The Helios Playbook: Billion-Dollar Lessons on Investing in Africa

Contributed by Jefferson Rumanyika, founder of The Grio.

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The dirty secret of investing in Africa is that the real money isn’t made where you think it is.

Forget everything (maybe not everything 😅) you’ve learned about investing in the West. A different set of rules applies in Africa’s bustling markets and boardrooms. These aren’t your typical Wall Street sayings. But hard-won insights from the trenches of one of the world’s most challenging and rewarding markets.

Are you ready to unlearn everything? See Africa through the eyes of a billion-dollar investor?

Alright, strap in. Let’s take a ride.

LESSON #1: “Be a First-Principles Investor” 

First-principles investing sounds like something Elon Musk mumbles in his sleep.

But it’s not rocket science. It simply means Think like a rookie. You ignore all the assumptions and do the brain work of figuring out what’s actually true. That means asking a few uncomfortable questions and challenging the norm. Now, how do you do this?

You ask questions that make people squirm😬, dig deeper than your typical armchair analyst. And go straight to the source like a detective who’s had too much coffee. 

Here’s the principle in action:

Case Study

When Helios bet big on Africa, they didn’t follow the crowd. 

Nope. They went all Sherlock Holmes. Digging into struggling sectors that needed a fix. They settled on mobile telephony. But didn’t just slap some cash on a mobile operator and call it a day. They realized Africa’s mobile network coverage was as reliable as a kid with a secret. So they asked, “What’s the core problem?” Bad coverage. “What’s causing it?” Crappy infrastructure. “Solution?” Build mobile towers that everyone and their grandma can use. 

Using a first principles lens🔍, they zoomed in on the infrastructure need. Building the Airbnb of telecom towers where everyone shares and everyone wins.

Here’s how to apply it:

Action Steps 

1. Find 🎯where money and knowhow can solve a problem
2. Break down🧩 the problem into the basics.
3. Rethink🤔 every step of the investing process.

LESSON #2: “Africa is a negotiated market” 

“Negotiated market” sounds like one of those intimidating finance terms.

But it simply means, “Let’s bargain.” In negotiated markets like Africa, prices are set by bargaining between parties. The informal nature of African markets means less transparency, standardization and liquidity. 

Opportunities in Africa are highly specific. So you need to get your hands dirty to really understand their value and risks. This isn’t a place where you can glance at a balance sheet and call it a day. You’ve got to know the business inside and out. 

Don’t rely solely on public reports. You’ve got to dig deeper to uncover the “story behind the story.” That’s where the real insights are, and that’s how you’ll spot the opportunities others miss.

Here’s how the magic happens in reality.

Case Study

Flashback to 2015. And the plot is just about to thicken.

Telkom Kenya, the oldest telco in Kenya is getting hammered by Safaricom and Airtel.  The no 1 and no 2 players in the market. France Telecom, the majority owner of Telkom Kenya, wants out and asks Helios to buy them out.

Helios looks at the deals. And says “No way José!”. Then about a year later. They call again and Helios says “Over my dead body ooh” in the most Nigerian accent. But a few months later, Helios gets a call, this time from the Kenyan government, the other owner of Telkom Kenya. They knew Helios was the best in the game after their successful investment in Equity Bank. The government says “Boy, it’s better if you figure something out. Because these guys are threatening to pull the plug and go home”. 

So, Helios goes back to their desks to think. Then came up with a deal. They would take Telkom Kenya for free in a payment-in-kind guarantee (complex PE deal terms ) for $150M. Mind you, France Telecom had bought Telkom Kenya for $300-400M. And ended up putting in an extra $300M. So, about $700M invested in total. Helios closed the deal in 2016 buying it for a bargain. 

Now, that’s how you make deals in the negotiated market that Africa is.

Let’s flip this into something you can use.

Action Steps

1. Go on the ground to understand the value and risks in opportunities.
2. Understand 🤔 the consumer behavior in countries/sectors you invest in.
3. Have 🤲 detailed knowledge of both the business and the regulatory environment.

LESSON #3: “Avoid a portfolio approach to investing in Africa”

The ‘portfolio approach’ to investing in Africa is a loser’s game.

Most foreign investors dipping their toes into Africa like to play it safe. Spreading the risk across a bunch of assets in different markets. Hoping the good vibes from the economy and markets will do the heavy lifting.

But guess what? That strategy doesn’t fly in Africa. Why? Local exchanges aren’t exactly buzzing with liquidity or overflowing with information. The ‘Africa Rising’ narrative is a half-truth. The whole “rising tide lifts all boats” thing? Yeah, not so much. Sure, the tide might be rising in a lot of places, but some boats are still going to sink. 

The hack is to invest in the ones without hidden leaks.

The catch is that only a few funds and advisers understand the region well enough to guide new investors. If you can find the right manager, you’re in for some serious returns

The real game here is about knowing the terrain—down to the country, sector, and even specific deals. Ditch the portfolio approach. And zero in on those expert fund managers who live and breathe African markets. They’re the ones who can spot golden opportunities and turn them into profit machines.

Here’s how this shakes out in the real world.

Case Study

Helios has mastered the art of taking highly concentrated bets.

Rather than spread investments across many telcos they invested in HTN Towers. Zeroing in on a specific part of the value chain rather than trying to capture the entire telecom market.

When it came to financial services, instead of taking stakes in many banks across Africa. They made targeted investments in Equity Bank in Kenya and First City Monument Bank.

This strategy is repeated across all their funds from Helios I – Helios IV. 

Let’s flip this into something you can use.

Action Steps

1. Bet 🎲on individual companies and entrepreneurs over countries.
2. Look 🔍for expert fund managers with detailed regional expertise.
3. Understand 🤔 that local exchanges do not have the liquidity to fit portfolio investors.

LESSON #4: “Look where the inefficiencies are greatest”

Investing in Africa isn’t about chasing the latest trend.

It’s about finding businesses that make things run smoother. You can either help established players level up or disrupt the market entirely.

Alright, time to see this in real-world mode.

Case Study

When Helios invested in IXAfrica, the top dog in hyperscale-ready data centers. 

It wasn’t a decision they’d made on a whim. Nope. They’d noticed that Africa has the highest data costs, with the slowest internet speeds in the world. Meanwhile, demand for all things digital was going through the roof.

And get this: Most of Africa’s data is stored overseas. Raising lots of questions on data sovereignty. Presenting a huge opportunity for IXAfrica to fix these inefficiencies and ride the wave of growing demand.

IXAfrica locked down a prime spot in Kenya’s data game. They now deliver over 20 MW of hyperscale-ready data center capacity. Keeping Kenya plugged in and ready for the digital future.

Here’s how to make this play for yourself.

Action Steps

1. Find 🔍businesses creating efficiencies.
2. See 👀opportunities where there are delays in a system.
3. Address📦 inefficiencies by investing in critical infrastructure that solves the problem.

LESSON #5: “Be a Deal maker not a Deal taker”

Investing in the West is pretty straightforward.

You scroll through your Bloomberg terminal (Not always 🤪). Pick what you like and boom you’re done. It’s like shopping for groceries online. But when you’re investing in Africa, where the financial markets are like a toddler learning to walk. And the private equity industry is still figuring out what it wants to be when it grows up. Things get a bit more… interesting.

You’ve got to get creative and think like a scrappy entrepreneur with an investor’s mindset. Take a good hard look at the environment you’re operating in like a business detective. Spot opportunities with unmet needs that others might miss. Then make a deal.

It’s not about buying a business; it’s about building one that people want to buy.

Let me show you how the pros roll with this.

Case Study

When you’re a big dog like Helios, deals come at you like spam emails—thousands of them. 

But Helios doesn’t sit back and wait for the perfect deal to land in their lap. Nah, they’re out there making their own moves. Back in 2011, Helios had its sights on the fuel business. They saw cities expanding. Traffic jams getting worse. And everyone driving around like they just got their license aka fuel demand was about to go nuts. 

Most investors would’ve bought a bunch of petrol stations, slapped on some new logos, and called it a day. But Helios isn’t here for the easy wins. They’re here to shake up the game. So, they teamed up with Vitol, one of the world’s top energy traders, and pulled off one of their craziest moves yet. 

They bought  Shell’s petrol stations across Africa (minus South Africa) for a cool $1 billion. That’s 24 companies in 16 countries. They rolled it into one under a brand new entity called Vivo Energy. They even scooped up some assets from Engen, taking Vivo into 23 countries.

Helios didn’t just make Vivo another pit stop for fuel. They made it the poster child for reliability and innovation in Africa’s energy sector. But they weren’t just building it to show off—they had an exit in mind. By 2018, Vivo Energy was listed on the London Stock Exchange and the Johannesburg Stock Exchange.

That, my friends, is how you turn a regular deal into a masterclass on going from deal taker to deal maker.

Now, here’s how you can put this into gear.

Action Steps

1. Avoid 🚫 looking at what is for sale.
2. Find 🕵️challenges you can solve to make money.
3. Make a deal 🤝when an opportunity meets scale and a long-term trend

LESSON #6: “Be an Active Investor”

Investors in the West can sit back and let the middlemen deal with the mess.

They make everything run smoothly. While you focus on counting your money. But in Africa, the game is different. The real money isn’t made by using financial tricks to prop up a business. It’s in growing the business. And to get the growth, you’ve got to roll up your sleeves and get your hands dirty. 

Helios knows this. They don’t sit back and wait for things to happen. They get in on the action and work alongside their portfolio companies. It’s a hands-on, full-contact sport where they’re not just owners, they’re operators. They take pride in delivering on their promises. 

In a market where talk is cheap, actions speak volumes. Being the team that says what they’re going to do and then actually do it? That’s how you win.

Let’s see what this looks like on the field.

Case Study

When Helios invested in GBfoods Africa (GBFA), a multinational food company, they didn’t throw money at the problem and hope for the best. 

They helped GBFA plant its flag in Africa. Setting up shop in Ghana with a leadership team that was a mix of Spanish flair and African hustle.

But they didn’t stop there. They combined global farming know-how with local smarts. Experimenting with land, irrigation methods, all to grow a killer tomato crop. They didn’t go with any old tomato, they introduced a new kind that could be grown during the dry season. Putting every single inch of land to good use. The result? Local farmers saw their yield skyrocket by 10x. 

They helped GBFA switch its packaging from old-school tins to smaller sachets. Sachets were cheaper for consumers and harder for international competitors to import. 

Helios didn’t just focus on tomatoes. They helped GBFA localize the production of mayonnaise and bouillon cubes. The new GBFA bouillon cube factory cranks out millions of Jumbo-brand cubes every day. Keeping shelves stocked and margins fat. While also protecting the business from currency swings and regulatory curveballs. Add in product launches and cross-selling across different markets and GBFA was on a roll. Over the 4 12  year investment, GBFA’s profits grew by 15%.

Proving that when Helios gets involved, they don’t just sit and count their money, they make things happen. 

Ready to make this work? Here’s your game plan

Action Steps

1. Build 🛠️ a reputation for doing what you say you will do.
2. Bring 📦significant operating expertise and resources to create value.
3. Apply 📝a hands-on approach to collaboration with portfolio company management.

LESSON #7:“Invest through the rough times”

Economic crises. Political drama. Wild currency swings. Occasional physical chaos. Just another day at the office, if you’re investing in Africa.

But that’s not just an African thing. That’s a global thing. Don’t let the news fool you. 

The problem is most foreign investors show up in Africa like tourists. The second something goes sideways, they’re out of there faster than you can say “Shazam.” They are not committed. They don’t get the market and won’t stick around long enough to snag a prime position.

It isn’t about quick wins. It’s about playing the long game. The investors who thrive in Africa are the ones who go all in. 

If you’re investing in Africa, don’t just dip your toes in. Dive in and make sure you’re built to last. 

Watch how this strategy comes alive.

Case Study

Picture this: It’s 2016 and the Nigerian economy is in freefall. 

Oil prices have sunk. The Naira is a hot mess. The official USD FX rate and the actual market rate are about as aligned as your weekend plans and reality. A good 40% gap. 

Enter the seller, Axxela, a local oil and gas giant, who’s sweating bullets. Their business is on shaky ground and they need a lifeline. They’re not just looking for anyone. They need a partner who can handle all the chaos with a straight face.

That’s when Helios swooped into the rescue. They saw an opportunity in Axxela. That was pioneering Nigeria’s natural gas distribution network. Buying 50% of it for $116M.  Fast forward to 2024 and Axxela is Nigeria’s largest private-sector gas distributor. It was such a power move that it inspired Helios to start its energy fund. 

In the end, what looked like a bad day in the market turned into a textbook example of turning chaos into opportunity. 

Here’s the step-by-step to making this happen

Action Steps

1. Find 🔍companies with natural hedges built in to manage FX risk.
2. Look 🧐for companies with pricing power that can weather through rough times.
3. Identify 🕵️companies that are essential in allowing domestic companies to function.

LESSON #8: Invest in the picks and shovels.

This lesson is more investment strategy than investment principle.

Ever heard of a pick-and-shovel play?

It’s an investor’s way of saying, “I don’t want to gamble on you finding the gold. But I’ll gladly sell you the tools if you’re doing the digging.” The idea is to invest in the tech or infrastructure needed to produce something. Rather than bet on the final product itself.

The term comes from the California Gold Rush in the 1800s. Back then, everyone was out digging for gold, but the real money was made by the folks selling the picks and shovels. If anyone struck gold or not, these guys were raking in cash.

Alright, time to see this in real-world mode.

Case Study

Helios knows this game well. 

Take their investment in HTN Towers, for example—a classic pick-and-shovel play. Instead of throwing money directly at telcos. They put their chips on the mobile towers that power those telcos. It’s a safer bet that still lets them profit from the booming telecom industry.

And they’re not stopping there. Helios has kept the strategy alive. With their investments in IX Africa and Maroc Datacenters. Instead of jumping straight into internet service providers (ISPs).  They’re backing the digital infrastructure that makes ISPs tick. It’s all about finding the sure thing, even if you’re not the one striking gold directly.

Action Steps

1. Find 🔍companies providing “shovels” for a growing industry.
2. Assess 🧐 the scalability and longevity of these businesses.
3. Bet🎲 huge on the ones with good management. 

LESSON #9: “An exit is a battle that is often won/lost at the time of the investment”

Great investments are like well-planned heists.

It’s not just about getting in. You have to plan on how to get out. Make sure there are at least two or three solid exit strategies on the table. But before you do all that, you have to pick businesses that tackle big problems in big markets. That increases your chances of hitting a homerun exit. 

Once you’re invested, you gotta whip your portfolio companies into shape with top-tier governance and control systems. So when it’s time to sell, potential buyers feel like they’re buying a well-oiled machine.

Here’s how the magic happens in reality.

Case Study
Helios is the master of exits.

As African capital markets have grown, so have Helios’ exit options. Strategic and financial buyers are hungry for the kind of companies Helios builds. The thing is, these buyers aren’t usually in the game early on. Helios is the one doing the heavy lifting. Finding the deals. Optimizing operations. Setting these companies on a steady growth path. Once that’s done, the business becomes an acquisition target that’s too good to pass up.

They have pretty much aced every exit strategy in the playbook. Raking in $4+ billion in the process. They’ve done it all: 

• Dividend recaps with Vivo Energy and Interswitch.
• Listing on the London Stock Exchange (Vivo Energy, Helios Towers, Crown Agents Bank). 
• Listing on local exchanges (Fawry, Vivo Energy).

They’ve played the on-market game with: 

• Block trades on local exchanges (FCMB, Equity Bank).
• Partial sales to financial buyers ( Interswitch, Fawry).
• Partial sales to strategics ( MTC, HTN Towers, Continental Outdoor Media, Interswitch, and Eland). 

Helios doesn’t just talk about exits—they execute them like pros.

Here’s how to take this from ‘sounds good’ to ‘let’s do it’.

Action Steps

1. Invest 💰 in businesses solving big problems in big markets.
2. Have 🤲at least 2 or 3 credible exit strategies before investing.
3. Set 🔧world-class governance and control systems to make it easy for future buyers

LESSON #10: You can’t kiss all the pretty girls/boys

Even the heavy hitters like Helios sometimes swing and miss.

You have to resign yourself to the fact that you won’t always win. Don’t snatch up every shiny opportunity that fits the bill. You’ve got to pick the one with the best odds of hitting it big. Yeah,luck plays a part in whether it all works out. But you don’t want luck to be your main strategy. 

You can’t count on luck showing up every time. You need something more reliable. The real game is sticking to a process: find well-managed companies, buy them at a sweet price, and hold on. That’s a way better approach than chasing every pretty face you see or read about. Stick to this simple formula. And you might enjoy those sweet, long-term results like Helios.

Case Study

Helios has had their misses.

They had to sell off investments like Telkom Kenya that were not working out. That’s part of the gig. If you’re killing it in the investment game like Helios, being right 6 out of 10 is already a win. 

In the 20 years of their existence, they’ve stuck to their process. Focusing on Africa’s megatrends. Zooming into sectors riding those trends. Scouting potential gold mines in those sectors. Making deals. Buying and building companies, turning them into bigger, better versions of themselves. Sell the companies for a tidy profit. Then rinse and repeat.

They run a tight ship. Going through 1000s of deals to only invest in one. It’s like running a nightclub with a velvet rope. With massive lines of people outside trying to get in. But you’re not letting just anyone into your club. You’re looking for the high rollers. The VIPs. The people who aren’t just here for free drinks but are ready to bring some serious energy to the place. 

Action Steps

1. Build 👷‍♂️an investment process that works for you. 
2. Be stubborn 🐂with the process, flexible with specific investment criteria.
3. Only change🔄 your mind when the facts change.

Conclusion

Helios’ success in Africa has not been a fluke.

It’s the result of their ability to see beyond the surface and create value where others see chaos. Challenging assumptions. Thinking from first principles. Writing checks. Rolling up their sleeves and getting involved. They keep it laser-focused. Targeting well-researched opportunities like they’re sniping at a dartboard.

At the end of the day, Helios isn’t just about making money in Africa. They’re reshaping the future, one game-changing deal at a time.

This article was originally published in The Grio.