Name: Fred Swaniker
Age: 32
City: Johannesburg

At 26, an employee of business consulting giant, McKinsey & Co., Fred dreamt of a school to train young African leaders. In 2007, that dream came true. We met at Life, a restaurant in Sandton City Mall near Mandela Square in Johannesburg.

S.A.: WHEN DID YOU START HASHING THE PLAN FOR THE SCHOOL?

FRED: Almost six years ago. I went to Nigeria to do an internship in Lagos. I’d been sponsored to do my MBA at Stanford by McKinsey, who I’d worked with a few years before, based in Jo’burg. Because I’d been sponsored, the deal was that I was supposed to come back and work for McKinsey for two years. Most of my peers in business school were going to do internships in private equity and I was like, I’m going to McKinsey, so let me just go do something fun – this [internship]. And while I was there, I met these wealthy Nigerians complaining to me about fees they were paying to send their kids to schools abroad. They were paying about $40,000 to $50,000 a year. Some of these kids are leaving at age 12, 13.

So I was thinking, why are we spending so much money to educate kids outside of Africa? Why don’t we have a school on par with the best in the world right here? It would be a cheaper alternative for the parents and I was worried that these kids were leaving at such an early age, they would never come back to Africa. And if they came back, how useful would they be to the continent? The more I thought about it, I thought, “I just don’t want to set up a school to serve rich families. If you’re going to go to the trouble of setting up a school, let’s have it have a much bigger mission.” I’ve lived and worked throughout Africa and I’ve come to see that the biggest issue we faced in Africa was leadership. That was the alpha and omega. If we didn’t fix that, we weren’t going to go anywhere.

S.A.: WHAT MADE YOU COME TO THAT CONCLUSION, WHAT DID YOU SEE?

FRED: The countries I’d lived in that I saw things were working, like Botswana, you could see that it was the leadership at the root cause of it. And no place shows you the impact of leadership in Africa than Nigeria. People think what we need in Africa is resources, it’s not resources, the world keeps giving us more aid, that’s not what’s going to change Africa, we have all the resources we need. We have people; I mean Nigeria has 140 million people. They have all these natural resources, starting resources that any country can really use to kickstart development. But time and time again, we find that our leaders have held us back.

Look at Zimbabwe today. The whole country’s being held back by one person. Look at where things worked, like South Africa. We went from apartheid to democracy – few people – Nelson Mandela. So I’ve come to see that a few people were holding Africa back, these people were the leaders. And I realized that if we can change Africa, it’s not going to be a lot of people. It’s going to be a few extraordinary leaders who are going to make all the difference.

The other thing I think we do in Africa is we think too short-term. When you’re transforming a nation, you need to think “generationally”, because Africa’s development is not a short-term project. I’m always amazed when I go to New York, you get in the subway system and travel from Brooklyn to Harlem and they built this thing 100 years ago. They thought, “In 100 years, what’s the population going to be and where will people need to travel?” You go to any neighborhood in Accra, Lagos, or Nairobi, and the thing was built five years ago and it’s already overcrowded. There’s no services, no water. What were these guys thinking? They couldn’t think ahead five years? We’re always fighting one crisis or another, putting out the fires. But how do we engineer society with a long-term view? You develop people who stop these problems from happening in the first place. Why should we have Bono and Bill Gates and Clinton coming to solve our problems? Where are our African versions of these people? That’s what inspired me to make that the focus of the school.

S.A.: WHAT HAPPENED NEXT?

FRED: I was staying with this former colleague of mine from McKinsey, a German guy called Peter Monga, I told him about it and he liked the idea. Later on discussed it with another McKinsey colleague, Mr. Acha Leke. My goal going into Stanford was to [start] one of these ideas that I had. I went back to Stanford, my second year, and started writing the business plan for the school.

S.A.: WHAT DID IT LOOK LIKE? ANOTHER GOAL OF THIS PROJECT IS TO INSPIRE PEOPLE TO GO FOR THOSE THINGS THEY THOUGHT WERE TOO BIG TO START. WHAT KINDS OF THINGS DID YOU HAVE TO THINK THROUGH TO MAKE SURE IT WAS A STRONG BUSINESS PLAN?

FRED: I think the plan is actually the least important part of it. It’s important but it’s not crucial.

S.A. WHAT’S THE MOST IMPORTANT THING?

FRED: It’s the team you put together to execute it and the dedication that you put to it. People have a lot of ideas and then they want to do them part-time, and they still want to keep their investment banking jobs, and try to launch this thing on the side. They don’t recruit other people with solid skills, who can help them make the thing happen, share the idea, and if it’s a business, give them a piece of the pie so they can do it as a partnership. So things just don’t fly because you don’t put enough muscle behind it. That’s the problem with Africans, we like to talk and don’t do enough.

S.A.: SUMMITS AND CONFERENCES, THAT’S WHAT WE DO.

FRED: There’s a thousand people at Harvard Business Conferences every year. Talking and they’re not doing stuff. Everyday I come up with a new idea. I quit my job to do it full-time. Those are the things that make it happen. The last five years, this is all I did – setting up the school.

S.A.: HOW DID YOU SUPPORT YOURSELF?

FRED: [He laughed.] There was this issue of the loan that I had to pay McKinsey. The deal was that I was supposed to go back and work for them. I was not going to do this idea because I thought, it’s a nice idea, but I’m committed. If I don’t go back to McKinsey, I owe them $120,000. So I thought, well, I’ll do it after my two years at McKinsey. But then the more I worked on the plan in my second year at business school, the more I got excited about it. And I thought, “Naah, I really want to launch this thing.” Initially I asked McKinsey for a nine-month leave of absence for personal reasons. My plan was to launch the academy in those nine months, get a CEO to run it, and then go back to McKinsey. But after a couple of months, I was like: I can’t outsource my dream; I have to do it myself.

I’m a bit of a hypochondriac sometimes. If I see a little blemish on my skin I think I have skin cancer. I go to see the doctor two or three times a year just to check. It was one of those moments when there was some little blemish on my skin and I was like: O I’ve got skin cancer. And then I was just thinking, what if I actually did have skin cancer and was told I had a year to live. What would I do? In that moment, it became clear. Of course I would do this school. Why should I wait until I’m told I have a year to live before I do what I’m really passionate about doing?

I didn’t know where the hell I was going to get the money from to pay McKinsey, but I called them and said I’m not coming. This was two months into my leave of absence. They said, “No, wait until your nine months are over.” I think they thought the idea would fizzle out after nine months and I would come back. After nine months later, I still said, I’m not coming back. And they were like, “OK, you have two months to pay us off.” I didn’t have a salary. I hadn’t been paying myself. I had raised a bit of money to start the organization.

S.A.: HOW?

FRED: Just from friends and family. I initially raised $200,000.

S.A.: YOU HAD FRIENDS AND FAMILY WHO COULD HOOK YOU UP WITH $200,000?

FRED: Yeah.

S.A.: [Incredulous silence] O.K.

FRED: I mean, my B-school classmates chipped in. And these guys, Peter and Acha, chipped in the most. So I’d raised some money and I was supposed to pay myself $60,000. So I just took that sixty that I was supposed to pay myself and gave it to McKinsey. So I got half of it from what I was supposed to pay myself. And the other half, my mother lent me the money.

S.A.: SO YOUR MOM WAS ONBOARD WITH THE IDEA?

FRED: My mother didn’t talk to me for about a year because she didn’t want me to take the risk. Which you would expect from a parent:  parental worries, they don’t want their kid to suffer, to have this loan burden and all that. But I think that’s also a big problem in Africa because our parents stifle entrepreneurship. They want us to take the safe path. When you’re growing up, all the role models they show you are the doctors, the lawyers, the engineers. Anyone comes to the house involved in business and you get the sense that this person is kind of shady, you don’t want to be like them. Meanwhile, we’re not going to come out of poverty in Africa unless we have major entrepreneurs. That’s what’s going to drive growth. We need indigenous African entrepreneurs – the guys who are going to come up with big dreams – the Bill Gates and Richard Bransons of Africa.

S.A.: MOMS ARE MOMS. SO WHAT NEXT?

FRED: In terms of developing the operation, the first thing we did is we launched a series of summer schools – a one-month version of what we envisioned this two-year program to be like. And for the summer we said, let’s be a bit crazier. Instead of recruiting kids from Africa, let’s recruit globally. If we prove we can get kids from all over the world, then Africa would be easy.

We got kids from the US, the UK, Nicaragua, all over Africa. The first year we did this in 2005, we had 70 kids who came to Cape Town, near the ocean. We got them to meet the leaders of South Africa. That first year, they met Desmond Tutu,  former prisoners from Roben Island involved in the struggle, and Mbongeni Ngema, writer of SARAFINA. Then we took them out to see Roben Island, where Nelson Mandela was imprisoned.

So they would have read an excerpt from Nelson Mandela’s autobiography; then you take them to Roben Island; then you bring a prisoner from Roben Island to talk about what it was like – linking their experience to what they were discussing in class. Then they’d go and do community service. The kinds of leaders Africa needs are those who will serve Africa not those who only want to enrich themselves.

We did it again in 2006 and this time we had 100 kids. It was starting to take on a life of its own. I was initially running both the summer program and getting this leadership academy set up and it was becoming too much work. So I hired a CEO to run the summer program, and spun it off as a separate organization. We replicated the program all around the world. Now that program is in 10 countries. This summer, we’ll take about 400 kids. There’s the original one in Cape Town, one in Ghana, India, Brazil, Costa Rica, Tanzania, Vietnam, Galapagos Islands, Guatemala and the Dominican Republic.

S.A.: WOW.

FRED: It’s a for-profit institution. I set it up that way because it’s much easier to raise money for profit, while we’re trying to test the concept. The whole nonprofit world distorts incentives for performance.

S.A.: WHY?

FRED: Donors want to see results before they give you money, but you can’t get the results without money. So it’s a chicken and egg problem. Whereas investors, when they know there’s a return to it, are willing to take the risk. But the donor knows if they give money and you fail or succeed this money doesn’t come back to them. So they’re much more cautious. It was very easy to raise that $200,000, we got it in like two weeks because we set it up as a for-profit.

So now when we went to raise money for the nonprofit, we could talk about the two summer programs we’d done before and the experience the kids had. It allowed us to develop relationships with great schools around the world, which we learned from for the ALA. And you can see how rapidly it grew: 10 countries in four years; went from 70 kids to 400 kids.

S.A.: WHAT ARE SOME OF THE KEY COMPONENTS OF YOUR TRAINING AT ALA?

FRED: We have this thing called the Seminal Readings Program. The first week of every term at ALA, kids do nothing else except these readings. We modeled after what they do at Aspen Institute. We select the readings that we want anyone who goes through the ALA program to have read. Whether you graduate in 2010 or 2050, you all would have read these. It’s a common base of knowledge for everyone who goes through ALA.

The curriculum at ALA has three legs – Leadership, Entrepreneurship and African Studies. We’re developing the leadership skills to become agents of positive change. Entrepreneurship: we want them to develop the skills of having a vision for something and how you practically bring it to life. With the African Studies, we want them to understand the context of Africa because most Africans are not educated about Africa. You learn about your country, your colonial power, not our own history, our own geography.

S.A.: AND HOW DO YOU GET THAT INFORMATION?

FRED: We’re building it. [Emphasis on the building] It’s nowhere near where I want it to be. It’s version 1.0, same thing with our entrepreneurship curriculum. We borrowed elements from different organizations, and things that we saw were missing, we developed our own.

END.