‘Government policies should create space for entrepreneurs to thrive’
Andrew Skipper currently heads the Africa practice of Hogan Lovells, a global law firm with offices in more than 45 countries including 11 offices in the USA. In this interview with FEMI ADEKOYA, he explains how he is leading his firm’s Africa practice to pursue a policy of understanding, operating, investing and respecting Africa.Specifically, he explains how his firm explores global technologies and strategies in supporting the development of local entrepreneurs and businesses.
Having worked in Africa for a while now, how would you describe your experience and why is your firm interested in the Nigerian market as well as others?
At Hogan Lovells, we see the potential in Africa as an emerging global market and we have been committed to this continent for over forty years. Nigeria is a focal point of the African market due to its population and the immense opportunities here. Personally, the African story is one of intrigue and passion for me. I am a member of the board of the Smithsonian African art museum so while I seek to promote art and Africa as a passion, I also get to fulfill my obligations of promoting law and Hogan Lovells, both of which I enjoy immensely.
When compared with other markets in Africa, Nigeria has a larger market or economy with various segments. Recently, there has been a surge in entrepreneurship, what is your view on how this impacts the economy?
As earlier stated, Nigeria is one of the most important markets in Africa in addition to other African economies which are all extraordinarily different and unique. Nigeria has an advantage in her scale in terms of population size. As for entrepreneurship, the entrepreneurial drive favors top entrepreneurs like Aliko Dangote who has an enormous financial clout through which he can make refineries and create industries. The infrastructural deficit and power shortage are debilitating factors for entrepreneurship in Nigeria. However, with the surge of entrepreneurs in the information technology space, FINTECH and others, alongside the advancement of block chain technology, crypto currencies and mobile payment systems, the opportunities for young people to be enthusiastic and successful is limitless.
Considering that contracts are often disregarded in this part of the world, due to several issues. With the rise in entrepreneurship, how can this be addressed to enhance investments inflow?
Many of the lawyers in our partner firms are very professional and excellent at drafting contracts, though most big contracts in Nigeria, whether on disputes or not, would probably go to arbitration and English, French or New York law and they would probably be heard in New York, Paris or London. The reason for this is that despite having very good lawyers in Nigeria, the court system here can take so long that an arbitration appealed to the court can come out several years later. I think some obvious steps should be taken and I know the vice president has been commenting on that in the last year.
Are there programmes or initiatives designed to help entrepreneurs mitigate against the skill and power challenges that affect their operations in Nigeria?
At Hogan Lovells, we are very supportive of developing young entrepreneurs across the continent and we have done that in a number of ways and in a number of sectors. Recently, we hosted our inaugural community solar innovation awards, involving 280 participants with the majority from Africa. This competition invited them to come up with specific small scale solar energy projects that are locally designed but globally scalable and replicable. These designs aimed to support communities using solar power on an entrepreneurial basis. The winner was a Ugandan company called Village Energy who won $10,000 and a package of support from Hogan Lovells and SEED. Most importantly, we were able to work with them, mentor them and provide them with free legal advice. We also worked with SEED (UN) and the Barefoot College on this competition, and identified specific issues such as the young entrepreneur’s need for financial and technical support, technical support in terms of starting a business, business mentorship and business management. We also have an initiative called Hogan Lovells BaSE which is a social enterprise programme where we mentor our junior lawyers and young businesses around the world to help with entrepreneurship development in a sustainable way.
There are a number of sectors where this works particularly well, one of which is solar technology in terms of its utility and the amount of power it produces locally. We have tasked ourselves with lighting up 20,000 homes in the next couple of years through a partnership with Barefoot College which trains illiterate women from villages to become solar engineers. In this way, upon return to their villages, they begin to create solar power which translates to a growth in business and education. So, in retrospect, we are big law firm with a global viewpoint as we explore global technologies and strategies in supporting the development of local entrepreneurs and businesses.
The government is looking at imposing tariff on solar panels. There are concerns as to how this might affect the alternative power industry in Nigeria considering that many firms and homes now adopt solar energy as a cost-saving measure. What are your thoughts?
I think this is a political question. The rationale for taxation of new businesses could be the massive infrastructural deficit which creates a need to raise money to pay the people who work for it. However, it is a global practice to encourage entrepreneurs by giving them early tax breaks. So, I think that any government has to balance the obvious need to raise revenue with encouraging enterprise by giving emerging businesses relevant grants and tax breaks.
Despite the social impact some business models offer to Nigerians, the cost of funding businesses remains high. What source of funding would you advise entrepreneurs to explore to remain competitive?
I wouldn’t presume to tell Nigerians what they need, however, other markets in the world use a combination of both. Support varies for the type of enterprise. For an IT developer, support means protecting your intellectual property rights from theft, for a shop keeper, it could mean a correctly signed and legally binding agreement. It also depends on the solutions which lawyers could bring to support in terms of helping people. Not everyone succeeds, most businesses fail but good entrepreneurs move forward until they eventually succeed.
How will an understanding of environmental regulations and policies help in providing support for entrepreneurs?
There have to be government policies in place that will allow entrepreneurs to be given the space to thrive. Without that, it is difficult for small businesses to grow. So, having a society which is regulated in a manner that supports entrepreneurship allows entrepreneurs access to financial, business and technical mentoring.You can go to venture capitalists, get direct funding from government, support from DFIs and angel investors like we at Hogan Lovells advise on to help out in particular cases, but to ensure the success and security of any investment, the underlying nature of government has to be stable and secure. In these ways and more, corporates and startups need to understand environmental regulation as it affects their business.
Beyond organizing competitions and rewarding winners with cash prizes, are there other platforms where people who have business ideas can pitch them?
Yes. Around the world, we have tech hubs designed to support small businesses. This is partly what HL BaSE does. HL BaSE replicates the sand box type of arrangement which governments are now adopting. For example, in London, young entrepreneurs can go and play in the sand box to find out whether their ideas work. We spot the most innovative of those ideas and see where we can help. We do a lot of that with development of the IT space, payment systems, block chain technology and all of the likes which is where Africa has an opportunity.
In addition to effective governmental regulations, how do you think technology can curb counterfeiting and ensure the protection of intellectual property?
These challenges revolve around origin, originality and ownership. Block chain technology is something which will definitely support the protection of intellectual property in a number of ways. It will support patterns because it will prove what patterns are made, it will support land registry, it will support contracts in terms of timing of contracts and ultimately will be put in the supply chain to prove when something has been left somewhere so you will be able to trace back without changing it. So, I think in terms of protecting contractual and intellectual property rights, technologies such as block chain are the future and will definitely be in place in the next 2-3 years.
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