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The Entrepreneurs on the Platforms of Nations

The Entrepreneurs on the Platforms of Nations

Comment: “It’s time for African entrepreneurs to start to figure things out and to stop sitting on the fence waiting for the government to provide solutions. Governments can support later but the momentum and direction must first come from African entrepreneurs.”

My Response:  I will respond by classifying entrepreneurs into two categories – typical entrepreneurs and pioneering entrepreneurs. Typical entrepreneurs are entrepreneurs  we meet daily, and they are common, and run in thousands in economies. Pioneering entrepreneurs are generation-shaping entrepreneurs who transform economies and nations.

Africa has many typical entrepreneurs and those entrepreneurs need platforms to operate. Economic platforms are built by governments and entrepreneurs build companies on them. The platforms include road, clean water, security, postal systems, and amenities which enable companies to grow and thrive. Some countries invest to build those platforms, even at losses, providing ecosystems for their typical entrepreneurs to do their things. 

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For example, the US postal service has not recorded profit in two decades, and the US Amtrak rail system has not made a profit since 1971, and America has not shut them down. What is happening is that the postal service and other platforms are foundational platforms which enable businesses to thrive in America. 

But there are also moments when the governments cannot build platforms by themselves. What they then do, is to transfer their rights as governments to pioneering entrepreneurs. When America promulgated the eminent domain ordinance, it helped  railway tycoons like Vanderbilt to build a platform for commerce. In other words, those pioneering entrepreneurs receive special benefits to solve platform-level problems in societies.

When you read about Mellon, Carnegie, Rockefeller, and other men who built America, you will notice that the government assisted in many ways because those men were building platforms. When Bezos started Amazon, a pioneering ecommerce platform, America did not require Amazon to collect sales tax, thereby making Amazon products cheaper than the ones sold in physical stores. Without those benefits, Amazon will not be where it is today.

So, the comment has it both ways: Africa needs pioneering entrepreneurs even as the typical entrepreneurs need platforms to operate.  And someone must build those platforms because they must exist before the typical entrepreneurs can create companies on top of them.

Note this: Across human histories, from the UK to America, companies rise before nations can build strong institutions. In other words, if you expect Nigeria to have the best public institutions before great companies, you would keep waiting. Typically, what happens is that nations have great companies, and then use the taxes paid by those companies to build better public institutions. My thesis is that Nigeria cannot have solid public institutions, from great schools to good public institutions, until Nigeria has created category-leading private companies that would provide resources to build those institutions.”

You can then ask: why must it be that way? It is what it is. What the US Congress did for Amazon would be seen as cronyism in Nigeria, but sometimes, those things are done to seed new platforms.

My summary: it is either your government builds those platforms or it gives goodies to the pioneers to build the platforms, because the platforms must be built for any nation to experience development and prosperity.


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1 THOUGHT ON The Entrepreneurs on the Platforms of Nations

  1. You have cited men that built America, and we seem to respect them even from across the Atlantic. We have one here, the man they call Aliko Dangote, but we do not give him enough credit. He made Nigeria self-sufficient in cement, he built a refinery big enough to make Nigeria pretty much self-sufficient in refined petroleum products. But how do Nigeria and Nigerians view Aliko Dangote? He’s seen as the great evil, the man who never did anything worthwhile but only favoured by governments. The very things Carnegie, Bezos, Rockefeller, etc enjoyed, but down here, Dangote is vilified and derided.

    What if I posit that the ultimate reason why Nigeria has failed to advance is not because of poor political leadership but rather how we treat our pioneering entrepreneurs? Who can robustly counter that? We only expect political leaders to perform in things they neither have no clue nor capabilities to perform in, yet we still insist they must perform there and vehemently oppose and resist potential pioneering entrepreneurs from delivering the very things we all yearn for. It is either that we are collectively dishonest or collectively clueless.

    We care less about development but more about who should deliver it. Keep waiting miserably.

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