Lauri Elliott

Media is such a major issue for Africa at this time.  There is a general perception that western media is doing a disservice to the image of Africa.  I agree and disagree.

I agree that western media has painted a particular view of Africa as needy, poor, corrupt, and in conflict historically.  But there are also those who do Africa a good service.

But to me this argument is no longer the primary relevant issue.  Now with the technology tools and the connected society, everyone is media.  That is called citizen media.  Individuals, groups, and organizations need to use this shift to make media that is appropriate for Africa.

The new configurations of media will be infinite, but open.  This is what we have to focus on.  There are still people who need to work with in traditional media who can help change what is being reported and how.  But most of us, whether professional media or public media don’t have to what for things to change, we can make the change.

I had a brief opportunity to share these thoughts and others at the Rwanda Convention 2010 (www.rwandaconvention.org) in Boston, Massachusetts on May 29, 2010.  And living  up to the potential in technology, I participated via videoconferencing from my home!

You can download my slide presentation – Evolving Media Presentation 2010 (37). 

Feel free to start up a conversation on this.

This is an article written by Hilton Tarrant and myself as part of the ICT in business sector series for Brainstorm Magazine in South Africa.

There is no question that the healthcare sector in Africa represents a huge challenge and opportunity. The question is how, and how well, ICT will meet the challenge.

Most African countries have a critical shortage of healthcare workers, and the majority of African healthcare systems are low-ranked internationally, according to the World Health Organisation.

Dr Dirk Koekies, Chief Executive Officer of GeoAxon, states plainly that the challenge is “creating a healthcare system out of nothing, which can deliver quality basic primary healthcare services to those without it”.

While this situation is a critical challenge, it presents a tremendous opportunity for ICT in the health sector. The opportunity is particularly good in the mobile sector (mHealth) due to the penetration of mobile phones on the continent.

The United Nations 2009 report mHealth for Development says: “Mobile phones reach further into developing countries than other technology and health infrastructures.”

One mantra for mHealth is “make available the right information at the right place at the right time and in the correct form,” according to a 2008 Rockefeller Foundation report.

This mantra, when actualised, translates to several benefits, according to Tyson Greer, CEO of Ambient Insights.

First, clinicians and patients can make more informed and intelligent decisions. Second, real-time data is provided for communication, consultation and notification. Third, mHealth increases efficiency and speed of care, and increases productivity of healthcare workers. And finally, it provides on-demand access to information and continual learning for healthcare professionals.

There is a unique opportunity to provide ICT-based products and services to the private healthcare sector.

Firstly, because private sector healthcare already represents a good portion of services provided to Africans compared to public healthcare. And secondly, African governments are using private healthcare providers to augment and enhance public healthcare systems, which are overtaxed.

This creates a sizable opportunity for ICT firms. Specific business opportunities in mHealth, according to the mHealth in Development report, include education and awareness, remote data collection, remote monitoring, communication and training for health care workers, disease and epidemic outbreak tracking, and diagnostic and treatment support. Koekies also says that developing centralised, electronic medical information records is a low-hanging fruit opportunity.

GeoAxon is delving into business opportunities presented in diagnostic and treatment support. Its “Tele-medicine Doctor in a Box” allows a doctor to examine a patient over the internet, using devices the patient interacts with locally. These devices transmit data, which would normally be assessed in a face-to-face consultation with a doctor, remotely to the physician.

While mHealth seems to be gaining momentum, it still has several challenges. mHealth is still in the pioneer stage with many projects in pilot, but little empirical evidence to prove its impact. Koekies indicates that funding for innovative solutions is still difficult to come by. And while the technology may be there, the ecosystem for the mHealth sector is still immature.

Recognising that eHealth*, and mHealth, are still emerging markets in Africa with high potential, ICT firms might want to first look for low-hanging fruit opportunities and those that leverage its strengths.

Big opportunity

The healthcare market is huge. A recent report by research and consulting outfit Markets and Markets says the healthcare IT systems market will be worth $53.8 billion in five years’ time.

One of the major areas of growth in the space is tele-medicine. This is by no means new technology, with policies put in place and applications created over a decade ago.

A new push, by networking giant Cisco, is through a pilot programme demonstrating that tele-medicine is real and it works. The so-called HealthPresence programme saw remote clinics linked up in Aberdeen, Scotland and San Jose, California.

This service provides what Cisco terms “care at-a-distance over the network”. It uses Cisco’s TelePresence teleconferencing technology, with patients and physicians able to see life-sized images of one another. The system also collects physiological data from a variety of linked devices such as a stethoscope, blood pressure cuff, pulse oximeter and other diagnostic equipment.

The Aberdeen trial started in January last year and found that 90 percent of the patients who used the technology were satisfied with the experience, 95 percent said the visit felt confidential and 93 percent said they would recommend it.

“In almost every case, we could accurately identify the degree of urgency and make a diagnosis,” said Dr James Ferguson, national clinical lead for the Scottish Centre for Telehealth.

He added: “Cisco Health- Presence can enable us to deal safely and effectively with 90 percent of the cases we see.”

The Medical Research Council is currently running five separate tele-medicine projects around the country.

Obviously bandwidth constraints mean that the implementation of tele-medicine is difficult in both South Africa and Africa. In addition to bandwidth, the MRC identifies other obstacles such as the lack of easy-to-use, robust diagnostic instruments and no dedicated tele-medicine centre to act as a hub for tele-medicine.

The deployment of terrestrial fibre networks in South and East Africa, as well as the commissioning of Seacom, has helped solve the bandwidth problem, however.

At a recent exhibition, Seacom showcased healthcare teleconferencing applications, and earlier this year at GovTech 2009, Moses

Mtimunye, then acting CEO of Sita, said that in the near future, similar technologies to Cisco’s TelePresence “will make for commercially available tele-medicine projects providing people in rural areas with world-class healthcare services”.

The national Department of Health says its long-term goal is to “make tele-medicine live up to its potential as a valuable tool to improve access to high-quality and cost-effective health care services in South Africa”.

Beyond structured implementation of tele-medicine systems, Cisco believes that HealthPresence could mean a revolution: “Instead of making a dash to an urgent care facility or emergency room, what if you could use your television or other networked device to connect with a medical centre?”

Cisco believes this is not fantasy, it reckons it could become reality within the next three to five years.

*eHealth is the use of ICT for health services and information.

“The process for seeking capital, or funding, for a business is an ongoing task that entrepreneurs need to understand,” says Patrice Backer.  Mr. Backer is Chief Operating Officer for Advanced Finance and Investment Group (AFIG).  He joined us for our November 4, 2009 segment, “Preparing Your African Venture for Investors.”

We opened the show with an overview of private equity funding options for businesses based on their lifecycle.  There are essentially two phases – start-up and growth/expansion.  During the start-up phase, businesses seek pre-seed, seed or early stage funding.  This start-up phase is connected with what its called venture capital.  Newer firms present higher risks, so there are certain types of investors, venture capitalists, who focus on these types of firms.  Backer noted that venture capital is still not a strong option in Africa.  The exception is South Africa which has a more mature market.

In the growth and expansion phase of an existing firm, there are also three funding cycles – second stage, third stage and bridge funding.  There is also an option of buy-out.  Growth and expansion funding for existing firms is the focus for the majority of private equity firms with an African portfolio.  Backer explains that it provides a good middle ground for investors – they get good performance with lower risk.

Backer says that investors in private equity funds in Africa are development institutions, private sector or a combination.  He says that development institutions, often affiliated with governments, have a higher tolerance for the risk environment in Africa so they are consistent contributors.  When the global economic crisis hit, it was private sector contributors who mostly pulled out of African investments.  However, it’s important to note the predominant reason for withdrawing investments was the need for cash not a lack of performance.  In fact, the only African country that had negative growth during this period is South Africa.

When firms are looking for private equity funding, Backer has three recommendations.  First, the firm should have a solid business plan.  Second, the firm should be organized, demonstrating it can handle all aspects of the business operation from customers to legal requirements.  Third, the owners should not shy away from hiring professional, e.g., financial and legal, to help them with the process.

Backer notes that there challenges which limit the private equity sector in Africa.  First, the legal and institutional frameworks conducive to private equity firms still lag in Africa.  Second, investments come mostly from foreign sources instead of local.  Once more local investments occur, it will shore up the number of foreign investors that come to the table.  One of the recent success stories is SEACOM, the undersea broadband cable provider for Africa.  SEACOM had a strong showing of both local and foreign investors.

To learn more from this insightful discussion, listen to the recorded show.  To learn more about AFIG, go to http://www.afigfunds.com.  To stay in the mix of venture capital and private equity opportunities in Africa, you may want to join one of the online communities like VC4Africa.

For additional resources about doing business or investing in Africa, go to our site – http://www.afribiz.info.

Originaly posted at www.afribiz.info.

Another strategy for building a business portfolio in Africa is investing in businesses listed on African stock exchanges.  Even during these turbulent times, there are companies worldwide sustaining well and set for growth.  Looking at companies listed on African stock exchanges helps you more readily identify solid performers in Africa.

You might be surprised to know there are actually 20 active stock exchanges on the African continent.  To learn more about them, start with two resources.  First, the African Securities Exchanges Association (ASEA) serves as a professional organization supporting African stock exchanges.  From here, learn about the landscape of African stock exchanges, as well as link to any of the African stock exchanges.  Second, the United Nations Development Programme (UNDP) sponsored a handbook entitled, “African Stock Markets Handbook.”

There is discussion on forming a central Pan-African Stock Exchange to strengthen the African stock markets structure and strength.  However, this will not develop soon, according to progress within the African Union.  However, you can deal with the individual stock exchanges when making your investment choices.  As with any stock exchange, the primary intermediary to manage stocks is through an approved broker.  You can contact a stock exchange directly to get a list of approved brokers.  The African Stock Markets Handbook also lists brokers for each stock exchange.

Since the Pan-African Stock Exchange is not developing more quickly, the Johannesburg Stock Exchange (JSE) in South Africa is allowing companies located and mainly operating in Africa, not just South Africa, to list.  The structure, called the Africa Board, just launched so there are very few companies not headquartered in South Africa listed on the JSE.  However, keep your eye on its progress.  This may be another path for investing in companies throughout Africa.

Another path for investing in African companies are exploring companies who offer indexes of African companies.  An index is simply a basket of companies pooled together, working as one stock opportunity.  For example, an index might comprise of 100 companies in the telecommunications sector from the major markets in Africa.  When you buy stock in the index, you are buying a portion of stock in each of the 100 companies.  Many of the stock exchanges themselves will have indexes on the entire list of companies listed on the stock exchange, sectors, etc.  There are also investment groups like Africa Investor who manage indexes.

When you invest, you should have sufficient knowledge, goals and plans.  If you are new to stock investing, look for resources to educate yourself – books, classes, websites.  The video, “Africa Investment Horizons,” opens your eyes to the potential in the African market.

The principles for investing are true worldwide, so you can look for local sources to help you.  You might want to try working with a small group of people in an investment club to make your initial investment funds go further and reduce the individual risk.  There will be local variations in the stock markets, so identify resources to help you understand these areas as well.

Next, you will want to identify a broker with which you can work.  You might want to ask a broker locally to identify another broker in your area or country who can purchase on the African stock exchanges through affiliations.  This way your broker is closer to you.

As you start researching African companies, choose a few solid performers in the African markets, e.g., MTN and Murray and Roberts, as test cases to become familiar with analyzing African firms and the process for investing in them.  Both are South African companies, having operations and markets throughout Africa.  MTN is a cell phone giant while Murray and Roberts is a large construction and engineering firm.

Always keep your objectives, constraints and plans in mind while you research, invest in, manage and monitor stocks.  And, consider getting professional advice when making investment decisions.