ADM EVALUATION AND AWEP ASSESSMENT FINAL REPORT OCTOBER 2014 This publication was produced for review by the United States Agency for International Development. It was prepared for USAID by Weidemann Associates, Inc., a Crown Agents USA Company AFRICAN DIASPORA MARKETPLACE PROGRAM EVALUATION AND AFRICAN WOMEN ENTREPRENEUR PROGRAM ASSESSMENT FINAL REPORT Authors: James Hochschwender M.B.A. Maggie Smith Contracted under AID-OAA-TO-10-00017 Task Order 32 Work Assignment 05c RAISE Plus IQC - Agricultural Knowledge and Program Support Task Order DISCLAIMER The author’s views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment i CONTENTS List of Abbreviations and Acronyms ........................................................................................... 1 Acknowledgements ........................................................................................................................ 3 Executive Summary ....................................................................................................................... 4 ADM Program .................................................................................................................... 4 AWEP ............................................................................................................................... 14 ADM/AWEP Program Synergies ..................................................................................... 14 Introduction: Overview of ADM Evaluation and AWEP Assessment .................................... 16 Purposes and Parameters .................................................................................................. 16 ADM Program………… ..................................................................................... 16 AWEP…………………. ..................................................................................... 19 Methodology for Combined Evaluation and Assessment ................................................. 20 ADM Methodology……. ..................................................................................... 20 AWEP Assessment Methodology ........................................................................ 22 ADM Evaluation – Findings and Conclusions .......................................................................... 23 ADM Design ..................................................................................................................... 23 ADM Competition Implementation .................................................................................. 27 ADM Results and Impacts ................................................................................................ 52 ADM Conclusions and Recommendations ....................................................................... 70 AWEP Assessment ....................................................................................................................... 73 AWEP Program Assessment............................................................................................. 73 SEAF AWEP Program Implementation ........................................................................... 75 Chapter Development Assessment ................................................................................... 78 AWEP Conclusions and Recommendations ..................................................................... 82 ADM / AWEP: Looking Forward/Recommendations .............................................................. 87 Opportunities to Combine ADM and AWEP Activities ................................................... 87 Annexes ....................................................................................................................................... 102 Annex A: List of Documents Reviewed ......................................................................... 102 Annex B: ADM I & II Comparison ................................................................................ 104 Annex C: Due Diligence Program Guide and Checklist Review .................................. 104 Annex D: ADM II Awardee Feedback, lessons learned and recommendations ............. 107 Annex E: ADM I Awardee Program Feedback and Recommendations ......................... 112 Annex F: Field Interview Questions for ADM II Grantees ............................................ 117 Annex G: Questions/Discussion guide for AWEP Chapters and Focus Group Discussions ..................................................................................................................... 121 Annex H: AWEP CHAPTER GUIDELINES ................................................................. 124 Annex I: MEMBERSHIP SUMMARY - AWEP NIGERIA ......................................... 127 TABLES Table 1: Main Challenges and Achievements to Date: ADM II ..................................................... 6 Table 2: Main Challenges and Achievements to Date: ADM I .................................................... 12 African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment ii Table 3: ADM I Awardees… ........................................................................................................ 17 Table 4: ADM II Awardees. ......................................................................................................... 18 Table 5: ADM Awardee Business Performance Evaluation Criteria ............................................ 21 Table 6: Total Investments in ADM Businesses ........................................................................... 26 Table 7: ADM II Roadshow Results…………………………………………… .......................... 30 Table 8: Summary of Roadshows and Submissions by Region, Country and SEctor .................. 33 Table 9: Due Diligence Areas and Sample Questions .................................................................. 39 Table 10: TA Requests from ADM II Awardees .......................................................................... 48 Table 11: SME Live Banking Forum 2012 & 2013 ...................................................................... 50 Table 12: Main Challenges, Achievements, and Future Prospects of ADM II Awardees ............ 53 Table 13: Main Challenges and Achievements to Date of ADM I Awardees .............................. 68 Table 14: IFC Note on Enterprise Definitions for Micro, Small and Medium Firms ................... 80 Table 15: AWEP Chapter Summary Data .................................................................................... 81 African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 1 LIST OF ABBREVIATIONS AND ACRONYMS ADM African Diaspora Marketplace (program) AED Academy for Educational Development AGOA African Growth and Opportunity Act ACBF African Capacity Building Foundation AKPS Agricultural Knowledge and Program Support Task Order AmCham American Chamber of Commerce AWEP African Women Entrepreneur Program BOI Bank of Industry in Nigeria CEED Center for Entrepreneurship and Executive Development CFA Constituency for Africa DCA Development Credit Authority DD Due Diligence DOS U. S. Department of State EDN Enterprise Development Network GDA Global Development Alliance GWU George Washington University GWU-CIBER George Washington University– Center for International Business and Research GWU-DCIP George Washington University – Diaspora Capital Investment Project ICT Information and Communication Technology IFC International Finance Corporation IP Implementing Partner IVLP International Visiting Leaders Program KPI Key Performance Indicators LEEDS Leadership in Energy and Environmental Design Specialist MBDA Minority Business Development Agency M&E Monitoring and Evaluation African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 2 OFK Organic Farming Kit OPIC Overseas Private Investment Corporation OPIC–EDN Overseas Private Investment Corporation– Enterprise Development Network SBDC Small Business Development Center SEAF Small Enterprise Assistance Fund SME Small and Medium (sized) Enterprises SOW Statement of Work SSA Sub-Saharan Africa TA Technical Assistance TAG The Arthur Group TCBA Thompson, Cobb, Bazillo and Associates TEF Tony Elumelu Foundation USAID United States Agency for International Development USG United States Government WA AKPS Work Assignment WC Working Capital WU Western Union Corporation WUF Western Union Foundation YALI Young African Leaders Initiative (YALI) African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 3 ACKNOWLEDGEMENTS The study team gratefully acknowledges the support received from all the individuals without whom this study would not have been possible. First and foremost we would like to thank all of the African Diaspora Marketplace program, phases I and II (ADM I and II) awardees whom we visited in Africa for their most warm welcome and their generous investment in time and effort to accommodate our needs and educate the evaluation team to the realities of their businesses and the environments in which they are working. Second, we would like to thank the African Women Entrepreneur Program (AWEP) chapter leaders and their membership for taking the time and effort to have meaningful discussions with us, showing us what they are doing, and sharing their aspirations and very practical ideas for moving AWEP forward locally and internationally. Also, we would not have been able to do any of the analysis without the strong support of the U.S. Embassy AWEP Coordinators in Ghana, Nigeria, Ethiopia, and Uganda. By arranging meetings and providing astute guidance, they made it possible with very short notice for the team to learn so much about the AWEP efforts from the field perspective. We also want to thank USAID and the U.S. Department of State (DOS) for their support throughout the evaluation and assessment process, and the Small Enterprise Assistance Fund (SEAF) staff, David Saunders, and The Arthur Group for informing us about how things were done and what was learned during their implementation of the ADM and AWEP activities. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 4 EXECUTIVE SUMMARY The Africa Bureau Office of Sustainable Development of the United States Agency for International Development (USAID/AFR/SD) contracted Weidemann Associates to conduct an evaluation of the African Diaspora Marketplace (ADM) program with a focus on ADM II and to perform an assessment of the U.S. Department of State (DOS) African Women Entrepreneur Program (AWEP) with the goal of identifying opportunities to strengthen and expand the programs and increase synchronization between them. ADM Program The ADM II continues a business plan competition started in 2009 with ADM I. ADM II expanded public-private partnership between USAID, private donors including Western Union Corporation (WU), the Western Union Foundation (WUF), the Tony Elumelu Foundation (TEF), the African Capacity Building Foundation (ACBF) and George Washington University – Center for International Business and Research (GWU-CIBER). The program seeks to encourage diaspora-driven small and medium enterprises (SMEs) to expand existing businesses and start new enterprises in Sub-Saharan Africa (SSA). This evaluation of ADM focuses mainly on the activities and results of ADM II while also providing some updates of the results of ADM I and incorporating four key elements that were compared and analyzed against each other: (1) the ADM design, (2) project implementation results, (3) awardees’ business performance, and (4) development impact and implementing partner performance. The evaluation team attempted to understand the extent to which the ADM process, diaspora involvement, and financing and any technical assistance (TA) contributed to the business success and development impact. The evaluation team, consisting of one team leader, who is an SME, and monitoring and evaluation (M&E) specialist, and a research assistant, traveled to four countries in Africa to conduct ADM grantee interviews and business site visits. The countries chosen were those with the greatest number of ADM grantees from the combined ADM I and ADM II programs and that were safe for travel: Ghana, Nigeria, Ethiopia, and Uganda. Including both ADM I and ADM II, the evaluation team was able to visit two grantees in Ghana, seven in Nigeria, and one each in Ethiopia and Uganda. As was found in the final evaluation of ADM I, the projects funded in ADM II did encounter challenges and most have yet to show the full measure of their potential success. Table 1 below summarizes the status of the ADM II awardees’ challenges, progress to date, future prospects and evaluator observations. The same challenges are still faced by several of the ADM I awardees, as noted in Table 2 below. Challenges shared by ADM I and II include lack of an adequate timeframe for implementation, insufficient or unrealistic planning for complementary services, insufficient funding for the scale and detail of activities envisioned, an overly ambitious set of objectives, and changes in personnel. This evaluation assesses businesses performance based on the metrics laid out in the SEAF USAID Cooperative Agreement and the milestones laid out in each of the grant agreements. However, again as in the ADM I evaluation, awardees’ business performance measures can only be judged in the context of the overall program. As in ADM I, despite minor limitations in the design and implementation of ADM II, the program continues to produce positive results. Several ADM II businesses have brought innovative products or services to local markets, created jobs, and are increasing local incomes. Some of the ADM I awardees are showing the necessary dynamism that will lead to lasting results in line with the ADM objectives. Diaspora partners were significant stakeholders and decision makers in most of the ADM II businesses, as was the case in ADM I. In addition, most of the ADM II businesses that evaluators were able to visit appear to be showing positive results: at least four are profitable already while an additional six have laid the foundation for future growth. However, three businesses are struggling and two withdrew due to African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 5 technical and/or marketing issues. In other words, ADM II appears to be experiencing a success rate of more than 50 percent, which is exceptional for an innovative enterprise investment fund. The extent of ADM’s role in these business successes needs further assessment. Awardee feedback indicated that ADM played an important role, particularly in building confidence and providing legitimacy to their entrepreneurial efforts. ADM finance most often was cited as allowing businesses to invest in things they otherwise might not have, such as branding and internet marketing, and internal control systems. Out of the ADM I businesses that were evaluated, three are clearly successful as a result of dynamic management and effective response and adaptation to market opportunities and three others are overcoming significant barriers to their business growth and are on the verge of becoming viable and impactful. The success of at least one of those was not foreseen in the ADM I evaluation.1 ADM Recommendations 1. Refine the tools of the ADM competition to enhance the overall process and maximize its short-, medium-, and long-term impacts. 2. Streamline the judging process to require fewer judges while ensuring a fair and transparent selection process. 3. Include additional elements of the due diligence evidence in the full business plan stage of the competition in order to streamline the post award process. 4. Formally incorporate a longitudinal research element to the ADM implementation programming to optimize learning and legitimize the proof concept. This would include more robust and consistent monitoring and evaluation systems. 5. Develop systems for providing TA in line with the technical, marketing, and business and organizational development needs of awardees. 6. Establish a communication strategy among past and present ADM awardees and introduce a program￾wide mentoring system incorporating the strategy. Tables 1 and 2 below summarize the main challenges and achievements of ADM II and ADM I awardees. 1 Student Card, now InterPay, appears to have learned how to adapt its product so that both institutions and individuals will pay for it. It was noted in the ADM I evaluation as an award that could have been avoided. Though it has not yet succeeded financially, the platform it has developed has the potential to do so. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 6 TABLE 1: MAIN CHALLENGES AND ACHIEVEMENTS TO DATE: ADM II2 Country Business Description Challenges Achievements Future Prospects Notes Ghana Gonja Meat Company (Existing) Meat processing and sales Working capital management and sales strategies in new market. Remote management Significant investment in physical infrastructure. Starting to expand sales in Kumasi market to government hospital, hotels and some retail customers. Diaspora principle returning to Ghana in September with some ideas about how to increase cash flow to generate additional funding for W/C and additional equipment investments. More aggressive utilization of existing assets and marketing could improve cash flow and generate finance for additional equipment they want to further vertically integrate the business. Sardis Enterprises (Existing) Import/export agency specializing in agricultural goods and other products produced in the country of Ghana. Need to expand sales but don’t have funds to expand production because he can’t increase sales. Wasn’t prepared financially for worst-case scenario so now is searching for financing opportunities Now working with 54 farmer co-ops compared to 25 two years ago. All farmers are certified organic. Claims to be only African organic pineapple producer exporting to the U.S. Plans to secure U.S. regional accounts with Whole Foods (Mid￾Atlantic, New England, etc.) but needs on additional finance to get products to market. Situation with errant container shipment highlights challenge of small business entering new foreign market. Might need mentor or better shipping company to get to secure process. Viable Vision Industries (Existing) Commercial mushroom farming and processing High energy costs using diesel because grid unreliable. Labor costs with continuing inflation –workers are asking for increases in wages. Contamination issue. Technical support. Reduced production costs with new spawning facility. Is containing labor costs by shift to piecework pay. Steadily increasing revenues generating financial resources for further expansion into new markets. Profits financing production and marketing expansion. Wants TA in local mushroom sporing tech so can produce indigenous varieties, which could become exotics in international markets. Wants drying machine to be able to enter Apparently well-managed company with reasonable expectations and a viable future. Rate of growth could accelerate with better access to appropriate finance & technology. 2 Due to political and other challenges, this evaluation covers only SSA awardees. Therefore, no information is being provided on Tunisia. In addition, the Libya Diaspora Marketplace is managed separately. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 7 Country Business Description Challenges Achievements Future Prospects Notes international markets including U.S. Kenya African Boreholes Program, Ltd. (Existing) Social enterprise expands access to clean water through borehole drilling services, shallow well drilling services, earth dams, solar pumps, solar cookers, and consultancy and organic farming kits & training services. Marketing – the overall security and stagnant economic environment in Kenya is reducing demand. Competition forcing ABI to lower prices and reduce kit production costs. VAT imposed on OFK Reached more clients, expanded ability to provide cost efficient agro-support. Generated publicity and marketing. Developing training centers accelerated growth of ag division. Reduced production costs by replacing costly import with locally developed input. In process of spreading training center model to other countries (Ghana, Rwanda, Uganda, and Nigeria) Organic produce business is expected to grow in line with client demand for healthier food sources Established profitable business model, but has to continue reducing costs to compete. Is competing with its OFK partner – Amiran. Expansion in other countries could be avenue for continue steady growth. Pork Delights Limited (Existing) Pig farm that sells pigs and piglets, provides artificial insemination services, offers pig rearing training for small farmers, and designs/builds biogas energy plant & fertilizer pellet production Getting environmental compliance certification delayed receipt of grant Increasing productivity Lowering costs Successful strategies to improve food production, environment protection, & green energy production. Shifted to AI - increased pig/piglet productivity. Implemented more suitable feed program. Biogas plant will reduce energy costs. Continued to expand/ develop its network of young farmers. Company collects data through website about its clientele while fielding their questions. Data will serve future growth to providing leadership, advice & services in pig farming enquiries. More cost effective production will support future growth Will have to work out revenue stream to pay for data analysis and advisory services. Infinicity PLC, Inc. (Startup) News streaming service Workable business model Could not meet milestones N/A N/A Liberia EcoPower Liberia (Existing) Authorized reseller of the GEK Gasifier, a power generating system that converts woody biomass into electricity, in Liberia Revenue system for energy sales Introduced workable “gasification” technology to Liberia. Currently generating energy at fifth of cost of diesel generation Installing Wi-Fi for live updates on biomass power generated. Continued success applying to green energy Ambitious 5-year plan to become significant vertically integrated supplier of electricity in Liberia with mini-grid green technologies African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 8 Country Business Description Challenges Achievements Future Prospects Notes and Guinea. for BWI Renewable Energy Center Raised ~$400,000 additional grant funding funds for grants for future projects will provide base to future expansion. Will need to work out distribution and usage revenue systems combining fuel production (pellets), power generation and distribution assets. Nigeria Comprehensiv e Design Services (Startup) Architectural design, engineering, and project management services for sustainable housing projects Determined to be corruption free business has slowed the pace of doing business Government controls access to land: rules and regulations slowdown expansion of business took time to find and train staff with reliable work ethic Completed first sustainable, affordable building on time per ADM timeline, but says needs $15,000 more to complete Passive House Prototypes. With limited financial assistance from ADM, owner became accredited in green neighborhood development Two pilot buildings for local government created interest in sustainable housing. Currently in talks with other state governments re contracts Challenge of funding and unproven sales model for private sector projects. Almost a year after pilot phase was completed does not have any contracts. Would mentoring from more experienced housing construction company in Nigeria help? MedEnhanz Resources Ltd (Startup) Web-based & mobile point-of-care medical reference and diagnostic system. Standardized e-medical recertification product. E-drug interaction checker. Need to get more local medical info (ex: tropical diseases) for e-Medicine POC diagnostic system. Certification of recertification app. Enough market to be profitable & generate finances for growth. Personnel – finding well￾qualified and ethical staff. Twice daily Skype with diaspora owner keeps all operating smoothly. This year they are ahead of projections except for doctor recertification. Have robust e-Medicine app that is available through Telco. Have web-based & mobile doctor recertification pilot completed & program in process of being approved by Nigerian medical authorities Have a way to go before they are viable, but appear to be making progress on all three services. They are realizing that consumers could be additional market for their POC e-medicine app that could make it more viable. Need to find and hire: Director to coordinate operations; Sales Manager for institutional sales; and Content person for recertification course content development. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 9 Country Business Description Challenges Achievements Future Prospects Notes OTG Playa Entity LLC (Startup) “Final Mile” networking technology for accelerated internet access that bypasses the bandwidth limitation in broadband poor nations like Nigeria Getting ideal kiosk locations in universities and elsewhere. Need to increase local content. Need “big player” partner to do massive franchising of kiosks and with financing to grow very rapidly to point that Google notices them. Concept is proven – have passed 1000 hits/day target, which means app is building use, affordable Offline Cloud platform patent is pending. Users don’t have to go through iApps to get it; they get it directly from Telco – which enables OTG Playa to earn more revenue from it. Adding ads to service. Need to expand service across Lagos and into other states of Nigeria and beyond, but feel they need bigger player partner with deep pockets to work with on that. Lofty Inc. incubator partner has been key support to their development, providing planning, access to finance, key introductions, and mentoring. Poultry Health Products (Existing) Farm produces eggs and poultry, breeds chickens, provides hatchery services, and training to smallholder farmers. Reliable power supply – can’t afford ADM hatchery production using diesel generator - need to relocate. Production planning - Business has invested significant resources/owns significant assets but has been slow to increase production. Market analysis & marketing campaign - hatchery is struggling due to unreliable power supply, low demand / increased competition due to insecurity in North flooding southern markets. Poultry breeding business is doing well: successfully hatched parent stock eggs and is currently raising them to produce eggs and breed additional flocks. Business overinvested and as result has limited W/C to relocate hatchery and complete breeding construction for expanded production. Has land to relocate hatchery. Unless they can get the new hatchery up and running profitably, they will continue to have financial and growth challenges. LT viability of poultry industry in Nigeria – Without cost-effective off-grid power solutions, questionable viability. Marketing: Need to increase demand for hatchery services Mentor – owner brought in diaspora friend to help with administration – former nurse. Appears to need mentoring/TA in planning and product development – is starting new investments without sufficient financial resources. RIOL Enterprises (Existing) Organic Poultry rearing and egg production. Start –up costs: needed to personally subsidize the business during the startup phase (Nigerian banks will not loan to agribusinesses Market: decreased demand from northern Nigeria due Despite the market glut earlier in the year, the business is still growing at a steady and predictable rate and expects to be making profits by the end of the year when the first batch of layers is sold. Expansion: after selling the layers the profits will be plowed back into the business so a larger chicken house can be opened to allow for expanded egg production Apparently sensible use of assets and sensitive to changing market conditions. Overall environment for poultry production in southern Nigeria challenged by insecurity in North. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 10 Country Business Description Challenges Achievements Future Prospects Notes to violence led to an egg glut in the south, lowering the price of eggs TrafficAfric Limited (Startup) Provides crowd￾sourced information about local traffic, accidents, crime, and corruption through a cellphone application service. Revenue model: The app is free to users but it is not popular enough yet to attract advertisers. May need to rethink their fee model and to find ways to broadly and inexpensively promote their app because people who need it the most and are willing to pay for it don’t know about it.3 App is up and running and user numbers are steadily increasing. Through competitor analysis, they know they are providing a unique service for which there is demand (especially the crime and corruption monitoring). But professional drivers and taxis are unaware of their traffic reporting app. Need to find way to grow users quickly and cost￾effectively (Facebook ads are effective, but very expensive). If they can sell app to drivers (taxis and chauffeurs) on monthly fee basis, could possibly generate enough cash to pay for additional market research and pay for an effective marketing campaign. If they can increase awareness about their service and grow their users they will be off and running They need a good coach in ‘guerilla marketing” or a good mentor, who knows how to profitably introduce new apps into the Lagos and Nigerian marketplace. They need clever ideas for raising demand for fee-based app sales. Because they depend upon constant inputs from drivers, they don’t feel they can charge app users. But they need to resurvey the market of taxis and other car service drivers, as well as trucking and delivery companies that may be willing to pay. Uganda ORIBAGS Innovations (U) Ltd. (Existing) Produces bags, stationary and jewelry using agricultural waste, waste paper and natural fibers for sale to local stores and businesses. Capacity: demand is higher than rate of production. Plan to move to new, larger location but are struggling to get approved for a loan to complete the transfer to the new facilities. Owner effectively leveraged government resources (Uganda Industrial Research Institute) as incubee. Currently low cost production has allowed business to get off the ground. Winning awards for recycling products and is making positive cash flow. Gaining new customers with Building production facility on farm & moving most staff to one location will increase production and allow more product diversification (other recycled paper products). If can replace expensive imports from China and Japan, it would greatly expand their share of profitable local market. Owner is a YALI graduate, AWEP member & well connected in local business community - networks with many potential buyers & technical support. Still too small to have easy access to additional finance. May need to link to internet women’s investment networks in U.S. and elsewhere. 3 Two drivers we told about the app and asked what they would pay both answered Naira10,000 a month. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 11 Country Business Description Challenges Achievements Future Prospects Notes larger demand. Zambia Mobile Payment Solutions Ltd. (Existing) Software company specialized in payment systems, electronic & mobile commerce – micro insurance Did not meet first milestone of workable app – so never receive second grant disbursement. Not able to develop workable app within grant period. N.A. ADM put correct milestone, but may want to change DD criteria for future ADM applicants. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 12 Additionally the following information was collected on the status of ADM I awardees. TABLE 2: MAIN CHALLENGES AND ACHIEVEMENTS TO DATE: ADM I Country Business Description Challenges Achievements Future Prospects Notes Ethiopia Global Tracking Ltd. Installs and maintains GPS tracking devices for commercial trucks and rail tankers that also monitor driver behavior in real time, quality controls the information received from devices and maintains the devices themselves. Lack of existing industry standards & GOE’s information control concerns causing certification delays & negatively affected their operating model Lack of FX in country for trade finance GOE’s lack of support for private sector growth has slowed their ability to expand their customer base. Demand driven product development - movement into rail tanker tracking, a new product, is response to GOE request once they saw value of road vehicle tracking. Helped GOE develop industry standard for certifying their type of IT business. They have equipment orders in the FX financing pipeline. Once installed this will provide a stable revenue stream. Once pilot testing of tanker tracking system is proven, GOE will also greatly expand their demand for that line of business. Trade finance is a constraint, but company needs to resist temptation to become clients’ financer unless can fully cover risks. Persistence with positive negotiating with GOE will likely ensure a viable business, but not within an ADM timeframe. They knew that when milestone targets & performance indicators were being set, but IP squeezed them into the ADM timeframe. Ghana InterPay (formerly Student Card) Online transaction fee￾processing portal for educational institutions to accept and process fees and other payments through their commercial banks. Original business plan (tracking system that the GOG used to monitor the use of the School Feeding Program) failed because the government did not pay bills on time, negative cash flow was unsustainable Identified more viable option working with the private sector (banks), partnered with local IT company (CiS), now work with numerous banks and more are requesting their services. Planning to be the first third-party payment processor (TPP) in Ghana. Currently, all payment information is processed outside of Ghana. Both government and banks are looking for this service locally. Current business is not generating enough profit to fund the TPP idea. Looking for other funders. AACE Foods Food processing company that preserves dried herbs and spices and process other milled gain products Original business plan (produce preserved fruit and vegetable products) failed because of production costs and market conditions Finding and keeping ethical and hardworking staff. Management identified more viable product lines, now producing an expanding range of herbs and spices for national market. Short term: expanding quality raw material sourcing and markets beyond Lagos. Long term: export regionally in Africa and to the U.S. and/or Europe Key to success: strong combination of financial management, market analysis and ability to produce to required food production standards. Biggest challenge is finding and keeping ethical and hardworking staff due to corrupt environment. Nigeria Sproxil Limited Anti-counterfeiting and Competition: illegal and Expansion: other legitimate Clientele are 80% of Keys to success: African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 13 Country Business Description Challenges Achievements Future Prospects Notes brand protection company that developed a product coding system that allows consumers to verify the authenticity of products while preventing the brand from being tarnished by fake products. legal is beginning to make inroads into their market dominating health product business Expanding into Kenya: difficult to open a bank account and register as a business businesses/brands in Nigeria need protection, therefore they are systematically expanding their product lines into other business sectors Only external funding – 25 X over five years. pharmaceuticals in Nigeria which continues to give them upper hand in market Expanding into other business sectors makes business more viable Profitable enough to use retained earnings for future investments reinforces their success. Sophisticated management Robust technical products combined with hiring individuals with extensive sales experience in industries they are protecting. EarthWise Ferries Environmentally-friendly passenger ferry services between Entebbe and the main island in Lake Victoria Economical ferry: First one not economical enough to operate on long route. Currently, it is only covering operating costs, not the capital investment. Market: As only boat to the island, still only 60% of capacity being utilized. Are covering operating costs of first ferry. Deigned bigger, faster, more efficient ferry and all parts are in Uganda being assembled. Raised additional 7 figure amount of investment from angel investors. Currently building a new, larger ferry: twice as fast, more cost efficient, operational within 2-3 months Keys to survival: diaspora’s knowledge and experience in angel investor fundraising. $100k ADM grant was less than 2.5% of the total investment needed to get company to viable takeoff. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 14 AWEP AWEP is a multifaceted program launched by former Secretary of State Hillary Clinton as part of the International Visitor’s Leadership Program (IVLP) in 2010. The assessment of AWEP focused on identifying one or more sustainable models of AWEP country chapters and cost effective ways to expand and strengthen them to increase their impact. A set of recommendations was generated based on the organic development process of AWEP chapters to date supplemented with ideas and practices from other successful membership organizations in Africa. The assessment also provides some feedback on the AWEP partnership activities, such as with Intel, the Cheri Blaire Foundation, the pilot one-on-one export expansion mentoring with the Center for Entrepreneurship and Executive Development (CEED), and the WECREATE–Caterpillar training center program. The assessors tried to take into account these newer elements as well as the potential for better integrating the resources of ADM, other USG programs, and the U.S. Embassy network in Africa with those in Washington. Furthermore, although they are limited, opportunities to synchronize ADM and AWEP in the future in ways that would strengthen and improve the results of both programs are discussed in the assessment. The resulting recommendations include the following:  Require annual or bi-annual elections  Include an Embassy foreign service national representative as non-voting board member  Put greater emphasis in chapters on the AWEP purpose of serving the “missing middle”4  Expand U.S. Department of State (DOS) guidance to Embassies and AWEP chapters on AWEP key policies, strategies, and membership guidance  Follow the successful American Chamber of Commerce (AmCham) model  Increase communications among AWEP chapters and members  Facilitate mentoring particularly of AWEP alumnae and other “missing middle” AWEP members ADM/AWEP Program Synergies The following synergies were found between the two programs and are recommendations for areas of mutual cooperation and support between ADM and AWEP:  Mutual networking  Access to training  Access to finance events  Potential mentors between and for both programs  AWEP orientation to ADM diaspora members doing business in Africa  ADM membership in AWEP and AmCham  Access to technical resources  Marketing and market access resources  U.S. Embassy access  USAID in-country program access This report is organized in four sections. Section One introduces the ADM Program evaluation and AWEP program assessment, providing the context conducting the two studies concurrently. It includes a summary of the methodology utilized for both the ADM evaluation and the AWEP assessment. Section Two presents a summary of the findings and conclusions of the ADM evaluation including the design and 4 “Missing middle” refers to medium size enterprises that are too big for micro and small business finance and other services and yet are not able to access the financing they need to grow as quickly as they could. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 15 overall implementation activities and results. It is broken down into five subsections encapsulating design, implementation, awardees’ business performance, local and other development impacts, and conclusions and recommendations. Section Three presents the AWEP assessment and chapter analysis. It is broken down into the following four subsections: AWEP chapter and membership assessment; AWEP design, activities, and implementation assessment; AWEP conclusions and recommendations; and American Chamber of Commerce (AmCham) Model for AWEP consideration. Section Four looks at paths forward for both ADM and AWEP with final recommendations and areas for mutual programming and collaboration. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 16 INTRODUCTION: OVERVIEW OF ADM EVALUATION AND AWEP ASSESSMENT Purposes and Parameters The USAID contracted Weidemann Associates to conduct an evaluation of the ADM program, focusing on the second competition (ADM II), and an assessment of AWEP with the goal of identifying opportunities to strengthen and expand the programs and increase synchronization between them. ADM Program ADM is a public-private partnership, under a Global Development Alliance (GDA) agreement between USAID, Western Union Corporation (WU), the Western Union Foundation, George Washington University–Center for International Business and Enterprise Research (GWU–CIBER), TEF, and ACBF. The latter two partners were not part of ADM I but were incorporated under ADM II. Western Union’s significant presence and engagement in global diaspora communities in which USAID operates made it a natural partner in ADM. ADM II was jointly funded by Western Union, the Western Union Foundation, USAID and ACBF. A consortium led and implemented by the Small Enterprise Assistance Fund (SEAF), including the Council for Africa and Thompson, Cobb, Bazillo & Associates (TCBA). SEAF was tasked with building on the lessons learned from ADM I, which included (1) expanding marketing and program outreach and (2) seeking other donors for TA; and (3) seeking sources of follow-on grants or other financing for ADM II winners. GWU–CIBER was to support both research and the initial stage of the selection process. TCBA was to help with the due diligence (DD) and M&E. In 2009 the ADM program launched its first business plan competition, ADM I5 , which was open to all business sectors except those specifically excluded by sponsors or regulatory compliance. Applicants were required to have a partner organization based on the African continent and to show a substantial presence in Africa through partnerships or direct ownership of assets. In total, U.S.-based members of the African diaspora—U.S. citizens or legal permanent residents—presented 733 business plans for small businesses that would contribute to economic development in sub-Saharan Africa. A panel of judges with representatives from USAID, Western Union, private-business, diaspora NGOs, government, and academia was assembled to evaluate the applications on criteria including the quality of the business idea, the proposed management plan, sustainability, results orientation, and ability to capitalize on diaspora resources. In January 2010, ADM announced that fourteen African diaspora businesses were awarded matching grants of $100,000 to help fund businesses in seven African countries. The awardees were required to match these grants through financial and/or in-kind contributions. The countries and numbers of awards included: Ghana (4), Ethiopia (3), Nigeria (2), and Uganda (2), Kenya (1), Liberia (1), and Sierra Leone (1). 5 ADM I was funded and managed by the USAID Office of Development Partners. ADM II was funded and managed by the Africa Bureau. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 17 TABLE 3: ADM I AWARDEES Business Name Sector Country City/Town AWEP Chapter In-Country AACE Foods Agribusiness Nigeria Sango Ota, Ogun State Yes AADT Consultants Geotechnical/Environmental Testing Liberia Monrovia Yes Aceritas Ghana Ltd. Agribusiness (Green Acres Goat Farm) Ghana Volta Region Sita Korfe, Fodzuku, Torgome, North Tongu Wata region Yes AMAD Metal Manufacturing PLC Manufacturing Ethiopia Yes Ansa Systems Ltd. Reliable Power Supply Energy Ghana Accra Yes Tek Consultants (Ltd.) “Global Solar Ovens” Energy/Environment Uganda Kampala Yes EarthWise Ferries Uganda Ltd Transportation Uganda Kampala Yes Global Telecommunications PLC Fleet Management System Transportation Ethiopia Addis Ababa Yes Palm Fruit Processing Processing/Agribusiness Sierra Leone Bo No Sproxil Ltd ICT/Anti-counterfeiting Nigeria Oshodi, Lagos Yes Student Card Information Communication Technologies (ICT) Ghana Accra Yes TAF BioTechnology Bio/Agribusiness Ethiopia Addis Ababa Yes E & M Capital Tek Corporation - Uza￾Mazao ICT/Agribusiness Kenya Yes MicroClinic Ghana Ltd Healthcare Ghana Cape Coast Yes ADM II In November 2011, the USAID and Western Union launched the second ADM Competition (ADM II), incorporating lessons learned and best practices from ADM I. The scope of the competition was narrowed to focus on three priority and high-impact business sectors in Africa: agribusiness, renewable energy, and information and communication technology (ICT). In addition, small business investment funds and TA mentors were invited to participate in the effort and engage with diaspora entrepreneurs. Applicants were again required to have a partner organization based on the African continent to help them execute their projects, and to own at least twenty-five percent of the proposed business enterprise. Under ADM II, U.S.-based diaspora submitted 492 applications and plans for small businesses that would contribute to economic development in sub-Saharan Africa. After an initial review by students at the George Washington University School of Business, a panel of judges was assembled with experts from Western Union, private equity firms, businesses, Diaspora NGOs, governmental agencies, consultants, and academic groups. The applications were evaluated based on the quality of the business idea, product African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 18 and service acceptability within the eligible sectors, and the strengths of the management plan including team composition, qualifications, and track record. Finally, the competing businesses had to be viable and sustainable into the future. In June 2012, 17 African diaspora businesses, representing 8 African countries, were awarded matching cash grants of $50,000 and a commitment to provide up to $20,000 in TA. The awardees were required to match these grants through financial and/or in-kind contributions. Following the announcement of the grants, ADM II negotiated a grant agreement with each award winner that outlined the uses of funds, disbursement schedule, and performance milestones. The countries and numbers of awards included: Nigeria (6), Ghana (3), Kenya (3), Tunisia (2), Liberia (1), Uganda (1), and Zambia (1). Categorized by sector, 8 agribusiness awards were made as were 7 ICT awards, and 2 for renewable energy businesses. TABLE 4: ADM II AWARDEES Business Name Sector Country City / Town AWEP Chapter In￾Country African Boreholes Program, Ltd. Agribusiness Kenya Nairobi Yes Comprehensive Design Services Renewable Energy Nigeria Port Harcourt Yes EcoPower Liberia Renewable Energy Liberia Monrovia Yes Gonja Meat Company Agribusiness Ghana Kumasi Yes Infinicity PLC, Inc. ICT Kenya Nairobi Yes MedEnhanz Resources Ltd. ICT Nigeria Ikeja, Lagos State Yes Mobile Payment Solutions Ltd. ICT Zambia Lusaka Yes ORIBAGS Innovations (U) Ltd. Agribusiness Uganda Kampala Yes OTGPlaya Entity LLC ICT Nigeria Ogba-Ikeja, Lagos State Yes Pork Delights Limited Agribusiness Kenya Nairobi Yes Poultry Health Products Nigeria Ltd. Agribusiness Nigeria Ikorodu, Lagos State Yes Promo Tunisia ICT Tunisia Tunis No RIOL Enterprises Agribusiness Nigeria Owode Obafemi Local Government Area, Ogun State Yes Sardis Enterprises Agribusiness Ghana Weija Accra Yes TrafficAfric Limited ICT Nigeria Lekki Lagos, Lagos State Yes TuniLab ICT Tunisia Tunis No Viable Vision Industries Agribusiness Ghana Kumasi - Plot #3, Afritia, Atwima Kwanwoma District Yes ADM II also added two new features to the competition: winners were provided the opportunity to present to a group of angel and early stage investors organized by TEF, as well as an opportunity to meet African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 19 with bankers at the SME Live Banking Forum in Lagos, Nigeria. The equity investors’ pitch event sponsored by TEF gave the entrepreneurs direct access to funding partners serious about investing in the best new local companies. The entrepreneurs had a formal opportunity to pitch their businesses and to get direct feedback on what it would take to make their companies into solid investment opportunities for third-party investors. Although no deals were made, the entrepreneurs benefitted from the experience of preparing for and making the presentation, the candid feedback, and the development of relationships with funding sources—all key elements of the funding process. The first SME Live Banking Forum was sponsored by Western Union and the Nigerian Bank of Industry in November 2012, and provided ADM and AWEP participants with an opportunity to present their companies and credit challenges to a panel of more than one dozen bankers. Western Union organized its agent banks as well as other pan-African banks to join Bank of Industry in listening and responding to the presentations of the ADM and AWEP members as well as other Nigerian SMEs. A second Live Banking Forum held in November 2013, built on the earlier event, improving and enhancing the experience for the entrepreneurs and bankers and adding a full range of informative presentations and workshops for the companies waiting to make their pitches. ACBF committed to providing USAID with a $100,000 grant to be used for TA. To date, however, USAID has only received about $60,000. AWEP AWEP is a trade and investment program launched by former Secretary of State Hillary Clinton in July 2010. AWEP identifies and builds networks of African women entrepreneurs to promote business growth, increase trade both regionally and to U.S. markets through the African Growth and Opportunity Act (AGOA), create better business environments, and empower African women entrepreneurs to become voices of change in their communities. There are seven primary components to AWEP: (1) professional exchange supported by the IVLP project of the U.S. State Department Bureau of Educational and Cultural Affairs; (2) participation in the annual AWEP-AGOA Forum and vendor-to-company showcase and networking events; (3) export promotion program; (4) establishment of women’s entrepreneurship center training program; (5) chapter business development trainings and community service initiatives. The sixth and seventh components are the development of the Young African Leaders Initiative (YALI) internship program and technical capacity building through ADM. Two or three women’s entrepreneurship training programs are to be established in fall of 2014. Currently, the IVLP, participation in the Annual AWEP-AGOA Forum and vendor-to￾company showcase and networking events, and YALI internship program are active. The export promotion and chapter business development trainings and community services program components were getting started as the assessment was being conducted. The final component, establishing the women’s entrepreneurship center training program, with support from the Caterpillar Corporation Foundation, is to come on line by the end of this year. Professional Exchange Through the IVLP, each year approximately 30 women entrepreneurs from across Africa arrive in the United States to attend professional development meetings and network with U.S. policymakers, companies, industry associations, nonprofit groups, and multilateral development organizations. The three-week program allows the AWEP participants to share best practices, discuss common challenges, and learn about the global economy and factors that lead to long-term business growth. There are currently184 AWEP IVLP alumnae, and a cohort of 40-50 women entrepreneurs (30 new to the program, plus between 15 and 20 previous alumnae and AWEP members) were projected to participate in African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 20 the program in June 2014. Upon returning home, alumnae often start their own local AWEP chapters. At present, there is an AWEP presence in all 48 sub-Saharan African countries. Twenty-two countries have AWEP chapters, including Botswana, Burundi, Cameroon, Cote d’Ivoire, Ethiopia, Ghana, and Guinea. Countries with chapters also include Kenya, Liberia, Malawi, Mauritania, Mauritius, Namibia, Nigeria, and Niger. Also included in this group are Rwanda, Seychelles, Senegal, Sierra Leone, South Africa, Tanzania, and Zambia. The more than 1600 AWEP members own SMEs in agribusiness, food processing, textiles, fashion, home accessories, and other sectors. The AWEP chapters serve as business associations through which alumnae and members educate aspiring entrepreneurs about exporting, establish or strengthen organizations that support women’s empowerment, and increase their business capacity and revenues. Annual AGOA Forum Through AGOA, AWEP entrepreneurs can better access U.S. markets to expand their businesses and increase trade capacity both regionally and internationally. Some of their companies engage in exporting under the terms of AGOA, while many others are working to increase their export capacity and establish business relationships with U.S. partners. Each year, AWEP members make key connections when the United States and AGOA member countries come together to discuss issues of economics, trade, and investment at the annual AGOA Forum. During these events, AWEP entrepreneurs participate in meetings and have opportunities to network with U.S. and African government officials and policymakers in trade, finance, and agriculture as well as with private sector businesses, civil society and non-profit organizations, and industry associations. The AWEP IVLP alumnae also host a special event during the Forum that showcases the women’s expanding businesses, entrepreneurial abilities, and capacities for trade and investment. Technical Capacity Building USAID and the State Department jointly provide technical capacity building opportunities for AWEP. DOS has invested approximately $3.5 million in the IVLP, chapter activities, export promotion program, member trainings and women’s entrepreneurship centers since AWEP’s inception. As part of the ADM program, some AWEP entrepreneurs have access to capacity building, TA, and financial support. As previously noted, ADM and AWEP entrepreneurs participated in the SME Live Banking Forum that was sponsored by Western Union and the Nigerian Bank of Industry in November 2013. Both USAID and the State Department recognize that there are parallel objectives and tremendous potential for synchronization of activities between ADM and AWEP. One of the key goals of this evaluation was to recommend how these two programs could be bridged and leveraged to enable participants to benefit from each other’s networks and experiences. Methodology for Combined Evaluation and Assessment ADM Methodology The ADM evaluation methodology followed fairly standard approaches to program evaluation and assessment. It was to start with a program document review followed by preparation of field and remote survey data collection instruments to get as broad a cross section of the ADM awardees from both ADM I and II competitions as well as across as many AWEP country chapters as possible. As part of the data African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 21 collection, limited attempts were to be made to explore the availability of other resources, such as second￾phase grants and finance, as well as local TA as called for in the SEAF-USAID Cooperative Agreement program description. Once data was collected, it was to be analyzed and preliminary findings and recommendations developed. There was to be a debriefing with USAID, State, and possibly other interested parties, who would provide feedback and guidance to improve the final reports on both the ADM program and AWEP and any future combination thereof. The field data collection involved visiting four countries: Ghana, Nigeria, Ethiopia and Uganda. They were selected because Ghana and Nigeria had the largest number of ADM awardees between ADM I and ADM II, and all four countries had an AWEP chapter or chapter in formation.6 The selection was determined to be optimal by USAID and State personnel, given travel restrictions in some other countries. The plan was to visit as many of the ADM I and II awardees in each of those countries as possible to see the businesses firsthand and get a better sense of their operations and the environment in which they were active. If possible, the evaluators also planned to observe any community-level impacts. There were challenges getting in touch with some awardees on a timely basis, and time limits and other constraints precluded in-country visits to a few awardees in Nigeria and Ghana.7 In the end, the evaluators were able to visit 11 businesses including 7 ADM II and 4 ADM I awardees. Individual interviews were conducted with diaspora investors/partners in the United States to the extent possible both before and after the field visits to clarify and corroborate information gather in the field. This allowed in-depth conversations with 12 awardees. Five additional ADM I and II awardees completed at least portions of a web survey. The ADM field data collection was supported by staff at U.S. Embassies and USAID Missions, who helped locate two awardees and introduced the team to two Ethiopians who had returned from the diaspora and were running national government agencies that involved foreign direct investment. The Embassy and USAID staff members also provided information about mission programs in related areas of trade and agricultural and value chain development as well as about some local and regional investment funds. In addition, they provided and introductions to other potential sources of finance and TA for ADM and/or AWEP participants. Further, they provided feedback and suggestions to make ADM more effective and better able to engage Embassy and Mission resources. The evaluation team also met with a few incubator, investment fund, and bank representatives and TA providers to gather information on the current range, quality, and appropriateness of other resources available in those countries. The methodology employed in gathering and analyzing data and evaluating results of individual ADM I & II awardees was based on the same framework used during the DD process (July through December 2012) that occurred after the final 17 awards were announced in June 23, 2012. The business performance evaluation criteria are outlined below. TABLE 5: ADM AWARDEE BUSINESS PERFORMANCE EVALUATION CRITERIA ADM II Due Diligence Category Data Sources Used Analytical Approach Market /Marketing Interview/Survey responses; external references/observations; results reports Response and evidence review Products & Services On-site observation & interview questionnaire & discussion; contextual assessment (external references); results reports Triangulate information provided and observations and information from external sources 6 Kenya had the third highest number of ADM awardees, but travel restrictions made it impossible to visit at the time of the evaluation. 7 The evaluation team was not authorized to travel to Port Harcourt, Nigeria, to see the ADM I awardee there. In addition, travel times to locations of two ADM I grantees in Ghana were too great to allow for site visits. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 22 ADM II Due Diligence Category Data Sources Used Analytical Approach Organization & Management On-site observation & staff interviews; Diaspora interview/discussions; rapid contextual assessment; milestone achievement & results reporting Orderliness & organization of business premises; able to express clear vision of way forward; able to achieve set targets; overall progress of business Financial Management On-site observation; interview responses & discussion; assets, other sources of income, liabilities results Listen for whether complaining about needing additional finance or doing what was required to handle the financial situation. Environmental compliance On-site observation & discussion Not addressed unless came up as an issue Due to the limited data pool resulting from visiting less than half of the ADM countries and less than a fifth of the AWEP countries with chapters, no attempt was made to do statistical analysis of either performance or results data. However, the team leader’s experience as a banker and SME consultant, and experience in SME association development and programming enabled the team to move beyond simple results reporting and provide a fuller assessment of the current status of ADM awardee businesses and their prospects. In addition, the leader was able to facilitate in-depth discussions about the key elements of potential AWEP chapter models. Therefore, the data compilation and analysis focused on highlighting stakeholder feedback that provided useful lessons learned as well as suggestions or recommendations that would serve more broadly across either or both the ADM program or AWEP. AWEP Assessment Methodology The AWEP assessment methodology included document review, interviews with key stakeholders, field visits to four AWEP country chapters, and use of an iterative feedback process as findings and conclusions emerged. One challenge related to the document review was collecting a full set of documents related to an array of AWEP activities. The AWEP field data collection was strongly supported by the U.S. Embassies in the four countries visited. Each Embassy arranged meetings with its own and USAID economic and commercial staff and with the AWEP leadership and facilitated AWEP focus group discussions and meetings with women’s entrepreneur groups, local banks, and other local contacts. The Embassy also made requests for guidance from DOS about efficiently building upon and strengthening AWEP chapters. The meetings with AWEP leadership were shaped similarly to the guided discussion format used in the AWEP member focus group discussions. However, the evaluation team attended a planning workshop organized by the U.S. Embassy AWEP Coordinator (Ghana) and a leadership meeting that was merged with a focus group discussion (Uganda). The meetings with the chapter leadership focused on the following areas of chapter development: (1) current chapter demographics, particularly the number and types of members and criteria for membership; (2) chapter formation and functions including clearly stated purposes and goals, services provided, member participation, AWEP IVLP participation, and benefits of membership; (3) chapter viability as indicated by sources of revenue, fee structures, endowment, linkages to other networks, access to finance and to TA, and existence of future development plans; and (4) suggestions for strengthening the AWEP network of chapters. Attempts were made to collect chapter materials and information about their systems, policies, and procedures. The focus group discussions delved into the characteristics of individual businesses, including expectations and needs of AWEP, contributions members currently make, and potential further investment into the AWEP chapters. Furthermore, discussions also included feedback on any AWEP- African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 23 sponsored activities, engagement with other women entrepreneur and/or export organizations, and access to services (such as finance, training, and TA.) from organizations other than AWEP. The evaluators also met with other resource groups including representatives from banks, incubators, universities, export associations, and women’s entrepreneur associations. The meetings provided further clarity about the AWEP membership benefits vis á vis other resources available to members and chapters and their associated benefits. ADM EVALUATION – FINDINGS AND CONCLUSIONS ADM Design Overall Design The SOW for the evaluation called for a review and assessment of the ADM design. The approach used was to compare the design of ADM I with that of ADM II to ensure lessons learned in ADM I were incorporated into ADM II and to assess the overall design’s effectiveness. This comparison analysis is summarized in Annex C. It is important to consider the overall design of a program, because it can either facilitate or challenge implementation of the project. As part of their review of the ADM overall design, the evaluators reviewed the Global Development Alliance (GDA) and the implementing partner (IP) consortium as well as the objectives, program phases and their content. The following is the assessment of the various elements of the ADM design. A. Overall Objectives and Framework What Is the Desired Result? A Need for Clear Expectations For a program with limited resources, the ADM II program description lists eight objectives:  Create jobs  Generate income  Provide needed services  Discover new ideas with potential impact  Create new and/or strengthen existing development partnerships and linkages  Increase engagement with diaspora communities, recognizing the critical role they play in development  Deepen development knowledge base  Expand learning networks among diaspora communities Depending on which stakeholder was being interviewed, emphasis was placed on different objectives. After observing some of the activities and investments, it is possible to say that all the objectives are elements of the ADM program. However, the lack of a primary objective may have led to unrealistic expectations among the grantees and perhaps underachievement of some of the objectives. A more specific example of the last point is what was expected in Phase 1: Pre-launch Marketing and Outreach. The stated objectives of Phase 1 were to: (a) fortify existing ADM relationships and the development of new partnerships between African diaspora communities and Africa public and private sectors; (b) assist in the development of appropriate ADM-related public private partnerships; and (c) African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 24 support the formation of sustainable mechanisms to support ADM linkages with successful candidates in the African diaspora communities beyond the grant award period. However, none of the ADM II awardees indicated that they were involved with any formal African diaspora community, but rather with informal ones consisting of a friends and family. Furthermore only five percent of respondents knew about the ADM roadshows. ADM is based on the assumption that “Africa has experienced record economic growth over the past decade and the Consortium firmly believes that continuous and sustained interaction with the Diaspora￾driven entrepreneurial development on the African continent is essential to the future of African development.” 8Therefore, it follows that ADM endeavors to make a clear contribution to increased diaspora engagement in African development. The ADM webpage does not clearly state the intended result of ADM, but the assumption quoted above led the evaluation team to the conclusion that the goal of ADM is – expanded, continuous, and sustained diaspora-led SME development in Africa. A focused goal will determine the most appropriate indicators of achievement for ADM overall. USAID has other innovation grant competitions, such as the Feed the Future Partnering for Innovation managed by Fintrac that focuses on agricultural and agribusiness innovation.9 USAID also supports the Grand Challenges Development grant competitions involving private business.10 Stakeholders reported the distinction of ADM from other grant competitions is the promotion of diaspora involvement in innovative investments in Africa, whereas other competitions do not explicitly encourage the diaspora involvement although they do not preclude diaspora candidates. As the ADM webpage does not clearly state the overall purpose of ADM, the evaluators suggest USAID and its partners consider the ultimate result of ADM to be “Expanded, continuous and sustained diaspora-led SME development in Africa.” Although the evaluators believe that this may have already been done by USAID and Western Union, it might also be useful to write the causal relationships that are being proven through the ADM program to ensure that certain elements are not lost in the planning and implementation processes. B. Learning from the Past to Inform the Future: Conducting a Longitudinal Study through the Life of the ADM Program From stakeholder discussions the evaluators learned that, GWU-CIBER was intended to play an important role in the ADM learning process throughout the program. GWU-CIBER surveyed and reported on the original 733 ADM I applicants in 2009–10. The original idea was to conduct a follow-up survey after three years to monitor any changes in attitudes, preferences, and obstacles. It appears that neither a follow-up survey nor a complete report on the 2012 applicant survey was completed. By not collecting regular data that can be compared across years and iterations of the project, ADM has missed a significant learning opportunity that could help ensure fuller realization of its overall goal. Program documents provided to the evaluation team included minimal mention of this important element being more prominently integrated in the overall ADM design. That omission became more apparent when reviewing the M&E system employed. Other elements of the ADM Design The first phase of the ADM design is outreach and marketing to diaspora individuals and communities in geographical areas in the U.S. with known concentrations of African diaspora members. Next is the application and selection phase, which includes the concept paper, business plan, and scoring system, all 8 SEAF – USAID Cooperative Agreement 2011 9 The link to that program website is: http://www.partneringforinnovation.org/ 10 The link to the Grand Challenges website is: http://www.usaid.gov/grandchallenges African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 25 of which reflect the eight listed objectives. More specifically, this phase focuses on the validity of the business idea, management capacity, sustainability, business results, and resources available. Except for some of the students at the George Washington University graduate program in business, their professors and the people selected to review the proposals had both background in business, investments and/or development and some diaspora expertise as well. The use of Overseas Private Investment Corporation (OPIC)-Enterprise Development Network (EDN) members as judges also was appropriate given their extensive experience reviewing exports to Africa and imports from Africa finance applications. The design appropriately called for a standard DD process before disbursement of any funds. It also required grantees to have at least two milestones linked to the disbursement of grant funds rather than the grant being disbursed in a single lump sum; this was done to provide incentives for awardees to continue to submit quarterly reports. The design also included a TA component to complement all grant funding, funded by ACBF and arranged by SEAF. Additionally, the design included assistance linking grantees to additional finance that was led by TEF along with Western Union and SEAF. Finally, the design included an M&E component for tracking program implementation and grantee progress. Recommendations on the Design Altogether these design elements should have contributed significantly to a successful ADM II program. Field experience in SME development has shown that it takes a combination of support services and finance to accelerate SME business growth and improve the average success rate of these businesses. Historically, the failure rate for new SMEs is fairly high—depending on the source of the data and the industry, 50-80 percent of all small businesses started in the United States fail within the first five years of their existence.11 Although similar statistics are not available for Africa, it seems safe to say that small businesses in Africa face many more challenges than they do in the United States. For that reason, any program that intends to foster the development of either new or expanded SMEs in Africa with the involvement of persons often not residing in the country in which the business operates, needs to provide a full range of services to participants to improve their success rate. Although there is mention of finance (the grants, general follow-up finance, and possibly additional grants), TA, and networking, improvements are needed in future ADM design iterations. These are discussed in the following list. Possible ADM Design Improvements 1. Timeframe for an ADM cycle. Both ADM I and II provided between 12 and18 months from the first award for implementation of the business plans. One of the reported lessons learned from ADM I the need for a timeframe long enough for all parties (awardees, USAID, and the GDA consortium) to see outcomes as a result of their investments. This was particularly true for startups, and even for existing businesses adding a new product line or expanding in Africa. It seems that all stakeholders understood that startup businesses usually require more than 12 or 18 months to reach proof of concept. 2. Amount of the ADM grant. At the beginning of ADM II, it was announced that the maximum grant amount was reduced from $100,000 to $50,000 because of the challenge of businesses coming up with a 100 percent matching cash or in-kind contribution. After reviewing the results from both ADM I and II awardees it appears that this aspect of the design may need to change. First, the ADM grant commonly represents a small portion of the overall investment made in an awardee’s business. As the following table shows, more successful businesses from both ADM I and II already have invested at 11 Entrepreneur Weekly, Small Business Development Center, Bradley University, University of Tennessee Research January 1, 2014. A study done by Inc. magazine and the National Business Incubator Association (NBIA) revealed that 80 percent of new businesses fail within the first five years. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 26 least 10 times the grant amount into their businesses. Some of the additional investment was made before and some after the award of the ADM grant. Major sources of those additional funds were either the owner’s personal investments or net revenues generated from non-ADM business activities and/or other grants. This seems to indicate that matching a larger amount is not much of an issue for most awardees. The average investment required to get these businesses to where they are now suggests that it might be worth increasing the maximum amount of the grant if resources are available. More evidence is provided to support this recommendation in the ADM Performance Results and Impacts section below. Evidence about the perceived value of the grants to the business is discussed in the ADM II Implementation section below. TABLE 6: TOTAL INVESTMENTS IN ADM BUSINESSES12 An alternative recommended by more than one awardee is to have a tiered system of grants. Similar to other USAID innovation grant funds, awardees successful with the first grant would have access to 12 No names are provided intentionally as the investment data is proprietary. 13 It is understood that among the angel investors there might have been significant contributions from a closely affiliate group of the diaspora awardee, and that this may not be a typical example for the magnitude of leverage that can be achieved. It does not change the fact that ADM sponsors may want to review the weight given to “the demonstrated ability to leverage additional financial resources” in the Points Rubric before finalizing the preparations for the next round of the ADM competition. Startup/ Existing Business Grant Amount Sector Estimated total investment Status of Business Comments S $100,000 ICT >$2.5million Steady growth, expansion of product lines Owner’s other successful businesses provided additional finance—expanding to another African country E $100,000 ICT >$1 million About to reach viable level of operations Constrained by not being able to provide finance for client purchases S $100,000 Other >$4 million13 Not yet viable Prior capability in fund-raising; sources: grants and angel investors E $100,000 Agribus >$1 million Surviving and growing Experienced in finance sourcing E $50,000 Agribus >$800,00 Surviving U.S. business is source of additional finance S $50,000 Agribus >$250,000 Growing Expanding to another African country S $50,000 ICT >$250,000 Proof of concept close Looking for deep-pocket investor to scale up S $50,000 ICT >$300,000 Has not yet proven business model Needs additional finance for market survey and needs app pay system adjustments. E $50,000 Agribus >$750,000 Surviving and growing Other part of business is subsidizing ADM portion African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 27 ADM SURVEY – MAIN TAKEAWAYS  Investment Motivations: Participants invest with their heart as well as their wallet (financial, emotional, family concerns matter most)  Investment Obstacles: Participants recognize investment challenges in their countries of origin but believe they have a diaspora advantage (government, financial and infrastructure obstacles are the greatest perceived obstacle)  Investment Interest: Want to create new businesses and invest in existing businesses in their countries of origin (equity, mutual funds, lending funds, real estate) Source : GWU-DCIP slide presentation June 2012 page 5 larger grants for commercializing and scaling up their proven business ideas. Garnering the necessary funding for such a sequential tiered approach is a significant constraint to the ADM program. 3. Generic terminology without specifics. Occasionally, some terms were not well defined. For example, the failure to precisely define “technical assistance (TA)” led to inadequate preparation for its provision, and the entire approach had to be revised midway through the project. It appears that part of the challenge of being more specific might have been the limited ADM resources available to support TA. The intended follow-up research envisioned at the beginning of ADM I could have provided better guidance for incorporating more specifics in the design of ADM II as well as preparing for its provision. 4. Mentioning a service not yet operationalized. Several awardees complained about not receiving assistance they thought was promised from ADM II in addition to the grants they received. An example of this is the “support in linking to additional finance.” In one of the ADM promotional webinars, USAID mentions working on lining up sources of grant financing as a follow-up to ADM grant funding; however, this did not materialize. In program documents the description of links to additional finance mention banks and investment funding as well. ADM program designers should better identify the appropriate types of financial links for ADM awardees. For example, startup businesses will not be able to create the needed track record within the short program timeframe to access loan funds, even with a guarantee, unless they already have land and building assets in an urban area worth double the amount of the loan. The same is true with traditional investment funds. In addition to demonstrating their successful financial performance, awardees would be required to transfer ownership or replace management. However, diaspora and/or local entrepreneur probably will be reluctant to make these changes. The hope of a follow-on grant facility was reported as an encouragement for many of the applicants. Another example was both the amount and the nature of the TA promised, which changed significantly during the program. These changes disappointed many awardees that depended on the promised assistance to bring their business ideas to fruition. 5. Incubators or Mentors. Including this element in the ADM design might mitigate some of the challenges of TA provision. Successful incubators employ a healthy dose of mentoring as part of their services. We suggest looking for mentors both in Africa and the United States. More detailed discussion of this point is found in the section, ADM Conclusions and Recommendations. ADM Competition Implementation ADM I lessons learned were to be incorporated in all aspects of ADM II. In principle the components were in place to attract and identify appropriate projects and monitor their successes. However, there were conflicting reports from various stakeholders about whether the actual materials and reports and therefore lessons learned from ADM I were ever made available to the ADM II implementing consortium. The webpage materials were the property of another USAID project (Knowledge Driven Microenterprise Development) run by another contractor (The QED Group). The Academy for Educational Development (AED) was not in a position to turn over those materials because QED and its IT subcontractor developed the website, although AED provided input in the design and content of the website. We were not able to verify why the materials provided by AED to USAID did not get to the SEAF consortium. It is African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 28 possible that was overlooked in shifting ADM from MPEP to the Africa Bureau. Although there were obstacles to overcome, some of the lessons learned from the ADM I research done by GWU-CIBER were shared at the ADM II judges training. (See text box previous page: ADM I Survey— Main Takeaways.) Background Before walking through the findings of the ADM evaluation, it is worth providing more information about the participating parties. First there are the USAID GDA partners led by Western Union and including the Western Union Foundation, TEF, ACBF, and GWU-CIBER. Of special note is the important role that Barbara Span, Vice President for Policy and Public Affairs at Western Union Corporation has played in ADM since its inception. She not only originated and engineered the GDA with USAID for ADM I, she also led the private sector fundraising for it, championed the expansion of GDA partners, and steadfastly made herself available for the numerous meetings, webinars, and events that have enabled ADM to work as well as it has. Also to be commended are the many people in the Western Union Foundation and in local Western Union offices in the United States and in Africa who stepped up and supported both ADM I and II. In addition, the ADM program has had energetic champions and support from other staff at USAID since its inception. The Small Enterprise Assistance Fund (SEAF) was the consortium lead for the cooperative agreement for ADM II. The Constituency for Africa (CFA), and TCBA14 completed the IP team. Outreach and Marketing The elements of this phase were to include: 1. Promoting and marketing the ADM II business plan competition through the launch of an improved ADM webpage and online application process 2. Leveraging strategic partnerships with African diaspora communities 3. Working with business leaders in local and African chambers of commerce as well as subject matter experts with local representatives of Small Business Development Centers (SBDCs) and the Minority Business Development Agency (MBDA) 4. Social media outreach including Twitter and LinkedIn 5. A series of ADM “roadshows,” each including a networking reception, an ADM II competition workshop, and a small business planning workshop A. Website Once the initial challenges concerning the authority and ownership of the ADM website were resolved, SEAF was able to complete the called for upgrades of the website. The evaluation team was not able to confirm whether the home page was refreshed because the previous one was not available. However, the evaluators were able to confirm the rest of those upgrades including: (1) updating the competition guidelines and procedures and the resources page, (2) adding a FAQ page and site map, and (3) publishing the Twitter feed on the website’s home page. In its first quarterly report, SEAF mentioned that it was “in the process of documenting the website transfer process and creating a policies and procedures manual” for sharing with USAID and any future ADM implementers. The evaluation team was not able to confirm that this manual was completed. 14 TCBA was the original partner, but after some time the person in TCBA who had been working on ADM opened his own shop and the work was transferred to his business, The Arthur Group (TAG). African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 29 The evaluation team went through the website, made general and specific observations about it, and developed recommendations for the future. Observations and Recommendations for Improved Website  Overall the website is attractive and easy to read and navigate. There is a clear history of ADM events and activities. Although there are many outputs mentioned on the website, results of past activities, other than those for some individual awardee projects, are usually missing. For example, the two Live Banking events and the equity event do not indicate any results. See grantees feedback below for why to consider changing those entries on the website.  Most links still work, but those that do not should either be refreshed or deleted.  Some items have been left on the website that, despite being dated, do still serve a valuable function. Such pages as the eligibility and evaluation criteria are appropriate to maintain between competitions because they provide some reference to what future competitions might be like.  Some items have been left on the site but no longer serve any purpose, such as the links to registration for past Live Banking events. Those should be weeded out as they clutter the site.  The home page layout and functionality are fine. It is easy to read and navigate. Most of the links are functional. However, the “17 Nov 2012: The Tony Elumelu Foundation, Western Union and USAID host the African Diaspora Marketplace Investment Event” link no longer works and should either be removed or re-established.  Some links need modification. For example, on the ADM page the link “Apply to ADM” should be deactivated until it is ready for ADM III. In addition, the two-step application process on the “Evaluation Criteria” page should be revised because awardees stated that they experience  A three-step process including the concept paper, business plan, and final presentation. Another two links that are not functional at present that would be helpful for diaspora planning for the next round of ADM awards are on the “Eligibility” page: both the “ADM General Restrictions and Prohibitions” and the “Parties Excluded from Federal Procurement or Non-procurement Programs” should be reactivated to assist future applicants.  The materials on the “Resources” page are appropriate because they help the program ensure that all participants in any stage of the ADM competition derive some benefit from it.  The evaluators could not find any materials from the roadshow workshops on the website and, given that attendees asked for these, the IP may want to ensure that a version of the workshops is posted on the website. B. Other Pre-Competition Outreach and Marketing The objective of this phase was to attract the most qualified candidates to the ADM II business plan competition. The applicant survey report done by GWU in ADM I provided useful information about the motivations, intentions, and perceived challenges that would be faced by a new set of awardees. The survey report also included a network of contacts and organizations that could have been built upon and expanded. Apparently much of that information and lessons learned was not passed on to the new ADM II IPs. The CFA was selected to implement the outreach to diaspora networks and key local groups such as the American Chambers of Commerce (AmChams), SBDCs, and MBDA offices and to execute a series of roadshows. Because the information from ADM I was not provided, SEAF had to use their networks. The sidebar summarizes the attendance at the six roadshows. Overall there were 570 participants, with nearly 70 percent originally from the United States, Nigeria, Ghana, and Liberia; this suggests that some other diaspora groups may be underrepresented. However, a comparison of the distribution with concept papers submitted, the 170 highest qualified ones and the final awardees included in Table 8 below, shows that African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 30 TABLE 7: ADM II ROADSHOW RESULTS ADM II Roadshow Results Participants Atlanta 50 Houston 80 Los Angeles 110 Chicago 40 New York 100 Philadelphia 100 Washington, DC 90 Country of Origin West Africa 57% East Africa 13% South Africa 0% The Caribbean 1% U.S. 28% Other 2% Country of Project West Africa 75% East Africa 18% South Africa 0% MENA 0% Other 7% Focus Sector Agribusiness 38% Renewable Energy 35% ICT 25% Other 2% Learned about ADM through: Local organizing committee 49% Local diaspora group 33% Local media 6% Western Union 3.5% ADM Website 3% distributions among regions and sectors are similar, with the exception of MENA, which had a separate competition and funding. Feedback from participants on the roadshows appears to have been generally positive. Key lessons learned by CFA:  Outreach and marketing for the ADM program should begin more than 90 days in advance of competition to allow for all local parties to plan/prep for applying and allow better vetting and utilization of MBDAs, SBDCs, diaspora community groups, WU local offices, and other resources.  The website needs to have full information about the next ADM round in advance of the promotion of the roadshow events. (Note the low awareness of roadshows from the website.)  There is a lack of awareness of what it takes to do business in Africa in local chambers of commerce, SBDCs, MBDAs, and in some diaspora groups. Additional time needs to be allowed for this education if more qualified candidates are to be attracted to ADM. Also, ADM needs to identify more people with experience doing business in Africa to be part of the outreach process.  Better vetting is needed for persons encouraged to attend future roadshows because many individuals attending past events were not qualified to apply.  A roadshow template should be developed and sent to local planning/organizing committees. There also needs to be follow-up with all stakeholders after the roadshows about what is next, what is working, and what is not.  Another media avenue that should be considered for future AMD competitions is advertising in local community newspapers/publications on-line or in print, and on local radio shows because all major cities have diaspora media. A budget will need to be allocated for this.  ADM should look to generate U.S. local corporate sponsorships (such as community banks) to add grant and/or TA funding.  A core group of people is needed, each of whom has a vested interest in ADM and will be part of planning for outreach and marketing. One possibility might be a U.S. regional/national partnership committee with regional competitions leading to national partnerships.  The program needs better links to better companies in Africa via AmCham offices in Africa.  A letter should be sent from a high-level USAID executive to leaders in MBDAs and SBAs about ADM to help get attention for the program from local offices. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 31 The following quote summarizes the outreach done in ADM I. “In ADM I the following avenues were used to reach out to the broadest array of diaspora to invite them to the ADM road shows and to the competition. 1. Outreach was done through Western Union channels 2. Outreach to U.S. Embassies 3. An online search for diaspora groups was conducted 4. Outreach to formal diaspora networks, and through professional networks 5. Dr. [Liesl] Riddle, [Associate Professor of International Affairs at GWU], provided suggested contacts (in line with professional networks) 6. There was a cascade effect of outreach. When we talked to some of the people, they provided suggested contacts, with whom we followed up.”15 Although the above information about the outreach approach used in ADM I is cursory, the last point may have some real value for the future and corroborate what was reported by other ADM I stakeholders. AED apparently followed up on leads provided by its outreach partners and sent individual emails and/or made phone calls to introduce ADM. This may have enabled them to reach into informal as well as formal diaspora networks. More than one ADM II stakeholder thought that the candidate pool in ADM II might not have been as strong or broad as in ADM I. Although broadly defined, ADM II was open to just three sectors: agribusiness, ICT and renewable energy. Something missing in ADM II was the systematic analysis and identification of the most effective avenues and procedures for attracting the most qualified applicants. In CFA’s report, 49 percent of the attendees became aware of the roadshow from the local organizing committee outreach. But no data was provided on what the most successful local organizing committees did to attract almost half of the total attendees. Beyond the roadshows, there was no system in place to identify and utilize sources providing the most qualified applicants. This information would have allowed the program to better utilize future marketing and outreach resources and reduce the time needed to reach those diaspora members most able to develop and present qualified concept papers and successfully implement them. It should be noted that none of the eleven ADM II respondents attended a roadshow. This does not mean that roadshows were ineffective; it just means that a system for cross-referencing marketing efforts, contacts, participants, applicants, and awardees was not in place in ADM II. C. Research Element Although 91percent of ADM II awardees said they did not feel affiliated with any formal African diaspora “community,” this finding may need modification because the awardees are linked to informal African diaspora networks some of whose members are connected to the formal networks. The research started by GWU-CIBER, if followed up, might reveal many other interesting lessons learned from ADM I and II. Dr. Liesl Riddle expressed interest in having GWU do a follow-up survey to see what changes have occurred since the earlier surveys were conducted. The M&E systems used in ADM II lacked a clear learning agenda as evidenced by the collection of inconsistent performance data from awardees. This is discussed below in the M&E section. However, it is worth mentioning here, as two of the stated objectives of ADM II were to  Deepen the development knowledge base  Expand learning networks among diaspora communities 15 Personal communication from a former AED staff involved with ADM I provided the quote. 2014 African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 32 Both of these require a research agenda and implementation plan that should include GWU-CIBER and other GDA partners as well as all IPs and ADM stakeholders, including awardees. Concerning the latter, and as will be discussed further below, promotion should mention the research aspect of ADM upfront in roadshows, webinars, and on the ADM /AWEP website, as well as in the final orientation workshop. ADM II Business Plan Competition The ADM II business plan competition followed along very similar lines to the ADM I process, with three steps; concept paper submission and selection, a semi-final business plan submission and selection, and a showcase and presentations to a final panel of judges. As mentioned above in the discussion about the website, standard guides for eligibility and concept paper judging as well as generic templates for concept papers and business plans were available on the ADM website. As time did not permit a full review of the selection process, the main focus of the evaluators was on whether the way it was set up and conducted ensured a fair and positive outcome aligned with ADM II’s objectives. In the fourth quarter of 2011, ADM opened a semi-automated system for submitting concept papers via the ADM website. The evaluators found an internet-based competition appropriate for ADM because for a diaspora who is based in the U.S. to be able to be regularly and effectively interact with a business in Africa, it would require ICT literacy. In total 495 concept papers were received including 481 for SSA, 11 from North Africa, and 3 from other regions. This included 360 submissions before the initial deadline of February 3, 2012. Then, due to a Fourteenth Amendment protest, the deadline for submitting papers was extended by a month, and an additional 133 concept papers were submitted by March 3, 2014. In Table 8 below, one can see that portion of the highest qualified concept papers by region parallels the proportion of concept papers submitted. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 33 TABLE 8: SUMMARY OF ROADSHOWS AND SUBMISSIONS BY REGION, COUNTRY AND SECTOR A. General Eligibility Requirements The evaluation team reviewed the general eligibility requirements after looking at the performance to date from the ADM awardees and receiving feedback from various stakeholders including the GDA and IPs, Roadshows Concept Papers of 495 Highest Qualified of 170 Sectors Number of Highest Qualified AgBiz ICT Energy Other Total % ADM II Awardees % Region of Project West Africa 75% 61% 58% 54 29 15 5 61% 59% East Africa 18% 31% 25% 24 11 8 3 27% 24% South Africa 0% 3% 0.6% - 1 - - 0.6% MENA 0% 2.5% 6% 3 4 2 1 6% 18% Other 7% 0.6% 9% 3 4 2 1 6% 6% Country of Project Nigeria 54 23 20 10 1 32% 35% Ghana 28 17 8 1 2 16% 18% Kenya 18 10 4 3 1 11% 18% Uganda 10 6 2 1 1 6% 6% Liberia 9 4 1 2 2 5% 6% Zambia 8 3 2 2 1 5% 6% Ethiopia 8 4 3 1 - 5% - Sierra Leone 8 6 - 2 - 5% - Tunisia 11 6% 12% Francophone 8 7 2 2 - 5% - Total of Highest Qualified by Sector 84 49 27 10 170 Percentage of Highest Qualified by Sector 49% 29% 16% 6% 100% ADM II Finalists 50% 43% 7% - 100% 44 ADM Awardees 47% 41% 12% 100% 17 African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 34 as well as the awardees. The purpose was to identify any changes that might be needed in the requirements that might improve the overall ADM process. Given that, as can be seen in Table 8 on the previous page, proportionately more ICT concept papers scored highest and became finalists, it is worth understanding whether there were any biases in the scoring and judging systems. What follows are summaries of five eligibility issues that administrators and GDA partners may want to reconsider:  Business Criteria: Must be a startup or established business seeking to expand or introduce goods or services. Several factors come into play in making any kind of recommendation about this particular criterion. The issue is whether it is realistic to expect that ADM can effectively support startup businesses. First, there is the very limited timeframe in ADM II (between 12 and 18 months maximum for the grant and TA assistance.) The question that this factor raises is what is/are an acceptable result measures for startup ADM businesses? Without some common set of results measures, no comparative analysis is possible of the merits of investing in one business versus another. And without the possibility of that analysis, it becomes harder to determine whether the program is achieving its objectives. Second, there are many known and unknown challenges to getting a business started in most of the ADM-eligible SSA countries, and these result in unexpected delays in implementation. Third, one would want to look at the experience to date in both ADM I & II with startup versus established businesses. Unfortunately, the combined data available from ADM I & II awardees is not definitive either way, and varies depending on the measure that is deemed most important for determining program results. If it is revenues or profitability, then, clearly, the majority of the startups do not attain that within the 12 to 18 month grant period. Also, a significant number of established businesses using ADM support to entering into a new product or service are not reaching profitable operations within the grant period. Several successful incubator leaders recommend a minimum of between two and three years for startups to be able to prove their concept sufficiently and become able to engage next-phase financing. That timeframe also has implications for the size of grants for startup businesses. The challenge of answering the question of whether ADM business criteria should include startups goes back to the question about what are the priorities among the eight ADM program objectives.  Matching contribution of one-to-one leverage ratio as the minimum requirement: This should be reconsidered given the actual total assets in the ADM businesses that are succeeding as discussed in the section on the ADM program design. Experience is showing that on average it takes much more than $100,000 to get most ADM-promoted businesses in going to the point that they meet the other judging criteria. 3. Award size $50,000: This was discussed in the design section. However, consideration of the point of startups needing at least two or three years to get going, suggests that if ADM is seriously considering supporting startups, the program may want to reconsider both the maximum grant amount together with any funding allocation for TA. 4. Business Location and Language: Given that 7 of the 19 eligible countries are not Anglophone, the English requirement may introduce a bias if concept papers, business plans, and presentations must all be in English, even if the diaspora participant is a citizen or permanent resident of the United States. The evaluators fully appreciate the additional challenge receiving applications in more than one language would represent. However, there have been no successful applicants from any non-Anglophone country in either ADM I or II.16 If USAID and Western Union want ADM support in francophone and/or Lusophone Africa, they may want to 16 With the exception of Tunisia and Libya which were separate competitions. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 35 consider a separate competition for those SSA countries along the same lines as was done for Libya and Tunisia. 5. ADM General Restrictions and Prohibitions: These include proving no negative environmental impact without adequate mitigation. It can be a major challenge for even an established agribusiness company to comply with this requirement after being selected. The evaluation team is not suggesting that these requirements be waived. However, it should be included upfront that evidence that these requirements are met or realistic estimates for what it will take to meet them will have to be included with any business plan submitted. B. Application and Selection Process The evaluators confirmed that the application and selection process employed in ADM II was, on the whole, transparent and followed the process presented in the competition promotion on the ADM website. Concept papers were submitted via a portal and, as part of the competition process, applicants completed a research questionnaire prepared by GWU-CIBER.17 GWU recruited and trained student judges, all of whom were supervised by Dr. Riddle (the supervisor for the judging process for ADM I). The scoring process was tracked through the GWU stage of review using a Microsoft Access database.18 The GWU records included the initials of each reviewer with respective scores. A pair of students in the GWU￾CIBER program and at least one business school professor scored the 360 concept papers submitted by the original due date. The Points Award Rubric methodology was employed with its accompanying Rubric General Guide. These were developed by GWU and SEAF, and training on them was made available to all the judges. Persons in SEAF scored the other 133 concept papers submitted between February 3 and March 2, 2014. SEAF also developed the Twenty-Point Bonus Criteria for the final round of the selection process. No mention was made by awardees of major issues in uploading to the CyberGrants platform used for the concept paper and business plan submissions. TCBA then conducted an eligibility review of the 170 concept papers/applications and eliminated ones that did not meet all of the requirements. The number of concept papers moving on in the competition was further reduced to 12019 before a team of ten judges from OPIC-EDN reviewed them and selected 71 “semi-finalists.” These applicants were given a month to submit a full business plan in a format and following guidelines provided on the ADM website (materials were due by May 4, 2014). A team of sixteen judges including development finance experts, venture capitalists, and successful entrepreneurs scored each business plan according to the same Points Award Rubric used in the concept paper selection stage and Rubric General Guide. Starting on page 28 below are brief reviews of those tools. C. Concept Paper and Business Plan Templates As mentioned, the ADM website provided generic templates for both the concept paper and the full business plan. The only adjustment recommended is minor wording changes to make it more consistent with the ADM program. Clearly the templates were guides for presenting to potential investors, and so some elements, like “exit strategy” may not be as applicable in the case of the ADM diaspora because these investors may not have any intention of cashing out of the African businesses with which they become involved. 17 The results of that survey are not yet fully compiled and analyzed although the raw data is available. 18 The evidence for the tracking of the 133 additional concept papers submitted during the information was not provided to the evaluators. 19 It was not clear what else besides the eligibility criteria and the score ranking was used to arrive at this number. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 36 The biggest issue is cash flow analysis. The template calls for annual Sources and Uses of Funds analyses to determine projected cash needs. However, monthly cash flow analyses are more useful for estimating actual cash needs. Obtaining accurate estimates is critically important because one of the most common afflictions of new businesses is underestimation of cash needed. Feedback from ADM II respondents about the application process was generally positive. Quotes exemplifying the majority opinions include the following. “Yes (it helped). The process was like following a roadmap of essential considerations.” “It helped expand the scope of our service beyond the original service intended which was to report traffic. What we ended up with was a platform that allows users to report anything/share information relevant to city commute and safety.” “Definitely helped us structure the ideas for what we wanted to do. We had to restructure things: “what can we do now?” It broke our original plan down into phases.” “Yes. It was a lot of work. I had to learn a lot about bookkeeping and accounting, which was very useful and helpful. (It) taught us a whole lot about writing effective business plans and thinking about. (It) helped to pull in other viable portions of the business, forced me to think deeper and harder about the dream I had and forced me to make it concrete and tangible. (It) helped me to pull together architecture, affordable housing and renewable energy.” “Yes. It made us sit down and organize and document about our company, particular projections for next three years—had to look at many things to do those projects. If I had the grant—what would be the targets. Expenses and purchases—had land and producing, but had to calculate value of property” “Yes. [It] helped to teach how to present an idea on paper, tell our story, and pitch our idea. Although we already had a story, the structure of the application helped to organize and crystallize their idea. It really helped us solidify our identity. We purchased QuickBooks because the business plan required a financial tracking system. Also taught about risk planning and helped them think more deeply about risk.” “That’s what helped us win the second time since we learned so much the first time. Biggest obstacle we faced was lack of reps from West Africa the first time around. ADM I was steep learning curve: be more prepared for applicant questions. [It] seemed like they focused more on African side whereas our business focuses on U.S. side. I learned an elevator pitch from ADM; that was the biggest thing for us.” A couple respondents indicated that they had enough experience to just cut and paste from the business plans they already had to fit into the ADM template. The split was 60-40 for those who benefited from using the templates versus who did not feel they had. Business Plan Template Recommendations After looking at the DD guidelines and reviewing several generic business plan template links provided on the website, the team believes that one element that should be introduced to the ADM business plan template is a monthly cash flow statement. Most business plan templates ask for a Sources and Uses of Funds statement as a substitute for an actual 12 to 24 month monthly cash flow analysis that is used to calculate the maximum amount of cash needed during the first year or two of either a startup or expansion of an existing business. One of the most common shortcomings in business startups and business expansions is underestimating how much cash they will need to get operations to the point that cash inflows cover cash outflows. Using annual Sources and Uses analysis just backs out the difference in the balance sheet accounts between the beginning and the end of the balance sheet period (year or quarter). African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 37 Cash needs within the period can be much higher. That is why a proper cash flow is needed that more accurately estimates when revenues will actually be received and when expenses will have to be paid. It helps quantify the additional cash funding that will be needed for building the business. D. Points Award Rubric and Rubric General Guide A key tool in the ADM selection process was the Points Award Rubric and Rubric General Guide. A review of this rubric was done first to see if it would facilitate a smooth and fair selection process that could be used by a very large number of judges (100 volunteers) from varying backgrounds and experience levels. Second, it was reviewed using the experiences and results of ADM I and II grantees to date and whether that experience indicated any further adjustments were needed to the Points Award Rubric and Rubric General Guide. Annex D contains the full, detailed review and recommendations for adjustments or additions to the Points Award Rubric and the Rubric General Guide used in ADM II to guide in the selection of concept papers and business plans submitted online by applicants. One of the challenges is that the rubric is to be used by both less experienced students in the first instance and more experienced professors and other judges in the second instance. Also, the evaluators were only able to review the Power Point slides used in the judges training session at GWU, and so are missing much that was actually covered in those discussions and is not reflected in the award rubric or guide. That said, however, the team did develop recommendations for improving the tools. These are summarized in the following list. Points Rubric and Rubric General Guide Recommendations 1. Given the fact that so many judges (approximately 100 in ADM II) are involved in the process, it would seem more equitable if more detail was provided for each grade in the Rubric General Guide. Many subcategories and one category are missing any grading description; this should be remedied. 2. Experience seems to indicate that a few of the subcategories (particularly Management Capacity and Profitability) may need further definition in the Points Award Rubric. 3. Two sub-categories in the Points Rubric—Finances and Passive or Active Engagements—and possibly other subcategories, appear to need additional scoring weight and emphasis based on ADM I and II awardees’ experiences. Currently, Finances is worth two points and Passive or Active Engagement is worth three points. Businesses that are more knowledgeable about financial management are less likely to spend all or too much of their working capital. However, a few of the awardees have currently done this. The utilization of management teams and/or mentors better able to assist with financial challenges will reduce the need for awardees to urgently raise money as soon as the ADM grant and match are spent. Regarding Passive or Active Engagement, it seems that more active involvement and more frequent contacts with diaspora investors lead to better organization and progress among the local businesses. Although there are exceptions to this observation, Riol Farms, Global Tracking, OTGPlaya, and MedEnhance, are just a few ADM awardees holding almost daily or at least weekly Skype or phone calls between the diaspora and the local business offices. In addition, Sardis and AACE, which have almost full-time diaspora involvement, are progressing nicely. ADM should continue using the scoring spread to select only those applicants that statistically have the greatest chance to win the competition, so that no one is asked to prepare a full business plan that has no chance of winning. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 38 Further specific changes and additions recommended to the Points Award Rubric and the Rubric General Guide are all contained in the Evaluator Comments/Feedback section of the Points Award Rubric table in Annex D. E. Judges One of the lessons learned from ADM I was that with a competition open to all sectors and across 19 SSA countries and with the magnitude of the response to the call for concept papers (733 in ADM I and 495 in ADM II)), it was a challenge to get a qualified set of judges who could ensure the fair, realistic, accurate, and timely judging of concept papers and business plans in a relatively short timeframe (3 to 5 weeks for the concept papers and 3 weeks for the business plans). The use of GWU-CIBER students from both the diaspora entrepreneurship class and other MBA students, with support from a well-qualified professor, appeared to be a mutually beneficial experience for the program and the students. Although the evaluators were not able to review all the qualifications of the 10 judges used to cull the semifinalists from the top 120 concept papers, nor the group of similarly qualified judges who were employed to select the final 44, it would seem that such a mix of qualified individuals could make a reasonable selection of ADM II awardees. One challenge mentioned by several ADM stakeholders was ensuring that there were enough judges who had enough familiarity with the African country context to be able to accurately assess the relative business-enabling environment and the socio-political, legal, market, and other risks where the proposed business activities would take place. The evaluators agree wholeheartedly that as many of the judges as possible along the entire selection process should have some contextual familiarity. If not, some enterprises that are likely to succeed may be overlooked because other, superficially more appealing business concepts score higher than they should. F. Marketplace Event and the Twenty-Point Bonus Criteria For the final selection of the ADM II competition, applicants with the 44 highest-ranking business plans came to Washington, D.C., to showcase their ideas and concepts directly to the judges in a marketplace format combined with two interviews. The evaluators agree that the attempt to simulate a real-world experience of pitching business ideas for funding to potential sources of finance is useful experience for all finalists. Feedback from respondent ADM II awardees, as was to be expected, varied greatly. Some, particularly those agribusinesses coming from Africa, felt at a distinct disadvantage not being able to actually show their products, due to customs restrictions on agricultural products, whereas ICT and some other types of businesses did not have that constraint. Also, because of the cost, they wished that the event could have been just two days instead of being spread over three. The evaluators also feel that using the Twenty-Point Bonus Criteria with a two-interview, multiple judges20 average scoring process added to the scores previously given to each of the finalists, provided a reasonable framework for the final selection. Although there was no time to do this, the evaluators felt it would be worthwhile having a few of the judges provide their feedback on how the Twenty Point Bonus guidelines could be improved. Feedback from persons at the marketplace event included the following observations.  Both the judges and finalists need to be on time for interviews.  Several final presentation panels were held in the same room, which caused some finalists to be confused about where to go. Also some groups were louder than others, which was a distraction for some participants. And finally, if a finalist entered the room early, s/he got to listen to 20 It seems the original plan for the marketplace event was to have two teams of eight judges each for the final evaluation, but in the end it was reported that two teams of six judges each participated. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 39 previous presentation(s). Therefore, separate rooms should be made available for each final presentation, as was done in ADM I.  The process should be completed in two days rather than three to keep finalists’ costs to a minimum, particularly those traveling from Africa.  Convene the marketplace event more than two weeks after the finalists are notified to better accommodate candidates coming from Africa—travel costs were significantly higher because of the short notice. ADM Award Process Once the 17 ADM II awardees were selected, DD was to begin within 10 days and negotiations of the grant agreements were to be completed within 45 days of awards. The DD process included confirming compliance with U.S. government regulations and verification of information provided in the business plans. A two-step individualized questionnaire was used to clarify business plan information. TAG examined the awardees’ proposed project plans and budgets, and based on results of these first steps, awardees completed a second questionnaire that addressed specific areas of concern based on their business plans and determined during the judging phase. That review was followed with a site visit to partner companies in Africa to observe required evidence firsthand.21 The purpose of the general compliance checks was to confirm the existence of the business and viability of the entrepreneur whether based in the United States or in Africa. The following areas were reviewed as part of the general compliance check: 1. Key performance indicators 2. Key company principals 3. Market analysis 4. Products and services 5. Organization and management 6. Environmental and compliance monitoring 7. Financial management 8. Corporate governance and social responsibility 9. TA 10. Application of funds The following are some sample areas of concern and questions addressed in the second DD questionnaire. TABLE 9: DUE DILIGENCE AREAS AND SAMPLE QUESTIONS 21 The evaluators noticed that in the ADM Q4 2102 Quarterly Report mention that DD had been completed in some instances before site visits were made without explaining how this was possible. Areas of Concern Sample Questions 1. Products and Services “Are the four organic inputs that are imported central to the OFK? If so, how reliable are the sources of supply and what is the backup plan if the external source is unable to deliver? Please supply the names of the vendors and the countries in which they reside and also signed terms and agreements for obtaining supplies from them.” 2. Competition “How does the price of Amiran’s ’traditional kit’ compare with your organic kit’? What is the value proposition that differentiates PHP from the competition?” African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 40 Other areas of concern that were covered in the DD included: quality control; management; use of funds; licenses, patents and trademarks; investment plan; and site visitation plan. The evaluation team reviewed the DD records for the 15 SSA ADM awardees. From the questions asked it was clear individuals adequately knowledgeable about the technical as well as the market, operations, financial, management, and other aspects of the different types of business were involved in the preparation of the issues and questions presented to the awardees. The evaluation team understands that several people with varying levels of expertise in different aspects and types of business conducted the DD site visits and milestone and key performance indicators negotiations.22 Feedback from awardees was mixed although generally positive about the ADM II DD and the milestone and key performance indicators development and negotiations. In some instances, awardees felt the process actually helped them better think through what they were planning to do with their businesses. The evaluation team also reviewed the DD Program Guide and Checklist to confirm its completeness and alignment with the ADM objectives and the USG’s grant-giving requirements. Annex E contains the complete review with recommended changes and additions. As can be seen in the comments column in Annex E, this program guide has many of the elements of an adequate DD process of ADM awardees, their businesses, and business plans. At the same time, a few additions and clarifications should strengthen it. Unfortunately, there were no additional instructions provided to the persons actually doing the DD, which seems to indicate that the person doing the DD was very experienced and familiar with the types of business being reviewed, as well as with the legal and regulatory requirements in each of the countries in which the ADM awardee will conduct business. Although the DD process was begun as promised within ten days of award announcements, eight of the 17 DDs had not been completed by more than 90 days after the winners were announced, and the site visits were conducted more than 120 days after the awards were made. There were a variety of reasons for this, some of which were beyond the control of the implementers, but others were due to the process selected. There were delays in receipt of responses to the two questionnaires and there were scheduling and travel delays. The entrepreneurs’ difficulties in complying with all of the DD requirements may need to be factored into the scoring system. Finalist judges’ comments about key issues to be resolved before the grant is made suggested that the factoring should be possible. 22 No matrix was provided to see if any patterns emerged demonstrating differences in the effectiveness of the DD provided by various persons/teams or among the different countries. Such an analysis would allow evaluators to see if any common factors were overlooked or their relevance underappreciated. On the whole this does not seem to be the case. 3. Market Analysis “Provide sources/references for figures quoted. Why is the goal of one million page-views per day by 2015 realistic? Please elaborate on how you can build up to this goal.” 4. Operational Plan “It is stated in the Executive Summary that the company is negotiating with Equity Bank for preferred loan program for purchasers of the OFK, but in the main business plan the claim is that the Equity Bank has already agreed to provide 3-year loans to farmers who desire to buy the OFK. Please clarify.” 5. Financials “Provide evidence of matching funds, such as the U.S. $15,000 cash equity, U.S. $20,330 in-kind contribution, and U.S. $35,000 other.” “Profit before taxes are consistently less than 10 percent of sales. This is very marginal, considering price fluctuations in livestock, fuel, etc. What cost cutting or containment measures are you planning to put it place?” African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 41 Due Diligence Recommendations The evaluators developed the following six DD recommendations. 1. A compliance review step is done after the initial scoring of concept papers; an appropriately qualified person should repeat this step before awards are announced. 2. Overall, the same or similar DD process should be kept, beginning with the finalist judges providing detailed questions to be satisfactorily answered by awardees and confirmed by evidence review during the site visit. 3. Streamline the two-step questionnaire process into one step. As can be seen in the comments in Annex E, most of the questions in the first step were asking for information that should have been in the business plan. Therefore, more explicit instructions in the application could reduce the need for this step entirely. Additional time could be eliminated from the DD process by not waiting to receive the answers to the second questionnaire before the site visit. 4. In the Financial Management section, instead of asking for Sources and Uses of Funds ask for a “detailed 12-month cash flow” for the reasons explained above. 5. It would be more realistic to state upfront to semifinalists, finalists, and again to awardees that the DD processes will take up to 90 days to complete, and that the time required will depend on how quickly the awardee can provide evidence. 6. A guide or manual should be prepared including the additions recommended in the Annex E table. The IP consortium initially focused on completing the targets related to the ADM competition and grant making process. Once that was completed, their focus shifted to monitoring awardee performance and facilitating the provision of TA and access to additional finance. The next steps in the ADM process after DD were milestone and key performance indicator setting. This step was accomplished during the site visits, which the evaluators were told were part of the DD process. However, because they are integral elements of the M&E system, they are discussed below as part of that element of ADM implementation. Monitoring & Evaluation Overall, the M&E portion of ADM II was probably the weakest element of the ADM program. In the first place it appears that only the awardee-monitoring portion of a proper program M&E plan was developed at the beginning of the project, and even that portion did not include all the needed indicators. This portion did mention where the data would come from and how it would be collected and stated that the data would be verified. However, no mention was made of the monitoring of the IPs performance and no targets were given. Although annual work plans did provide outputs targets that could have been used, no reference was made to them in the quarterly reporting. Also, although some elements of the ADM II M&E system were apparently presented in the orientation workshop following the awards ceremony, some of the basic elements, it would seem, were not clearly laid out. For example, no baseline for each of the awardees was available. Nor was there a common set of performance indicators across awardees by which the overall results of ADM II could be measured. As a result, the M&E system did not allow for effective results reporting. Awardee monitoring focused on four things: milestone achievement, key performance indicators (KPIs), risk assessment, and financial statements. Awardees generated quarterly reports based on these together with information extracted from their financial statements. TAG collected and reviewed the data submitted and asked for clarifications as needed. SEAF, in turn submitted the information to USAID and the GDA partners. Milestones and KPIs varied greatly from awardee to awardee. Therefore, the information reported to SEAF, USAID, and the GDA was inconsistent and sometimes hard to comprehend. The risk assessment reporting seemed a bit arbitrary or, in a few instances, inaccurate, because there was no guide established in advance for the three levels of risk ranking (low, medium, and high) for each of the risk categories. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 42 What follows is a walk-through of the post-award M&E process in ADM II. It concludes with recommendations for the next ADM round. A. Milestone Setting and Achievement Setting of awardee milestones and key performance indicators are principle elements of any performance￾monitoring plan. But they should be guided by the M&E system, not drive it. In the case of ADM II, members of the DD implementing team conducted individual negotiations with the applicants in the U. S. and/or during the visits to the African businesses. Review of the milestones chosen for awardees found that they were tailored for each awardee and constructed to allow for two grant disbursements made over the course of the grant period, one fairly early and another between 5 and 9 months later. Because the milestones differed for each awardee, it was difficult to conduct comparative analyses of performance, beyond whether the milestones were achieved within their estimated timeframe. For example, five awardees had completing prototypes or beta versions of software or launching production as a milestone, four had staff hiring, while three had purchase of equipment and another two had required certifications. Only four had production or sales milestones, none of which were achieved within the allotted timeframe. The feedback from a significant portion of the respondents (40 percent) was that milestones were shoehorned into the timeframe allowed for the ADM grant period. Additional work appears to be needed to arrive at milestones that are well aligned with both the objectives of the awardee businesses and the achievement of ADM objectives. Another reason given for two disbursements was to ensure better awardee reporting. Although a financial incentive may be appropriate to drive reporting, the program may want to consider other incentive in the future such as being able to receive results from across the ADM awardees. Several awardees said they would have liked to hear how their fellow awardees were doing. B. Key Performance Indicators A review of the KPIs chosen for the ADM II awardees reveals a similar challenge of not having consistent performance measures. First, a predominance of indicators do not allow for measuring ADM’s overall objectives, but focus on specific outputs (such as the numbers of persons trained, contracts signed, and/or subscribers) rather than revenues and other outcomes or results. For example, there are only two instances in which “jobs created” is a key performance indicator. Although this makes sense for the very short ADM grant timeframe (12 to 18 months), the program does have the stated objective of creating jobs. Second, although a program objective is “increasing incomes,” only 4 of the 14 awardees evaluated had any kind of revenue key performance indicator. Again, this is somewhat understandable in the case of the four startups because the timeframe is so short. However, the brief timeframe should not be used as a justification for the absence of key revenue indicators among the 10 existing businesses that indicated they already had markets for their expanded production. Although financial indicators were not systematically included as KPIs for all grantees, with the justification that it was known that some awardees would not have revenues to report for most of the grant period, all awardees were required to submit quarterly income statements and balance sheets. Only 28 percent of ADM II awardees had any financial targets or KPIs, which made it difficult for most of them to understand why they had to keep submitting quarterly financial statements. It was not, therefore, surprising that many awardees complained about having to submit financial statements when their grant agreement indicated that this data would not be used. A few expressed appreciation of the “discipline” of having to make the submissions. For others it was just extra work for the small grant amount they received. When informed that the financial reporting was being used to justify supporting diaspora involvement in business development in Africa, the awardees changed what they said about the financial reporting requirement. This comes back to the question about priority objectives of the ADM program. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 43 Should increasing incomes be a priority objective? If so, then financial returns need to be included as KPIs for all awardees. In addition, ADM needs to be clear that it is asking for financial information by including financial targets in the KPIs of all awardees. C. M&E Reporting System SEAF’s original idea was to develop a web portal to which awardees would upload their quarterly reporting information, and which would then compile the data for easier reporting to USAID and the GDA. The awardees were provided with a link to the performance reporting template that they were to complete via the Internet. However, that idea was dropped when many of the awardees were challenged to provide the information in the required format and were submitting Excel spreadsheets instead. The reporting template included an M&E page with schedules (milestones, key performance indicators, and a five-dimension risk assessment). It also included a separate tab for filling in the detailed quarterly financial income statement and balance sheet data. Another tab called for entry of the financial data once again, but translated into U.S. dollars. Subsequent tabs stored past quarters and automated annual income statements and year-end balance sheets. The concept seemed sound, but awardees of small grants were asked to prepare balance sheets and translate financial statements from fluctuating local currencies into dollars four times a year, which was often challenging and frequently led to results that could not be compared to each other. (In part, the request to translate amounts into U.S. dollars was made because the GDA and USAID need the information in this format for their own internal reporting requirements.) In the end, the IPs realized that the program had to look for ways to facilitate the conversion and data collection.23 The evaluators appreciate that for any startup business proof of concept may come long before profitability. They also appreciate that it is important for the sponsors to know what additional funding the ADM grants and TA may be leveraging. More than one non-awardee stakeholder mentioned withholding a portion of the grant until the very end of the grant period to provide an incentive for awardees to continue to submit their quarterly reports including financial statements. A different approach might be more beneficial to the entire M&E process. As mentioned above, informing the awardees at least before they submit their full business plans that should they win, they are agreeing to become part of a USAID and GDA research effort studying how to better foster diaspora investment in African development. After being told about the research and proof of concept aspect of ADM, several of the awardees responded very positively to being part of that process. We recommend that, as part of the restructuring of the ADM program into a results framework, the most appropriate overall performance indicators for the program be agreed upon and then appropriately applied to each of the awardees. D. Implementing Partner Performance Reporting Quarterly reports submitted by SEAF provided insight and evidence concerning the IP M&E tracking system. Through them it is possible to track the activities and progress of ADM II. There are some minor elements of the reports that should be noted, and they are included in the following list. Performance Reporting Elements for Improvement 23 It was noted in reviewing the information in the M&E tracking sheet that it did not correspond to the data being reported by SEAF in their quarterly reports. It is not clear how the extraction of the FS data that applies to the ADM funded activities is being conducted. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 44 1. There were a number of instances in which the information provided did not correspond to the period of the report. That made it more difficult to ascertain the extent to which specific targets had been attained within the reporting period. 2. Specific targets for the period were not clearly laid out in the reports, which made it difficult for someone not closely involved with the program to ascertain whether a grant was on track. 3. It was reported that some awardees did not submit their quarterly reports on a timely basis during the later stages of the program or failed to submit some of the required information. One item that was most often omitted was balance sheet information. This is an understandable omission for small startup businesses, because they often are more focused on their income statements than their balance sheets, and only ask their accountants to prepare the latter once or twice a year. It is important to remember that unless it is an existing business, the leader of a small enterprise has many burdens and few resources; something like preparing a balance sheet is not the most pressing item when getting a business up and running. The evaluators also noted that very little of the information from the balance sheet was being reported (total assets, current and long-term liabilities, and additional financing). USAID and its GDA partners may want to consider streamlining the balance sheet requirement and ask only for the information needed to effectively monitor awardee performance. 4. Of concern for an SME development program is the format of the Summary of Financial Performance section for each of the awardees and inconsistencies in the numbers being presented. Given the amount of financial information being provided by awardees, more accurate reporting should be possible. The sequence in the financial performance summary needs to be reordered as revenues, expenses, profit, and then other sources of income (divided into grants, owner investment and other sources). Total assets should be reconcilable with net income/loss, other financing (loan proceeds) and prior period total assets, or an explanation should be provided. Where there are apparent discrepancies, explanations should be placed directly below the table in the report. 5. Both awardees and IPs should report findings related to, and organized in alignment with, the ADM program’s principle objective indicators. In particular, information should be provided about jobs created and other measurable results or impacts. 6. Each quarterly report on IP target attainment should include a table clearly laying out the activity targets for the quarter and progress directly related to achieving each of the targets during the time period. This information is not readily discernible in the current quarterly reports. M&E Recommendations The following are the summary recommendations for improving the ADM M&E system. 1. Going forward, the GDA stakeholders should develop the ADM program research agenda and work plan together with GWU-CIBER. The documents should utilize data already collected from ADM I and II. The research agenda should be based on a prioritized set of ADM objectives. 2. Aligned with that overall ADM research agenda and work plan, the IP should redevelop the ADM implementation M&E system. It should be based on a clear statement of the program’s overall priority objectives with key performance indicators defined. 3. Within 45 days of signing the cooperative agreement, the IP should submit a performance M&E plan for approval by the COR and GDA partners. This plan needs to include layouts for all quarterly results reporting. 4. ADM III finalists should be clearly aware before they submit their full work plans that they are agreeing to become part of the ADM research process, and should understand and agree to provide all the required performance evaluation M&E data on a quarterly basis. 5. At the post-award orientation session, the IP, USAID, and the GDA representatives need to be present and review a manual of the ADM M&E system. To the extent possible, the system should African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 45 be automated and have the flexibility to accept common spreadsheet datasets and translate them automatically into the database format. 6. The IP should ensure that its quarterly report data is consistent across awardees and that any required explanations are included as notes that will resolve apparently contradictory financial and performance data. The IP should also ensure that the report clearly presents it progress against quarterly and annual performance targets. Other Elements of ADM Implementation A. ADM Steering Committee The ADM Steering Committee was to oversee the three ADM components. It was composed of WU, WUF, USAID, and a lead partner from the implementing Consortium—a total of five or six professionals. It was noted that no one from TEF was on the steering committee, perhaps because this foundation joined the GDA after ADM II started, although they were to be a key avenue to additional finance.24 The design called for frequent steering committee meetings, which apparently did occur through at least the early phases of ADM II. However, given the feedback from TEF about needing much more communication, ADM leaders may want to consider including new GDA partners on the steering committee, to keep communication channels active and to sustain mutual learning that occurs when intelligent and committed people from different types of organizations come together with a common purpose that benefits all partners. B. Past ADM Awardee Participation and ADM Communications In discussions with the evaluators, various ADM II stakeholders from USAID, the GDA, and ADM I and II awardees agreed on the importance of the active participation of past ADM awardees in all stages of the ADM program. Involvement of past ADM awardees was part of the ADM II design and several did participate in both roadshows and in the final competition and award event. Other attendees said that the participation of ADM I awardees was one of the most valuable elements in all the activities.25 It was also mentioned that USAID, Western Union, and other GDA and IPs have much to learn from the ADM I and II award recipients. However, learning from the awardees is only a part, although a very important one, of the overall educational experience that could be derived from ADM. A more concerted effort and possibly some funding (although not necessarily from USAID and Western Union) may be required to ensure that the larger learning process occurs. As was mentioned in the section about GWU continuing the research begun in the early stages of ADM I, and as noted as one of the stated objectives, the ADM program is very much about learning and identifying best practices in engaging and supporting the leveraging of diaspora human and other resources for investment in Africa. The evaluators believe that specific learning is a potentially significant contribution that the ADM program can make to accelerate development in Africa. Therefore, the 24 Even though TEF were located in Nigeria, their earlier and more active participation might have helped avoid the subsequent misunderstandings about ADM awardees and their stage of financing. TEF, in fact, did indicate that there was not enough communication among GDA partners and USAID. 25 Zelalem Dagne, Founder and CEO of Global Tracking; Robert Smith of EarthWise Ferries; Alden Zecha, CFA and Strategist of Sproxil, Inc.; Raymond Rugemalira, Founder and CEO of E&M Capital Tek Group; and Henry Adubor, Founder of Aceritas Ghana, Ltd., were invited. Several of the invitees participated in one or more of the roadshows and the final competition and workshop event. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 46 evaluation team recommends that the complete ADM learning agenda be made part of all related GDA, IP, and ADM awardees agreements. Many of the ADM I and II respondents mentioned their distaste for the ADM reporting requirements. When asked further, most of them said it served no useful purpose other than to respond to bureaucratic needs of the U.S. government. However, when reminded that an important purpose of ADM was demonstrating the value of involving the diaspora in business development in Africa and generating the data that would make the case for additional support for similar programs, most of the respondents relented and asked when they could see the results of those investigations, including the findings of this evaluation. What the evaluators observed was a willingness among awardees to contribute to the learning process that belied the challenge sometimes encountered in getting their required quarterly reports. More than one stakeholder recommended withholding at least a portion of awardees’ grant funding until the end of the grant period, and only giving it as a reward for not only achieving their milestones, but also for providing as much data and feedback as possible to enrich the learning process. However, the message that ADM is an experiment in which diaspora and local Africa businesses are asked to participate did not come through well if at all in the video and slide presentations used in events and trainings. Although the idea was mentioned, the question remains—was it emphasized enough to gain the level of commitment, cooperation, and energy necessary for the awardees to play their critical role in realizing the learning that can come from ADM, not just for ADM, but for other activities supporting diaspora involvement in African development, such as the diaspora courses at GWU and other universities. It is not clear the extent to which having former awardees provide on-going mentoring was contemplated or attempted. In at least one instance an ADM II awardee mentioned the value of the interactions they had with an ADM I awardee. There were other isolated cases of the latter and most of those were among people who knew each other before they were ADM awardees. The willingness was clearly there on part of some of the ADM I awardees, particularly those who were more successful and had more experience raising additional finance and maintaining extremely close relationships with their African counterparts. The consensus among respondents seemed to be that more communications among awardees in the same business sector is what would likely be most worthwhile, although 40 percent also felt that more general interaction among awardees would also have value. Ideas put forward for effectively increasing communications include:  Publishing a regular newsletter that would include individual business stories of overcoming obstacles, a questions and answers section that would highlight commons issues and concerns and how they are being addressed.  Providing periodic gatherings, either regional or Pan-African, held perhaps once or twice a year, for ADM awardees. These would be an opportunities to share experiences, network, and perhaps get some training.  Maintain an active ADM website that could include blogs, event notices, and invitations to past awardees to participate in upcoming ADM events. The evaluation respondents unanimously agreed on the importance of including information about each ADM awardee, such as contact information, a basic description of their products and services, and some material about their evolution. Individual awardees would be responsible for the content of their entries. Technical Assistance (TA) Once the competition and DD was complete, focus in the program shifted towards satisfying the TA needs of awardees. Although some work was done to line up TA resources before the final quarter of 2012, it was really in that quarter that three TA providers were engaged: the Wharton SBDC, CEED, and African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 47 Enactus (known until 2012 as Students for Free Enterprise).26 The understanding of the wide range of TA needs of ADM awardees and approach to meeting those needs has evolved over the course of the last two years of ADM II. Initially SEAF established a working relationship with Enactus, a U.S.-based student entrepreneurship and leadership organization with a broad footprint in Africa. One factor in their choice appears to be the limited funding available for TA in ADM. In addition, ACBF, a member of the ADM II GDA, had agreed to provide $100,000 funding to support ADM awardee TA. There were delays in that funding being issued, and thus far, ACBF has only provided $60,000 towards their commitment. Although this significantly delayed and reduced the implementation of the TA portion of ADM, it was only one of several weaknesses. The original concept was that Enactus would send students to ADM awardees to design scopes of work for the needed TA. It was not entirely clear whether the students would then deliver the TA, or if they would facilitate finding persons qualified to do so. The feedback from awardees that had Enactus students come to work with them was that the students did not know enough about business or the industry to do anything but learn from them. Although that learning is part of the Enactus objective, these relationships did not meet the ADM TA needs.27 With the list they had of TA requests from ADM II awardees, SEAF realized that they needed to think more in terms of professional TA not students training to become future leaders. Towards the end of ADM II they shifted to a system that seemed to bear better results—allowing awardees to identify their own TA sources and then vetting them before approving funding for the TA project. Also, due to funding limitations, TA applicants were asked to cost-share, which they did without exception. One common ADM II awardee complaint was being told that they would have up to $20,000 in TA available to them, but then being told they would not and being asked for proposals for a reduced amount. For at least two awardees, that change threatened their business plans because the businesses had depended upon receiving the full $20,000 in TA. In the future, ADM may want to keep in mind that selected businesses deserve to have qualified TA to help them through their current stages of development. Although there may be some TA subjects that university students could be helpful with—such as setting up and training staff on basic accounting systems, doing simple market research, or helping design and set up a website—there are many more that require extensive knowledge and experience. However, as can be seen in the table below, the kinds of TA needs students could provide any help with were in the minority amongst the ADM II awardees requests for TA. 26 As CEED was focused on providing TA to the two awardees in Tunisia, this evaluation does not cover their work. 27 Two businesses in Ghana reported that the students that were sent to assist them were more a burden than a help. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 48 TABLE 10: TA REQUESTS FROM ADM II AWARDEES The evaluation team understands that negotiations are underway with Deloitte to provide pro bono assistance from their local in-country offices. The evaluators feel that this is a wonderful addition to the ADM support tool chest. Given the range of TA needs as evidenced in the table above, the evaluators suggest that ADM continue supporting awardees as needed to find local resources that can serve their more specific technical needs. These resources definitely can help with accounting system set up, financial statement preparation, and costs analysis assistance. And perhaps they will have a few volunteers in their offices with enough other business experience to be able to effectively advise on issues such as market analysis and product/service pricing strategies, and provide other needed technical support. However, from some of the kinds of technical support that SEAF was asked to arrange for ADM II grantees, At least three awardees requested that ADM identify people who have been successful in business in Africa to provide TA. The evaluators feel that there are a couple of elements of good early stage business support missing in the ADM program. One is support to the diaspora investor in appreciating what is needed to successfully do business in Africa. This is support in navigating legal, customs, local banking, and other challenges that have to be effectively overcome, especially to get a startup business going and to succeed with a new product line that may need official registration and/or certification. Type of TA Number of Priority 1 Requests Number of Priority 2 Through 4 Requests Comments Market Study/Marketing Strategy/Branding 5 3 In two instances the market research and marketing had to do with U.S. markets. Agribusiness Total 5 1 100 percent were of a very technical nature that required specific skills and experience. Artificial Insemination 2 - Facilities Certification 1 - Ag production 2 - Equipment - 1 IT 2 1 ADM could link past IT ADM awardees and/or AWEP members as mentors Accounting/ Financial Management 1 - This could be perfect for a pro bono Deloitte advisor. Leadership in Energy and Environmental Design Specialist (LEEDS) Accreditation 1 - Awardee paid for a good portion of this because it is an internationally recognized accreditation that could be used anywhere in the world. Environmental Impact - 1 Social Impact - 1 African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 49 A second element that is missing—and this may have been what those three ADM awardees were requesting—is guidance from successful business people who would best serve as mentors, rather than as TA advisors. Linking newer grant recipients with the more successful past ADM awardees could support adding mentors to the ADM mix. In fact, the majority of awardees interviewed expressed strong interest in having more interactions with other ADM awardees, not just in their own African countries and industries, but among them as well. This idea could possibly further be served by the linking the AWEP chapter network with an ADM awardee network. Another possible source for mentors could be local AmCham offices and the SEAF CEEDS AWEP mentoring for exports and training programs. Startups versus Existing Businesses There is no question that the ADM program was intended to be much more than just another grants program: the design included seeding ideas opportunity of the application and selection process, access to TA and capacity building, access to finance and elements needed for awardees (and possibly the entire field of applicants) to expand and deepen their networks. But that may have made it an overly ambitious program given the resources in the original GDA and consortium. Compounding those challenges was the very short timeframe in the original design (grants terms were between 12 and 18 months).28 The challenges of the initial 12 to18 month timeframe forced several things to happen that had very mixed results. First, SEAF, USAID, and the GDA had to rush through the marketing and outreach phase and then require some awardees to squeeze milestones and key performance indicators into unrealistic timeframes. Those challenges were exacerbated because TA was arranged long-distance and without agreements fully worked out with the principle TA funder for each assignment. Although some of those factors can be eliminated in future GDA configurations and agreements, the evidence suggests that the timeframe may not be realistic for serious catalytic diaspora business development in Africa, and in particular for startup businesses. Two of five ADM awardees indicated that the milestones that they were required to set had to be shoehorned into the grant period, which most of them knew was not realistic. When that is combined with the limited amount of grant funding and low required match (as discussed above in the design section), it suggests that it may be helpful to question the merits of an emphasis on startups versus on existing businesses. An easy short-run solution could be to adjust the Points Rubric slightly to account for the increased risk of a starting up versus extending an existing business. Access to Finance It appears that all parties implementing ADM II took an active part in trying to address the limited grant funds issue of ADM II by working on creating access to additional finance through a number of different channels. GDA lead partner Western Union, together with USAID and SEAF, played a significant role in trying to create access to additional finance for ADM awardees (both ADM I and II) throughout 2012 and 2013. Western Union, together with the Bank of Industry of Nigeria (BOI) and with support from SEAF, organized two Live Banking Forums in Lagos, one in November 2012 and another in November 2013. Those two events were open to SMEs and 3 ADM awardees and 30 AWEP members attended.29 The table below shows the participation in each of those two forums. It is encouraging to note the increases in not only the number of SME presentations made, but also in the number of banks participating. 28 In the end the grant period and the consortium’s cooperative agreement were extended by 12 months. 29 Almost all of these ADM and AWEP attendees were from Nigeria. Part of the reason given is the expense of traveling to Nigeria from other countries without any assurance of getting the type of funding needed. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 50 TABLE 11: SME LIVE BANKING FORUM 2012 & 2013 SME Live Banking Forum 2012 & 2013 2013 2012 Total number of Banks 14 9 Total number of presentations 107 72 Total number of Women that presented 16 Total number of companies identified to follow up by bankers 82 30 Percent of companies identified for follow-up 77% 42% Other elements that appear to have added to the attractiveness and effectiveness of the Forum included the:  Introduction of BiD networks BiDX platform30  Series of workshops on SME  The SEAF SME screening template and pre-event webinars on presenting to banking panels  Panels with WU, BOI, the International Finance Corporation (IFC), Verod Capital Management, Wennovation Hub, faculty of the University of South Africa and Pan-Atlantic University’s EDC, W-Tech, and Diamond Bank. Clearly lessons were learned from the Forum in 2012 and applied in the one in 2013. SEAF took the opportunity to develop a pre-screening template and held several webinars to help participants prepare their presentations.31 Unfortunately the evaluation team was not able to locate any ADM or AWEP members who participated in either of the two Live Banking events that had actually been granted a loan by any of the banks in the Forum. The following bullets present feedback from some event participants in 2012 and 2013.  Some participants were told they would hear back from a bank and never did, although they tried to follow-up with the banks more than once. These participants felt that the bankers should have had the courtesy to let them know if they did not qualify.  Agribusinesses were told by a participating banker that the attending banks did not lend to agribusiness. These awardees wondered why they had been encouraged to come.  The pre-event support (webinars and pre-screening) was found useful for preparing but did not get them the result they desired.  The one participant who signed up on BiDX has not received any finance offers. Additional lessons were learned from the 2013 Forum experience. For example, some of the AWEP business women who participated did not fully appreciate the value of having professional interactions with their banks before asking for a loan. ADM and AWEP might consider developing a webinar and/or other materials on to educate the entrepreneurs having difficulties in finding access to finance about the realities of loan-making such as the need for connections with bankers and, if possible, acceptable collateral. In addition, ADM and AWEP should encourage participants to consider working with business mentors to learn about the loan process and to make key connections. However, it was unclear what if any 30 BiDX is a web-based business investment for development platform that posts information about Kenyan companies looking for investments and tries to help link them with investors. It is looking to expand to other countries in Africa. 31 The evaluators were not provided with specific information about either of these tools and so are not able to provide any feedback on them. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 51 follow up was being done with the Forum participants (bankers as well as pitchers) to learn more from the experience and identify ways to improve it. SEAF also worked throughout ADM II to identify and improve access to additional finance. The organization tried to establish working relationships with many groups and projects that could potentially provide access to finance. Access to additional finance was being accomplished by a few ADM awardees individually, but not by the majority. Between both ADM II and ADM I awardees, the ones who already had experience getting grants or investment funding were able to get additional grants; those who had an existing businesses that generated profits would add to the ADM investment from those retained earnings. The evaluators did not come across any ADM awardees taking loans from banks in Africa; the stated reason was that the cost was too high. That feedback makes sense for agribusinesses and manufacturers and in countries where annual inflation is above 10 percent, which it was in most of the countries visited in the evaluation. The prime interest rate for very best bank customers—those with acceptable collateral and fully proven business success— ranges from 16 percent to 20 percent in most ADM and AWEP SSA African countries. That is before loan origination and numerous other bank fees are added to loan costs; these bring the effective interest to 25 percent and above. For all but very high turnover or very high margin businesses, that cost is too expensive to use loan funds except for extremely short transactions. However, it often appears that the banks do not want to make short-term loans available because their costs for the loans outweigh their opportunities for profit. Therefore, SMEs do not have access to finance at a cost they can afford. The availability of USAID’S Development Credit Authority (DCA) and other loan guarantees to facilitate lending does not generally lower the loan costs enough to make bank loans affordable for the majority of ADM awardees and AWEP alumnae businesses.32 The need for access to additional finance was well recognized in ADM I, and efforts were underway during this first program iteration to establish relationships and open doors to additional finance for ADM awardee businesses. In ADM II, a new partner, TEF, was added to the GDA. TEF is an experienced development investment management organization that has investments in 10 countries across SSA. The executive director was one of the eight final judges participating in the June 2012 review of ADM II awardees. TEF organized an equity funding event that brought, among others, ten ADM I and II awardees to make pitches to twenty investors or investment funds.33 TEF feedback on what ADM needs to improve for ADM awardees to have better access to finance includes the following: 1. ADM awardees need to be operational businesses because it takes diaspora partners a long time to know the local context and be able to effectively work in it.34 2. No ADM awardee obtained any funding from the TEF equity event in 2012 because they had not been properly prepared. Based on where their businesses were in the investment cycle, the awardees did not meet with the appropriate participating investors. 3. ADM needs to target certain kinds of investors, such as angel investors, NGOs, and host-country national investment services. 32 The exceptions are subsidized interest rate lending programs. But we do not recommend those as they undermine the overall health of the local financial sector. 33 TEF claimed that when none of the ADM awardees were in the top five of the presenters, it hurt their reputation with the investors they had assembled. 34 This point was very eloquently reinforced in the Ethiopian Diaspora event held at GWU on August 3, 2014, in which one gentleman indicated that even with all of his success in business in the United States, it had taken him almost 10 years to really learn how to successfully navigate his business through the many challenges to doing business in Ethiopia. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 52 4. ADM awardees do not need grants; they need seed investments and the associated financial discipline. 5. Every three years ADM should host an equity event, but the program should pre-screen awardees that might attend and make sure they are ready to present to the selected audience. The invited awardees should not be left on their own with no guidance. Better communication is needed among GDA partners. With that said, it is evident from the financial information provided that some awardees are finding additional funding after ADM grants have been awarded. Asked about the degree to which winning the ADM competition influenced their ability to access additional funding, awardees’ responses were mixed, but leaning positively. That evidence of additional finance obtained after the ADM award seems to validate what was mentioned earlier – that winning the competition boosted the entrepreneur’s personal confidence and confidence in the business idea while also providing legitimacy to their business concept. ADM Results and Impacts The success or failure of ADM grantees reveals a lot about the efficacy of ADM as a program. What follows is a brief discussion of the results and impacts of the ADM grants on each grantee’s business. Did the award help their business? How did it help? Did they succeed and why? As noted above in the design and TA sections, ADM was intended to be much more than just a grant program. It was understood that it takes much more than finance to nurture good business ideas and concepts into working and successful businesses. For that reason, TEF was brought into the GDA and agreed to sponsor an equity investor event for ADM awardees. Also for that reason, SEAF tried to establish working relationships with Enactus and other TA groups that would provide the needed TA support. This section provides the available evidence about ADM results and impacts together with an analysis of that evidence, including observations made during site visits to awardee businesses and in conversations with diaspora partners and other ADM stakeholders. As was found in the final evaluation of ADM I, the projects funded in ADM II did encounter challenges and most have yet to show the full measure of their potential success. Table 12 summarizes the ADM II awardees challenges, progress to date, and future prospects, as well as the evaluator observations. Some of the challenges in ADM II were the same as those in ADM I, including lack of adequate timeframe for implementation, insufficient or unrealistic planning for complementary services, insufficient funding for the scale and detail of activities envisioned, a perhaps overly ambitious set of objectives, and frequent changes in personnel. This evaluation assesses businesses performance based on the metrics laid out in the cooperative agreement and the milestones in the grant agreements. However, again as in the ADM I evaluation, awardees’ business performance measures can only be judged in the context of the overall program. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 53 TABLE 12: MAIN CHALLENGES, ACHIEVEMENTS, AND FUTURE PROSPECTS OF ADM II AWARDEES Country Business Description Challenges Achievements Future Prospects Notes Ghana Gonja Meat Company (Existing) Meat processing and sales Working capital management and sales strategies in new market. Remote management as result of partner having to drop out Significant investment in physical infrastructure. Starting to expand sales in Kumasi market to government hospital and hotels and some retail customers. With the diaspora principle returning to Ghana in September, he now has some ideas about how to start increasing cash flow to generate the additional funding for W/C and additional equipment investments. More aggressive utilization of existing assets and marketing could improve their cash flow and over time generate the finance for additional purchases they want to make to further vertically integrate their business. Sardis Enterprises (Existing) Import/export agency specializing in agricultural goods and other products produced in the country of Ghana. Need to expand sales but don’t have funds to expand production because he can’t increase sales. Wasn’t prepared financially for worst-case scenario so now is searching for financing opportunities Grew farmer relationships: working with 54 farmer co￾ops compared to 25 two years ago. All farmers are certified organic. Currently the only organic pineapple producer exporting to the U.S. Plans to secure U.S. regional accounts with Whole Foods (Mid￾Atlantic, New England, etc.) but depends on additional finance. Situation with errant container shipment highlights challenge of small business entering new foreign market. Might need more experienced mentor to guide them through process. Viable Vision Industries (Existing) Commercial mushroom farming and processing High energy costs using diesel because grid unreliable. Labor costs- with continuing inflation – workers are asking for increases in wages. Reduced production costs with new sporing facility. IS containing labor costs by shift to piecework pay. Steadily increasing revenues generating financial resources for further expansion into new markets. Profitable enough to finance production and marketing expansion. Wants TA in local mushroom sporing tech so can produce indigenous varieties, which could become exotics in international markets. To purchase drying machine to be able to enter international markets including U.S. Apparently well-managed company with reasonable expectations and a viable future. Rate of growth could be accelerated with better access to appropriate finance and technology. Kenya African Boreholes Program, Ltd. Social enterprise expands access to clean water through Marketing – the overall security and stagnant economic environment in Reached more clients, expanded ability to provide cost efficient agro-support In process of spreading training center model to other countries (Ghana, Has established profitable business model, but have to continue reducing costs to African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 54 Country Business Description Challenges Achievements Future Prospects Notes (Existing) borehole drilling services, shallow well drilling services, earth dams, solar pumps, solar cookers, and consultancy and training services. Kenya is reducing demand. Competition forcing ABI to lower prices and reduce kit production costs. VAT imposed on OFK and generated publicity and marketing. Developing training centers accelerated growth of ag division. Reduced production costs by replacing costly import with locally developed input. Rwanda, Uganda, and Nigeria) Organic produce business is expected to grow in line with client demand for healthier food sources compete. Is competing with its OFK partner – Amiran. Expansion in other countries could be avenue for continue steady growth. Pork Delights Limited (Existing) Pig farm that sells pigs and piglets, provides artificial insemination services, offers pig rearing training for small farmers, design/build biogas energy plant & fertilizer pellet production Getting environmental compliance certification delayed receipt of grant Increasing productivity Lowering costs Successful strategies to improve food production, environment protection, & green energy production. Shifted to AI - increased pig/piglet productivity. Implemented more suitable feed program. Biogas plant will reduce energy costs. Continued to expand/ develop its network of young farmers. Company collects data through website about its clientele while fielding their questions. Data will serve future growth providing leadership, advice & services in pig farming enquiries. More cost effective production will support future growth Will have to work out revenue stream to pay for data analysis and advisory services. Infinicity PLC, Inc. (Startup) News streaming service Workable business model Could not meet milestones N/A N/A Liberia EcoPower Liberia (Existing) Authorized reseller of the GEK Gasifier, a power generating system that converts woody biomass into electricity, in Liberia and Guinea. Revenue system for energy sales Introduced “gasification” technology to Liberia. Currently generating energy at 1/5 cost of diesel generation for BWI Renewable Energy Center Raised ~$400,000 additional grant funding Installing Wi-Fi for live updates on biomass power generated. Continued success applying to green energy funds for grants for future projects will provide base to future expansion. Will need to work out distribution and usage revenue systems 5-year plan to become significant vertically integrated supplier of electricity in Liberia with mini-grid green technologies combining fuel production (pellets), power generation and distribution assets. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 55 Country Business Description Challenges Achievements Future Prospects Notes Nigeria Comprehen￾sive Design Services (Startup) Architectural design, engineering, and project management services for sustainable housing projects Corruption –determined to be corruption free business has slowed the pace of doing business Land-Government controls access to land: rules and regulations slowdown expansion of business Staff-took time to find and train staff with reliable work ethic Completed first sustainable, affordable building on time per ADM timeline, but says needs $15,000 more to complete Passive House Prototypes. With limited financial assistance from ADM, owner became accredited in green neighborhood development Expansion-built two pilot buildings for local government interested in sustainable housing and currently in talks with others Scaling up-Challenge of Almost a year after pilot phase was completed does not have any contracts. Would mentoring from more experienced housing construction company in Nigeria help? MedEnhanz Resources Ltd (Startup) Web-based & mobile point-of-care medical reference and diagnostic system. Standardized e￾medical recertification product. E-drug interaction checker. Need to get more local medical info (ex: tropical diseases) for e-Medicine POC diagnostic system. Certification of recertification app. Enough market to be profitable & generate finances for growth. Personnel – finding well￾qualified and ethical staff. Twice daily Skype with diaspora owner keeps all operating smoothly. This year they are ahead of where they had projected to be except for recertification approval. Have robust e￾Medicine app that is available through Telco, have web-based & mobile doctor recertification program in process of being approved by Nigerian medical authorities Have a way to go before they are viable, but appear to be making progress on all three services. They are realizing that consumers could be additional market for their POC e￾medicine app that could make it more viable. Need to find and hire: 1. Director to coordinate operations; 2. Sales Manager for institutional sales; and 3. Content person for recertification course content development. OTG Playa Entity LLC (Startup) “Final Mile” networking technology for accelerated internet access that bypasses the bandwidth limitation in broadband poor nations like Nigeria Getting ideal kiosk locations in universities and elsewhere. Need to increase content, including local content. Need “big player” partner to do massive franchising of kiosks and with financing to grow very rapidly to point Concept is proven – have passed 1000 hits/day target, which means app is building use, affordable Offline Cloud platform patent is pending. Users don’t have to go through iApps to get it; they get it directly from Telco – which enables OTG Playa to earn more revenue from it. Adding ads to service. Need to expand service across Lagos and into other states of Nigeria and beyond, but feel they need bigger player partner with deep pockets to work with on that. Lofty Inc. incubator has been key in supporting their development, providing planning, access to finance, key introductions, and mentoring. Lofty has small ownership share. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 56 Country Business Description Challenges Achievements Future Prospects Notes that Google notices them. Poultry Health Products (Existing) Farm produces eggs and poultry, breeds chickens, provides hatchery services, and training to smallholder farmers. Reliable power supply – can’t afford diesel generator. Production planning - Business has invested significant resources/owns significant assets but has been slow to increase production. Market analysis & marketing campaign - hatchery is struggling due to unreliable power supply, low demand / increased competition due to insecurity in North flooding southern markets. Poultry breeding business is doing well: successfully hatched parent stock eggs and is currently raising them to produce eggs and breed additional flocks. Currently, the business is struggling to cover costs, which is preventing growth and completion of expansion plans. Unless they can get the new hatchery up and running they will continue to remain stagnant. LT viability of poultry industry in Nigeria – industry is protected with ban on frozen chicken imports. Without cost￾effective off-grid power solutions, questionable viability. Marketing: Need to increase demand for hatchery services Mentor – owner brought in diaspora friend to help with administration – former nurse. Appears to need mentoring/TA in planning and product development as seems to be starting new investments with insufficient resources. RIOL Enterprises (Existing) Organic Poultry rearing and egg production. Start –up costs: needed to personally subsidize the business during the startup phase (Nigerian banks will not loan to agribusinesses Market: decreased demand from northern Nigeria due to violence led to an egg glut in the south, lowering the price of eggs Despite the market glut earlier in the year, the business is still growing at a steady and predictable rate and expects to be making profits by the end of the year when the first batch of layers is sold. Expansion: after selling the layers the profits will be plowed back into the business so a larger chicken house can be opened to allow for expanded egg production Apparently sensible use of assets and sensitive to changing market conditions. Overall environment for poultry production in Nigeria questionable until reliable, low costs source of power incorporated. TrafficAfric Limited (Startup) Provides crowd￾sourced information about local traffic, accidents, crime, and corruption through a cellphone application Revenue model: The app is free to users but it is not popular enough yet to attract advertisers. They may need to rethink App is up and running and user numbers are steadily increasing. Through competitor analysis, they know they are providing a unique service for which Need to find way to grow users quickly and cost-effectively (Facebook ads are effective, but very expensive). If they can They need to find a good mentor, who knows how to profitably introduce new apps into the Lagos and Nigerian market. That person would help them African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 57 Country Business Description Challenges Achievements Future Prospects Notes service. their fee model and to find ways to broadly and inexpensively promote their app because the people who need it the most and are willing to pay for it, don’t know about it.35 there is demand (especially the crime and corruption monitoring). But from our limited research with professional drivers and taxis, no one knows about the traffic reporting app. sell app to drivers (taxis and chauffeurs) on monthly fee basis, could possibly generate enough cash to pay for additional market research and pay for an effective marketing campaign. If they can increase awareness about their service and grow their users they will be off and running find clever ideas for raising demand for fee-based app sales. Because they depend upon constant inputs from drivers, they don’t feel they can charge app users. But they need to resurvey the right target market of taxis and other car service drivers, as well as trucking and delivery companies, that may be willing to pay good money for the service, Uganda ORIBAGS Innovations (U) Ltd. (Existing) Produces bags, stationary and jewelry using agricultural waste, waste paper and natural fibers for sale to local stores and businesses. Capacity: demand is higher than rate of production. Plan to move to new, larger location but are struggling to get approved for a loan to complete the transfer to the new facilities. Owner effectively leveraged government resources (Uganda Industrial Research Institute) as incubee. Currently low cost production has allowed business to get off the ground. Winning awards for recycling products, making positive cash flow. Gaining new customers with larger demand. Building production facility on farm & moving most staff to one location will increase production and allow more product diversification (other recycled paper products). If can replace expensive imports from China and Japan, it would greatly expand their share of profitable local market. Owner is a YALI graduate, AWEP member & well connected in local business community - networks with many potential buyers & technical support. Still too small to have easy access to additional finance. May need to link to internet women’s investment networks in U.S. and elsewhere. Zambia Mobile Payment Solutions Ltd. (Existing) Software company specialized in payment systems, electronic & mobile commerce – micro insurance Did not meet first milestone of workable app – so never receive second grant disbursement. They were not able to develop a workable app within grant period. N.A. Fortunately ADM put the correct first milestone. 35 Two drivers we told about the app said they would pay Naira10,000 a month for such an app, more than half of a day’s wages. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 58 Despite all the challenges, the ADM program continues to produce positive results as evidenced by the following. Several ADM II businesses have brought innovative products or services to local markets, created jobs, and are increasing local incomes. In addition, some of the ADM I awardees are showing the necessary dynamism that appears will lead to lasting results aligned with many of the ADM objectives. ADM II continued an element in ADM I awardees of transnational diaspora family and other business enterprises, as diaspora partners being significant stakeholders and decision makers in most of the businesses. In addition, of the ADM II businesses evaluators were able to visit, at least six are profitable36 already while an additional three or four have laid the foundation for future growth,37 two are struggling to solve either a sales or a similarly key conundrum,38 and two have dropped out due to insurmountable technical or marketing issues.39 That is a 60 percent and possibly more success rate, which is exceptional for funding investments innovative enterprises. The extent of ADM’s role those successes needs further assessment. But from the feedback from awardees, ADM did play an important role, mostly in building confidence and providing legitimacy to their entrepreneurial efforts. Even more encouraging were some of the ADM I businesses the team saw, several of which are clearly successful as a result of dynamic management and effective response and adaptation to market opportunities, and three others of which are overcoming significant barriers to their business growth and on the verge of becoming viable and impactful. The success of at least one of those was not foreseen in the ADM I evaluation.40 The following are some of the highlights of results from the responses from awardees. FIGURE 1: ADM EFFECT ON BUSINESS While none of the percentages are high, it is appropriate to look across the results and realize the most of the respondents’ and their businesses were positively affected by participating in ADM. Another factor in the successes has clearly been the diaspora investor. Examples of that include the legitimacy provided by the U.S. medical doctor to MedEnhance. 36 ABI, Gonja Meats, MedEnhance, OTGPlaya, Pork Delights, and Viable Visions. 37 Comprehensive Designs, Ecopower, Oribags, and RIOL Farms. 38 Poultry Health and TrafficAfric. 39 Infinicity and Mobile Solutions 40 Student Card, now InterPay, appears to have figured out how to adapt its product into one that both institutions and individuals will pay for. It was noted in the ADM I evaluation as an award that could have been avoided. Though it has not yet succeeded financially, the platform it has developed has the potential to do so. 0% 2% 4% 6% 8% 10% 12% 14% "How did ADM affect your business?" Responses by Country Liberia Kenya Nigeria Ghana Uganda African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 59 Overall Impacts of ADM II Although not overwhelming, the some of the results from ADM II supported activities are worth mentioning and provide evidence that the program is already having impacts beyond the awardees’ businesses. Total Revenues from supported activities were $1,184,546 as of June 30, 2014.41 Other Sources of Income totaled $1,146,242 from January 2013 through June 2014. These figures do not include the matches to the ADM grants. The sources of these funds are grants (ABI), retained earnings or additional cash injections of the owners (RIOL and Poultry Health).42 Nor do they include the matching funds for TA provided by at least two awardees. There were only two awardees that reported receiving loans. Full time jobs created were at least 43 directly in awardee businesses, mostly by Viable Visions (11), Oribags (9), ABI (8), MedEnhance (6) and TrafficAfric (6). In addition, at least 200 people have benefited from temporary jobs and trainings from CDS (65), Sardis (54 coops), ABI (50 farmers trained and exporting organic produce). Further, there are improved secondary jobs because of ADM businesses like Oribags that sources inputs from people collecting and processing agricultural and other waste for recycling. This number is definitely understated because not all awardees have reported full details on this indicator. It is much harder to summarize impacts being realized by ADM I companies. However, one highlight was total Revenues. Sproxil’s revenues in 2013 were over U.S. $1.8 million, and totaled in 2012 – 2013 >U.S. $3.6 million. ADM II Awardee Performance There were several measures of awardee performance that the evaluators were able to review: milestone completion, key performance indicator achievement, and portions of financial performance. In addition, the evaluators took those achievements and tried to relate them to the five major factors used in judging their original business plans. The purpose of that was to get some reflection on the effectiveness of the selection process. Milestone on-time completion: Of the 15 ADM II awardees, eight completed their milestones on time, three completed approximately 80 percent, one completed almost 50 percent and three were reported as not completing milestones. Key Performance Indicators achievement: Six companies achieved 100 percent, four companies achieved 75-80 percent and one company achieved about 50 percent. Four companies did not have any key performance indicator achievements. Financial performance: Although the majority of awardees did not have any financial performance key indicators, the evaluators felt that financial performance when combined with the field visits could provide insights on the future prospects as well as on additional TA and financing needs of awardee businesses. Unfortunately the financial reporting included in quarterly reports was in most cases limited to the ADM funded activities and did not present income, expenses, profits, liabilities, and assets data for the entire business. This more limited perspective on the businesses, while providing a more focused view 41 This does not include any revenues from the April-June 2014 quarter for either Ecopower. 42 No breakdown was provided for the sources of these funds. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 60 Poultry Health hatcheries located at site 4 (see box 1) and purchased with ADM II funds. of the financial flows directly related to ADM funded activities, made it impossible for the evaluators to fully examine the overall financial health of the African businesses. Annex H contains highlights of the reported income statement and balance sheet data for the period January 2013 through June 30, 2014 for the 15 companies. Some interesting observations can be made from that data. There are only five ADM II companies that did not receive any income from other sources: African Borehole Initiatives, Oribags Innovations Ltd., RIOL Enterprises, and Viable Visions Industries Ltd; all of them reported positive and generally growing revenues. One in which the owner put additional personal investment, Gonja Meats, showed steady growth in the last three quarters, and MedEnhanz Resources, Ltd., started generating revenues and a profit in the last quarter, after employees had invested some sweat equity in the business.43 Four companies received grants and/or did not report any Revenues: Sardis Enterprises ($50) reported zero revenues, Mobile Payment Solutions ($50) reported zero Revenues; MedEnhanz Resources Ltd., ($99) reported zero Revenues, Ecopower Liberia, ($445,077) reported zero revenues. In the case of Ecopower, it is an example of a management team that is familiar with and successful in generating financial resources through grants with government and civil society entities. What remains to be seen in this instance is whether they can work out the transition to a viable pay-for-power-usage model. Again, the financial data provided does not give the full picture of what has or has not been accomplished by and the current financial status of the 15 ADM II awardee businesses. Table 12 below provides a summary of the challenges, achievements, future prospects and additional notes for each of the awardees. Specific ADM II Awardee Results and Impacts The following descriptions provide more detail about the ADM II businesses. Poultry Health Products The mission of Poultry Health Products (Poultry Health) is to improve the quality of chicken and eggs sold in Nigeria while also making eggs and hatchery services more widely available and affordable for the Nigerian population. Chicken is widely consumed in Nigeria, but there are few regulations in place to ensure the quality and safety of the meat. Eggs would be an ideal, healthy alternative to chicken, but the egg supply is low, making them scarce and expensive, a “luxury good” as described by many interviewees. Poultry Health hopes to decrease the price of chicken and eggs through expanded local production while also raising Nigeria’s standards in the poultry sector. Poultry Health, which began producing chicken and eggs in 1988 on family-owned land, applied for a grant through ADM II in early 2012 to fund their continued expansion, specifically expanding their 43 The evaluators found three other companies in which employees were accepting lower than market wages while the company builds up to breakeven and beyond, a demonstration sound financial management. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 61 Site 2: partially constructed chicken houses POULTRY HEALTH LOCATIONS  Site 1: one house for egg production, one barn with equipment for producing feed and PVC chicken feed troughs (current not in use), office space (currently not in use)  Site 2: *Fully functioning chicken breeding facility, three partially constructed chicken houses  Site 3: Main hatchery and offices (built in 2008)  Site 4: *New hatchery compound (currently not in use) * Indicates item was funded by ADM II grant hatchery capacity and enabling them to breed chickens. The grant money allowed Poultry Health to purchased parent stock eggs to begin breeding chickens, construct a new compound to house the hatchery equipment and services, purchase and install the hatchery equipment, and contribute to the cost of raising the parent stock chicks. Weidemann visited the four Poultry Health locations in July 2014 (see box to the right for details). Of the two business streams funded by the ADM II grant, poultry breeding and expanded hatchery capacity, the poultry breeding business stream is doing well. The new breeding facility is up and running and has been at capacity since it began operations in early 2013. According to the ADM progress report for the third quarter of 2014, net income reflected a loss in the first two quarters of 2013 but showed profits by the second half of the year with losses steadily decreasing followed by profits steadily increasing; this is consistent with the timeline described to Weidemann.44 The parent stock eggs were being raised during the first half of 2013, thus not producing eggs or being sold, and the hatchery had only just opened in the first quarter of the year. Cash flow would necessarily be negative as money was spent to hatch and raise the parent stock eggs for breeding and egg production and would not be positive until the chickens began producing eggs and the hatchery grew its client base. There is steady demand for the chickens bred by Poultry Health, and the eggs they produce and their supplier of parent stock eggs is reliable. Also, as described above, there is a large market for chicken and eggs especially those that can be produced locally and sold for less than imported eggs. However, the hatchery business is struggling. The new hatchery that was built with the ADM II grant is currently not in use because electricity is unreliable and expensive. There are four generators in the hatchery compound, but the cost of running them is too high for the hatchery to be profitable. The hatchery closed in early 2014 after being operational for about a year. The financial issues are reflected in the summary of financial performance included in the ADM progress report for the second quarter of 2014. It shows decreased revenues and profits in the first quarter of the year and losses in the second quarter.45 The lack of revenue from the new hatchery facility is leading to losses for the company as a whole. With only one business stream running it has been difficult to cover costs. The current business plan is to sell the new hatchery compound and relocate the equipment to a new site with a more reliable and affordable power supply. While the poultry breeding business stream is doing well, it appears that Poultry Health has spread itself too thin, leaving multiple projects started but incomplete and not producing revenues. In addition to the 44 Quarterly Progress Report, African Diaspora Marketplace (ADM) II, Cooperative Agreement Number AID-OAA￾A-11-00030, Submitted to USAID, Period Ending June 30, 2014, Page 20. 45 Ibid, page 20. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 62 “You cannot rely on the grant alone; you have to have your own resources and business plan, and you have to be willing to work hard. These grants must go to viable businesses.” – Ishola Lawal, RIOL Farms owner and manager new hatchery, these projects include three chicken breeding and egg production houses that were recently started but cannot be completed due to lack of funding. In the case of Poultry Health, it appears that a business mentorship or business planning and strategy TA would have been helpful, particularly if the recommendations included a longer timeline for the planned expansion. Also, the short grant implementation period for ADM II may have pressured grant recipients to rush business plans into fruition that they otherwise would have taken longer to implement. RIOL Farms RIOL Farms started producing eggs and chickens for sale in 1984 but the business collapsed after an unsuccessful attempt to diversify into cassava processing and the local chicken market was flooded with cheap frozen imports. But with the government ban on imported frozen chicken, the ADM II grant allowed the business to expand back into poultry production. Specifically, the grant funded the purchase of day-old chicks, feed, and laying cages. In addition, the grant enabled the business to begin reusing their existing chicken houses, office space, and barn for feed production. While matching funds are a requirement for receiving an ADM grant, the owners of RIOL farms understood that a business cannot get off the ground without injection of resources well beyond the required combined U.S. $100,000. Therefore, large personal investments were built into the business plan to supplement startup funds and compensate for negative cash flow during the first two years of business. It is lucky that this was the case, because the site visit to the farm and interview with the owner revealed that the first grant payment was not received until April 2013, even though the financial performance summary provided in the second 2014 quarterly report reflects neither the personal investment made nor the delayed receipt of the first grant payment.46 The business plan also expected expansion at a steady, moderate pace funded by reinvested profits and personal investments. Profits are tracked on a daily basis with a simple but accurate accounting system: all money spent is accounted for with receipts and all expenditures and revenues are reconciled at the end of each day by the owner. He forecasts expenses for each week and adjusts the forecast according to weekly revenues and costs. Using this system, the farm is on track to have positive cash flow after the sale of their current batch of layers in December 2014. At that point, the owners will no longer need to subsidize the business with personal investments and will begin turning a profit. This plan appears to be on track as reflected in the 2014 second quarterly report financial summary report. In 2013, the reports for the first three quarters show no revenue because this was when the chicks were purchased and being raised. The final quarterly report for 2013 and the first two quarterly reports for 2014 show revenue because the chickens were producing eggs and being sold for meat.47 46 Ibid, page 22. 47 Ibid, page 22 RIOL Farms Poultry Operations Manager in farm office African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 63 One chicken house where chickens are being raised to the point of lay TrafficAfric developer and backend manager in the TrafficAfric offices In addition to a well-developed and realistic business plan, the success of RIOL Farms can be attributed to the active involvement of the diaspora member who received the grant, in this case a daughter of the farm owner. The Lawal family owns the business, with the father living in Nigeria and managing the day-to-day operations and his two children living in the United States. The family holds weekly conference calls to discuss the current status of the business and future plans. The father provides accurate and up-to-date information about the economic environment in Nigeria while his children contribute additional business discipline and management experience as well as links to U.S. network connections beneficial to the enterprise. Although there continue to be market challenges, RIOL Farms appears to be on track to succeed because it has the combination of strong technical knowledge, market acumen, and sound financial management and planning. The ADM II grant combined with their well-developed and realistic business plan has allowed RIOL Farms to employ 10 additional permanent employees who raise the chickens and collect eggs. TrafficAfric TrafficAfric was registered as an official business in 2009, originally offering monitoring and data collection services to private toll operators. However, this business was too capital intensive so the entrepreneurs closed down this business stream and began developing the CityNav cell phone app, which relies on crowd-sourced information to provide traffic updates, accident reports, crime reports, and corruption warnings to users. The ADM II grant funded the app startup, specifically the marketing and public relations needed to raise awareness about the new app. The product was advertised on the local radio station (with little success) and Facebook (with great success) but, after 2 years, the app has only 1,085 users.48 While the market for a real-time traffic app in Lagos is large, a city known for its pervasive cell phone use and crippling traffic, TrafficAfric is struggling to develop a reliable revenue stream for an app that is currently offered to users for free. The long-term goal is to generate revenue through advertisements, but their fledgling status and low usership does not make them an attractive advertising platform at the moment. As reflected in the Summary of Financial Performance 48 This was the number of users listed in the backend database during Weidemann’s visit on July 16, 2014. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 64 provided in their 2014 second quarter report, TrafficAfric has not generated any revenue for the duration of the grant implementation period and has been actively losing money since the fourth quarter of 2013. 49 When asked how the ADM grant changed the business, the evaluator was told “it resurrected a dying business.” As recommended by RIOL Farms, these grants need to be awarded to viable businesses, as opposed to using them to breathe life into dying businesses. The grant recipient lives in Maryland and reportedly does not visit Nigeria often. This information supports a noticeable trend among grantees: those who have active and involved diaspora members tend to be more successful than those whose diaspora members are out of touch with the daily operations of the business. Gonja Meats Winning the ADM competition encouraged this diaspora member to start his sanitary meat business in Ghana before rather than after he retired. The ADM grant enabled the business to buy and install refrigeration and other equipment for its retail outlet and provide some working capital. The business succeeded in getting a major contract to supply meat to the local government hospital. That success, together with supplying a few local hotels, has started to steadily grow their business in the last three quarters. The diaspora grant recipient achieved this by managing remotely from the United States. However, he recognized the need and will be going to Ghana for six months in September 2014, when he will accelerate the expansion of his business. The government runs an abattoir near the center of Kumasi, and as the city grows sanitation issues are developing related to this facility that affect public safety. If that abattoir is displaced, it could be a bonanza for Gonja Meats. Even if the government abattoir is not displaced, the growth of greater Kumasi will provide an expanding market for better quality meats. As Gonja Meats builds up its working capital from profitable sales, it should be increasingly able to take advantage of that increasing demand. Gonja Meats has the facilities in place to be able to provide 50 times the quantity that they are currently selling through their abattoir and retail outlet. Power is one of the cost challenges for which Gonja will have to devise a new and better solution. They have a large generator providing backup power whenever the grid is down, which happens fairly frequently. However, it is very expensive to run. Gonja Meats has enough land around its abattoir to establish an animal auction as an additional business and source of income with minimal startup expenditures, and the diaspora owner plans to initiate this business in the near future. The auction business would augment or replace the one in the middle of the town. Overall, management has shown an ability to find a market for its products (the government hospital, several hotels, and individuals). Although its revenue growth is constrained by limited access to working capital, this should not be a long-term problem because operations are profitable and the company will be able to build up working capital as it increases its turnover.50 MedEnhance MedEnhance is a good example of a startup business that recognized niches in the medical applications market, lined up the necessary resources to build and pilot applications, obtained government 49 Ibid, page 24. 50 Gonja Meats has figured out how to get reimbursed by the slow-paying government hospital—stop delivering meat. This solution will increase available cash and provide increasing resources to purchase more cows and other animals to slaughter, prepare, and sell. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 65 endorsements of the same, and used sound financial management to contain costs until revenues started flowing. The business started with the concept of a web-based mobile point-of-care (POC) medical reference and diagnostic system, tapping into medical databases from the United States. They later realized that there was no standardized e-medical recertification product in Nigeria, although there is significant demand. They built and piloted that product and are obtaining Ministry of Health in Nigeria certification before launching this much-needed tool for doctors to maintain their medical certification. Encountering the challenges of rolling out the e-diagnostic and medical reference and e-drug interaction checker products revealed that another source of demand might be the key to the business’s ultimate success—the consumer, of whom there are many more than there are doctors in Nigeria. As can be seen in the latest quarter financial results, the first product by itself is beginning to generate significant revenues ($99,000 in 3 months since its launch with the bulk coming in during the final month). Challenges to maintain this growth trend include finding inexpensive sources of tropical medicine diagnostic and reference materials to better meet the medical needs in the Nigerian market. However, the impending approval of the e-doctor recertification courses should provide an additional revenue stream and enable the business to hire the technical staff needed to ensure the necessary expansion of e￾diagnostic and doctor recertification course content, thereby ensuring their continued revenue growth. The involvement of their two diaspora investors has been key to their success, because one provided the medical legitimacy and the other offered business and financial management acumen. Proof of skill financial management was their limiting their current expenses to their available cash. OTGPlaya OTGPlaya is an example of a business that is introducing a new technology into a niche market (universities) in order to prove the concept before a much more significant rollout to broader markets. OTGPlaya has developed a technology based on an ecosystem of content providers connected via a local area network that allows for faster streaming of content than that offered by standard Internet service providers in Nigeria. The company originally sought to leverage available content from the fastest￾growing and third largest movie industry in the world, Nollywood, with a network of kiosks with high￾speed movie download capabilities across strategic urban areas in Nigeria. This network also resolves last-mile reliability issues. However, they have added education content needed to give them better access to strategic kiosk locations in universities. They are signing up students across a number of universities to be access points for content distribution. Additionally 10 entertainment kiosks (Storm Kiosks) will be designated to churches and other mass events such as concerts. The business model is for 1500 students to push 500 new education and 10,000 entertainment contents per month via the kiosks to target up to 500,000 new users. After fabrication and construction of two flagship kiosks, along with curated Ibaka TV content they had reached the critical benchmark of 1,000 users in a month by the time of the evaluation. They have four patents, but have not generated sufficient revenue streams to finance needed growth. They are looking for an experienced investor to bring them to the commercially viable level that they think would enable them to expand exponentially. ADM I Results and Impacts The following are some results and impacts that the evaluation team was able to gather from visits to a few of the ADM I grantees’ businesses. InterPay (formerly Student Card) Student Card’s original business plan that was proposed during the ADM I competition provided monitoring and data collection services to the Government of Ghana, specifically tracking enrollment in the school feeding program and the demographics of those enrolled. However, as a startup, working with the government was unsustainable because payments were frequently delayed, which left the company African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 66 cash poor. The owner decided to abandon this business plan and merged with a local IT company in Ghana (named CiS) and created InterPay, an online transaction fee-processing portal for educational institutions to accept and process fees and other payments for the school feeding program through their commercial banks. This new business plan has been very successful. Their clients, local banks, are very satisfied and other banks are regularly approaching them to request their services. They have developed strong relationships with the local banking community as well as with government agencies that regularly provide market information. In addition, InterPay has made institutions more efficient; schools are not behind on receivables and can forecast revenues and costs more accurately, which creates a better environment for students. With the current business doing well and expanding, they plan to diversify into third-party processing (TPP) services. Currently, if anyone uses an ATM in Ghana, the information is routed out of the country, often to the United States, to be verified by a foreign TPP service. InterPay plans to create the first local, Ghanaian TPP service that would keep Ghanaians’ information in the country. After offering TPP services in Ghana, the business hopes to expand to other countries within West Africa. Sproxil Sproxil has reached critical mass and is scaling up, both within Nigeria and by bringing its services to other countries. But the road has not been totally without its challenges. First, several competitors have entered the pharmaceuticals labeling market, some legitimate ones and others not so legitimate. While that forced some pricing changes, Sproxil still has contracts with the companies that produce up to 80 percent of the pharmaceuticals in Nigeria. When management took into consideration that 60 percent of all imports to Nigeria are counterfeit goods, they realized that they needed to help other local manufacturers fight the onslaught of counterfeit goods pouring into the country. So they have started labeling products ranging from mattresses to auto spare parts and other manufactured goods. In 2013, their revenues were just over U.S. $1.8 million, a slight decline from their total revenues in 2012. The rapidly increasing competition in Nigeria is one of the reasons that they tried to enter the Kenyan market and were challenged by such basic barriers as opening a local bank account, which is made more difficult because a company has to have a place of business, meaning at least a signed lease, before they can open a bank account. But to be able to sign a lease, the company has to have a bank account. It took them several months to overcome that barrier to extending their business to that country, but it is underway now. They have also entered the India markets. And they are preparing to enter other markets in Africa as well. As their services help protect local manufacturers, they are playing an import roles in the development of African manufacturing. They report that they have reached between one and two percent of the Nigerian population and now say that the number of transactions is greater than the total population of countries such as Ireland. The benefits to client companies are not small—most clients report 50 percent increases in sales volumes since using Sproxil’s service—suggesting that Sproxil provides good value for service. AACE After scrapping their original plan to produce baby food and preserved fruits and vegetable products in Nigeria because they realized they could not do it profitably, AACE is carving out a market in dried chilies, herbs, and spices. And to stay true to their original objectives of providing safe and better nutrition products for babies and young children and their families, they are also packaging dried cassava, soy, and other protein- and vitamin-supplemented cereals and drink additives. AACE’s impacts go beyond creating jobs for 12 people, because they source their products from 10 farmers unions with a total of 660 farmers. They have to use the unions to help them trace the source of the products all the way African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 67 to the individual farmer so they can meet the NAFTA import food standards. They state that ADM was critical to their success because winning t built their confidence. Although they are still encountering many challenges doing business in Nigeria (including two in-house robberies), with careful financial management, good market analysis and well-coordinated execution, they are progressing bit by bit. Although supplying only shops and 50 supermarkets in the greater Lagos area, they expect to be able to extend their marketing. They have had to shift away from supply in the north because of the conflicts there. They already have over $500,000 in land and buildings and are adding $300,000 in equipment. Sales are trending up each year, but profits are still a challenge. To address this, they are focusing on retail rather than bulk sales. They are accessing finance from an angel investment facility funded by the KfW development bank. Global Tracking (formerly Global Telecommunications) The diaspora owner of Global Tracking was planning to begin the business after he retired, but the ADM award encouraged him to start sooner. It has taken some persistence and a willingness to negotiate positively with a government that is not a strong supporter of private enterprise. However, by deftly finding how to help the Ethiopian government meet its own needs for reducing transport costs, Global has been able to make slow but steady headway in introducing sophisticated vehicle tracking and performance monitoring. They are reducing gas consumption by 20 percent, a savings that pays for the equipment in a relatively short time. Global Tracking only has 650 units installed at present, but has orders for 1,300 more units pending approval of client access to the necessary foreign exchange from the GOE with which to buy the equipment. Installation of just half of those units will catapult them to over $3.5 million in annual sales and into profitable operations. Because there were no industry standards for their service or equipment, the GOE was very wary of what Global Tracking was doing. The business has had to work closely and patiently with the government to help them develop the standards required to conduct their business activities. In the process, the GOE discussed a problem they had with delayed petroleum shipments coming from Djibouti. Global is close to completing a pilot of a new tanker tracking system so that the Ethiopian government can get a more reliable and timely supply of oil to support the burgeoning national growth. Although the business has not yet created many jobs in Ethiopia, the filling of pending orders and others in the pipeline will put Global in a position to create up to 200 jobs in Ethiopia within the next year or two. ADM I Progress Summary Table 13 summarizes the progress made by the ADM-I companies that the evaluators were able to contact. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 68 TABLE 13: MAIN CHALLENGES AND ACHIEVEMENTS TO DATE OF ADM I AWARDEES Country Business Description Challenges Achievements Future Prospects Notes Ethiopia Global Tracking Ltd. Installs and maintains GPS tracking devices for commercial trucks and rail tankers that also monitor driver behavior in real time, quality controls the information received from devices and maintains the devices themselves. Lack of existing industry standards & GOE’s information control concerns causing certification delays & negatively affected their operating model Lack of FX in country for trade finance GOE’s lack of support for private sector growth has slowed their ability to expand their customer base. Demand driven product development - movement into rail tanker tracking, a new product, is response to GOE request once they saw value of road vehicle tracking. They have equipment orders in the FX financing pipeline. Once installed this will provide a stable revenue stream. Once pilot testing of tanker tracking system is proven, GOE will also greatly expand their demand for that line of business. Trade finance is a constraint, but may need to resist temptation to become clients’ financer. Persistence with positive negotiating with GOE will likely ensure a viable business, but not within an ADM timeframe. They knew that when milestone targets & performance indicators were being set, but IP squeezed them into the ADM timeframe. InterPay (formerly Student Card) Online transaction fee￾processing portal for educational institutions to accept and process fees and other payments through their commercial banks. Original business plan (tracking system that the GOG used to monitor the use of the School Feeding Program) failed because the government did not pay bills on time, negative cash flow was unsustainable Identified more viable option working with the private sector (banks), partnered with local IT company (CiS), now work with numerous banks and more are requesting their services. Planning to be the first third-party payment processor (TPP) in Ghana. Currently, all payment information is processed outside of Ghana. Both government and banks are looking for this service locally. Current business is not generating enough profit to fund the TPP idea. Looking for other funders. Ghana AACE Foods Food processing company that preserves dried herbs and spices and process other milled gain products Original business plan (produce preserved fruit and vegetable products) failed because of production costs and market conditions Finding and keeping ethical and hardworking staff. Management identified more viable product lines, now producing an expanding range of herbs and spices for national market. Short term: expanding quality raw material sourcing and markets beyond Lagos. Long term: export regionally in Africa and to the U.S. and/or Europe Key to success: strong combination of financial management, market analysis and ability to produce to required food production standards. Biggest challenge is finding and keeping ethical and hardworking staff due to corrupt environment. Sproxil Limited Anti-counterfeiting and brand protection company Competition: illegal and legal is beginning to make Expansion: other legitimate businesses/brands in Nigeria Clientele are 80% of pharmaceuticals in Nigeria Keys to success: African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 69 Country Business Description Challenges Achievements Future Prospects Notes that developed a product coding system that allows consumers to verify the authenticity of products while preventing the brand from being tarnished by fake products. inroads into their market dominating health product business Expanding into Kenya: difficult to open a bank account and register as a business need protection, therefore they are systematically expanding their product lines into other business sectors Only external funding – 25 X over five years. which continues to give them upper hand in market Expanding into other business sectors makes business more viable Profitable enough to use retained earnings for future investments reinforces their success. Sophisticated management Robust technical products combined with hiring individuals with extensive sales experience in industries they are protecting. Nigeria EarthWise Ferries Environmentally-friendly passenger ferry services between Entebbe and the main island in Lake Victoria Economical ferry: First one not economical enough to operate on long route. Currently, it is only covering operating costs, not the capital investment. Market: As only boat to the island, still only 60% of capacity being utilized. Are covering operating costs of first ferry. Deigned bigger, faster, more efficient ferry and all parts are in Uganda being assembled. Raised additional 7 figure amount of investment from angel investors. Currently building a new, larger ferry: twice as fast, more cost efficient, operational within 2-3 months Keys to survival: diaspora’s knowledge and experience in angel investor fundraising. $100k ADM grant was less than 2.5% of the total investment needed to get company to viable takeoff. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 70 ADM Conclusions and Recommendations On the whole, ADM II is accomplishing its overall objectives, even though in a number of instances there have been significant delays in the actual issuance of and implementation of grant agreements according to established timelines. The following are some of the reasons that we can say that ADM and its GDA are accomplishing the overall objectives of ADM and summary recommendations for continuing and expanding upon those successes. 1. A significant portion (67 percent) of the ADM II awardees and (at least 43 percent) of the ADM I awardees are making good progress towards proving the concepts and business ideas put forth in their concept papers and business plans; in some cases, they have already achieved profitable operations. In addition, at least 80 percent of the ADM II diaspora awardees are actively involved in the African businesses, with several spending much more time in Africa than they had originally planned. Therefore, the ADM concept and design seem to have validity. 2. As 55 percent of ADM II respondent awardees mentioned challenges related to working capital or cash flow, if it is not already in the business plan template, a simple 24-month cash flow projection template should replace the Sources and Uses of Funds sheet. 3. Recommendations for minor adjustments to the design focus on reviewing the timeframe and adjusting the weights in the Points Award Rubric and Rubric General Guide should be considered as presented above and in Annex D. Likewise, based on the successful experience to date, a DD guide or manual should be developed to ensure that a standard process can be executed in all instances. 4. The ADM research agenda and work plan should be formalized and the implementation M&E system be developed in alignment with and supporting that plan. Further, the research agenda and an M&E manual with links to at least semi-automated reporting tools should be presented to awardees in the post-award orientation session. In addition, mention of participation in the ADM research agenda and the specifics of reporting requirements should be included in the grant agreements. 5. Although there were hurdles to overcome, some TA perceived as very useful has been provided to at least 40 percent of ADM II awardees, with additional services lined up to be delivered in this and the next quarter. However, because SEAF does not have a significant footprint in Africa, ADM needs to leverage TA and possibly additional finance resources. The first resources to be leveraged should be USAID programs in the countries where ADM awardees’ businesses are located; this might be followed by leveraging resources from other donors’ programs. This is what Ecopower is doing in Liberia, and as their financial data shows, the process is contributing to their forward movement. 6. Although there were at least three formal attempts to connect ADM awardees to other sources of finance, this is an area that needs significant further work to better align the efforts and linkages to the types and sources of finance that are appropriate to the developmental stages of the ADM I and II awardees’ businesses. When trying to assist ADM awardees to look for additional sources of finance it is important to keep in mind the type of business and the enterprise’s stage in the business development cycle. For example, startups have different needs as they move from proving the product and market concept to commercialization and then to scaling up operations. Expensive short and medium term loans may not work in many instances, even if the business person has enough collateral to get such a loan. Angel investors are most appropriate for some businesses, while others, such as the alternative energy company EcoPower, and the green housing company in Nigeria can more easily find grant or other government or donor program African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 71 resources. However, the amount of additional financing going into ADM businesses suggests that awardees in existing businesses may be in a better position to leverage ADM grant funds with cash generated from their other business activities. One recommendation heard more than once from past and present awardees is that awards should not be made to startup businesses in which either the diaspora or local management member are solely dependent on the income from that business to meet their immediate financial needs. Because of the cost of business loans in Africa, the recommendation made above about looking in some non-traditional directions for additional finance for ADM awardees might provide better access sooner for these innovative enterprises. In addition, given that the originators of the ADM concept realized that significant additional soft funding would be needed in many innovative awardee businesses, it is recommended that GDA partners, USAID, and IPs encourage awardees to look more systematically beyond the traditional business investment and growth sources of funding (such as loans, guarantee funds, and investment funds) and check the following and similar options.51 a. USAID and other donor programs in awardee countries or in the region that have grant facilities. This would require the DOS Africa Bureau to provide mapping information of USAID mission projects to awardees via the IP. i. USAID Grand Challenge and other innovation fund competitions (such as the Partnership for Innovation in Agribusiness). Here again, this would require the Africa Bureau to provide this information to awardees via the IP. ii. Incubators with access to funding such as Precise Consultants in Ethiopia and Lofty, Inc., in the United States That work with African diaspora businesses. iii. Buyer networks that can provide partial advance payments for large orders (such as for garments and food products) iv. Angel fund networks. The IP could map some resources focused in sectors and countries in which ADM awardees are operating to find potential matches. v. Crowd-sourced funding. These would have to be screened by knowledgeable individuals in the field to select sources appropriate to the ADM awardee context before recommendations are made to awardees. In any case in which ADM awardees (or AWEP alumnae or members) are being introduced to other sources of finance, there should be a screening process combined with appropriate coaching to ensure that the applicants are well prepared and the ADM program and AWEP are well represented to those sources of finance. This will build stronger relationships between ADM and AWEP and the sources of additional finance. Incorporating the experiences with the other sources of finance in the research agenda will help awardees avoid a recurrence of the TEF equity event. 7. Additional links between AWEP and ADM, either for mentoring women awardees, or for identifying mutually beneficial business opportunities, can only strengthen both programs. Encouraging women ADM awardees to join the AWEP chapter in their countries and encouraging AWEP members to link with diaspora ADM participants should further the objectives of both programs for expanding businesses and trade. 51 This recommendation could also be applied on a selective basis to AWEP alumnae. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 72 8. Supporting and encouraging more communications among ADM awardees through web chats, and possibly annual awards ceremonies, would reinforce needed experience-sharing and networking. AWEP’s experience has shown that such networking, along with inter-chapter contacts, can increase intra-African trade and often can lead as well to increased imports from and exports to the United States. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 73 AWEP ASSESSMENT The main purpose of the AWEP assessment was to assess the effectiveness of the program in meeting it stated goals with respect to chapter business development and technical capacity building and to identity areas for further development of the program in order to achieve its stated goals. One product of the assessment was to recommend how to reform and institutionalize the chapters, making them more effective, robust, sustainable and efficient as women’s business centers and/or incubators. Another was to identify areas for potential expansion and collaboration between the ADM and AWEP networks and potential collaboration between AWEP and groups such as other like-minded donors, private sponsors, and local and international women’s organizations. Given the restricted time for the evaluation and limited data access, the main focus of the assessment has been contributing to informing DOS about a viable model for individual AWEP chapter development as well as strengthening the entire network across Africa. The evaluation team was able to visit AWEP chapters in Ghana, Nigeria, Ethiopia, and Uganda, the last of which does not yet have a formal chapter. That made it possible to see chapters in various stages of development. DOS requested that several other chapters be interviewed remotely, but contacts have not responded yet to set interview times. Additional challenges in data collection resulted in much less information being available than had been anticipated at the initiation of the assessment. However, despite these issues, and to the extent feasible given the limited exposure to the entire AWEP network and the many related activities of State and its partners, the following assessment is offered. AWEP Program Assessment The AWEP program evolved out of an initial idea to support already successful women entrepreneurs in Africa through professional exchange and participation in the Annual AGOA Forum and technical capacity building. Since 2010, when the first group of 35 women came to the United States and took part in the DOS IVLP, participated in the AGOA Forum, and went back to their respective countries to share their experiences and knowledge gained with other women entrepreneurs, AWEP has been a trade and investment program. As such its purpose has been to promote business growth, increase trade (both regionally and to U.S. markets through AGOA), create better business environments, and empower African women entrepreneurs to become voices of change in their communities. One point made by Secretary Clinton was that AWEP was to target not the micro or smaller enterprises, for whom many donor and other resources have been directed, but to target a level or two above that—the larger small and medium sized women-led enterprises, which have enjoyed some success but now find themselves in the ‘missing middle’ group of businesses, too big to get micro and small business finance, but not big enough yet to access finance from commercial banks and other financial service providers. Another description of this group is “already export ready, or nearly export ready.”52 To achieve that very ambitious set of goals, AWEP has evolved and continues to evolve seven primary components including links to capacity building through the ADM IP. The five components of AWEP in addition to the two already mentioned are: (3) moving forward with the Women as the Missing Middle of Africa’s Supply Chain project, (4) establishing a women’s entrepreneurship center training program, (5) providing chapter business development training and community service initiatives, (6) advancing the YALI program, and (7) offering technical capacity building through ADM. The women’s 52 This is a point that will come up again in the discussion about identifying the target businesses for AWEP membership and appropriate ways to attract them to be an active part of an AWEP chapter. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 74 entrepreneurship center is currently under development with support from the AWEP-WECREATE project in collaboration with Startup Cup, Caterpillar, Inc., and the Caterpillar Foundation. The evaluation team did not have enough exposure to many of these initiatives to be able to provide a well-informed assessment of them. This was because some of them were in the process of being implemented during the assessment period and others have not yet started. However, observations will be made about as many of them as possible based mainly on what was seen in the AWEP chapters in the four countries visited in July 2014, a review of written documentation, and interviews with a few of the people involved.53 AWEP Program Evolution From its origin with the first group of African women entrepreneurs in the IVLP program in 2010, AWEP chapters have been established in 20 or 22 countries, depending on the definition of “established.” Their growth was entirely organic, led initially by some of those 35 original IVLP participants. On their own with very little support from DOS, they formed chapters, led by Zambia and followed by a few others. That first AWEP IVLP group was the initial core for AWEP chapter development, supplemented each year by some of the additional AWEP IVLP participants. Figure 2 below provides a representation of the array of activities that DOS has or is in the process of developing to support AWEP. 53 The data collection for the assessment was being done in the month leading up to and through the African Leaders Summit in Washington, D.C.in early August 2014, which made it challenging to have interviews with people involved in AWEP. The AWEP Network Missing Middle Supply Chain Project •Expert Business Consulting •Working Capital •Company to Supplier Matchmaking International Leadership Visitors Program (IVLP) •Export Promotion •Science, Technology, Engineering & Mathmateics (STEM) •184 alumnae Women's Entrepreneur ship Centers •Kenya •Zambia •Ghana (TBD) 22 Women's Business Associations •Train-the-Trainer Programs •Community Service Projects •Public outreach •Virtual Trainings & Webinars AWEP-AGOA Forum & Trade Show YALI Internship Program African Diaspora Marketplace (ADM III) African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 75 As can be seen in this figure, many of the concerns and issues for AWEP entrepreneurs are addressed in one way or another, and to one degree or another. Although DOS is to be commended for trying to provide and support all these activities, a question arises about whether the necessary resources are in place to ensure that all the components happen as planned. The program reaches into many different offices in DOS DC, and involves many public-private partnerships and interactions with between 20 and 40 Embassies across Africa. Based on the evaluators’ experience, a program this complex appears to merit the exclusive commitment of one or more staff members. Without this dedicated support, it is possible that the many different efforts to channel resources via the AWEP networks and create more viable chapters and linkages could be wasted. SEAF AWEP Program Implementation SEAF signed an amendment to its ADM Cooperative Agreement in September 2013 that added the AWEP component to SEAF’s ADM implementation activities. This component was to include six major tasks with many subtasks none of which was insignificant. Completing the overall program within the one year allotted seems to have been ambitious. The following is a review of major tasks and what appears to have been accomplished.54 Objective 1: Diagnostic surveys sent to AWEP members to augment existing data and create a centralized AWEP database There were two diagnostics called for in the final SEAF-USAID Cooperative Agreement amendment. One was of the AWEP IVLP alumnae and the other was a broader one of all of the members of existing AWEP chapters. Of the 154 AWEP Alumnae sent diagnostic surveys in February 2014, only 67 had submitted their responses by the end of June 2014. A review of the first diagnostic sent out found it to be very long (60 questions with multiple parts to some of the questions). In places it was unnecessarily complicated (including the undifferentiated long list of primary products or services in question 18 and section D of question 21which asks about “trouble building relationship in the target investment country”). In other places, the survey omitted important options, showing a lack of understanding of the context in which the alumnae are working. (For example, question 32 asks about obstacles but does not include “finding qualified staff”). In addition, the survey asked respondents to provide a significant amount of information and materials and to convert all financial figures into U.S. dollars. It is clear that a significant investment of time would be required to complete the diagnostic. The email that was sent asking the AWEP alumnae to complete the survey was not included in the documents for review; therefore, it is not known if sufficient incentive was provided to the alumnae for them to fill it out. It appears from documentation reviewed that the survey was intended to help the program select persons for the pilot export program reviewed below. If that was the case, then perhaps the unexpectedly low response rate is actually feedback on the extent to which AWEP alumnae are qualified and interested in being part of such a program. If there was no specific incentive for them to complete the survey, except perhaps a vague comment about providing opportunities to access financing, then the non-respondents might fall into one of the following categories: (1) not interested, (2) not qualified for what members were told the survey results would be used, (3) not willing to share personal and business information that might be shared with unknown people and institutions, or (4) not understanding what was being asked well enough to be able to respond. It is important to remember that AWEP alumnae have private, not public, companies and for a variety of legitimate reasons may not want provide the detailed business information asked for in the diagnostic survey. Also, the alumnae might not be able to answer many of the 54 Very little evidence was provided to the evaluators besides quarterly reports and verbal presentations about activities and their results. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 76 questions given that the average AWEP business is far from being export-ready. On the other hand, the evaluators agree that a valuable database would be available if all the data requested was provided. This database would enable users to view enterprise distributions and characteristics by size and sector and determine whether AWEP chapters were effectively reaching the intended population of ‘missing middle’ women entrepreneurs.55 Another survey, the Chapter Demographics and Training Request Form, was sent out to AWEP chapters to provide information and guidance in capacity building efforts. (These efforts are addressed as part of the third objective below.) The survey requested summary information about chapter membership and primary sectors represented in the membership and asked questions about patronage, offices, dues, and media presence. Twenty of the 30 questions were about training capacity and interest. The evaluators were told that all but four AWEP chapters had responded to the questionnaire by May 19, 2014. This information was given to the evaluators to help respond to their questions about chapter demographics.56 In an attempt to get a better response rate on the diagnostic survey, SEAF sent a shorter version of the survey to the alumnae, possibly in response to comments about the length of the original. The new version had only 39 questions, but still contained the same challenges in the original one already mentioned above. Still just over half (78 or 154) of the alumnae had filled in those surveys at the time of the evaluation. In summary, for the reasons mentioned, it is not surprising that so few surveys were filled out. Our suggestion is to ask the AWEP chapters for membership lists that have some basic information about each of their members. When they are presenting members with incomplete information in their lists, they chapter should be asked to obtain the information. A further thought about how to incrementally be able to build a useful database is to incorporate in the membership requirements the updating of member business data every time they pay their membership fees, which are normally assessed annually or every six months. Most of the chapters visited maintain membership information in a spreadsheet, and it should be possible to obtain those sheets and transfer the data to a single database. The Nigeria AWEP chapter provided an example of the member list that is in Annex M. The predominance of micro and small enterprise members is obvious, even though there is much data missing on the size of enterprises. Objective 2. Capacity building for AWEP alumnae and chapters in the areas of access to finance and exporting In the fourth quarter of 2013, SEAF helped organize and deliver workshops in connection with the Second Annual SME Live Banking Forum in Lagos, Nigeria. This was a joint effort sponsored by Western Union and the Bank of Industry of Nigeria. SEAF apparently helped spread the word across Africa about this event, which pre-registered 150 SMEs. From the quarterly reports it seems that SEAF is delivering on this objective. For example, in the fourth quarter of 2014, SEAF supported the AWEP Cote d’Ivoire chapter, which hosted the Female Day & Launch of the AWEP Francophone Chapter. At this event, AWEP members exhibited their products, listened to a lecture about regional integration, and attended workshops about taking advantage of Economic Community of West African States (ECOWAS) opportunities and accessing additional financing. However, no data on results were available and the time of the evaluation. 55 AWEP IVLP alumnae all agreed—that was why they had been chosen for the program and what they had been told by Secretary Clinton when she talked about who AWEP was intended to serve. 56 The rest of the survey results were not provided. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 77 Objective 3. Access to Capital: Pursuing appropriate financing facilities for AWEP members In the fourth quarter of 2013, SEAF was leveraging relationships with CEED and exploring topics for AWEP training sessions. The sessions actually started on March 27, 2014, when AWEP Cote d’Ivoire hosted the Female Day & Launch of the AWEP Francophone Chapter. As noted above, training was provided about regional integration, ECOWAS opportunities, and accessing finance. 57 SEAF and CEED reported that virtual training sessions were being developed on minimum viable products (MVPs), entrepreneurial finance, effective and repeat sales, partnership and international expansion, and capital growth. However, these were not ready for review. From June 25 to June 27, 2014, AWEP conducted training for trainers at the African Women’s Entrepreneurship Program offices in South Africa. The event was designed for AWEP alumnae and members nominated as trainers by their chapter leaders. This workshop was intended to provide participants with the tools and resources they would need to share their skill sets with other African female entrepreneurs, to participate in the United States-Africa Leaders Summit, and to raise funds through the submission of at least three proposals for capacity building grants on behalf of their chapters over the next year. In the second quarter of 2014, SEAF hosted two of five capacity virtual webinars; these covered MVP and entrepreneurial finance and were offered in both English and French. Objective 4. To provide a pilot group of high-potential alumnae with hands-on interventions to help grow their businesses and to develop scalable models that can be expanded to the entire AWEP alumnae population It appears that this objective differentiates between the AWEP alumnae population and the broader AWEP membership population, which is appropriate. A different program would be required to mentor the average AWEP member to the high-potential level, and it would involve scaling up to thousands, not a couple of hundred, mentoring relationships. A review of the profiles of the alumnae selected for this pilot showed that they are some of the most experienced and successful entrepreneurs in the AWEP network. One of the evaluators met three of these alumnae and is aware of their qualifications. It is commendable that the companies’ business plans, marketing materials, financials, and CVs were compiled in a database, because the information will then be available as a baseline against which results of the AWEP and ADM programs where aligned, (such as increasing incomes and creating jobs) can be measured. It was not possible to ascertain from the work plan exactly when any milestones of this objective were to be completed, as there was only one entry that covered the entire activity. As part of the AWEP Export Promotion Pilot Program launched in the second quarter of 2014, AWEP members are to receive support with individual connections to potential buyers, trade partners, distributors, and logistic providers and be given the assistance necessary to participate in major industry events. This project is in progress. 57 Post-event participant feedback to assess these training sessions was not available during the assessment. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 78 Objective 5. Develop scalable and sustainable intervention models to provide targeted support to current and future AWEP alumnae In the first quarter of 2014, SEAF submitted a list of most experienced entrepreneurs in the AWEP network who were identified in the diagnostic survey information and who reported revenues over U.S. $100,000. In the second quarter of the year, 15 entrepreneurs were chosen with no more than two companies per country including Francophone and Anglophone companies. The companies’ business plans, marketing materials, financials, and CVs were compiled in a database that will be used to pair the pilot group with a mentor from the SEAF partner at CEED who will help the group improve their capacity to export to their target markets. From a review of the profiles of the persons selected, it appears that an appropriate group was chosen, although time did not permit review of the four applicants who were not selected. Additional activities under the SEAF-USAID Cooperative Agreement Modification included the following: 1. Marketing and Promotion of AWEP. The evaluators are aware of several SEAF activities, including the addition of AWEP information on the ADM website, and the preparation for and delivery of activities related to the AWEP IVLP program in July and August 2014 including the workshop at the Ronald Reagan Building on access to finance and marketing to corporations. An evaluator attended the session on marketing to corporations and observed active interest and participation on the part of the almost 40 AWEP participants. The combination of panelists brought practical and insightful reflection to the topics discussed. In addition, SEAF supported the set-up and logistics for the AWEP showcase on August 6, 2014, which was a side event of the African Leaders Summit. 2. Design of Financing Mechanism. Although it was in the SEAF work plan, no information was provided on the status of this task, and so it has not been assessed. Chapter Development Assessment What the assessment team found in the four countries was four different versions of an AWEP chapter. That gave the team and the chapters the opportunity to begin to assess what actually is an AWEP chapter and ask questions like, “What are the primary purposes of an AWEP chapter?” and “What criteria should exist for being an AWEP member?” For both of those questions the chapter leadership found important to get some guidance from DOS. Similarly, AWEP coordinators and other Embassy staff stated that the answers to these sorts of questions about AWEP chapters would help them to have a clearer idea about what their responsibilities were in relation to AWEP. To help answer those two questions, the evaluators first looked at the current composition of each chapter. Answering the questions starts with examining the chapters’ purpose, goals, structure, and activities. To understand some of the differences, the evaluators had to understand the size of women-led enterprises that are currently members of each AWEP chapter. We know that SEAF and DOS unsuccessfully tried to do this earlier this year. After finding out a little more about the types and sizes of businesses that comprise the bulk of the four AEP chapter memberships we visited, the evaluators came to understand better why so few surveys were completed. It comes back to the types of entrepreneurs attracted to the chapters. One of the most graphic examples that we were able to collect was of the Nigeria AWEP chapter. The chapter is formally organized as a not-for-profit group, with a memorandum of understanding and articles of incorporation but no bylaws or standard operating procedures. The chapter originally was organized to reach into six regions, but it has since been reorganized into subchapters in all the states of Nigeria. It is a good example of an AWEP chapter that has made it a point of recruiting members from all across the African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 79 country. There are 306 active, dues-paying members. (Annual dues are N10,000 or about U.S. $60.) In addition, between 500 and 600 women are in the “interested” category, having attended one or more AWEP Nigeria events. Of the member businesses, 40 percent have annual sales of greater than N5 million (about U.S. $30,675); 30 percent have annual sales between N1,000,000 and N5,000,000 (about U.S. $6,150 to U.S. $30,675); and 30 percent have annual sales of less than U.S. $6,150. Unfortunately the chapter did not have an accurate breakdown of that top 40 percent, to see how many small- and medium￾size enterprises are members. Of the AWEP IVLP participants, about 75 percent are active in the AWEP chapter. Participation is facilitated by the organizational structure of AWEP Nigeria. It originally had 406 regional groups, but after the regional leaders realized this was too burdensome on them, the regions were reorganized into state subchapters. It was not clear whether each or any of those subchapters are registered legal entities. Their main functions are to recruit new members, collect annual dues, organize state-level events, and promote participation in national AWEP events. The chapter leadership was quite proud of the fact that they had members in every state of Nigeria. The Nigeria chapter was assisted in getting organized by the Zambia chapter, which provided sample articles of incorporation, registration forms, and other materials. The evaluators noted that DOS DC had also provided some basic guidance, although most meeting participants were not aware of that. In their feedback, chapter leaders mentioned that they felt great responsibility to their sister- entrepreneurs, but were not sure how to meet their many needs. All of the leaders reported having to contribute significant sums of personal money (U.S. $8,000 to U.S. $10,000 each) for AWEP Nigeria to pull off the events they sponsor or to help pay rent or buy equipment for the modest AWEP office in Abuja. The leaders lamented that they were not sure that they could or wanted to continue making such monetary contributions in addition to the time, other efforts, and in-kind contributions that they have been making. All of that feedback and the comments from other AWEP chapters are indicative of the challenges they encounter in setting up and running their chapters. The following is an attempt to provide some evidence about why this is the case and then to suggest ways to alleviate some of the stress the chapter leaders are experiencing. The following are the IFC definitions of micro, small and medium enterprise. As can be seen in Table 14, they use number of employees, total assets, and total annual sales, and they state that if a business meets two of the three criteria, then it falls into that business category. This applies wherever in the world the enterprise is operating. Global Financial Markets categorizes its clients’ sub-borrowers according to the following definitions: (1) Microenterprise if loan < U.S. $10,000 at origination (2) Small Business if loan < U.S. $100,000 at origination (3) Medium Business if loan 100% match is generally not enough to get an innovative business far enough to be able to attract other funding. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 105 Program Phase ADM I ADM II Comments TA OPIC’s EDN allocated funds but no requests were made TA provided as part of the grant (non-matching). ACBF joined GDA. Needs assessment done as part of the evaluation process and TA provided in country. TA only available to ADM II awardees. Started with implementing partner identifying TA resources; changed to allowing awardees to ID local TA resources with DD done by IP. Need to improve TA process, starting with ensuring what TA ADM III can provide and to whom (ADM I & II awardees as well as ADM III?) Deletion of ACBF and addition of Deloitte helps certain areas, but does not cover technical and other key TA areas. Suggest adding mentoring system that uses successful African businessperson mentors. Continue allowing awardees to ID local TA resources with IP DD/concurrence and reimbursement. Due Diligence None to cursory Perform a due diligence of operating businesses, as well as a background check of project sponsors. This will only be done at the “finalist” stage. See recommended adjustments to Due Diligence process in Annex E. Need more emphasis on market analysis DD. Need more streamlined process. Monitoring & Evaluation M&E requirements were not included in original grant agreements – caused some upset with grantees. Follow-up monitoring visits M&E requirements were included in Grant agreements. Idea was to establish a portal where awardees could input project performance information, including financial statements, online. On a pre￾determined basis, the awardee’s accountant or auditor will verify the report. Portal idea is fine as long as it is very simple to use and compatible with FS software being used. Annual follow up visits should be by qualified SME consultants so that rapid, accurate TA needs assessments and plan updates can be completed. Judging Panel 180 judges used. Local and sector experts – were a challenge to identify and coordinate. Recruit additional practitioners in the private equity/banking sector to be panelists. OPIC offered the services of selected members of their Enterprise Development Network. Need to avoid alterations in judging schedule to ensure judge availability. Need to ensure have judges with current knowledge of local business environment in specific countries. What is the plan for that for ADM III? OPIC judges enabled reduced number of judges with requisite business plan assessment skills. How will more open sectors and not pre-determined countries be effectively dealt with as far as having appropriate judges with both technical and country specific expertise? Mission Involvement Limited Missions could have a limited role in the due diligence process, as well as assisting the awardee to access other local Missions are challenged to provide this support. Suggest a better option may be to recruit technical/business experts from IPs in country. Also, post award, Africa Bureau can inform ADM African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 106 Program Phase ADM I ADM II Comments resources, such as any DCA and other banking, financial or business relationships. awardees via ADM website, or via email from USAID/AFR of existing in-country programs with website and contact information for each and any requirements or protocols for TA and/or financial support as link could be mutually beneficial. Finance None – although it was implied that links would be provided. Develop a strong linkage between the program and existing DCAs. By involving PEs throughout the process, some may wish to evaluate awardees (as well as finalists) for equity consideration as the business plan is implemented Care needs to be taken in what links to finance are presented, as most banks (even with DCA guarantees) come with caveats that would exclude >90% of ADM Awardees until well after the end of the grant term. Links to angel investor networks and other SME innovation grant programs need to be established early in the next round. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 104 Annex C: Due Diligence Program Guide and Checklist Review Below is a line-by-line review of the Due Diligence (DD) Guide and Checklist. This was the only template provided to the evaluation team during the evaluation. In fact, interactions subsequent to the evaluation revealed that this template was just the first of three steps of the DD process. This first step was fairly generic, applying equally to all awardees. It was sent and responded to by email. The second step was a set of questions generated by Sam Arthur after a thorough review of each awardee’s Business Plan and the awardee’s responses to the questions in the first DD template. The reported purpose of this second step was to ensure that the awardee had adequate evidence for all that was submitted in his/her business plan. That questionnaire was also sent and responded to by email. Copies of documents, like certifications of business registration in the country of implementation, were collected at this stage. And finally the third step was of a site visit to physically confirm the authenticity of documentation presented as well as verify that assets and facilities presented in the business plan were there and were whose it was claimed they belonged to. There was a site visit template, but it likewise lacked any guide for its use. As can be seen in the Comments column, this list has some but not all of the elements of an adequate due diligence process of ADM awardees, their businesses and business plans and a few additions and clarifications would strengthen it. (See added content in blue) There were no additional instructions provided to the persons actually doing the DD. It is, therefore, recommended that a guide be prepared, including concerning the additions recommended in the table below, since there were at least four persons involved in the DD process in ADM II and likely will be a similar number in subsequent rounds of the competition. Without a guide for the template, it will be difficult to ensure different parties do the same level of DD. Due Diligence Program Guide And Checklist ADM II Due Diligence Awardee Company : ____________ U.S. Contact: ___________________ Awardee Tel/Email: ______________In Country Tel/Email:____________ In-country Contact: _____ African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 105 Areas Response Reference (Evaluator Comments) Evaluator use only Key Performance Indicators 1. Provide critical benchmarks, indicators and ratios showing how these business goals and objectives will be achieved 2. Identify critical areas where you will be measuring??? (what? Performance?) Ok, except #2 appears to be incomplete. Key Company Principals 1. Provide detail historic resume of their past work experience in the last 10 years 2. Discuss how their experience will contribute to the achievement of business goals 3. Do they have an in country mentor? If not, would they consider looking for one? 4. Will sponsoring member consider joining local AmCham chapter? OK. Since #1 & 2 are presented in the full business plan, what is the procedure to be followed in doing this portion of the DD? Are any reference checks or resume verification done to confirm accuracy of resume entries? Market Analysis 1. Provide basis for determining your market –size, potential demand and segment, sources of any independent research 2. Competitors – explain how you will identify and address competitors 3. What specific benchmarks do you intend to use for monitoring your marketing efforts – share, target etc. 4. Pricing – How did you develop your pricing strategy? Most of these are part of full business plan (FBP). What is the actual being done to complete the DD on the information provided in the FBP? Products and Services 1. Does your product or service need to be patented, certified, approved or licensed? Explain 1a. If you have already acquired, please provide proof? 2. How do you intend to go about that? 3. What is the estimate time to acquire that? 4. What environmental impact will your product have on the country? 5. Will you need an environmental impact assessment for that approval? 6. What is your contingency in case you are unable to obtain approval? Are not most of these (#1, 2, 3, 4, 5, 6 included in the FBP? IS this a check of what they included in their business plan? Where is the guidance to the person doing the DD on what to look for and how? Organization and Management 1. Provide commitment letter from key principals and employees as to their level of commitment to the business 2. Have you obtained an operating license yet? 2a. If not, please provide copy of completed application? 3. How long do you anticipate to obtain a license 3a. Would you require special license? If so, what What about DD on management? Verification of resume entries? Verification of management results in other businesses? Reference checks? African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 106 special license will be required? What is the procedure for obtaining that license? On-site verification – See attached ????? Environmental and Compliance Monitoring See attached ????? Briefly describe how you what you can put in place to prevent or detect improper environmental practices occurring in your business and how you will correct this in a timely manner:  Policies and procedures, standards, guidelines  Periodic reviews and self-assessment of activities and financial transactions Financial Management 1. Please provide detail cash flow on the sources and application of funds for the next one year, including the disbursement (partial) of the $50,000 2. Provide evidence that the other sources exist 3. Please provide items listed in attachment 4. What is your in-kind matching contribution? Please explain and provide evidence Using Sources and Uses of Funds is a very inaccurate way of assessing actual monthly cash flow and generally underestimates the maximum amount of funds that will be needed during the period being reported upon. Since a major portion of small business failure is due to insufficient cash, it is important to have a real cash flow worked out in advance and not one derived from changes in balance sheets. Corporate governance and social responsibility 1. Are you sure none of your activities will conflict or compromise competitiveness of sponsoring partner? 2. Will your product/service compete with funding partners? 3. What oversight has been worked out a The two items listed under this section do not cover corporate governance or social responsibility; the second one is a compliance issue, while the first would appear to be an internal matter between the sponsoring partner and the local business. See suggested additions. Technical Assistance 1. Do you anticipate a need for technical assistance? 2. If so, which area(s)- administration, accounting, operational, technical, research & oversight, financial management, training Application of grant funds Please specify the various components of your business activities i.e.  Purchases of inventory  Marketing  Payroll  Administration – permits/licenses  Leases  Acquisition of F/A Might want to lay this list out in a more logical sequence: Marketing/Sales materials/Branding Raw Materials purchases Payroll Equipment purchases Legal – permits, licenses, registration Leases Product/Service development Other Fixed Asset purchases African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 107 Annex D: ADM II Awardee Feedback, lessons learned and recommendations Country Company Name Description Application/Selection Process Implementation Challenges Recommendations Ghana Gonja Meat Company Meat processing and wholesale and retail sales Learning Experience: No real challenges in this as they knew the business well from doing it in the U.S. for many years. Realities of market and ability to sell to paying customers at viable price. With strategic plan we had, we ran out of cash for working capital while still needing additional capital investments (refrigerated truck, money for buying cattle before existing large customer wouldn’t pay). Owner to spend more time in Ghana building up the business but also will need to generate revenues with the assets that he already has (land, facilities, equipment, staff, etc.) Sardis Enterprises Import/ export agency specializing in agricultural goods and other products produced in the country of Ghana. Applied for ADM I but was not selected. However, participating in the application and selection processes was a learning experience that helped them win an ADM II grant. Also, application process helped them to perfect their “elevator pitch.” Getting their pineapples certified as organic was a big challenge because there was no agency in Ghana licensed to do that certification and they had to bring in someone from outside of Ghana to do so. Second, getting the logistics worked out for reliable transport of their pineapples to the U.S. has proven harder than they expected.60 Still learning the ropes of shipping to the United States. Perhaps one of the AWEP members or the Commercial Officer at the U.S. Embassy or a Ghanaian exporters association or an AmCham member can help with that? Viable Vision Industries Commercial mushroom farming and processing Had existing business but of a type that was hard to “show” at the show and presentation. Only had three poor photos to show, versus the digital enterprises that had much more glossy presentations Getting appropriate TA to be able to expand their product line to include local mushrooms. What ADM II provided was totally inadequate. Requests that grantee be allowed to identify local TA and get it approved to be paid for by ADM as better approach to implementation. Kenya African Boreholes Program, Ltd. Social entrepreneurial organization that expands access to clean water through borehole drilling services, Had done business plans and concept papers before but the ADM application process encouraged applicants to consult more sources to ensure answers were thorough. “The process was Getting environmental compliance certification. Had to do it anyway in Kenya, Just delayed U.S. getting grant funds. 60 Their first shipment of certified pineapples went to the wrong port in the U.S. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 108 Country Company Name Description Application/Selection Process Implementation Challenges Recommendations shallow well drilling services, earth dams, solar pumps, solar cookers, and consultancy and training services. like following a roadmap of essential considerations.” Pork Delights Limited Pig farm that sells pigs, provides artificial insemination services and offers pig rearing trainings for smallholder farmers. No recommendations Infinicity PLC, Inc. N/A N/A N/A N/A Liberia EcoPower Liberia Authorized reseller of the GEK Gasifier, a power generating system that converts woody biomass into electricity, in Liberia and Guinea. Include equity/debt financing program beyond ADM grant Nigeria Comprehensi ve Design Services Architectural design, engineering, and project management services for sustainable Taught applicant about:  Accounting  Writing an effective business plan  Organizing thoughts and ideas to turn a dream into a concrete plan When ADM is being planned, there should a plan for a forum or conference (in DC, same as they had when they awarded the grants) in the middle of the grant period where the grantees can come together and do peer learning and African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 109 Country Company Name Description Application/Selection Process Implementation Challenges Recommendations housing projects Helped her to pull together architecture, affordable housing and renewable energy peer reviews and mentorship, hold each other hands. “I felt abandoned by the ADM program. I had to give quarterly reports but beyond that no one was interested in what I was doing” More support for successful grantees MedEnhanz Resources Ltd Web-based & mobile POC Medical reference and diagnostic system, and standardized e￾medical recertification product. E-drug interaction checker Would have been helpful to have business plan template 2- 3 months before due. Meeting with SEAF on milestones was productive. Delay of one year to get grant money was too long. We knew limit of amount of grant and worked with it. However, we were promised TA, very generally, but company ADM hired to deliver TA in Nigeria didn’t. ADM needs to be clearer on what TA they can provide. Also hope for USAID connections to Ministry of Health didn’t happen either. Realize need to be working FT in business for it to work. Even without giving money were demanding quarterly reports. Money was too small for quarterly reporting requirements for so long. OTG Playa Entity LLC “Final Mile” networking technology for accelerated internet access that bypasses the bandwidth limitation in broadband poor nations like Nigeria Get real on TA – no patchwork approach to it. Need mentors in same industry Set up three layers of ADM talents – give certain amount first. Then arrange for an equal amount match. Need to restructure to maintain relationship – or get out of the way. Three - mentors in same industry– award one of them each year. Align grantees with mentors and local businesses or provide guidance services in-country. ADM needs to increase portfolio of GDA partners. Poultry Health Products Poultry farm that produces eggs and poultry, breeds chickens, provides hatchery The ADM business plan was very demanding; used own template but used ADM template as a checklist. Helped to restructure things: Told they would get $20,000 technical assistance, and had factored that into their proposed budget and plan. Needed someone with poultry expertise to get things started. Since the technical assistance fell through they Allow more time before final showcase to arrange lower cost logistics African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 110 Country Company Name Description Application/Selection Process Implementation Challenges Recommendations services, and training to smallholder farmers. “what can we do now?” Broke their original plan down into phases. Very odd that the process was so disjointed and rushed (only two weeks between notification of shortlisting and presentations in DC, tickets to DC were so expensive because of quick turnaround) Didn’t take into account peoples’ lives outside of ADM. had to cover that need on their own. RIOL Enterprises Poultry rearing and egg production. Check-in on businesses, follow-up so the grant isn’t wasted and the business doesn’t collapse, increase grant amount. If a business isn’t doing well, visit and see how it can be helped (tech skills, introduce to banks?) Also, need to make sure you are giving the grant to people who understand this will not be a silver bullet for their business. They will have to contribute a significant amount of their own time and resources. “Need to make sure these grants to go VIABLE business ideas" TrafficAfric Limited Provides crowd￾sourced information about local traffic, accidents, crime, and corruption through a cell phone application service. The process led the applicant to make modifications to his business plan that expanded the scope of services beyond the original plan (to report traffic). The result was a new platform that allows users to report anything/share information relevant to city commute and safety. Where applicable, ADM program could leverage the networks of their partners (USAID, Western Union etc.) and possibly opening up these networks to Awardees with the intent of identifying low hanging fruits certain businesses may be able to take advantage of in their target market. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 111 Country Company Name Description Application/Selection Process Implementation Challenges Recommendations Uganda ORIBAGS Innovations (U) Ltd. Produces bags, stationary and jewelry using agricultural waste, waste paper and natural fibers for sale to local stores and businesses. Startups: difficult for startups to succeed/benefit from ADM because they don't have funds from sales to attend networking events which is a huge benefit of participating in ADM (connection to networks and industry events). Coaching: Coaching during the application process would be helpful, or even someone to email with questions. ADM Alumni: encourage grantees to communicate with each other, guide each other, rely on each other for help. Perhaps organize an ADM alumni reunion. Zambia Mobile Payment Solutions Ltd. N/A Do not reply to Survey Selection Process: Most of the companies with the exception of one that replicated the model used in the USA found that although the ADM template was complicated to fill it in, it help them put together important information non-existent in their business and therefore helped them organize basic essential organizational data of their companies; it also helped them create and modify their business plans. Implementation Challenges: All awardees expressed lack of TA specific to their businesses. TA was not supplied on time or adequately until late in the program. Recommendations: Five of the Companies interviewed strongly recommend the need of mentors and ADM Alumni to guide them and advise them; 2 Companies felt that the ADM program only wanted the quarterly reports and after submitting it they felt abandoned; 2 Companies feel that ADM has to increase the amount of the grants it gives. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 112 Annex E: ADM I Awardee Program Feedback and Recommendations Country Business Application/Selection Process Feedback Implementation Challenges Recommendations Ethiopia AMAD Metal Manufacturing N/A N/A N/A Global Tracking Ltd. Freight tracking Already knew business planning and this business from working in it for many years. Templates were very generic, so had to fit what we had into them. No industry standards and a government that is less than supportive of private sector. Lack of FX for private business to be able to buy equipment needed for U.S. to do the tracking. Reporting does not help U.S.. We do it anyway, And don’t see why except for administrative reasons USAID needs all that data. More support of ongoing communications amongst ADM awardees Ghana InterPay (formerly Student Card) Online transaction fee-processing portal Learning experience: Given the grantee’s academic and practical background in business, the application process was not particularly educational Feedback: Needed clearer expectations about the process up front. Overall, application process was easy and went smoothly Public Sector: Original business plan approved by ADM involved working with the government which proved to be too difficult/ burdensome; government didn’t pay on time. Expectations: Because expectations were not clearly laid out the reporting requirements were a burdensome surprise. Give grant without matching requirement but look critically at the business idea and plan. Match grantees with industry experts, someone who works for a similar, successful company, to learn from mistakes that have already been made, help grantee to avoid stumbling blocks Nigeria AACE Foods Food processing Too much time between award and first disbursement – 5 months. TA would be helpful More follow-up after grants are awarded (Perhaps a newsletter that keeps grantees in touch) Sproxil Limited Anti-counterfeiting and brand protection At presentation event at AED – physical location okay facility okay except security a bit weird. Check-in process not smooth – did not have all the info ready to receive entrants and directing them to booth. Insufficient planning – also limited place to Legalese of getting grant agreements finalized was a bear!! January won – no money received before August – contracting terms took forever to finalize – also compliance issues such as proving that not an environmental polluter – cost $thousands to get – USAID had to get waiver for some awardees Suggestion – Put that and any other requirements in the rules up front – tell them upfront what they will have to and be able to certify. Not asking for certification at time of application, but let applicants know they will need to have it before they can sign agreement or get their first tranche. More streamlining – more upfront African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 113 Country Business Application/Selection Process Feedback Implementation Challenges Recommendations put baggage – had come directly from airport. Program paid for two nights – so showed up with luggage- weren’t prepared. 3 judges panel – issue – in a room with three other sets of judges – some confusion about which tables to go to – also some groups louder. If entered early, got to listen to previous presentation – so should be separate rooms!!! Both awards ceremony fine – ADM II all actual awardees got some kind of memento for desk or wall – nice touch – means a lot more. Not expensive. information about any and all requirements. Might limit applications, but then would save both sides some time. ADM Streamlining – website should be updated instantly with awardees – took a week. Brief 1-2 sentence posting for each. Timeliness important – because of instant social media announcements. Reuters did video piece on ADM winners – very credible media. KEEP THIS IN!!! Team of three at final award event. Video guy local women from Canada. 1. In awardee agreement –require giving back time in next round of ADM – publicity show up and talk, show up and judge. 15-20 hours. < 1 hour per month. Justification – will learn something from it. Important to give back. 2. Consider awarding using a bit of awardees to award each other – hard – give each next awardee option for allocating amongst ADM awardees – shared money 3. Reunions – ADM mini / Skype group belonging - limited to amongst awardees – linked in group – not 4. AmCham – in some countries help AWEP leverage as well as ADM winners get warm welcome, more inclined to deal with American even if diaspora 5. Willing to participate in ADM III!!!! Uganda EarthWise Ferries Passenger ferry services Templates didn’t fit what we were used to for concept paper and business plan, but we adjusted what we already had to fit in their categories. Did not learn from it. Was pleasantly surprised as white South African to be able to win! Had experimental green ferry that has turned out to not be economical except for short runs – it is too slow and so market not as responsive as we had expected. We are close to finishing more advanced model that will be bigger, and 3-4Xs faster. Fortunately we knew how to raise money, since have had to raise 30X the ADM grant. Get better concept paper and business plan templates. Allow more time from notice to final event to allow African participants lower cost for attending. Get rid of the financial reporting requirements, which no one used. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 117 Annex F: Field Interview Questions for ADM II Grantees 1. How did you learn about the ADM business plan competition grant program? Internet advertisement____ Diaspora community group _____ MBDA ____ SBDC ____ Other: (Please indicate from what source) _______________________________ 2. Was the application process a learning experience for you? Yes ___ No ____ 3. How did it inform your concept paper and business plan? a. b. c. d. 4. Who prepared your concept paper and business plan? You? Your spouse? Other diaspora member? Other(s) (please indicate who and their relationship to you.) a. b. c. d. 5. a. When was this business first started? ________________ b. Were you providing the same services or selling the same goods that you are now? Yes ____ No ____ 6. How did being awarded an ADM II grant program change the business that you were doing? Size____ Products ______ Number of Employees ______Other (Please specify)______ Information about your business: 7. Please provide the following information: 2011 In last twelve months a. Annual sales the year before you received the grant? ____________ ___________ b. Number of employees? Male __ Female __ Male __ Female __ c. Products /Services _________________ _____________ d. Net Profit _________________ _____________ e. Total Assets _________________ _____________ f. Total Debts _________________ _____________ g. What Markets was/is the business serving? _________________ _____________ 8. Do you know how big the markets are that the business is serving? Yes _____ No _____ Units per month/year Local __________ Regional ____________ National ______________ Regional ___________ Africa ________ International _____________ 9. Where do you get information about markets for your products/services? _________________ _____________________________________________________________________________ 10. How often do you get that market information? Times per year: __________ 11. The ADM Grant Process – (Owner – Diaspora person) a. How much was the total grant you received from ADM? U.S. $ ___________________ African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 118 b. When did you submit your concept paper for the ADM grant? Date: ________________ c. When did you learn you were selected to submit a Business Plan? Date: _____________ d. When were you told you would receive an ADM grant? Date: ______________ e. Who determined what the milestones and indicators would be for your grant? You? ____ SEAF _____ Other (please indicate, who) ___________________________ f. How long did it take for you and USAID to determine your milestones for grant disbursements: Weeks: _______ Months: _____ g. How long was it before you received your first grant money? Months: _____ h. How long before you were able to complete your next milestone? Months: _____ i. How long after you completed your next milestone did it take before you received your next ADM grant payment? Months: _____ Did that delay cause any particular problems in your business? Yes ___ No ___ If Yes, what problems? ________________ _______________________________________________________________________ _______________________________________________________________________ 12. What would you recommend be changed in order to make the grant application and approval process easier and more efficient? a. b. c. 13. What did each AMD grant payment allow your business to do that it could not have done without it? Hire new staff _____ Buy new equipment ________ Expanded production ____ Increased sales ____ Decreased Costs ____ Market study_____ Enter new Markets ______ Other: (Describe) ___________________________________ _______________________________________________________________________ 14. a. What impact(s) has the ADM grant had in the community around and beyond your business? _____________________________________________________________________________ _____________________________________________________________________________ b. Can you quantify any of the impacts on New jobs?_________ Cost reductions? ___________ Increased local incomes? ______________ New Services? _______________________________ Better products? _______________ Health? _________________ Access to electricity? _______ 15. How else do you think the ADM program could be improved?___________________________ _____________________________________________________________________________ _____________________________________________________________________________ 16. What do you know of the Africa Women’s Entrepreneur Program (AWEP)? ________________ _____________________________________________________________________________ 17. Are you a member of the African Women Entrepreneur Program (AWEP) chapter in your country? If not, (and a female business person) why not? ______________________________ 18. How big do you expect your business to grow in the next 3 years? 19. What markets will you serve within the next year? _____________________________________ Next three years? _______________________________________________________________ 20. Matching Funds a. What was the total amount of your business’s matching funds? ___________ b. What was the primary source of these funds? _____________________ c. Were the matching funds available according to business plan? Yes _____ No ____ If no, why not? _____________________________________________ African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 119 21. Technical Assistance a. What technical assistance did you/the business receive from the AMD program? _______________________________________________________ ________________ _______________________________________________________________________ b. How much of that technical assistance did you receive? Hours ______ Days______ Weeks_____ Months___ c. How did the technical assistance you received affect your business performance? Increased sales ____ Decreased Costs ____ New Markets _____ Expanded production ____ Hired more employees ____ Bought better technology ____ d. How did receiving technical assistance change how the business is run? _____________________________________________________________________ e. Did/does the business need more technical assistance (TA) than the ADM program could provide? Yes _____ No _____ f. What other types of technical assistance did you find you needed besides what you were able to get from the ADM program _____________________________________ _____________________________________________________________________________ g. What other services do you think need to be part of the ADM program and why? i. ii. iii. iv. 22. Additional Finance a. What other sources of finance did the ADM program introduce you to? _____________ b. What additional finance were you able to access as a result of receiving the ADM grant? Amount: __________________ Source(s): _________________________________ c. What additional finance were you able to access as a result of the technical assistance you received via the ADM program? Amount: _______ Source(s): ________________ 23. How else did the ADM program help your business? ________________________________ ______________________________________________________________________________ 24. How did the ADM program hinder or harm your business? ______________________________ ______________________________________________________________________________ 25. What ADM organized/sponsored forums or activities did you participate in? ________________ a. How did your participation benefit you/your business?___________________________ ________________________________________________________________________ _ 26. Would you like ADM to sponsor other events? Yes ___ No ____ a. Such as? ______________________ _____________ Why? _______________________ ___________________________________________________________________________ b. How would that benefit your business? _______________________________________ ___________________________________________________________________________ 27. Would you be willing to pay for those ADM events? Yes ___ No ___ How much? ____________ African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 120 BUSINESS VIABILITY 28. How viable is this business? (Measures of viability – Significant, ongoing markets/ accessible yet to be penetrated markets; Viable products/services - Able to make a Profit, Input cost trends are manageable, Sources of raw materials inputs are reliable/expanding; Sources of labor inputs are available; Transport and other access to markets is reliably available; utilities are reliably available; Owner has a vision of the future of the business) ______________________________ Why? _____________________________________________________________________________ _____________________________________________________________________________ 29. What will it take for your business to become more viable in the next six to twelve months? ______________________________________________________________________________ ______________________________________________________________________________ 30. Any other suggestions you would like to make to improve ADM? _______________________ ______________________________________________________________________________ 31. Other final comments? _________________________________________________________ _____________________________________________________________________________ African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 121 Annex G: Questions/Discussion guide for AWEP Chapters and Focus Group Discussions 1. Why was your AWEP Chapter formed? What are its purposes? a. b. c. d. 2. What do the members contribute to the Chapter? a. Personal time __________ How many hours per month? _____________ b. Financial resources to support an office? ________ How much per month? ________ c. Financial support to sponsor specific events? _______ How much per event? _______ d. Regular Membership Fees _________ e. Other: Please describe: __________________________________________________ 3. When was your chapter established:?Date _________ Number of Members when first established: ________ 4. Is your AWEP Chapter Legally registered? Yes ____ No ____ If, yes, under what type of registration? ________________________________________________________________ 5. a. How many paying members are there now? ______ b. How many of them are active? ____________ 6. What defines a member of your AWEP Chapter? (What criteria must a person/business have to qualify to be an AWEP member of your Chapter?) ___________________________________ ____________________________________________________________________________ 7. What services does your AWEP Chapter provide it its members? a. b. c. d. e. 8. How are those services paid for? Fees?___ Outside Financial Support? _______ Pro Bono Support? ______ Other? (Please describe):____________________________________ ______________________________________________________________________________ 9. What services are provided to AWEP members by other than your AWEP Chapter? SERVICE PROVIDED BY a. b. c. d. e. f. g. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 122 10. What are the biggest benefits you and your members derive from being part of AWEP? (in order of importance) a. b. c. d. e. 11. How do you think your AWEP Chapter networks could be strengthened in your country? a. b. c. 12. Do you think the AWEP Chapter network should be strengthened in your region of Africa? Yes ____ No _____ If, yes, why? a. b. c. d. 13. How do you think the AWEP Network could be strengthened across your region of and all of Africa? a. b. c. 14. What would your Chapter be willing to do to strengthen an AWEP network across Africa? a. b. c. d. 15. What other women or other enterprise associations or networks does your AWEP chapter interact with? a. b. c. d. 16. What benefits do your members derive from the interactions/connections with those other enterprise associations/networks? a. b. c. 17. What other enterprise networks could your AWEP chapter being interacting / connecting with? a. b. c. d. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 123 18. What sources of finances are your members tapping into to build their businesses? a. b. c. d. e. 19. What ideas do you have for making your Chapter more viable? a. b. c. d. 20. What other ideas do you have for making AWEP across Africa more viable? a. b. c. d. 21. What can your Chapter do to help make those ideas happen? a. b. c. THANK YOU VERY MUCH FOR YOUR PARTICIPATION IN MAKING AWEP STRONGER AND MORE VIABLE!!!! African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 124 Annex H: AWEP CHAPTER GUIDELINES Interviews with U.S. Embassy personnel in the four countries visited yielded consistent requests for more guidance and guidelines for AWEP chapters and AWEP membership, because they see that AWEP is representative of the USG and State. Interviews with three existing country chapters and one forming chapter61 were conducted in-country while remote interviews were conducted with leadership of two other AWEP country chapters. In addition the assessment team interviewed several persons in State in Washington, DC. Below are the already drafted guidelines with some recommended comments changes and additions in track changes (in blue) based on discussions with all of the above-mentioned stakeholders and the other association development experience of the assessment team. It is useful to note that most of the changes are minor. AWEP Chapter Formulation Guidance The AWEP network has more than 1600 women entrepreneurs organized into 22 chapters throughout Sub-Saharan Africa.62 The large majority of these women own and operate businesses and serve as change agents in their local community. Chapters were established to increase the scale and impact of the AWEP program by encouraging alumnae to share the experiences, networks and resources gained through the program with other prominent and aspiring entrepreneurs in their home countries. AWEP chapters are organized, operated and funded primarily by AWEP members, in cooperation with U.S. Embassies and AWEP partners. Recommended Next Steps for Establishing an AWEP Chapter 1) Formally register the chapter as a non-profit or business association within the host country. This process will include the creation of a mission statement, bylaws, structure, program, and business plan that includes avenues for generating recurring revenues and revenues for individual events, etc. It should also include having a representative from the U.S. Embassy as a non-voting member of the Board, at least bi-annual elections, and requirements in the registration process for providing minimum demographic and survey information about the member and the member’s business, and business needs and interests. 2) Host an official chapter launch for the local community and government officials, in cooperation with the U.S. Embassy. 3) Conduct local membership drives and periodic meetings to encourage other prominent and aspiring women entrepreneurs to join the chapter and provide services to those members. 4) Solicit a local patron. This final step is optional; however the USG encourages members to invite prominent women such as the First Lady, female ministers and/or other prominent public or private sector leaders to serve in this capacity. 5) Require members to complete online diagnostic survey via the following link: (NOTE: This survey is too much from most members to be able to comfortably complete. It either needs to be streamlined down to the average level of AWEP chapter membership, or targeted specifically and only to the top 61 Ghana, Nigeria and Ethiopia are the existing AWEP chapters visited by the assessment team while the forming AWEP chapter visited was in Uganda. The two remote interviews were with the AWEP Zambia and Cote d’Ivoire chapter presidents. 62 AWEP Chapters currently exist in the following countries: Botswana, Burundi, Cameroon, Cote d’Ivoire, Ethiopia, Ghana, Guinea, Kenya, Liberia, Malawi, Mauritania, Mauritius, Namibia, Nigeria, Niger, Rwanda, Seychelles, Senegal, South Africa, Tanzania and Zambia. Chapters are currently being explored in Angola, Sierra Leone, Mozambique, Uganda and the Democratic Republic of Congo (DRC). African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 125 tier members that are at least small enterprises per the IFC definition of “small enterprise”. Separate surveys could be developed for the majority of the AWEP members. However, it would seem to make more sense to have the survey be part of the AWEP chapter member registration process, and have the results accessible to both the AWEP chapter and State.) English: https://www.surveymonkey.com/s/ZZXDHJP French: https://www.surveymonkey.com/s/abbAWEPDiagnosticFrench Portuguese: https://www.surveymonkey.com/s/abbAWEPDiagnosticPortuguese See AWEP section in body of report for more details about the changes needed in the surveys. 6) Establish a work plan with State and your local Embassy 7) Develop a business plan for the AWEP Chapter that includes realistic strategies for self-financing of activities in which members are interested in participating. USG Support for AWEP Chapters The USG provides a variety of services and opportunities for AWEP chapters, which include, but are not limited to: 1. An all-expenses paid invitation for selected alumnae to participate in the annual AWEP International Visitor’s Leadership Program (IVLP) in the United States; 2. Formal invitations to participate in the annual AWEP-AGOA forum held on the margins of AGOA; (should make it clear that travel is self-financed) 3. AWEP export promotion programs; (in-country or where?) Also, is this available to the general AWEP membership or just to AWEP Alumnae? 4. Business development, access to markets, and access to capital training opportunities; (what are we actually promising?) 5. Invitations to regional Business-to-Business (B2B) networking events and SME Live Banking events; 6. Access to USAID’s African Diaspora Marketplace business competition if qualified, and advisory services and entrepreneurship fund; (we will need to set some parameters on this or we are creating unreal expectations on the services that will be accessible through ADM) and 7. The African Women’s Entrepreneurship Program (AWEP)-Women’s Entrepreneurial Center of Resources, Education, Access and Training for Economic Empowerment (WECREATE) project will support the following activities: a) identification of a physical space for the center; b) technical assistance provider to provide entrepreneurship training, business development, gender sensitization and other support services for women, girls and at-risk youth; c) train-the-trainer program for chapters within the African Women’s Entrepreneurship Program (AWEP) network, and d) ownership transfer program to ensure long-term sustainability of the project. These centers will serve as a haven for women, at-risk-youth and GBV survivors seeking to reintegrate into the local workforce. Who is the target population that we are trying to serve with these centers? This makes WECREATE sound more like a social service more than something targeted at the ‘missing middle’ that former Secretary of State Hillary Clinton was talking about as the focus for AWEP, since other funding is available for micro and smaller businesses and other disadvantaged women. Similar to business incubators, they will provide vocational training opportunities, apprenticeships, and community service projects for aspiring youth entrepreneurs and women￾owned micro, small and medium enterprises (MSME) and farmers in AF-WPS target countries. Including all three sizes of enterprises will guarantee that the Centers will be overwhelmed with African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 126 requests for training, etc. from the majority micro enterprises and will not serve at all the scale of enterprise that was the intention of AWEP. We understand that including micro and small enterprises was probably necessary in order to garner the support for funding this activity, but we recommend that it not be too closely associated with the AWEP chapter or the original focus of AWEP will be lost entirely. The center will also provide gender sensitivity training for men and boys that emphasizes the power of entrepreneurship and how supporting their wives, mothers and daughters can have a profound influence on their families and communities. This goes without saying and should be part of AWEP activities, as creating an ecosystem of equality in business is one of the objectives of AWEP. Program managers will establish close partnerships with civil society organizations that have received WPS-related programing in the past to ensure that WPS(??) beneficiaries participate in AWEP-WECREATE projects (Pending Congressional Approval). Recommended Support from the Government (which government(s) – USG and local national?)  If the AWEP Chapter meets the minimum requirements for being a U.S. Embassy certified AWEP (we may have to find out if this is even feasible for a local CSO to be certified by a foreign entity as something that might make it seem like other than a local entity – that’s for the lawyers to decide.)Publicly acknowledge and support the chapter.  Include the chapter in multi-stakeholder consultations on trade and investment policies.  Invite chapter members to participate in government-sponsored trade shows, business development trainings and export promotion events.  Support the establishment of an expanded AWEP website that members can contribute to and use to share experiences across the entire AWEP network. It should include blog capabilities for AWEP leaders and vetted members to lead blog discussions on topics pertinent to AWEP leadership and/or members. It should have the capability of having limited access. African Diaspora Marketplace Evaluation & African Women Entrepreneur Program Assessment 127 Annex I: MEMBERSHIP SUMMARY - AWEP NIGERIA Of members reporting the number of employees: - 124 members have < 10 employees; - 31 members have 10-19 employees; - 18 members have ≥ 20 employees; - 133 members did not report how many employees they had. Of members reporting the number of employees - 71% < 10 employees; - 18% 10-19 employees; - 10% 20 or more employees. - 43.5% did not report employees.