‘Institutional investors should not think twice before funding women…’

There is something exciting about Adesuwa Okunbo Rhodes that the world needs to see and learn from. Despite being just 30 years old, she has been named an Agent of Impact; changing the narrative within finance and impact investing for women and making an impact on society, one investment at a time.  KINGSLEY JEREMIAH met with the Chief Executive Officer of Aruwa Capital Management and she told him how it all started and how she got here with her passion for women to succeed in business. Enjoy.

Kindly tell us about yourself?
I was born in Nigeria and started primary school in Chrisland and did one year of secondary school in Atlantic Hall, Lagos, but I was sent to a boarding school -St. Lawrence College, Ramsgate in England, at age 11. For me, it was a good foundation to be away from home at a young age and a step towards being independent. Afterwards, I proceeded to Bristol University, United Kingdom, where I studied Economics. I have always known that I wanted to be in the world of finance and I found Economics interesting and it gave me a good foundation for the investment-banking world that followed university. My interest has been in the financial markets from a young age, particularly its impact on daily life.

During my first year in university, I got an investment-banking job at Lehman Brothers, which was very rare at the time, and it was a unique privilege to be selected in my first year when I just turned 18. I did my second internship at J.P. Morgan, also in investment banking, and following that was offered a full-time position at J.P. Morgan after graduation.

At J.P. Morgan, I worked in the acquisition and leveraged finance teams covering a range of sectors and countries. I executed $3.6 billion of structured credit transactions across emerging markets, including Nigeria. During my time in investment banking – Mergers and Acquisitions department of the company, I executed $2.0 billion of M&A transactions in the United Kingdom and United States. I believe the long hours and deadlines laid the foundations for being the entrepreneur I am today.

Before J.P. Morgan, I worked with TLG capital as an investment analyst. I was involved in a number of private equity transactions in Anglophone Africa, including a very successful principal investment I made in Uganda. The investment in Uganda was a company that manufactured generic pharmaceutical products such as anti-malaria and anti-retroviral drugs. I took the decision to personally invest because of the impact it would have on people’s lives. In Africa, we have a lot of fake medicine but our efforts reduced that challenge significantly in the country, as the company was the first WHO pre-qualified factory at the time. The business helped Uganda become self-sufficient in manufacturing those drugs and was also a very strong financial return for all shareholders. The balance between impact and profit really sparked by interest in impact investing.

I became a co-founding partner at Syntaxis Capital Africa in 2014, where I spent five years as the managing partner. The company was a provider of growth capital to SMEs in Nigeria and Sub Saharan Africa. Syntaxis Capital Africa was part of Syntaxis Capital Limited, a private equity fund operating in other emerging markets with $300 million in assets under management from global institutional investors. There, I led and worked on transactions worth more than $200 million across Sub Saharan Africa.

At what point did you decide to establish your company?
In 2019, I took a decision to start my own firm – Aruwa Capital Management, which is a continuation of Syntaxis Capital Africa. I decided that for the long-term of the business we had to take ownership and control our own destiny. Most of the businesses we take on are currently undervalued and underserved by larger financial institutions. Based in Lagos, Aruwa Capital focuses on providing growth capital to untapped indigenous businesses with an operating history and track record of profitability of at least three years. The company focuses on high growth sectors such as FMCG manufacturing, tech enabled non-banking financial services, education, healthcare and B2B services.

Why do you support women more in your firm?
Africa has the highest percentage of female entrepreneurs in the world. One of the reasons I wanted to set up an investment firm was to have more successful women in business and empower women at all levels of society. Institutional investors should not think twice before funding women, but unfortunately we do not yet have enough success stories to change that status quo. The fact that only 2 per cent of women entrepreneurs in Africa have access to capital is worrisome. If women are funded and empowered, we can take strategic roles in our industries and the success stories will help other women to have easy access to capital.

Also, there is a huge multiplier effect when a woman is empowered. 90 per cent of a woman’s wealth is invested back into her family and community because the woman controls the household. When women have access to capital and financial dependency, they impact the economy and society because of the significant roles they play, especially in Africa.

Our latest investment manufactures hygiene products like baby diapers, sanitary pads, net maternity pads among others. eighty per cent of their products are bought and used by women. There are still many parts of Nigeria where women are not using the right products during birth or their menstrual circle. Whilst this business drives industrialisation in Nigeria, our investment also helps to increase capacity whilst improving health outcomes and creating further employment opportunities for women. For businesses we work with, we emphasise on the importance of gender balance in their operations. We strongly believe that when we have a gender-balanced team, we will have stronger returns, profitability and there will be multiplier effect on society.

What can be done to address the challenges facing SMEs in Nigeria?
The challenges cannot go in a day.  But access to capital remains a critical challenge. Many commercial banks in the country are not ready to provide the capital that meets the specific needs of SMEs. When they do, the interest rate is high and tenors are too short. The capital has to be tailored to peoples’ needs and their cash flow and has to be patient. We also need the right capacity building to be able to institutionalise businesses to become sustainable, considering that a lot of the businesses are family-owned. There is need for the right operational support to ensure the right processes and systems are in place. These will make the business effective while there are the necessary checks and balances.

The economic outlook of the country has been worrisome to some experts, especially looking at the current debt profile, tax and budget deficit. What is your take on this?
We need to diversify our economy and I think the current administration is doing it in the agricultural sector. We need to support businesses that are driving industrialisation e.g. local manufacturing, probably with tax holidays. The development on border closure is a good move as it has encouraged local manufacturing.

We also need to reform the pensions industry. Nigeria has more than $25billion in pension assets and I don’t think we’re utilizing them for investment to match the long-term nature of the assets. We need to match those assets with longer- term investment, private equity and infrastructure specifically. Right now, those assets are idle in short-term investments and it is high time we addressed the mismatch in my view.

Government must work with the private sector to encourage the economy. Private equity is a big part of providing patient capital to businesses. That will have a significant effect on the economy in terms of employment opportunities.

We should diversify the economy from oil and provide incentives to back local manufacturers and industrialisation. We can raise capital from pension fund to back industries and invest in infrastructure.

What were the challenges finding your path in life?
I come from a good family but I have always been interested in making an impact and a name for myself through hard work and being focused.

I was not a spoilt child who relied on her parents. I have always made sure that I did everything by myself because I wanted to make a name for myself and chart my own path. The only thing your parents owe you is a quality education but it is left to you to make good use of it. I am a believer in writing your own story and success.

But as a young woman, it was challenging raising funds and convincing investors that I was committed and could do a good job just as a man.

At 30, everything is going well for you. What has been your secret to success?
I am highly focused and I grew up fast. In school and university, I was a year ahead of myself. In my career, I am always surrounded by older people. Being focused and persistent has been a driver of any success I may have had.

How do you ensure career doesn’t affect your role as a wife and mother?
I am married and have a son. There is a saying that you cannot have it all and that is the truth. For me, it is all about prioritising things. I also think the man you get married to as a career woman matters a lot. My family and husband have been very supportive of my dreams. Most importantly, one has to look up to God for strength and wisdom because it is not easy to be a good mother, a good wife and a good CEO. It is challenging but with a supportive family, God and determination, everything is possible.

How do you take time off your busy schedule?
I enjoy travelling, cooking and playing tennis to relax.

Who are your role models?
I look up to a lot of strong women in finance and industry. I admire Daisy Danjuma and I look up to her as a role model. I also look up to Bola Adesola, Ibukun Awosika, Osaretin Demuren, Adeola Azeez and a host of other amazing women. Apart from being at the pinnacle of finance and industry, these amazing women walk the talk and pave ways for other women to rise. When women support other women, the sky is the limit.

What advice do you have for women?
Women should remain focused and determined. They need to know what they want to achieve and have a dogged determination to achieve it, no matter what. One of my favourite quotes is that, “a river does not cut through rock because of its power; it cuts through because of its persistence.”  Once I set my mind on something and I am certain it is God’s will for my life, I will do everything to ensure that I meet the objective and fulfil that purpose. That’s how I have made my achievements under 30. I had a successful career in investment banking, private equity and now, I have been able to start my own investment fund to impact the economy and improve the lives of people. By investing in small and medium size businesses, we have been able to generate attractive returns for investors with added socio-economic development benefits. Apart from making strong financial return, we have been able to make an impact on the economy by generating jobs for the youth and women as well as generating tax for the government.  The passion is to be able to build my own firm while also making long lasting impact on the lives of people and the financial ecosystem in Nigeria and across Africa. That is actually the legacy I want to be remembered for.