When the African Capital Alliance (ACA) was founded in 1997, its ambitions were global, but it had to start somewhere. His first job, as an established pioneer of a business that wanted to establish its knowledge in raising investment funds, was in the commercial capital of Nigeria, Lagos.

It was a very bad time, during the dying days of General Sani Abacha in the military dictatorship when Nigeria was the world’s only foreign power. But African Capital Alliance managed to raise its first round of $35m less than a year after it was formed in 1998, proving its resilience in a difficult environment from the outset.

Growing up in such conditions for more than two decades now, the ACA seems to have aged. With more than $1.2bn raised since its inception, with offices in Nigeria, Ghana and Mauritius, the company seems to be fulfilling its original dream. It currently manages five funds with investments in 51 companies covering seven business sectors in 10 African countries.

“Yes, Africa has always been the focus of ACA,” co-founder and chairman Okey Enelamah says. African business in an interview with Lagos. “The idea to start in West Africa was based on the growth and potential of other economies such as Nigeria, Ghana and the Ivory Coast. The goal was to invest in Africa as a whole.”

The initial fee pays

With the initial investment ACA made, it became the first investor in South Africa for MTN’s Nigerian unit of the mobile phone company, which obtained a license to operate in Africa’s most populous country in 2001.

This was the most successful investment made since the first round of fundraising, with MTN Nigeria’s value rising from $400m at the time of the investment to $13bn at the time of the ACA exit in 2012, according to company records.

Some of the money ACA released also went to MTN Nigeria. Apart from its cost, the ACA also contributed to the success of the mobile phone company by creating a financing structure and “special purpose vehicles” that allowed Nigerian investors to participate.

Beyond telecommunications, ACA funds have covered financial services, media and technology, consumer goods, agribusiness, energy, education and health care. Profitable companies came from Business Day newspaper, Continental Reinsurance and online travel agency Wakanow.

Going through the motions

The ACA is the result of the crossing of ideas between an American entrepreneur, Richard Kramer, and a young Nigerian doctor, Enelamah, more than thirty years ago. Kramer came to Nigeria in 1978 to set up a division of Arthur Andersen accounting firm.

Enelamah had taken a different path, graduating from secondary school at the age of 16 and admitted to a pharmacy course at the University of Nigeria, Nsukka, in 1979 before becoming a doctor a year later. After attending medical school in the mid-1980s, he wondered if he really wanted to be a doctor.

While he was in this situation, Enelamah remembers, an opportunity arose to join Arthur Andersen as a student.

He said: “He tried to be an engineer but he had never tried to be a doctor.” Both sides were willing to take a gamble, and Enelamah began his studies as a business professional, which included qualifying as an accountant and attending Harvard Business School in the US. The rest, as they say, is history.

After successfully raising its first $35m, ACA’s next round in 2005 raised $100m. Three years later it raised $165m for its first real estate fund. Other rounds that followed show the growing confidence of investors with about $400m raised in 2009 and $567m in 2015. During this time, the company also established property management and real estate.

Creating a business environment

While Kramer was the chairman, Enelamah served as CEO from its inception until he was appointed as Nigeria’s minister of commerce and finance in the first term of President Muhammadu Buhari. He saw his role mainly in reducing the problems of various groups that acted as obstacles that reduced or hindered investors.

“One of the most important things we wanted to do was create a good business environment,” says Enelamah.

The reforms he introduced as minister led to laws such as granting business travelers visas on arrival in Nigeria and simplifying business registration. The new corporate law that came into effect in 2021 provides significant changes to the incorporation of companies, including the establishment of limited partnerships and allowing ownership of companies with limited debt.

Okey Enelamah representing Nigeria at the Fourth China Round Table, Nairobi, 13-14 December 2015. (Photo: WTO)

Investing across Africa

Kramer retired as chairman in 2018 and died in April at the age of 88. Enelamah, who returned to the chairman’s chair after his ministerial stint, will continue to push the founders’ goals. This includes promoting “finance, management expertise and technology to create a modern African economy,” he says.

Enelamah sees the establishment of the African Continental Free Trade Area as a boost to the company’s goals and a sign of new opportunities that seek to expand its presence across Africa, with more offices being considered in East and North Africa.

“Indeed, over the past decade, the company has been looking to partner and invest in businesses that have strategies that are moving around the country,” said Enelamah. “The amount of money being collected so far shows the wide coverage and scope.”

Beyond the great economic benefits, Enelamah also demonstrates the company’s impact on society, which is often not seen due to the restraint of the private sector. In addition to the money that creates jobs, their leadership, business integrity and compliance often affect the companies that receive its money, according to the ACA.

Some of these investments have also brought positive economic and financial benefits. For example, by enabling Continental Reinsurance to work with organizations and governments in Nigeria, Kenya, Zambia, Uganda, Malawi, Tanzania and Zimbabwe to provide 10m insurance to farmers against crop failure.

Another beneficiary of his investment, Global Accelerex, provides electronic services in Nigeria and Ghana, supporting corporate banking that has increased the inclusion of more citizens in the economy. It plans to expand in Côte d’Ivoire, Tanzania, Kenya and South Africa.

Enelamah expresses his conviction that “the combination of economy, technology and management expertise will be instrumental” in the development of Africa.

“The private sector, therefore, is more than a profit-making process for us,” he says.

“It is also a way to generate profits by promoting economic growth through successful businesses that can help transform the African continent.”

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