WILDGEESE: EMIGRANT BUSINESS LEADERS ON OPPORTUNITIES ABROAD: Niall O'Cathasaigh - Founder, ManoCap

WHEN NIALL O’Cathasaigh arrived in Sierra Leone in 2005, the country was still emerging from a crippling civil war that left 70,000 dead and displaced millions.

“The country was devastated. There were no services, no electricity, and water was a major issue,” says the Tralee man. “But I landed on St Patrick’s Day and ended up in a big expat party with cold beer.”

The “luxurious expat bubble”, as he describes it, made him cynical, and it wasn’t long before he began looking beyond the aid sector to the private sector as the best way to get the west African country’s economy off the ground.

A qualified accountant, O’Cathasaigh was working for Apple in Cork when he decided on a final adventure before he settled down. “I had one eye on the auld fella’s accountancy business in Tralee and decided on one more jaunt,” he recalls.

A colleague had volunteered for Goal in Sudan, giving him the idea to do something similar. “I was coming up to 30 and thought if I left it any longer I’d never go.”

Once in Sierra Leone, though, he became “very cynical about the aid business”. “There is some tremendous work done but it was all about establishing stability and handouts,” he recalls. “What Sierra Leone really needed was a vibrant private sector, but nobody was talking about it.”

He met Welsh management consultant Tom Cairnes, who was working as the private-sector consultant for the United Nations Development Programme, and began formulating the idea of investing in small to medium- sized enterprises that were finding it difficult to source funding.

“Sierra Leone has . . . large fishing resources and very substantial mineral assets such as bauxite and gold. It’s the wettest country in Africa and, in terms of geographic proximity, is close to markets in Europe, Latin America and the US,” says O’Cathasaigh.

“But the big development finance institutions such as the European Investment Bank did not have the time or resources to invest in local businesses after the war. Our conclusion was that it needed a venture private equity fund, with people on the ground working together with the businesses.”

Without “a bob to our names”, in 2006 O’Cathasaigh and Cairnes began working out of a friend’s house in the British high commission, where their new business, ManoCap, had phone and internet access. Early on, they secured £30,000 (€35,200) in investment from Baron Dennis Stevenson, the former chairman of British bank HBOS, which “kept us going for a year before we got proper funding”.

“Tom was friends with [Stevenson’s] son, and he liked what we were doing. He was anti the handout mentality and believed in the private sector as a route out of poverty.”

Being Irish in Sierra Leone didn’t hurt, O’Cathasaigh adds.

“Half the country was educated by Irish priests, Irish NGOs have been here since the 1980s and the country received a huge amount of funding from Irish Aid. Ireland has made its mark on Sierra Leone and the Irish are very well received.”

In 2007 the company secured $6 million (€4.4 million) in funding from various investors and started putting the money into businesses. “People were only looking at mining and telecoms companies, so we decided to take a different tack and concentrate on fisheries, agriculture and agri-business.”

One of the earliest investments was in the Sierra Fishing Company, a trawler business that freezes and processes 3,000 tons of fish a month.

“It’s a 50-year-old business that was destroyed during the war and was on the seat of its pants,” says O’Cathasaigh. Owned by a Sierra Leonean, it now has 16 trawlers and sells primarily to the local market, although it has started exporting to Côte d’Ivoire and Liberia as well. “We are looking to make it EU compliant so that it can begin exporting to Europe,” O’Cathasaigh adds.

Other investments include an ice-making business that sells to artisanal fishermen, allowing them to stay out at sea three or four days longer, and a trading and logistics company. The latter has a network of trucks that travel around regional trading hubs, selling fish and buying agricultural produce.

ManoCap has now invested in four companies, with $22.5 million under management.

“We buy equity in businesses we see potential in and hope we can double our money over three to five years as more funding comes in to the country and provides exits. We are 100 per cent aligned with the companies we invest in and looking to grow the businesses with them,” he says.

ManoCap is seeking to establish a similar fund for Liberia early next year and hopes to expand its investment model across west Africa. “There is a post-conflict model that we want to follow,” O’Cathasaigh says.