with farmers, as their work targets the heart of their client’s livelihood and identify. Offering people alternative seeds, or recommending slightly different farming methods is essentially asking farmers to shift their behaviour away from well-practiced norms. It seems this trust is created by building a staff who are farmers themselves and live in the villages One Acre aims to serve, by running highly-localised tests at village-level to show the value of different seeds and techniques, and by taking a very long-term view on building both social and infrastructural capital.
To conclude, the Africa Trek will definitely be one of the highlights of my MBA. It was a rare opportunity to have a privileged access to CEOs and other business leaders, and to learn first-hand about the business models and activities they are pursuing to help build the region. As an African, and as a business student, I am hugely excited by amazing work I witnessed in East Africa. The experience opened my eyes to the opportunities of the region, but also reminded me that there is much work to be done to ensure those living in poverty are supported to move up and live more dignified lives free of carting heavy water drums, free of preventable illnesses and free of the structural violence that comes with poverty. There is much work to be done.
Author Gillian Benjamin is a social design practitioner from South Africa. Driven to use design to create social impact, she founded a design studio to serve social justice organisations and later worked at the Cape Craft and Design Institute running design thinking projects in healthcare, education and the built environment.