“For the last five years I have been making direct loans to entrepreneurial people in the South,” Freddy De Mulder tells us. Until 2008 he was the CEO of Opel Antwerp and later he headed up sales operations at General Motors for 25 European countries. “An investment of EUR 20,000 can give thousands of people a better life and secure their future.""Take my first loan to an entrepreneur in Haiti, for example. Through NGO Codeart I learned that there was a need for industrial machines to turn sugarcane into juice. The sugarcane farmers worked with dilapidated wooden presses, with low yields. Entrepreneur and experienced technician Meles Augustin wanted to set up trade in machines and maintain them and provide parts for them afterwards. That was what gave his business story the edge. He generated an ongoing stream of income with which he could repay the loan and grow his business. And the machines would remain in perfect condition."
"A good example is the water wells in Africa that soon stop working because they are not maintained. This entrepreneur’s story ensured continuity.” Freddy gave the man a loan of EUR 25,000 at an interest rate of 5 percent. Meles could buy ten machines with that and sold them to a few big farmers, who hire out the machines to hundreds of smaller sugarcane farmers. Their yield is now much higher. As a result, children are able to go to school and the farmers can buy all kinds of things from the local shops in town. In a nutshell, the local economy got a leg up and it improved the lives of thousands. In fact, the indirect impact of my investment is even bigger than the direct impact on the farmers.” The loan was repaid in installments.
“After I gave up work, the entrepreneur in me wanted to support a good cause with a tangible impact. Through Entrepreneurs for Entrepreneurs, a non-profit organization that does not receive any government subsidies, I was able to contribute to blasting their B2B pillar skywards. They make it possible to invest directly in the South. Because I believed so strongly in this, I also wanted to help an entrepreneur in the South myself. I chose my first project and got bitten by the bug. After that I participated in another five projects. I fall in love with a business plan every time.”
Together with a few friends, Freddy De Mulder also gave a “fantastic lady” from Uganda a loan. “She obtained her PhD at the University of Ghent in quality control and nutrition. Her thesis was on making juice from bananas, a project she had started herself. She has done it on a larger scale in her home country now. And so successfully!” Freddy De Mulder co-screens the business projects at Entrepreneurs for Entrepreneurs for aspirant investors. “It is no simple matter for local entrepreneurs to come up with a business plan that is tens of pages long. We help them to assess their own abilities. Sometimes it takes months before such a plan takes shape after endless rewriting.”
And then the search starts for financial backers. “That is really difficult. People often ask about the risk attached, but it really isn’t a problem. In my case, it has never gone pear shaped. This is because the projects are stringently assessed by a very competent team and also followed up afterwards. Of course, we can’t give a 100 percent guarantee ever, but there is a very significant chance that you can have a large impact locally that will have a lasting effect! Not only individuals can offer such a loan, it could also be as part of a club. For example, Rotary Beveren has given two loans with great success in the past.”
“With a loan of EUR 20,000 you give thousands of families a better life in Africa.”
Freddy De Mulder, former CEO at General Motors/Opel and member of the board at Febiac and Agoria
Entrepreneurship is key
Another argument that Freddy regularly hears from possible investors is that it is all too complex. Life here is already so busy, why would they still burden themselves with monitoring a project in the South? “For that reason we will start this year with a rolling fund, which is funded by donations. Entrepreneurs in the South can obtain loans from that fund and repay the fund, so that we can give new loans again. It is also possible to take a combined loan from the fund and a direct investor. This spreads the risk”, explains Freddy De Mulder.
And he adds: “Sustainable economic development is the only way to raise the South to new heights. Instead of making a donation here and there, the results are much better if you can stimulate entrepreneurship. That is exactly why Entrepreneurs for Entrepreneurs is such an excellent partner. Contact me and I’ll explain how it works and how much joy you’ll get from it.”
Text by Véronique Goossens
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