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Tuesday, April 17, 2012

BUILDING BUSINESS EMPIRES: Lessons from Kano’s major business families

     Kano is known around the world as a major commercial centre in West Africa with history dating back to 1000 years. Kano is believed to have been established in the year 999. Centuries of business activities have made Kano very distinct around its neighbours, as a market place, in fact everything in Kano is 'sale-able' and every inch of space around the city is a potential market place. That explained the attraction of Kano to other migrants from around the world and the reason why inside the ancient Kano city you find people who trace their ancestral roots to far away places luke Yemen, Syria, Mali, Libya, Senegal, Ethiopia, Sudan, Burkina Faso etc. Writing on the success of Kano as a commercial centre Ibrahim Ado Kurawa (2006) observes,The Jihad leaders of the caliphate encouraged Kola nut trade and Kano was the greatest beneficiary with an annual turnover of about $30 million. Kano merchants were also very innovative and they were able to integrate commerce and craft industry during the precolonial Kano, contributed to the prosperity of the province. Kano was producing an estimated 10 million pairs of sandals during that period because of economic harmony. Sarkin Kano Alhaji Muhammadu Sanusi (1953-1963) established the Bompai Industrial Estate”.  At the centre of Kano success as centre of commerce, is the role played by its rulers to ensure the sustenance of the land as trading point for the region. Even with the Jihad of Usman Dan Fodio, Kano remains the most successful and richest of all the provinces in the Sokoto caliphate.

      Kano is full of markets that attract hundreds of visitors from neighboring countries such as Niger, Burkina Faso, Chad, Cameroun, central Africa republic, Benin and Togo on daily basis. The major occupation of Kano resident remains trading, which explain the reason why Kano continues to produce some of the most successful business individuals in the country. One of the oldest market place in west Africa that is still existing till today, the Kurmi market (established by the emir of Kano Muhammadu Rumfa in 16th century CE), still retains it old friendly atmosphere, candor and attraction; other major markets in Kano includes Dawanau grain market (the largest in West Africa), Sabon Gari market, Singer market, Rimi market, Kofar Ruwa, Kantin Kwari, to mention just a few. Kano has a sizeable number of industries in the country, the largest outside Lagos. According to a Kano state document (K-SEED, 2004), the Kantin Kwari textile market alone, in around 2004 was valued at around N20 Billion worth. This article will attempt to look at some of the most successful business dynasties in the ancient city, though, the problem with this area of study is that there are few works done in this area by the business scholars; the articles made use of the few material at the disposal of the author, his personal knowledge and interview with more knowledgeable members of Kano business community. 

      Agalawa remain the most business conscious group in the entire Hausa land, before and after the jihad of Usman Dan Fodio. According to some scholars, their origin is linked to the Tamashek speaking people of the Sahara desert; though, they are more concentrated in Kano they were found in Katsina, Borno and other parts of the Hausa land. According to Dan Asabe (1995), the patronage, encouragement, and protection given to Agalawa by the emirs and rulers of Sokoto caliphate help a lot in the success of their businesses. Prominent examples of successful Kano businessmen with Agalawa origin includes, Kundila (d. 1901),Umaru Sharubutu (d. 1944), Adamu Jakada (d. 1942), Maikano Agogo (d. 1946), Alhassan Dantata (d. 1955),and Iliasu Dandagomba (d. 1952). On their habit, Dan Asabe (1995), wrote: “But they remained largely endogamous, and thus because of this, they were in any particular area almost all related to one another. They were unostentatious, frugal and in most cases ate only once a day - usually a late evening meal. They maintained friendly relations with local rulers and attempted to avoid confrontations with them. They regard long-distance trade as their natural way of life and indeed, almost as a religious obligation. They rightly argued that the prophet Muhammad and all his close companions were, by profession long-distance traders”. They were said to have learned their business skills by starting as apprentice and in the process moving from market to market, house to house selling goods. Traditional Agalawa businessmen move a lot together with their families on trading expedition as if they were some kind of nomadic people. The Business families discusses below, with the exception of Isyaka Rabiu, trace their root to Agalawa people.

Dantata family
       Dantata remain the main name when you are talking of wealth in Kano. Alhassan Dantata is the patriarch of the Dantata family who died in the year 1955. He was reported to be the wealthiest person in West Africa who first specialized in Kola nuts trade before branching into other trades. Dantata moved to Ghana from Kano during his early life where he started his Kola nut trade at Gonja, it was from there that, in later years, Dantata started moving Kola from Ghana to Nigeria. After he must have become famous with diversification into other businesses, Dantata became a major agent for Royal Niger Company in the North in charge of groundnut trade. Dantata is one of the famous examples of Agalawa clan known in Northern Nigeria for their business exploits. He is the major known survivor of the clan that went into oblivion with the coming of European and their modern businesses. Dantata is a very devout Muslim who did not received interest on his money and has visited Mecca for Hajj. He is said to be very discipline and avoid taking part in politics despite his connection to those in power. Sanusi Dantata is one of the most well known children of Alhassan Dantata who become famous with his continuation with his father groundnut trade. Generally, the Dantatas are known for their system of credit allocation through the family line, it was through one of these credits that Dangote received one of his initial starting capitals around 1977 from Sanusi Dantata who is his grand father from the part of his mother Mariya Sanusi Dantata. Through the use of agents dispersed in various town and rural areas Sanusi Dantata and his brother Aminu bought agricultural commodities and livestock from the rural areas and kept them in major warehouses located in the town. The late Abdulkadir Dantata is the eldest son of Sanusi Dantata who apart from his traditional merchandise trading and importation, established Dantata & Sawoe one of the biggest construction firms in Nigeria. Abdulkadir Dantata was last year listed among the forty richest Africans and was on the inaugural list of 40 wealthiest African this year by Forbes magazine. 

    Aminu Dantata who i had mentioned earlier is the richest son (immediate) of Alhassan Dantata alive today. Born in 1931, Aminu like his brother started in the family business before moving into administration with the creation of Kano state where he became commissioner of commerce. He later left government and went back to his family business where he actively participated in the establishment of industries in Kano state at that period. Apart from establishing and buying shares of newly created industries in Kano, Aminu engages in the importation business, where he was very active in the importation and the distribution of fertilizer, cement, chemicals, building materials, and automobiles. Aminu is director in over 21 companies among which is the recently established Jaiz bank, a non interest Islamic bank. Unlike the like of Dangote, Aminu Dantata is highly conservative businessman who has substantial number of his investments in businesses closer to home: Kano. He is very active in real estate business where he owns a lot of properties in Kano. Aminu like his father spend a lot of his wealth in philanthropic work, currently he is the chancellor of Katsina Islamic university. Tajuddeen Dantata is son to Aminu Dantata who is also very active in the family business, as he manages million dollars of his own and father’s wealth. Unlike his father Aminu Dantata, Tajuddeen received conventional business education both in Nigeria, United Kingdom, Saudi Arabia, and Egypt. He is currently on the board of many Nigeria firms where his family have substantial interest; and with the help of his family business and connections he has proven to be an upcoming billionaire coming from the Dantata family. Alhaji Sayyu Dantata who is mechanical engineer by training was once head of Dangote transport section before moving into his own business with the establishment of MRS one of Nigeria’s major oil companies’ .With the acquisition of Texaco/Chevron Nigeria limited by MRS, Sayyu Dantata is considered one of the richest up coming billionaires in Nigeria and major oil player. Like Tajuddeen Dantata, Sayyu business approach is modernistic in outlook and substance. 

The empire build by Dangote
    Aliko Dangote is currently one of the most notable faces from Africa who has caved his own niche  among the club of world richest Billionaires, with over $11 billion in net wealth; Dangote is the richest African alive and the only Kano and Nigerian businessman to ever attain such a feat. Born to the family of Dangote on the side of his father and Dantata on the side of his mother, Dangote received both conventional and Islamic education. With degree in Business administration from a university in Egypt, Dangote is a classic example of some one who combines both the traditional family business skill with the modern.  Like most other Kano businessmen that come from business oriented families, Dangote cut his teeth in the family business from where he branched out to set up on his won with a loan from his grand father which he judiciously utilized to become what he is today. Starting as a trader who import commodities from outside the country in 1977, Dangote succeeded in building the largest business conglomerate in the country, that manufacture everything from cement, sugar, flour, noodles, juice, Textile, sacks, to iron and steel. Like his great grand father the famous Alhassan Dantata who was the richest person of his time and the most daring and adventurous of his time who went to other businesses that most business individual avoided, Dangote has become a modern Ba’agale (from Agalawa) who through his investments traverse the whole continent of Africa in search of profit. Currently, Dangote is investing billions of Dollars in other African countries to shore up his empires in Sugar and cement business. Dangote cement is today the biggest cement company in Africa with over $11 billion in capitalisation and is planning on listing shares on the London stock exchange sometime next year. Like with all major business individuals around the world, Dangote is broad minded and can adopt to new environment fast, a good example is his second home Lagos which has now become his first home, he has become a Lagosian- he is at home there since he first moved in about 35 years ago. 

       Dangote is very ambitious individual recently he was quoted as saying he hopes to become the fifth richest individual in the world with the listings of his company on the London stock exchange next year. This is belief to be one of the major drive behind his continue acquisition of assets around Africa. Like most family business, Dangote group (his major company) has participation of sizeable number of his family members and close relatives, with the exception of sensitive and technical managerial position where he employed a lot of expatriates from abroad. Famous among his family members that feature regularly in Dangote business is Sani Dangote who is the group vice president of the Dangote group.  He himself is an established business individual with interest in manufacturing, agriculture, banking, and oil services. He is junior brother to Dangote. Dangote group has about 13 subsidiaries spreading all over Nigeria and operations in about 14 African countries. Unlike Agalawa who made Kano the centre of their universe, the focal point of Dangote operations reside in Lagos where his headquarters and major companies are located. Apart from Lagos, other major Nigerian states have substantial number of Dangote businesses, like Kano (Textile, flour mills, Noodles, sack, and beverages), Benue (cement), Ogun (cement), Rivers (cement terminals), Adamawa (sugar), Cross rivers (flour mills), and Kwara (Flour mills).  Like earlier Agalawa who quickly developed a good rapport with the rulers of their period from the Sultan of Sokoto to the emir of Kano, Dangote has cemented a solid relationship between himself and the power that be, whether in Abuja, Lagos or in Kano. But, unlike some Agalawa businessmen who cannot adapted to the fast changes that are taking place in their business environment with the coming of the Europeans, Dangote is quick to adapt to changing circumstances as provided by the modern world. As Dangote aspire to be among the top five richest individuals in the world, it is possible that the centre of his activities may move from Lagos to either London or New York as it happened with many Billionaires of his reckoning. 

Khalifa Isyaka Rabiu and his children
  The family of Khalifa Isyaka Rabiu is one of the most famous business families in modern day Kano, he and his children run Business Empire that run into billions of dollars and is considered as one of the richest families in the state and the nation at large. Born in 1928 Isyaka Rabiu grew up in a family with tradition of scholarship (his father is a great Islamic scholar); he, too, become very vast in Islamic scholarship before turning his attention to commerce in the 1960s. The discipline he acquired during his learning period as Islamic knowledge seeker is belief to have helped him built his business acumen and skills. His networking abilities see him establishing a business contact with long established Kano businessmen (such as Alhaji Ibrahim Gashash) and prominent corporate agencies and government officials. Isyaka Rabiu has the vision and optimism to see things coming and where next business opportunity is going to come. For example, during the 60s and 70s he transformed himself from textile merchant to textile manufacturer by establishing his own company. The oil boom of the 1970s left Nigerian economy with abundant liquidity of cash and therefore higher purchasing power, Isyaka Rabiu was not blind to this opportunity; he actively participated in the importation of commodities of that era. This together with the indigenisation policy of that era, that saw Rabiu buying shares of formerly foreign own companies, help in making Isyaka Rabiu one of the richest men of that era. Apart from trading and manufacturing Rabiu engaged actively in real estate business and construction. Despite his image as a scholarly person, to many people especially in Kano he was viewed as a cut throat businessman like most other business personalities in Kano. He competed to get what he want in the business world of that period and does not fear any other competitor.  

     Most famous among the children of Isyaka Rabiu is Abdussamad Rabiu, the chief executive officer of BUA conglomerate one of Nigeria’s leading companies. Abdussamad received his conventional education both in Nigeria and the United State, apart from the Islamic education he received during his youthful age. The enormous goodwill gathered by his father during all those years in business and the huge empire he built has a great impact on the up bringing of Abdussamad and his growing up to be an important business personality in the country. As a very disciplinary person the older Rabiu made sure he transmitted the same disciplinary culture to Abdussamad and made him to take business with the most uttermost seriousness; and as a profession for living. He started his BUA Company in the late 80s as a trading company that specialised in the importation of agricultural commodities and chemicals, iron and steel and industrial chemicals. Like it is the tradition with most Kano businessmen, he too started as a trader and importer before moving into real manufacturing. Unlike his father who is educated in the Islamic knowledge, Abdussamad like many modern Nigerian businessmen is equipped with modern education, that took him to America where he studies Economics. Thus, Abdussamad is versatile in both the modern and Kano traditional business skill that request some one to move a lot from one part of the world to another. Then there is excessive desire to acquire wealth which is common with all Kano businessmen, that motivate businessmen to any length allowed by law to acquire wealth.  With the return to democracy in 1999 and the large scale privatisation of government own enterprises by the Nigerian government, Abdussamad wedded in and buy substantial interest in many companies among which are Sokoto cement, Delta steel company, ports, Lafiagi sugar company, and Edo cement company. So far Abdussamad has turned some of these companies into world class business, away from the moribund businesses that they were under state management. Other manufacturing business that he is currently doing well in includes, flour and oil milling, pasta production, oil and gas, shipping, and real estate.

  One of the conclusions that can be driven from this piece is the Kano tycoons’ obsession with building conglomerate instead of Anglo-Saxon specialized businesses. This is due to many factors among which are the environment they are doing their businesses, family tradition and the desire to growth wealth in such a short span of time. They are very conservative as they hardly go into business areas prohibited by their religion with the exception of few with investments in modern interest base banking system. To them business profession is like a religion- they followed the rule to the end and do not joke with business deals. The children of the founders of these family businesses unlike their parents have acquired a lot of Western education and business skills.

Ado-Kurawa, I. (2006), “Investment opportunities in Kano: the centre of        commerce”, Research and documentation directorate, Kano state government
Kano state economic empowerment and development strategy (K-SEED), September 2004