Efe Ukala is an experienced investment lawyer. She is Vice President and Assistant General Counsel at JP Morgan, a global investment bank, where she advises institutional investors.
For her extensive private equity know-how, Ukala has advised on numerous deals arising out of Africa ranging from financial services to consumer goods, and has successfully led deals to completion in countries like Nigeria, Ethiopia, Kenya, Zimbabwe and Mauritius.
Previously serving as a lead In-House Counsel and Chief Compliance Officer at an independent investment management firm focused on alternative assets in emerging and frontier markets; she advised on numerous cross-border investments and managed the firm’s fund formation processes.
Ukala recently founded ImpactHER as a product of her observations in the African entrepreneurship space and how this affects women. In this interview, she talks about her desire to help women build better businesses; why institutional investors fund more male entrepreneurs compared to female entrepreneurs that seek funding amongst other issues.
Tell us about yourself?
I am an investment lawyer and I currently serve as Vice President and Assistant General Counsel at a global investment bank in New York. I received my A.B. from the University of Chicago and my J.D. from Washington and Lee University School of Law. I have extensive private equity experience and have structured numerous deals arising out of Africa ranging from financial services to consumer goods. I am also a member of the New York State and New Jersey State Bars and currently serve as a member of the Board of Director for the Association of Black Women Attorneys NYC. Presently, I advise on structuring cross-border private equity transactions, negotiate transactions, draft agreements and advise the firm and its portfolio companies on compliance and Foreign Corrupt Practices Act matters.
What is the motivation for your interest in investment Law?
Being an investment lawyer was not always my dream; I always envisioned being a litigator, which I was for a few years. As a litigator, I was keen on getting exposure in matters arising out of Africa. This interest led me to write an article on the role of the private sector in helping bridge the Africa infrastructure financing gap and after a few conversations with a couple of interested parties, I got a job as an investment lawyer. Ultimately, I consider myself privileged to have a career that I really love.
What inspired the creation of your nonprofit organization, ImpactHER?
ImpactHER was founded based on my observations in the African entrepreneurship space – African female entrepreneurs were not accessing institutional capital as their male counterparts. The African women that attempted to access institutional funding, oftentimes, were unable to make it to the latter stage of the process due to lack of being institutionalized, lack of “good governance” and financial management issues. Moreover, the percentage of African women seeking institutional funding was significantly less than their male peers. After an in-depth research to determine the issue, I found out that there was a huge entrepreneurship-funding gap for African female entrepreneurs – the African Development Bank puts the figure of the funding gap for African female entrepreneurs at about $42 Billion. This propelled me to create a non-profit that can help address this issue.
What interest does ImpactHER serve?
ImpactHER, a registered non-profit organization, was established to teach African female entrepreneurs how to scale their business and help them access institutional capital properly.
In what way has your work experience helped to build the organization?
My experience has played a critical role in building ImpactHER. As an investment lawyer that has advised on numerous transactions in numerous African countries, I have observed first hand the issues that are faced by our delegates. I have advised on investments in companies across Africa on diverse sectors such as fast moving consumer goods, financial services and infrastructure. Advising on complex investments across Africa and in the U.S.A has presented me with a unique opportunity to easily identify critical issues that entrepreneurs face and know how best to get resources together to help address such issues.
How is ImpactHER designed to help the female entrepreneurs?
ImpactHER trains African female entrepreneurs on how to build scalable businesses, access institutional investors, and overcome operational challenges they face as they scale their businesses. We do this by providing training conferences each quarter to a group of selected female entrepreneurs. We focus on training a small group of women in each cohort to ensure that we can provide each of them with the requisite skill set to build best-in-class businesses as well as allow them to build a close knit network. We just concluded our 2017 training conference and now look forward to the 2018 training conferences.
How do you balance working at a demanding job and running the organization?
We have built a structure that allows the organization to function without my day-to-day involvement.
What is your opinion on the perception that women are not applying for institutional funding?
I do not agree with the statement that women are not applying for institutional funding. I believe we are. Indeed, the number of women-owned businesses is not as much as male-owned businesses but that doesn’t mean women are not applying. It’s about proportionality; the proportion of women seeking funding versus those that actually get funding. According to the International Finance Corporation, approximately 30 per cent of formal SMEs are owned or run by women; however, 70 per cent of women-owned SMEs in developing countries are underserved or unserved by financial institutions. Let’s now bring the analysis closer to home by turning to a recent survey conducted by Gracia Marcia Trust on female business owners from Kenya, Uganda, Rwanda and Tanzania. The survey found that only 27 per cent of the female business owners that applied for a business bank loan were successful, a daunting 27 per cent! I believe that the results of the survey will not significantly differ from the results of a Nigerian survey.
Moreover, according to an IFC study cited by Goldman Sachs International, in developing economies, women have a higher rejection rate than men when they apply for business loans. Now, let’s briefly turn to the gender financing gap in venture capital sector. A study published in the Harvard Business Review revealed that female entrepreneurs that sought funding from venture capitalists were only awarded, on average, 25 per cent of the amount they asked for, on the other hand, men received, on average, over 50 per cent of the amount they asked for. Conversely, the study also revealed that women female entrepreneurs had a higher rate of their financing application being denied, women were at about a 53 per cent denial rate compared to men at 38 per cent. While we do not have extensive studies within the African context, I believe that if such studies were conducted here, we would arrive at similar results. Moreover, based on my personal observation as an investment lawyer, institutional investors are funding more male entrepreneurs than female entrepreneurs that seek funding and the cheque sizes given to male entrepreneurs are indeed larger than that given to women entrepreneurs.
What is the vision of ImpactHER?
ImpactHER’s vision is to utilize our institutional investing experience to help African women build best-in-class legacy businesses and help bridge the gender-financing gap. This in turn will further spur Africa’s economic growth.
What advice would you give to a female entrepreneur who is afraid to start her business as a result of poor access to institutional funding?
Start that business; do not defer your dream. If funding is an issue, seek financial help from family and friends. Once you are able to prove that your business thesis works with your limited funds and show growth potential, you can then begin to seek institutional funding. Getting access to institutional funding is a process that requires patience and perseverance; make those two your best friends while also working hard.