Last month, I joined top executives and founders from 14 African firms on a tour of a company’s headquarters in Germany. The company is the world leader in its luxury products industry. It turns over nearly €1.5-billion per year and accounts for roughly 10% of the global market share.

That none of my African colleagues had ever heard of the company was not surprising. Scores of German firms have built exceptional global brands quietly, almost stealthily. Many of them started, like this one, from humble beginnings, often as small family businesses, before growing into international giants.   

We were in Germany to share our stories and imagine how some of Africa’s fastest-growing and most inspiring companies could forge their own path to global success. What brought us together was the inaugural African Hidden Champions Summit in Frankfurt.

The summit arose out of the African Hidden Champions initiative, a co-founded initiative of the Africa Foresight Group (AFG) and the German Investment Corporation, DEG (Deutsche Investitions-und Entwicklungsgesellschaft), a subsidiary of KFW, the world’s largest national development bank.

No African company can lay claim yet to a global growth story as impressive as the largest European, North American or Asian firms. Indeed, Africa is the only continent that does not have a single Fortune Global 500 company. The largest African businesses would need to grow their revenues by roughly four or five times just to reach the last spot in the ranking.

Through the African Hidden Champions initiative and our annual summits, AFG and DEG together hope to change that. 

It is no coincidence that the term “hidden champion” company was coined by a German. In formulating the concept, Hermann Simon, the country’s leading management expert, drew on his extensive research on the international competitiveness of small and mid-sized German firms, the so-called “Deutschen Mittelstand”.

Germany has given rise to roughly half of the more than 2,700 companies worldwide that have been identified as hidden champions. Simon described such companies as extremely successful in their niche markets but largely unknown outside of them and to the public-at-large, despite their often-remarkable records of expansion. Hidden Champions have been integral to Germany’s postwar economic success.

Growing up in Germany, I experienced first-hand the way some companies’ products became synonymous with excellence — “the best” — and fostered a collective sense of pride in German manufacturing and ingenuity. It is similar to the impact companies like Samsung have had on South Korean society, Toyota on Japan’s, or even Apple and Microsoft in the US.  

The companies selected as African Hidden Champions by AFG/DEG since the initiative was established in 2020 have a long way to go. But they are subtly building the muscle for global leadership.

They were born in some of the continent’s biggest markets (South Africa, Egypt, Nigeria) as well as its second-tier economies (Ghana, Kenya, Sudan). Even one of Africa’s smaller economies, Namibia, boasts a hidden champion. They operate across various sectors, from services, manufacturing, energy and retail, to pharmaceuticals, automobiles and education.

Varied as they are by history, product and location, Africa’s hidden champions share several key attributes that position them for success. They are all sustainable businesses, with proven track records in their markets; they have sizeable opportunities for expansion, especially through innovation; what they offer has relevance internationally, far beyond the countries in which they were founded; and none are well known outside their home markets.

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Not yet, at least.

Salma Okonkwo epitomises the spirit of a hidden champion. She cut her teeth in the male-dominated oil and gas sector, building one of the most dynamic energy firms in West Africa, the UBI Group. Today she is developing one of the largest solar farms in the region, in her ancestral homeland of northern Ghana. 

Okonkwo’s largely unknown story was one of many shared at this year’s summit, including that of her Ghanaian compatriot, Edmund Poku, founder of Niche Cocoa, the largest fully integrated cocoa processor in Ghana.

Poku left Wall Street and returned home with the goal of disrupting the world’s $130-billion chocolate industry. The greatest exporters of cocoa beans — Ghana is the world’s second-biggest, after Ivory Coast — have not fully benefited from chocolate’s immense global popularity, nor have its small-scale producers, most of whom live in poverty. Marketed under the tagline, “Taste of Ghana”, his multi-million-dollar company started selling chocolate to local and international markets in 2017.

The other recognised African Hidden Champions attending this year’s summit — among them, the path-breaking South African-Kenyan schools’ group, Nova Pioneer; the century-old Namibian family business, Pupkewitz Group; the Egyptian snack food giant, Edita; and Daphne Mashile-Nkosi, who built the world’s largest manganese sinter plant in South Africa’s Northern Cape — share their intense commitment to growth through performance, innovation and a solid foundation of values. 

They also share many of the same qualities that underpin the success of mid-sized German companies that have become market leaders: a strategic vision and deep personal commitment by leaders to their firm’s and nation’s future; the courage to take risks and swim against the tide; a singularity of purpose; the ability to inspire others; and a desire to be the best, no matter what.

The huge advantage that German hidden champion firms like Symrise — a world-leading supplier of fragrances and flavourings for over 30,000 products worldwide yet known by only a handful of the millions who use their products every day — have had over their African counterparts is an enabling ecosystem, which gives them both the stability and the opportunities to plan for the long-term.

The shortcomings in Africa’s current business environments are well known. High trade costs, poor infrastructure, policy uncertainty, currency risk — one could go on. But Africa’s business upside — its burgeoning culture of innovation and early adoption, its young and ambitious workforce, its abundant resources, and the potential for high returns on investments in African companies — is rarely given its due.

Mindful of the massive development impact, especially on employment, of thriving African firms, no effort should be spared in building an ecosystem that supports Africa’s hidden champions. There is no reason that this generation of African companies, aided by a conducive environment to excel, can’t one day engender the same level of national pride in their home markets that highly acclaimed firms elsewhere do.

Our initiative on hidden champions is meant to open another window on the African business story which draws on a successful model that should be better understood and studied on the continent.

We hope to raise awareness through case studies and future summits of the unique role that African hidden champions are playing in their economies. We seek to encourage other firms to believe that they too can become hidden champions. And one day, global leaders in their respective markets, where children grow up knowing them as brands of trust and prestige. DM