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Cracking the Code and Bridging The Gender Gap

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One spring day in 2015, Julia Lee, a top performer on the engineering team at the payroll-software start-up Gusto, asked Edward Kim, the company’s cofounder and chief technology officer, for a one-on-one meeting.

Sitting together on a gray couch in the middle of their open-plan office in San Francisco’s SoMa neighborhood, Lee, a Stanford grad who had interned at Google and Palantir, told Kim that she loved her work but was struggling with one issue. Of the 18 people on Gusto’s engineering team, Lee, then 26, was the only woman.

Before she got to Gusto, she told Kim, “people often assumed I didn’t know the answer to a problem because I was a female engineer.” Even at Gusto, she was reluctant to share her feelings of self-doubt. Kim, Lee says, was extraordinarily receptive. In fact, he made it a personal project to study the gender breakdown on the engineering teams at other tech firms. The numbers he found were dismal.

READ MORE: ‘One In 100 Million’ Chance Alleged Gender Pay Gap At Google Is Random, Says Class Action Lawyer

Only 12% of the engineering staffers at 84 tech firms were female, according to statistics gathered in a public Google Doc posted in 2013 by Tracy Chou, then an engineer at Pinterest. Kim read a U.S. census report on racial and gender disparity in STEM employment and was troubled by a National Public Radio report that showed an increase in women graduating with computer science degrees through the early 1980s and then a steep decline from 1984 on.

He also read a 2015 McKinsey study showing that companies with diverse workforces outperform financially. “The fact that no one else in tech was able to really crack the gender diversity nut and solve it represented an opportunity for us,” Kim says. “If we want to reimagine what HR is like for the very diverse workforces of our small-business customers, we ourselves have to build a diverse workforce.”

After a series of meetings with Kim and Lee, Gusto’s human resources team launched a plan to attract women engineers. Initial steps included writing job descriptions that avoided masculine phrases like “Ninja rock star coder.” Gusto’s most important step: For a six-month period starting in September 2015, the company devoted 100% of its engineering recruitment efforts to women.

While it solicited only women, it considered male applicants who approached the firm and treated all candidates equally, which kept Gusto from running afoul of antidiscrimination laws, according to Gusto lawyer Liza Kostinskaya. The pitch to women included emails signed by Lee inviting female candidates to have an initial talk with her and was backed by $60,000 the company spent to be a sponsor for two years at the biggest annual women’s tech conclave, the Grace Hopper conference.

Kim also published a blog post that made Gusto’s diversity numbers public and broadcast its goal of hiring more women engineers. “We believe that diversity is in itself a core strength that will enable us to write better software and build better products,” he wrote.

In line with more than 80% of start-ups, according to a 2017 Crunchbase study, Gusto’s three founders are men. Kim and Gusto’s CEO, Joshua Reeves, both 34, met as undergrads in Stanford’s electrical engineering department.

They launched Gusto in 2012 along with Tomer London, 33, an Israeli immigrant who got to know Reeves while a Ph.D. student at Stanford. Like its boom-and-bust competitor, Zenefits, which launched the following year, Gusto sells cloud-based comprehensive subscription software to small businesses to help them manage employee records like payroll and health benefits.

At the outset Gusto even had a similar name, ZenPayroll, which it changed in 2015 when it started offering a more complete selection of employee-tracking software.

Zenefits attracted $584 million in venture capital and hit a valuation of $4.5 billion in 2015 before running into regulatory problems related to the way it sold health insurance. It sacked its CEO, reworked its business model and saw its valuation slashed to $2 billion. Gusto, meanwhile, grew less feverishly.

By late 2015 it had raised $176 million from firms like CapitalG (formerly Google Capital) and General Catalyst, and 75 individual investors handpicked by Reeves, including Ashton Kutcher and PayPal cofounder Max Levchin. That year it broke through to a $1.1 billion valuation. Forbes estimates Gusto’s annual revenue at nearly $100 million.

READ MORE: The World’s Highest-Paid Women In Music 2017

At the start, Gusto’s founders acknowledge, diversity was on the backburner, and as it grew, they found that it didn’t happen organically. When it came time to hire a chief operating officer in 2015, they made it a priority to find a woman. Lexi Reese, a veteran of Google and American Express, is one of two women on the six-person executive team, and firmwide, women account for 51% of Gusto’s 525 employees.

Even after Gusto began its diversity initiative, applications from women didn’t flood in. Gusto assigned two in-house recruiters to the job, and it hired TalentDash, a Singapore-based firm that sources talent, to look exclusively for women.

Though hiring women engineers took more time, Kim says, Gusto never dropped its standards. “It bothers me when people say that prioritizing diversity lowers the bar in terms of the calibre of talent you’re able to hire,” he says. “That is simply not true.” Nor, he says, was there any pushback from inside Gusto.

Gusto also addressed its compensation policy. Since 2016 its salaries have been audited by Mercer, a human resources consulting firm, which has found no gender pay disparity. Benefits include 16 weeks of paid leave for a primary parent, plus an additional $100 a week for groceries and food deliveries, $100 a month for six months of housecleaning and up to $500 for a baby-sleep coach.

Gusto’s women-only recruiting effort lasted six months. It stopped, Kim says, because “we exceeded our goals.” In 2015 Gusto was trying to hit 18% women engineers, the proportion majoring in computer science as undergraduates, according to the National Center for Education Statistics, and it reached 21%.

Since then it has started staffing a Denver office, where it aims to increase the engineer head count by at least 25 this year and where the company is reprising its women-only recruiting strategy. Now that 17 of Gusto’s 70 engineers are female, it’s getting a little easier, says Gusto’s HR head, Maryanne Brown Caughey. “It’s kind of a domino effect,” she says. “Women know they’re joining a welcoming community.”

While Gusto has made progress, its engineering team has no Latinos and no African-Americans. Kim says Gusto has two hiring goals in 2018: senior women and racial diversity in engineering. “The way we make progress is by focusing on one problem,” Kim says, “and then we move on to the next.”

– By Susan Adams

Entrepreneurs

Why This 48-Year-Old Woman Is Building Ghana’s Biggest Solar Farm

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Chairman of UBI Group Salma Okonkwo. UBI GROUP

For more than a decade, one 48-year-old entrepreneur in Ghana has been quietly building up a multimillion-dollar oil and gas outfit called UBI Group. Salma Okonkwo is a rare woman to head up an energy company in Africa. “I don’t stop when the door is being shut. I find a way to make it work,” Okonkwo told Forbes. “That’s what propelled my success.”

She’s now expanding her reach across Ghana’s energy industry, working on an independent side project that may become the biggest in her career. Okonkwo is building Ghana’s biggest solar farm, called Blue Power Energy, slated to open in March 2019 with 100 megawatts of energy. It’s set to be one of the largest in Africa.

“Most of the multinational companies that come to Ghana don’t put in infrastructure. They operate a system where they invest very little and they take it away. They sell their products and leave,” Okonkwo says. “I’m hoping to provide employment and add to Ghana’s economy.”

Okonkwo grew up in Accra, one of 14 children born to a real estate agent and developer mother and a cattle dealer father. She often visited her grandmother in her family’s ancestral village. She’s a member of the Akan clan, whose women often sell products they make, like sandwiches or smoked fish, to make sure their children are provided for—and that left an indelible mark on Okonkwo. “The women didn’t know how to read and write, but they knew how to make a margin,” Okonkwo says.

After graduating from an all-girls boarding school with little running water, Okonkwo moved to Los Angeles for college at Loyola Marymount University. (Her family was able to pay her tuition.) She graduated in 1994 and briefly worked in California for a food brokerage company. Then oil and gas company Sahara Energy Group recruited her; Okonkwo returned to Accra in 2003 for the job.

Within a few years, Okonkwo realized that the firm could grow by opening up retail gas stations. She presented the idea several times over the years, but each time she was rebuked. Executives told her they wouldn’t change their business plan because it would be too political and would require too much of an investment in infrastructure.

At 36 years old in 2006, Okonkwo decided she’d heard “no” too many times and quit to try it herself, focusing on bringing liquified petroleum gas to the hard-to-reach region of northern Ghana, where many families still rely on burning firewood for energy. Because Okonkwo’s father was from northern Ghana, she knew firsthand how the business could change lives there. “It was just too hard to pass up the opportunity,” Okonkwo recalls. “It looked quite lucrative.”

But Okonkwo hit an early snag when she realized that she didn’t take into account a complicating factor: The North had few storage facilities for the liquified gas. To get it to the remote region, she’d have to build the storage herself, and she was already struggling to secure funding. So Okonkwo pivoted and started trading diesel and petroleum wholesale. A contract to supply fuel to Dallas-based Kosmos Energy came in 2007, followed by one with Hess in 2008. In the early days, she financed the operation by mortgaging some properties that her family and husband had inherited.

A UBI Group retail gas station in Ghana. UBI GROUP.

By 2008, UBI opened its first retail gas station. It soon owned 8 outright and managed another 20 through partnerships. That caught the eye of Singapore-based multinational firm Puma Energy, which had 2017 sales of $15 billion from operations in 49 countries. Puma acquired a 49% stake in two of UBI Group’s subsidiaries (retail gas stations and wholesale fuel distribution) in 2013 for about $150 million.

After the partial acquisition in 2013, Okonkwo says, she started developing her solar company. She estimates the company will spend about $100 million—financed by roughly $30 million in loans—to create 100 megawatts of solar power by early next year. Construction started earlier this summer. The plan is to add another 100 megawatts by the end of 2020.

Despite all the sunshine in Africa, solar power isn’t a prominent energy source on the continent. Most farms are concentrated in South Africa and Kenya. In 2009, Morocco announced plans to build one of the biggest solar farms in the world. The first of the project’s three phases opened in 2016. “I don’t know of another large-scale project like this in Africa that’s led by a woman,” says Arne Jacobson, who has been studying renewable energy with a focus on Africa since 1998 and is now the director of Humboldt State University’s Schatz Energy Research Center. “Power is fairly expensive in countries like Ghana. If they can keep costs low, this is will be a profitable venture.”

The project is also personal for Okonkwo. Half of the solar farm will be located in her father’s village in northern Ghana. The rest will be spread out throughout the North, which is Ghana’s poorest region, according to Unicef. The organization says the area has seen the smallest progress in terms of poverty reduction since the 1990s.

There are so few employment opportunities in the north of Ghana besides farming that most women migrate to Accra looking for work. Many can only find jobs as “kayayo”—working in markets carrying goods for customers, sometimes known as “living shopping baskets.” They live in slums and regularly endure harassment, theft and even rape. Okonkwo, aiming to create a better alternative for some of these women, says Blue Power Energy has already created hundreds of jobs in northern Ghana and that more than 650 will be created upon completion.

Okonkwo’s ultimate goal is to bring cheap energy to northern Ghana through the solar farm, which she hopes will incentivize companies to create lasting jobs there. In the meantime, she is opening a day-care center in Accra for children born to kayayo women, where, as she explains, they can “get educated and hopefully break the cycle.”

“I want to bring support to my people in the north,” Okonkwo says. “Then there will be more Salma’s all over the place.”

 

– Chloe Sorvino

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The Bloodless Battle Against The Malaria

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With Africa having a big share of the global malaria burden, technologists are developing new, cost-effective ways to detect the disease – minus the needle.

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The Nigerian Who Runs His Business On Luck

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Don’t tell Akin Alabi there isn’t enough time in the day to do everything. He just might tell you off.

At 41, he has built multiple businesses and is making money and time for more.

Alabi is the founder of NairaBET, Nigeria’s first and leading sports betting platform, a company he started in 2009 after he identified what he calls “a starving crowd”.

By that, he means a customer base willing and able to pay for services enough for him to make a sizeable profit.

Besides NairaBET, Alabi owns a small football club, has a book-writing business, is into digital marketing, business coaching and seminars, and is also contesting for a seat in parliament in the 2019 Nigerian elections.

The entrepreneur-investor likes to spend his days identifying specific gaps in the market and providing solutions to address them.

READ MORE: Nigeria; Where Football Is Life

Over the years, he has identified many ‘starving crowds’. He found the first one just after completing a diploma in business administration in 2001. At the time, there was a growing desire for Nigerian youth to travel abroad, especially to Canada, in search of greener pastures.

According to data from the Canadian immigration service, as many as 27,625 immigrants from Nigeria were residing in Canada by 2011.

Alabi tried his luck too.

In 2001, after his visa got rejected, he decided to collate his experiences navigating the complicated visa application process and sell that knowledge online to first-time applicants.

“So anything I learned, I created the information pack and I put it online and sold it,”

“I started downloading information tutorials and videos about the Canadian application process. I put all the information together and said some people will be interested in this so let me put it out there for sale. So in January 2003, I launched my first business, which was selling information products, and the first information product was this Canadian visa package,” says Alabi.

The guide was an instant hit. Alabi was selling it at N10,000 ($28) per copy and over 100 copies later, he knew he had struck a gold mine. It was time to find other crowds. Alabi decided to share his experiences making money online through his new startup in another how-to guide, which also found demand. After the success of the two digital products, Alabi decided to register his company at the Nigerian Corporate Affairs Commission (CAC).

“I went there myself and I did everything myself and I was surprised I didn’t need a lawyer. So I created another information product – how to register your business with the CAC without a lawyer in 21 days or less. I put that out and people were buying. So anything I learned, I created the information pack and I put it online and sold it,” says Alabi.

He had stumbled on a booming industry. According to Stratistics MRC, the global e-learning market accounted for $165.21 billion in 2015 and is expected to reach $275.10 billion by 2022 growing at a CAGR of 7.5% during the forecast period. The flexible learning, low cost and easy accessibility of the market bolstered by the increasing proliferation in the internet during the dotcom boom, presented Alabi with a hungry market eager to grab anything offered online.

Akin Alabi. Photo provided.

Alabi’s story is one of organic growth. Setting goals and achieving them is a prominent theme in his new book Small Business, Big Money: How to Start, Grow, and Turn Your Small Business Into a Cash Generating Machine, where he presents a practical guide for startups looking to scale.

“As early as I can remember, I wanted to be rich. I was fixated on wealth because I did not experience wealth growing up. It is something I believe gives you freedom. Freedom to do things you really wanted to do and freedom to impact this world. You can help the less privileged and also give your family the basic comfort of everything they want,” says Alabi. “I know money is not the most important thing in life but it is reasonably close to oxygen in terms of importance.”

After the success of his digital offerings, business began to slow down, but Alabi wanted more growth. He decided he would venture out of Nigeria to the land of milk and honey, in search of that elusive wealth.

“I got to the UK and wanted to work. I looked at the potential of what I could make and after four months, reality dawned on me. I didn’t want to become an illegal immigrant and felt I was better off doing what I was doing in Nigeria. So I said ‘I had something going for me, it might not be big but there was potential’. I said ‘let me go back and make it bigger’. I was not investing in the business so it was time to do it properly.”

But before leaving the UK, a chance encounter with the bookers would lead to the serial entrepreneur’s most lucrative venture yet. His brother called him from London while he was in the town of Milton Keynes to make a bet in an online sports shop for a football game so they could win some money.

“So I played and I made some money and then I played again and I lost and I played again and I won. And I said ‘wow, anybody can do this and people in Nigeria will love it’. So I wrote down on paper, how to make money from football betting. It was just 14 pages and I put it online and I called my friend in Nigeria to help me go and run an advert in the local newspapers,” says Alabi.

He invested N200,000 ($555) in the advert and made N450,000 ($1,248). That demand was going to progress from online content to a new customer base wanting a platform to bet on sports.

READ MORE: Success Is In The Bag For This Entrepreneur

“So those that bought the information product from me started reaching out to me that the website I recommended they should bet on did not work in Nigeria. And I was like ‘wow, you people are actually taking this seriously’. They wanted to place bets from $100 to $750. So I got thinking, these people are actually sending money to me abroad to place bets for them. Isn’t there anyone in Nigeria that has a business like this? And there was no one. So I said to myself ‘I have to create this platform’.”

That was almost a decade ago. He could not afford the software to create the platform at the time, which cost almost $1 million so he used a local developer to create his first platform. Today, NairaBET, a major player in the online sports betting market, has steadily transformed itself from just a football betting platform to a 360-degree sports booking platform covering digital, SMS, apps and retail betting. And, they have a new million-euro software upgrade in place, according to Alabi.

The total value of the global sports betting market is difficult to estimate because of the lack of consistency in how it is regulated in some parts of the world. Betting makes up about 30% to 40% of the global gambling market, which also includes lotteries, casinos, poker and other gaming, according to a report in Reuters.

This has led to challenges regulating the sector in Nigeria with issues arising from double taxation from the Lagos State government. But Alabi is hopeful these issues will be resolved once there is proper legislation of the sector. In the meantime, he is betting on a career in Nigerian politics and the corridors of power.

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