In Johannesburg on Thursday, London Stock Exchange Group (LSEG) hosted the first of a six-city pan-African roadshow to showcase the dynamic businesses featured in its 2019 Companies to Inspire Africa report.
The publication identifies 360 of Africa’s most inspirational private high-growth businesses, highlighting their successes to a global audience.
People often associate London Stock Exchange Group with large public companies, however we have an established history of supporting smaller ambitious companies throughout their growth journeys, connecting them to the capital and skills they need to expand. Small and medium-sized enterprises (SMEs) are the engines for economic development, driving innovation and supporting the jobs of the future.
AIM, launched 23 years ago is now the most success global growth market in the world and has raised over £110bn for nearly 4,000 companies. And over 1,000 companies from Europe, the Middle East, Africa and the Americas have joined ELITE, our business support and capital raising initiative for private companies. This includes the 100 African companies that have joined ELITE in Morocco and in French-speaking West Africa.
In Africa, SMEs account for around 90% of all businesses, but many of these companies experience a shortage of finance, estimated to total US$140bn. Ultimately, the lack of funding can result in millions being forced out of business, preventing these vital enterprises from reaching their full growth potential and becoming the ‘blue chips’ of the future.
One of the reasons that SMEs do not get sufficient funding is a lack of awareness of the variety of financing options available. Through the Companies to Inspire Africa reports and initiatives such as ELITE, high-growth companies gain exposure and support to help them access the right financing to support their growth ambitions. It’s worth noting that through ELITE, UK companies alone have raised over £1bn.
This is why we are so pleased to celebrate and showcase the 360 inspirational high-growth businesses in our 2019 Companies to Inspire Africa report. The companies featured come from 32 countries and boast an incredibly impressive average compound annual growth rate of 46 per cent.
They represent a diverse range of sectors with Consumer Services, Industry and Agriculture companies making up over 50 per cent of those featured. Technology & Telecoms, and Financial Services together represent over 25 per cent of firms, while Healthcare & Education and Renewable Energy also feature strongly. It is also notable that 23 per cent of the senior executives of the companies featured are female, a near doubling from 12 per cent in the inaugural report.
The rates of growth and diversity of sectors of the companies featured highlight their potential to transform the economies of Africa and beyond, driving global job creation and innovation.
What’s more, this is representative of a wider trend of African countries experiencing strong GDP growth over the past two decades and for the past 16 years, outperforming the global average GDP growth by about two percent annually.
London is an international hub for raising capital and LSEG has a long history of supporting Africa’s businesses. It was over 80 years ago that the first African company listed on London Stock Exchange.
Today, over 100 companies and nearly 40 African bonds are now listed on London markets, gaining access to a global investor base.
In 2018, we saw sovereign bond issuances from Nigeria, Kenya, Egypt, Angola and Ghana as well as corporates such as Seplat, Absa Bank and FirstRand Bank.
There was another significant milestone in 2018 - the IPO of Vivo Energy, dual listed in South Africa, was both the largest African IPO in London for a decade and the first company from the 2019 Companies to Inspire Africa report to float on London Stock Exchange. A true inspiration.