HOW RWANDA CAN PARTNER WITH APPLE TO CREATE A MIDDLE CLASS

                The nation of Rwanda wants to forsake its sordid past, look ahead, and create a future for its people. Rwanda’s President Paul Kagame  is partnering with Western entrepreneurs to create jobs in his country. President Kagame’s vision is to lure private investment to Rwanda, train a new generation of managers and “in country” entrepreneurs, and join the global economy as a charter member in good standing. The ultimate goal is to move the country away from foreign aid. President Kagame’s model is the Asian Tigers of the 1980s. The Tigers were South Korea, Taiwan, Singapore, and Hong Kong.

            The Tigers were overpopulated, had little reserves, and they were overpopulated. They are similar to present day Africa. The Tigers biggest asset was the Pacific Ocean. This allowed the Tigers to create an export economy. This export economy allowed the Tigers to create a middle class economy and to join the modern world. The Tigers evolved from being an emerging economy to being a significant economic player in the world global system. This is President Kagame’s vision for Africa. President Kagame has a vision for the development of the African Gorillas.  These are a group of African nations that want to create strong, middle class, entrepreneurial economies that create jobs. Africa is an emerging economy. President Kagame’s vision is that Africa will stop being an international state and become a strong player in the globalized economy. 

            The Tigers had the Ocean. The Gorillas have two assets in a creating a middle class economy. They have social media and they have personal relationships with major western entrepreneurs. Social media creates great scale, and content is allowed to move easily and quickly.  If apps can be localized, those apps can penetrate rich diverse global markets.

            A strong wireless telecom network is a must for President Kagame as he tries to build Rwanda’s economy. This is where relationships come into play. An entrepreneur that is partnering with Rwanda is Scott Ford. Mr. Ford is the former head of Alltel Wireless. This company developed a large wireless network in the rural South, which is similar to Rwanda.

            Rwanda needs cell phones for its development to take off, but they need cell phones of a certain type. They have to have smart phones, but dressed down smart phones. It is the development of these specialized smart phones that may hold a key to Rwanda’s development.

            There is a new concept that has developed entitled reverse innovation. In years past, organizations would develop products for mature western markets, and then simplify (dumb down) the product for Third World Markets. Reverse innovation is when simple products are developed in a Third World country and then is sold in a Western Economy. Many times there is a market for this simple version of a larger product.

            In the case of Smart Phones, not everyone needs the tens of thousands Apps on a conventional I Phone. Rwanda needs a simple phone, with ease of use. Rwanda has a population which is 50% under the age of 16. The population has limited conventional educational exposure. The Rwandan smart phone must have simple, easy to understand touch graphics. Many Rwandans are illiterate.

Apple could partner with Rwanda, develop and manufacture a simple I phone. This phone could be an example of classic reverse innovation. There is a vast market for Apple in the States for a simple, smart phone. For Rwanda to develop as a middle class economy, a manufacturing base must be created in Rwandan cities. Presently 80% of Rwandans are subsidence farmers.

The Rwandan smart phone could be manufactured in Rwanda, and marketed in both the U. S. and Rwanda. Labor prices in Rwanda would be low in comparison to the U.S., but the manufacturing base would be the beginning of a Rwandan middle class. An operation such as this would create sustainable job s in Rwanda. This is only a simple way of describing a way in which Rwanda and the rest of the African Gorillas could join the global economy. Obviously, the devil would be in the details.

Dean Hambleton

dnhambleton@gmail.com

WHAT IS THE PROCESS RWANDA IS USING TO CREATE A MARKET ECONOMY?

           

            Rwanda is attempting to create a market economy by developing relationships with Western entrepreneurs. Rwanda is an example of how social media has changed the paradigm on which the globalized economy now operates.

            Social media operates on the basis of strong relationships. The relationship is based on something more than just knowing someone. The relationships are deep.  The relationships are the equivalent of human friendships.  People do not trust brands---but they trust their friends.  This relationship is critical to the development of Rwanda.

            If Rwanda is going to succeed as a country, it must create jobs. The nation has a huge population per square mile. It is the equivalent in size to the state of Vermont, but it has 16 times the number of people. It is a very young population. Half of the population is 16 or under. Foreign aid is a massive failure. It just subsidizes people, it doesn’t support them.  It can’t. The government can’t hire everyone.

            Rwanda has significant limitations in its infrastructure.  Nine of every 10 adults are a subsistence farmer. The present per capita income is only a dollar day. Rwanda has no oil and few mineral. The great asset that Rwanda has is a President who has great people skills and who has the ability to create relationships.

            President Robert Kagame is a benchmark for the job skills that a leader must have in our social media era. Mr. Kagame must attract entrepreneurs to Rwanda who will then encourage other brother and sister entrepreneurs to follow. Rwanda has a terrible brand. In 1994 it  was the site of one of the worst massacres in history in which 1/8 of its entire population was murdered in a month. Mr. Kagame must use other people, customers to brand his nation for him.  This is a significant fact of modern branding in a social media era. Other people must brand your product for you, for no other reason than they just plain “like” your product. This is a very crucial and interesting fact for a modern marketer to focus on.

            To create these relationships, Mr. Kagame sends fact-finding missions to Asia. He pursues Rwandan professionals in exile who left during Rwanda’s dark days. He speaks at Google and Facebook. He meets personally with American entrepreneurs. One thing that Mr. Kagame does that is interesting is that he has created a strong relationship with the American Evanglical community. He has created a strong network of people who are willing to invest in Rwanda. It is beginning to pay off.

            Rwanda has a Presidential Advisory Council has become a high-level, low-profile dispatch team and brain trust. All 16 members---10 are non-Rwandan---are stars in their sectors, from life sciences, telecom, economic development, and consulting. They meet twice a year, once in Kigali and once in New York for strategy sessions. Some of the people involved in this advisory group are Michael Porter, the Harvard Professor, Eric Schmidt of Google, Tony Blair, RealNetworks founder Rob Glaser, former Alltel CEO Scott Ford. An interesting member of President Kagame’s advisory council is Rich Warren, the Evangelical pastor who wrote the best-selling book, “The Purpose Driven Life”.

            Mr. Warren is an interesting personality to be engaged in this Rwandan endeavor. In addition to being a well-known spiritual leader, he is also rich now that his book has sold so well. The mere presence of Mr. Warren on the council creates a strong brand for Rwanda.

            Mr. Kagame’s goal is to create jobs. In doing this, he hopes to create a legitimate middle class in Rwanda. His plan is only in its early stages. He is enjoying some successes.

            In the 1980’s,  the Asian Tigers created middle class economies in Asia. Leaders such as Mr. Kagame are creating the African Gorillas. This force has the potential to be a significant factor in the global economy.

Dean Hambleton

dnhambleton@gmail.co

HOW CAN THE 'AFRICAN GORILLAS' BECOME A FORCE IN THE GLOBALIZED ECONOMY

?

             In the 80’s the world economy was fueled by the Asian Tigers. These were export led economies that created a strong middle class in their countries. Today, we have the African Gorillas who want to do the same thing.  The African Gorillas have the potential to become significant players in the global economy.  Let us use Rwanda as an example of how the African Gorillas are trying to develop. The West has spent $1 trillion on aid to Africa over the past 4 decades. This has not built strong economies because aid doesn’t create jobs. It creates dependency.  Job creation is critical for a nation like Rwanda. Half of its population is under 18. If Rwanda is to create a middle class, job creation has to be emphasized. The government can’t hire all these people. Unless jobs are there, eventually civil unrest will develop. The means that Rwanda and the rest of the African Gorillas desire to develop is through outside investment using private entrepreneurs.

Rwanda wants investment because they want to build the build a business environment and infrastructure that is needed to create a strong middle class. Rwanda desires investment and eschews aid, although presently aid makes up half of Rwanda’s budget. Investment is a driver of economy and aid saps the economy. The mistake that a lot of third world countries make is that they receive foreign aid. Foreign aid does not work because it doesn’t create jobs.

                        Rwanda has some severe limitations in creating a middle class. It is landlocked, and largely deforested, and 90% of its population is subsistence farmers. The biggest asset that Rwanda is its President, Paul Kagame This is a nation that is led by a President who wants to make his country business friendly.

            President Kagame has lofty goals. He wants to boost GDP sevenfold, find paying jobs for half of Rwanda’s subsistence farmers, nearly quadruple per capita income to $900, and turn his country into an African center for technology, all by 2020. Creating a strong technological base is key to Rwanda and the rest of the African Gorillas. Rwanda has committed 5% of its GDP in science and technology by 2012.

            Rwanda’s strategy revolves around brand reversal. This strategy involves having key entrepreneurs from the west invest, have successful experiences in Rwanda, and attract newer investors through networking. Social media is a key ingredient to the development of the African Gorillas. Facebook has approximately ¼ of the world on their site. If ¼ of the world understand that Africa is great place to invest, it is the hope of the Gorillas that the world will come to Africa and help them develop their continent.

            The strategy of the African Gorillas is this. Anyone with a big idea, a smart phone, and an app can now connect with a worldwide market and build a brand.  By partnering with Western investors, the Gorillas hope to adapt products to African needs and cultures, build strong middle-class communities, and bring their continent to the point that Africa is part of an interconnected world.

Dean Hambleton

dnhambleton@gmail.com

HOW PRESIDENT PAUL KAGAME IS USING REVERSE BRANDING TO DEVELOP RWANDA

             Let’s say that you are an entrepreneur.  You know that the American market is saturated, and that little growth will continue there. You’re sitting home, and you receive a call from the President of Rwanda and he asks you to invest in his country.

            Rwanda is known for two things, Gorillas, and the 1994 Genocide, this is their brand. So you say no. Five minutes later, you receive a call from your best friend who is also an entrepreneur. He tells you that he has located an operation in Rwanda and that it is producing profits off the charts. You now are attentive. You’re best friend is attesting to the brand of Rwanda.

            You then get a third call. This is from Rick Warren, the evangelical pastor, and he asks you to invest in Rwanda. You may or not be a person of faith, but Rick Warren lends an air of credibility to Rwanda. It creates a brand for Rwanda. Now, you have an interest in investing. Why?  Rwanda has had a brand created for it. This is reverse branding.

The President of Rwanda, Paul Kagame, faced a dilemma. He wanted his African country to thrive. To do this, he knows that he had to create investment in his country.  His country had a sordid past that Western investors simply couldn’t ignore. President Kagame is using Reverse Branding to create investment in his country.

            Reverse branding is when the customers brand the entrepreneur, and this brand, brands the products. When Steve Jobs creates a new product, it instantly has credibility.  In the social media era, reverse branding is becoming an important branding strategy.

           In the social media era, there is so much content, so many players. There is so much scale created in social media. It is hard to create that significant brand. Customers have to do the branding to create credibility. This is what happed in Rwanda.  Successful investors told their story on Facebook, Twitter, and YouTube. This created a brand. Rick Warren, the evangelical pastor, created a YouTube video.  Rwanda, a nation with a dark past, now had credibility.

            President Kagame wanted foreign investment and not foreign aid. Investment has a profit motive---in a very unusual way,   this has created ethics in an economic-business system. Foreign aid is government to government and it creates corruption.

            Simply looking at numbers will bear this out. In the last 40 years, the West has spent $1 trillion. Just looking at the continent of Africa, it can be seen that this is unproductive. With a lot of money flying around and no controls, corruption is a natural consequence of aid. Corrupt leaders siphon it off. Inefficient leaders merely squander it, and this is just as bad. Millions of people get hooked on it. Economic development created by private investment is the engine that is needed to  drive African economies. Private investment creates jobs---foreign aid does not. Jobs create a middle class and a stable, uncorrupt government.

            President Kagame seeks to build his nation through reverse branding and a social media strategy.

Dean Hambleton

dnhambleton@gmail.com