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from the September 30, 2003 edition

(Photograph) CLEAN IMAGE: When Ayisi Makatiani started out, his competitors "convinced" the telephone company to turn off his phone service. He says there was a temptation to pay bribes, but he says he wanted to do things the right way.
ANDY NELSON - STAFF
Africa's new class of power players
Page 3 of 6
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Sticking to his guns

Ayisi Makatiani is often mentioned as one of young Africa's up-and-comers. But it's taken him the better part of a decade to gain that recognition. It was back when he was still studying for his degree by the placid Charles River in Cambridge, Mass., a decade ago that Mr. Makatiani first came up with the idea of starting an Internet business: an online chat room that would link Kenyans living in the US who missed home and wanted to keep in touch.

(Photograph)
AYISI MAKATIANI: • Studied electrical engineering at MIT in Cambridge, Mass.
• Started Africa Online and Gallium Capital, which raises funds for African technology companies

ANDY NELSON - STAFF
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It didn't take long for Makatiani, an electrical-engineering student at the Massachusetts Institute of Technology and his Kenyan friends to learn that they were on to something. A fast-growing subscription base and demands for hard news from home led them to a more ambitious goal: an Africa-based Internet service provider, complete with African content.

Most people back home still did not have electricity, true, but those were the early days of the dotcom craze. With the sense that anything could happen, they gave it a go. They knew navigating the waters of Kenyan corruption would be daunting, but they weren't prepared for the class 5 rapids they encountered.

Shortly after the opening of the Africa Online offices in downtown Nairobi, Makatiani's competitors, who had ties to high-level government officials, "convinced" the national telephone company to shut down his company's phone lines - leaving the main server unable to dial out. Customers began canceling subscriptions. "We were offering dialup service, and we had no dial tones," he recalls. "It was not fair. Not easy."

But today, Kenya's first commercial Internet service provider is operating in 10 countries and is considered one of the continent's best-run businesses. Makatiani has been named one of the World Economic Forum's leaders of tomorrow and recently started a promising new venture capital firm - Gallium Capital Partners - to fund tech companies in the region. Gallium has already been flagged by Fortune magazine as a model fund for companies in Africa.

Africa needs the kind of economic boost Makatiani's venture-capital fund can provide. Sub- Saharan Africa now is poorer, sicker, and more devastated by war than it was when the colonialists departed. At the start of the 21st century, it has the largest concentration of people in the world living on less than $1 a day, the greatest number of civil wars ongoing, and the highest number of refugees. AIDS has cut life expectancy to 47 years, and only 12 percent of the roads are paved. Corruption still abounds.

But Makatiani always knew two things, he says, as he maneuvers his car along the highways of his current hometown, Johannesburg, South Africa, between meetings: He was going to become a major business player in Africa, and he was going to do it the fair, ethical way.

"That was a time where you simply could not do business without having to pay someone," says Makatiani, a handsome one-time track-and-field champion who today favors dapper suits and conservative ties. "But we didn't want to pay someone. We didn't want to join that club. It was like being part of the mafia."

But he also knew that he could not yell and scream and demand things in Nairobi that were par for the course in Cambridge - like getting a working phone line if he paid his bills. With the help of a colleague's influential father, Makatiani created a politically well-connected board of directors that began lobbying on Africa Online's behalf, protecting it from unfair demands and steering it toward helpful partners.

"What we had to do was educate [government bureaucrats and suppliers]. There are a lot of people around who have power but who are poor - trying to get a piece of the action. But we refused to cut corners," he says. If his group had started handing out bribes, he says, they would never have seen the end of it.

"Perhaps we were a little bit naive in those early days at Africa Online," he chuckles. "We wanted to stick to our guns. We might have been richer quicker, but I am not in the business of short-term advantages. And I have always been able to sleep at night."

"It will be men and women like Makatiani who will create the wealth that pulls Africa into the developed world," Red Herring, the respected technology magazine, wrote last year. "His company is treading where diplomacy has failed, confronting problems that have thwarted powerful international agencies, and slowly progressing toward its goal of creating a single market out of Africa's 800 million people."

Page 4: Who knows division like Rwandans? | 1 | 2 | 3 | 4 | 5 | 6

  COMING HOME: Africa's emerging power players
KENYATTA
Possibly Kenya's next president
MAKATIANI
Launched Africa's biggest Internet company
KAYOMBA
Founded an independant newspaper in Rwanda
DARKOH
Leads Botswana's free AIDS-drug program

BRUKTAWAIT
Started Ethiopia's largest private bank

TSELE
General Secretary of the South African Council of Churches
Q&A: The higher education equation in Africa's development
 



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