The focus on gender balance as a strategic economic opportunity has risen around the world over the past two decades – now it is accompanying Africa’s rise. As research of the benefits of gender balance has steadily grown, companies and countries have pushed to balance boards and leadership teams. More recently, investors have added pressure on the issue. Large funds have declared they won’t invest in companies that don’t balance. Women-led venture funds have started to emerge, and just this week a women-led bank announced its opening in the US.
Yet in the developing world, where the financing gap is most stark, women-led investments are rare, and women on listed company boards still a tiny minority. But efforts pushing for progress are emerging and deserve visibility.
Top Down: Focus on Corporate Boards
Back in 2002, as President of the European Professional Women’s Network (now PWNGlobal.net), I remember doing one of the first surveys of Women on Boards in Europe, in partnership with Egon Zehnder. These and other efforts led to the introduction of board quotas across the continent a few years later, and a substantial increase in board balance, now averaging 33% female/ 67% male across the Stoxx Europe 600 companies.
It is heartening to see this kind of effort and focus emerging in Africa with TBR Africa. The steps for change are all on the agenda: measure today’s reality, educate and prepare women, and educate and lobby companies and governments. They are getting the measure of the current situation by mapping and publishing the imbalances on listed Boards across the continent. Then working with a range of actors (development finance institutions, private equity investors and companies in and outside Africa) to accelerate the appointment of women on boards and build a growing pipeline of board-ready women. While also educating the business community on the power of balanced leadership.
Launched in 2016, TBR Africa now has a network of over 1500+ senior executive women from over 55 countries. Since 2018, they have placed more than 35 women on boards, and trained over 120 women through their board training programme, Open Doors, developed in partnership with the UK’s Institute of Directors. They recently got a £1.6 million injection from the UK’s CDC which should help reach their target of doubling the number of women on African Boards by 2028.
- EXPATS COMING HOME: As women rise in the corporate world, they push for balance. Like Beatrice Hamza Bassey, a lawyer who grew up in Northern Nigeria in a family with a long line of women each breaking the mould of their conservative societies. After attending Harvard Law School and spending 20 years as a lawyer in the US, she returned to her home country in 2015. She was recruited there by Bob Diamond, the former CEO of Barclays, to build an African banking platform. The goal was to acquire banks that would reach top 3 status in every country. She made nine acquisitions within two years. In every company, she sat on the Board as General Counsel. And made gender balancing Boards part of her strategy to improve corporate governance and transparency. The project was reshaped by the Covid crisis, but Hamza Bassey remains Chair of Union Bank of Nigeria’s Board, now over 40% female. “We have become a leader in gender balance and sustainability. They are related, as balance is part of the reason attention has been paid to these issues.”
Bottom Up: Invest in Entrepreneurs
Women run 40% of Africa’s SMEs but receive only 1% of funding from VCs. “In 2021 so far, male single founders & all-male founding teams have raised 84% ($2.2bn+) of all funding raised by startups in Africa,” says Maxime Bayen, who runs Africa: The Big Deal website. This gaping chasm hurts the region’s future. The region could capitalise on having the highest rates of female entrepreneurship in the world if access to capital wasn’t such an obstacle to achieving full potential. An additional challenge is that much of the VC funding in Africa does end up with local founders. “A good chunk of the funding that goes to female-led startups in Africa (especially in Kenya) goes to non-local founders,” adds Bayen. There are only a handful of women-led investment initiatives in Africa’s formal financial markets – and are, for the moment, limited to the continent’s two biggest economies. South Africa has the Kenya Women Investment Company and the Women’s Investment Portfolio Holdings Limited while Nigeria has Alitheia and the Women Investors Fund.
In Francophone West Africa, informal savings and credit groups called ‘tontines’ are commonplace. Some estimates suggest over 80% of the adult female population are members in urban areas, with amounts loaned ranging from a few dollars to thousands. But these systems don’t lead to scale and limit women’s potential economic impact. 44% of women entrepreneurs in Senegal, for example, finance their businesses by borrowing money from relatives. Only 3.5% of Senegalese women entrepreneurs borrow from banks and micro-finance institutions. The Covid crisis has hit Africa’s women-led, informal-economy businesses hard as investors prioritise existing relationships. Even government-led relief measures often have not reached them. Resilience depends on women having easy access to capital and business support. That’s what moved a group of West African women to create a fund by women for women.
WIC Capital is the first fund dedicated to women-led businesses in West Africa. It aims to connect female entrepreneurs to modern financial instruments, promote women’s leadership and skills (through its WIC Academy), and position women as full economic players rather than spectators. Led by Thiaba Camara Sy, the founder of Deloitte Senegal, WIC Senegal brings together 90+ women who invested over US$1m of their own money and raised over US$1m in grants from local and international partners. This has been invested in the Regional Stock Exchange (BRVM) and is being distributed to local entrepreneurs.
- THE GENERATIONAL RETURNERS: Some women are born abroad of African parentage and move to Africa as adults, bridging global educations with African roots. They too will shape the gender balance of Africa’s future. This includes Maya Horgan Famodu, a rare female founder of a VC fund, Ingressive Capital, launched in 2017 to invest in African tech. Even rarer that she is young, half-Nigerian, half-American, and focuses on start-ups in Sub-Saharan Africa. With US$10 million assets under management, she was named one of the 10 women reshaping Nigeria’s tech ecosystem, and is pushing to combine progress and innovation. “Not only do I have an obligation to generate economic activity on the continent,” she said in an earlier FORBES interview, “but I have an obligation to use my access to empower the next generation of African innovators.”
The thirst for better tools and education about financing – especially for women – is widespread. The United Nations Economic Commission for Africa (UNECA) and the African Institute for Economic Development and Planning (IDEP) has responded with a dedicated training program for African Women Investors. to build a pipeline of women investment leaders in Africa.
Invest in Women, Everywhere
Even in the US, less than 5% of VC partners are female. But over the past five years, the number of women-led funds has multiplied by four. This has led to a surge in female entrepreneurship (73% of women-led firms were founded in the last five years).
The research shows not only that large companies with better gender balance in leadership outperform, so do companies founded by female entrepreneurs. Imagine when more funds, more investors and more governments get their strategies and their money aligned with the data. It’s starting, but there is a long way to go.
Africa, with its exceptionally entrepreneurial women and its huge gender gap in corporate business, has the most to gain from closing the gap. The region’s enormous potential has been hard hit by the Covid crisis. Investing in the continent’s women is a sure fire accelerator to recovery, and beyond.
Micron Urges Government Investment with R&D Spend – The Next Platform
Over the last twenty years, memory has risen from 10% of the semiconductor market to almost 30%, a trend that is expected to continue, propelled by compute at the edge all the way up to datacenter. To meet these demands, memory giant, Micron, has announced it will make $150 billion in internal investments, ranging from manufacturing and fab facilities to R&D to support new materials and memory technologies.
The nature of the announcement serves two purposes. The first is obvious, Micron is putting a stake in the ground around its bullish view for edge to datacenter growth and their role as a primary component maker. The second is only slightly less obvious: to compel the U.S. to match funds or continue new investment strategies to support U.S. fabs and semiconductor R&D.
While $150 billion is a sizable investment, the fab component of Micron’s plans will gobble up a significant fraction. While no fab is created equally, consider TSMC’s investments in new facilities, which are upwards of $9 billion. Such investments can take two to three years to yield but the time is certainly right. Gartner, for instance, estimates the costs for leading-edge semiconductor facilities to increase between 7-10%.
While DRAM and NAND are less expensive than leading edge technologies, Micron will need to choose carefully as it sets its plans in motion. Luckily, there is ample government support building in the U.S. for all homegrown semiconductor industry, although it is unclear how federal investments, including the $52 billion CHIPS Act, will augment Micron’s own ambitions.
Micron is seeking the attention of government with its broad R&D and manufacturing investment, pointing to the creation of “tens of thousands” of new jobs and “significant economic growth.” In a statement, Micron explained that memory manufacturing costs are 35-45% higher than in lower-end semiconductor markets, “making funding to support new semiconductor manufacturing capacity and a refundable investment tax credit critical to potential expansion of U.S. manufacturing as part of Micron’s targeted investment.”
“The growth of the data economy is driving increased customer demand for memory and storage,” said Executive Vice President of Global Operations Manish Bhatia. “Leading-edge memory manufacturing at scale requires production of advanced semiconductor technology that is pushing the laws of physics, and our markets demand cost-competitive operations. Sustained government support is essential for Micron to ensure a resilient supply chain and reinforce technology leadership for the long term.”
Micron CEO, Sanjay Mehrotra says the company will “look forward to working with governments around the world, including in the U.S. where CHIPS funding and the FABS Act would open the door to new industry investments, as we consider sites to support future expansion.” The subtext there is that the U.S. is only one country in the running, among others making investments.
Increasing government support will likely align with fabs and facilities but Micron says it’s working on next generation technologies set to keep pace with growing demand.
This is part of the company’s 2030-era plan for memory technology. Micron sees edge and cloud deployments expanding but also points to AI as the leading workload across deployment types. The company’s senior VP and GM for Compute and Networking, former Intel HPC lead, Raj Hazra, says that by 2025, 75% of all organizations will have moved beyond the AI experimentation stage into production.
To support this more practically, Micron has set forth some ambitious near-term targets, including reaching for 40% improvements in memory densities over existing DRAM, double SSD read throughput speeds over current 1TB SSDs, 15% power reductions over existing DRAM and 15% better performance for mixed workloads over existing NAND.
Walmart allowing some shoppers to buy bitcoin at Coinstar kiosks
Coinstar, known for its machines that can exchange physical coins for cash, has partnered with digital currency exchange CoinMe to let customers buy bitcoin at some of its kiosks.
There are 200 Coinstar kiosks located inside Walmart stores across the United States that will allow customers to buy bitcoin, a Walmart spokesperson said.
Walmart was subject to a cryptocurrency hoax in September when a fake press release was published announcing a partnership between the world’s largest retailer and litecoin. The news had briefly sent prices of the little known cryptocurrency surging.
(Reporting by Uday Sampath in Bengaluru; Editing by Devika Syamnath)
Here’s What Makes Intuit (INTU) A Meaningful Investment – Yahoo Finance
Cooper Investors, an investment management firm, published its “Cooper Investors Global Equities Fund (Hedged)” third quarter 2021 investor letter – a copy of which can be downloaded here. For the rolling three months to one year, the Fund returned 5.7% and 28.24% respectively, while its benchmark, by comparison, returned -0.42% and 26.57% over the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
Cooper Investors, in its Q3 2021 investor letter, mentioned Intuit Inc. (NASDAQ: INTU) and discussed its stance on the firm. Intuit Inc. is a Mountain View, California-based software company with a $156.4 billion market capitalization. INTU delivered a 50.80% return since the beginning of the year, while its 12-month returns are up by 72.12%. The stock closed at $572.80 per share on October 19, 2021.
Here is what Cooper Investors has to say about Intuit Inc. in its Q3 2021 investor letter:
“The other meaningful deal during the quarter was Intuit’s acquisition of Mailchimp for $12bn. Intuit has reinvented itself over the last decade and thrived with a leadership position in QuickBooks Online, the financial accounting software for small businesses (effectively the ‘Xero of the US’). We originally invested in Intuit in February 2020, excited by the QuickBooks prospects.
Management have executed exceptionally well on the opportunity set which has seen the shares double since our initial purchase. However, the company has now conducted two meaningful deals in Mailchimp and Credit Karma worth a combined US$20bn over the last 12 months. The investment proposition has shifted from a focus on QuickBooks to now being a financial and small business software conglomerate. We continue to very much admire the company, but with Intuit now trading on 50x forward earnings we no longer see such attractive latency on offer, nor the rewards for the level of execution risk and thus we have exited the position.”
Based on our calculations, Intuit Inc. (NASDAQ: INTU) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. INTU was in 66 hedge fund portfolios at the end of the first half of 2021, compared to 68 funds in the previous quarter. Intuit Inc. (NASDAQ: INTU) delivered an 11.34% return in the past 3 months.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest-growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage.
Disclosure: None. This article is originally published at Insider Monkey.
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