I have a bone to pick with Dangote. Why can't we invest in your stock?
The past couple of weeks have been mad. Everyone has been scrambling to get into the IPO. And when I say everyone, I mean Africans and those of us in the diaspora. I bumped into an American last week who had never heard of Dangote, so I couldn't yap in their ear about it. But that's beside the point.
The matter has now entered my house. My wife asked if she should buy the stock. I asked if she had read the prospectus. Still going through it, she said. But like her, plenty of people are buying in because this is a historic moment for Africa and Africans. I could see the disappointment on her face when I told her she couldn’t buy the stock because she doesn't have a BVN. A BVN (Bank Verification Number) is a unique 11-digit biometric ID used across the Nigerian banking industry to verify customers and reduce fraud. You can get one as a Nigerian, at home or abroad. Most non-Nigerians can't.
There is an overwhelming number of Africans who want to participate in this IPO. Technically, they can't. I do applaud the effort to list across multiple exchanges to widen access, so I know you're trying.
Maybe I should be fighting the Nigerian government (I’m not). They need to lower the barrier to entry so the average Joe can invest in Nigeria. Plenty of Nigerian investment apps carry US stocks, and people buy them daily. So why can't Nigerian stocks be open to the world?
I understand the importance of protecting the country and its businesses from financial crime. But there has to be a way. Tanzania recently opened up government securities to non-residents. The law is still nascent, but it gives Tanzania a real shot at pulling in productive foreign capital.
The Dangote IPO is a watershed moment for African capital markets, and it will open the floodgates for many more listings. This is Nigeria's chance to capitalise on the attention and invite the world in.
Now, as someone who has been in the investment space for a while, I know there are workarounds. I'm deliberately not naming or recommending any of them, because I'm not fully clear on how legal it is to make these stocks available this way.
What I am doing is speaking to some of our portfolio companies about how we can streamline the process for people who want to buy the shares.
Sooner or later, all of us will own Dangote Refinery shares, and I'll get my certificate framed so my grandchildren know that Dangote is the greatest African industrialist to bless our continent.
While I have you here: I'll be co-writing Invest Diaspora with Timame and Nubi. It's an educational newsletter covering all things diaspora investment. The first edition drops shortly, so join the mailing list.
Lastly, I'll be in Accra next week and hosting a small gathering. If you're around, join us.