Child of globalization, Ilan Benhaïm is an entrepreneur and business angel – with a triple origin: Moroccan, Austrian and French. A graduate of NEOMA Business School, in 2001 he co-founded veepee.com (formerly vente-privee.com), a company specializing in event sales with a turnover of 3.8 billion euros. He is also a shareholder of Blablacar. Since 2019, Ilan Benhaïm has created IB Participations, an investment holding company specializing in the financing of French and international start-ups operating in the world of fashion, tech and retail. To date, around twenty start-ups have already received its support. From its subsidiary based in Casablanca, IBP Africa, it will be deployed in the French-speaking countries of the continent by positioning itself as a trusted third party between investors and start-ups. Next September, Ilan Benhaïm is organizing a road show that will take him to Senegal, Ivory Coast and Mauritania. In this interview, he deciphers his strategy.
What are your ambitions in the African startup market?
Ilan Benhaïm: Projecting myself on the African market is a natural orientation for me. I have a subsidiary of the family holding company in Morocco, IB Participations, the purpose of which is to make investments in Morocco and in sub-Saharan Africa through the acquisition of stakes in startups. We Africans often have this little complex that we are not as good as Americans, Europeans, etc. I will demonstrate that the continent is full of enormous potential for an entrepreneur. Of course there are always things to improve and obstacles in the business environment, as everywhere. I admit that I was pleasantly surprised by the quality of the pitches and the entrepreneurs I met.
Afterwards, the most skeptical will always oppose the argument of the narrowness of the market. Despite its billion inhabitants, the entire continent has a GDP equivalent to that of France. I consider that the sources of wealth creation and inventiveness are inexhaustible in Africa. As a business angel, if we succeed in creating innovative and agile local champions, tomorrow these start-ups can become international champions.
Why did you choose to position yourself as a trusted third party between owners of capital and start-ups?
I started from the observation of a crisis of confidence between the project leaders and the owners of capital. They are wary of small businesses. In the other direction, the founders of start-ups fear losing control of their business. From the outset, the business angel must clarify its intentions by specifying that it is aiming for a minority stake and that its objective is to enhance its stake. The land must be cleared immediately. As a business angel and investor, I only get involved in a business to boost acceleration and take it to the next level. When things are presented very clearly, trust sets in. People who take 40% of a start-up with a little money create mistrust. The relationship must be based on win-win.
What is your analysis of the start-up ecosystem on the Continent?
I have not carried out a specific study, but I can tell you that in terms of attracting capital, there is not one Africa, but two Africa. The English-speaking part attracts funds from the United States, China and India that know how to do venture capital and invest a lot of money. Those who create start-ups develop concepts and solutions by projecting themselves into the global market. Which is very popular with investors. Kenya, for example, attracts ten times more foreign investment than Morocco. The other advantage is the ease of exit, especially for fintechs. By buying them back from their founders, banks are making it easier to exit funds that have invested in these small businesses.
Francophone countries attract little capital. They are lagging far behind the English-speaking countries. Being Moroccan, I thought it would be better to go to countries that have a capital deficit despite the presence of a pool of very high quality entrepreneurs. In the English-speaking countries of the continent, foreign investment funds are more present and the start-up ecosystem is more dynamic. More concretely, this means that if you invest in French-speaking countries, you don’t know when you are going to get your money back. The market lacks liquidity. If an investor places 100 in a company, they don’t know how they are going to get back the 1000 they were initially aiming for. Small business buyout transactions are very rare. Obviously, all local funds are reluctant to invest. But the situation is starting to change. The talents exist, the pool of entrepreneurs too. Opposite, those who hold capital are reluctant to commit.
The other challenge in French-speaking markets is to improve market liquidity in order to resolve the exit issue for business angels. Today, it is difficult for an investor in a startup to predict with certainty his exit from the round table. In developed ecosystems, it is large companies that boost market liquidity by buying startups.
How do you explain that the Moroccan ecosystem has failed to create fintechs or to hatch at least one unicorn? Where are the obstacles?
Before we can talk about a unicorn, we must first have gazelles. For a business to become a unicorn, it takes funding. But today, the big foreign funds have not yet put Morocco on their radar. One of the explanations is the projection of entrepreneurs. Start-ups that develop solutions in Morocco mainly target the local market and perhaps the African market. On the other hand, a Kenyan start-up because of the advantage of the English language among other things, will naturally project its concept on the international market. This dimension is crucial because it makes it possible to beep in the radars of major international investment funds. The example of Israel is instructive in this regard. This country is a small market but with an impressive population of start-ups that shine all over the world. As a result, foreign capital is rushing in because entrepreneurs create solutions that can be deployed anywhere.
Which markets are you primarily targeting?
Very clearly, the French-speaking countries because I consider that everything is to be built on these markets. To go quickly, we must target countries where there is not yet a bottleneck for operators and we must build trust between project leaders and investors. I focus on French-speaking Africa because I know it, and as a trusted third party, I can make my contribution to the foundations of the start-up ecosystem. It is a market of 500 million people with talent and well-trained resources. Next September, I will be organizing a roadshows with stages in Ivory Coast, Senegal and Mauritania.
Four nuggets accompanied in Morocco
In Morocco, IBP Participations, the holding company of Ilan Benhaïm has already financed 4 start-ups in the early stage: Nadari, Saweblia, Pip Pip Yalah and Shipex.
. Nadari is a young company that aims to revolutionize the Moroccan optical market by making the purchase of prescription glasses more accessible. Nadari is indeed the first 100% Moroccan player in the sector to integrate the industrialization and marketing of its glasses within the same space, and this within a compressed period of 20 minutes and at extremely competitive prices from 200 DH. The start-up is now counting on a rapid growth strategy that will allow the opening of several points of sale across the kingdom (20 stores within 3 years) and, ultimately, on the African continent.
. Saweblia: Small-scale home and office business Launched in 2019, Saweblia is a full service provider of home and office repair and maintenance services. Present in Casablanca and Mohammedia, Saweblia connects professionals and individuals in demand for plumbing, electricity, air conditioning, painting, disinfection, carpentry work with around a hundred qualified and trained craftsmen. The date and time of the appointment are decided by the customer, prices known in advance including supplies, several possible payment methods and services guaranteed for up to 6 months. In 2021, a new fundraising of 3 million DH will allow the company to deploy in the cities of Rabat, Marrakech, Fez and Tangier and to expand its catalog of services (swimming pool, gardening, television, satellite, etc.) by recruiting 400 new artisans.
Pip Pip Yalah: The first Moroccan inter-city carpooling application, Pip Pip Yalah offers an innovative and flexible service, based on the collaborative economy. Its vocation: to develop the culture of carpooling in Morocco and participate in the emergence of ethical and sustainable mobility, while guaranteeing the safety of its users via a system to verify their identity. Listed in the Top 5 downloads of Google Play Store in Morocco, the application currently brings together the largest community of its kind across the Kingdom, with more than 340,000 users and up to 1,000 carpooling offers per day. Pip Pip3 Yalah also won the prize for the best application of the 2020 edition of the Maroc Web Awards.
. Shipex is a 100% Moroccan company which aims to revolutionize the international express courier market. It thus offers its users, individuals or professionals, a mobile application and an interactive web platform that draws on the know-how of world leaders in the sector, allowing them to manage the sending of documents with equal efficiency and simplicity. and parcels in over 220 countries around the world.