Mashariki Creative Economy Impact Investment Conference 2017

2017

CONFERENCE REPORT

1st Mashariki Creative Economy Impact Investment Conference held at the Serena Hotel Dar es Salaam, May 11 - 12, 2017

FROM THE CONFERENCE ORGANIZERS n May 11, 2017, Culture and Development East Africa (CDEA) welcomed participants to the 1st Mashariki Creative Economy Impact Investment Conference held at the Serena Hotel Dar es Salaam. The two-day conference was opened by Dr. Consolata Ishebali, Director, Small and Medium Enterprises, Ministry of Industry, Trade and Investment, who represented Hon. Charles J.P Mwijage, the Minister of Industry, Trade and Investment. She pointed out that the Ministry has keen interest in the creative industry development, which has been included in the Small and Medium Development Policy that is under review. The conference participants learnt that the Ministry of Industry, Trade and Investment of Tanzania has so far done research to establish the challenges of the creative industries with the aim of informing policy. For instance, the Ministry has set up a Textile Development Unit and has National Textile Development Strategy.

H.E Einar Jensen, the Danish Ambassador to Tanzania in his opening remarks said CDEA’s research programme that is funded by DANIDA is aligned to government of Tanzania investment priorities namely: broadcasting –content production for digital channels, manufacturing - garment manufacturing, mining - utilizing gold and gemstones and tourism –cultural tourism. He also pointed out that UNCTAD’s (2015) outlook report on the trends of international trade for the creative industries shows Tanzania’s creative industries exports increased significantly from $2.5 million in 2003 to $69.9 million in 2012. However the report indicated that Imports grew at a higher rate reaching $121.05million in 2012, which led to a trade deficit of $ 51.13 million in 2012. He mentioned that the export/import gap could be narrowed with the development of the film and music sector in Tanzania over the last decade.

The conference began by CDEA sharing its research findings of a study carried out in 2016, titled: Tanzania Film and Music Industries: Analysis of Industry-Specific Framework Conditions Relevant for Growth and Investment and a study carried out by the African Development Bank, titled Feasibility Study for the Development of the Fashionomics Platform. In addition, George Gachara, Managing Director of the Heva Fund provided an oversight of the ‘Financial Landscape for the Creative Industries in East Africa.’

These research products provided a pathway for the conversations on impact investment and government policy, as well as the proposal establishment of an endowment fund for the creative industries in East Africa.

Over the two days, speakers and participants explored the theme of impact investment in four sectors of the creative sector namely: Content production for digital channels, textile and fashion design, jewellery and accessories design and concerts and festivals in the East African tourism circuit. Conversations were enriched by contributions from a diversity of participants who included: Representatives from cultural associations, creative entrepreneurs, the National Arts Council of Tanzania, ministry of culture and arts and trade and industry officials, impact investors and a representative from the East African Legislative Assembly (EALA).

The feedback from the conference indicated that the conference was engaging, educative and provided an opportunity for start-ups in the creative sector, arts federations to interact with more experienced entrepreneurs from the East African region. Other participants also found it a valuable networking platform for creative entrepreneurs from the region and requested CDEA to host an annual networking platform. The National Arts Council of Tanzania appreciated the conference and looks forward to supporting CDEA in organizing the next conference, while the Ministry of Industry, Trade and Investment of Tanzania welcomed CDEA to work together.

Some of the participants were happy about the parallel sessions that enabled participants to focus on sector specific issues linked to the generic theme of impact investment.

We also received feedback that the conference could have been more engaging, if Kiswahili, being an official language of the EAC, was also used in the conversations. It was also recommended that in the next conference, CDEA should invite more creative entrepreneurs and impact investors, as well as the ministers of industry, trade and investment, culture and regional integration, so as to have a more regional focused conference.

Some participants also thought the proposal to establish an endowment fund for the creative sector and follow-up conferences are crucial in developing the creative industry. It was also noted that for the sector to develop there is need for creative entrepreneurs themselves to invest in the industry.

One participant advised that the pitch platform in the next conference should have clear presentation guidelines, so that there is uniformity in terms of time management and presentation format.

One of the participants felt that a key challenge for the creative sector is access to markets outside the region. This indeed raises the question as whether the Article 16 – Preferential Treatment for Developing Countries in the UNESCO 2005 Convention, is being used to advocate for access to markets beyond the EAC by member states who are signatories to the Convention.

The conference participants reaffirmed that both development funding and impact investment are required to enhance the industrial development of the creative sectors.

This conference was made possible by the support and engagement of the speakers, moderators, rapporteurs, participants and our supporters DANIDA and British Council Tanzania. We sincerely thank everyone involved in making the 1st Mashariki Creative Economy Impact Investment Conference a success.

The rapporteur notes from the conference can be found online at sanaabiz.co.tz.

We hope that the conference has inspired the government, creative entrepreneurs and impact investing community, and that this will lead to more regional representative and successful second conference in May 2018.

Godfrey Madaraka Nyerere Chairperson, CDEA Ayeta Anne Wangusa Executive Director, CDEA

CONFERENCE PROGRAMME East Africa is one of the centres of global impact investing, with Kenya and its capital city Nairobi being the regional hub of East African impact investing, followed by Uganda and Tanzania. According to a study carried out by the Global Impact Investment Network (GIIN) in 2015, in East Africa, small social value chain (VC) and debt-finance funds target early-stage businesses in businesses in ICT, Agriculture, Health, Energy with a deal size range of less than $500,000. Private equity funds, VC funds and foundations, on the other hand, target social businesses with some track record in the Agriculture, Financial Services, Health, Energy sectors, with deals worth $500, 000 - 1m. (Open Capital, GIIN, interviews, 2015).

CDEA’s research findings on the framework conditions relevant for industrial growth for the film and music industries in Tanzania (2016) indicated that film and music businesses in Tanzania are at the precursor and embryonic stages of industrial growth. The study also showed that most of these early-stage creative business use personal savings and family support to run their businesses and have not been considered for debt-finance. While, the film and music industries, because of their point of confluence with ICT, should be considered for investment under small social value chain (VC) and debt-finance funds have not been a beneficiary of these financial instruments.

There is no documentation of impact investment in the creative industries in East Africa, expect for the Heva Fund based in Nairobi, Kenya that has provided a range of funding instruments for creative entrepreneurs in the craft, fashion and photography namely: Revenue share model, convertible debt, fixed interest rate loan and lease to own.

CDEA’s research in the cultural and creative industries in East Africa, with a focus on film and music industries in Tanzania, established that the donor landscape for the cultural and creative industries NGOs has shifted. The research also noted a policy shift from Global North funding institutions from funding Non-State-Actors involved in the Cultural and Creative Industries to supporting the role of the arts in intercultural dialogue and the role of the arts in addressing inequality. In a way, this shift has positioned the creative industries in their right arena; the private sector - to be able mobilize private capital and finance to develop the creative industry in East Africa.

This policy shift by the traditional development partners, led the conference programme director to design a programme that would address the following key questions.

What kind of policies and legislation is required to attract private sector investment in the selected creative value chains and to mitigate the risk of investing in the creative industries that mostly situated at the precursor and embryonic stages of industrial growth?

What impact capital vehicle is required for supporting the creative economy ecosystem in East Africa?

What do early-stage creative businesses need for them to shift from the precursor and embryonic states to the nurture and mature stages of industrial growth?

The programme also had key questions for the four industries linked to impact investment.

• Textile and Fashion Industries: What are the key challenges in the textile and fashion value chain and what impact investment actions are required to promote industrialized and handcrafted garment manufacturing in the EAC regional market that meets international standards for the global market?

• Gold and gemstones/ Accessories Design: What safeguards need to be in place for impact investment in gold and gemstones jewellery design by artisans within the mining value chain in East Africa?

• Film/Content Production for Digital Channels: What guarantee funding mechanisms need to be put in place to mitigate the risk of investing in the broadcasting sector, with focus on content production and distribution in local, regional and international markets?

• Music/concerts and festivals in the Tourism Circuit: What would impact investment for the music industry in East Africa within the framework of sustainable tourism look like? What commitments should government, private sector and development partners make in this ecosystem?

The programme also used a visual artist from Uganda, Rolands Tibirusya to do a commemorative /interactive live painting on the conference that was later signed by the conference participants.

Day 1: Plenary Sessions Creative Economy Value Chain Findings in East Africa

AFDB Feasibility study for the Fashionomics Platform

By Angela Kilusungu, Audio-Visual Programme Officer, CDEA

A presentation on AFDB Feasibility study for the development of the Fashionomics platform was made and these were highlighted as its potential uses for the fashion industry stakeholders in East Africa Relevant contacts in the sector: from government and manufacturing industries.

Access to market There will be access to financial resources to get all information to financing and funds.

Skills development of the personnel or hiring special talents, with a focus in women onto businesses, employment for youth and micro development.

Interesting potential platform uses according to those interviewed in current prototype.

7% of those interviewed said export is the most important thing, 13% said quality, 33% said financing same as communication and 40% said training, 47% said selling.

Tanzania Film and Music Industries: Analysis of Industry- Specific Framework Conditions Relevant for Growth , By Ayeta Anne Wangusa, Executive Director, CDEA A presentation on CDEA’s research study, Tanzania Film and Music: Analysis of Industry- Specific Framework Conditions Relevant for Growth and Investment was made.

Research findings: • No guarantee system financial system for the creative industries (focus on film and music) • Creative content producers are at the precursor and embryonic stages of industrial development • There is a market for film and music in Tanzania, controlled by telcoms and broadcasters and aggregators • Limited knowledge development (research) for the creative economy • There is a weak copyright management framework • No policy measures to support creative startups and stimulate innovation • Mobility funds are limited, save for the British Council Easy Africa Mobility Fund • Very few support organizations providing support to creatives • There are clusters of creatives both music and film, which need both technical and organization development Policy Conclusion: • There is need for development partners, the government of Tanzania and private sector to work together to transform the film and music industries • The government needs to provide the enabling environment for impact investment to invest in the film and music industries.

• There is need for a systemic approach to address all framework conditions, if Tanzania is to enhance the growth and investment of the film and music industries.

• Need for national research to capture creative economy data and to trend it over the years • This calls for the government to trigger a process that will mobilize resources to build capacity of film and music enterprises, through business incubators and accelerators, mobilize direct investments, offering providing regulatory reforms and establish guarantee funding systems from development banks to commercial banks for the creative industries

The Financial Landscape for the Creative Industries in East Africa: What is the Way Forward?

By George Gachara, Managing Director, Heva Fund

Issues that inspired by this research • The need to develop clarity on the statistics of the contribution of the creative sectors to our EAC countries’ GDP to understand the footprint of the creative sector.

• Issues arising from that research in 2012-2013 • Perception issues: poor quality products, too expensive, internationals are better than local • Value chain integration issues • Associated sourcing issues • Operating environment issues • Kill gaps : most entrepreneurs are self-taught • Copyright issues • Competitive issues • Specific firm level questions from the entrepreneurs and their business • Selling issues • Working capital issues Entry points and strategy based on research findings and facts findings studies done by Heva from 2013 to 2015 are: • Need of training of creative entrepreneurs • Need for business development and financing of the sector There were emerging trends in the creative economy sector • All our creative industries are entrepreneur driven with maximum of at least five people working for them and most of them not on permanent bases. Their capitalization is less than $30,000 • Landscape of about 2500 businesses are operating as early stage businesses post revenue • Little knowledge on keeping our businesses the way the market requires • Market has very little understanding of the creative sector value chain hence risk on calculation of debt product in the market • A lot of us are still informal: haven’t registered our businesses, we don’t file returns

Heva’s approach towards these challenges which also serve as opportunities • Injecting capital into businesses that are viable and start working with them towards investor readiness • Heva evaluates the potential of a business for investment through a creative panel created in 2015 Critical areas for investment and innovation for Heva fund • Business aesthetics of the entrepreneur – first area for innovation • Suitable finance (Financial innovation: Financial modelling and instruments) • Security and collateral • The creative process • Value chain investment development Areas where the fund has invested • Fashion value chain – invested in production factories, retail and brands • Heva has identified a collective of about five fashion designers who will be contracted in 2017 Areas for future investment • Invest in an East African Fashion retail network in 2018-2020 where Heva has key retail assets in Addis Ababa, Kigali, Dar es Salaam, Nairobi and Kampala • Invest in content development from 2018 • Music Performance and entertainment.

Heva’s comparative advantage with other impact investors • Unique creative product • Creating value from opportunities we have • Targeting young population in the region • Working in the cultural space and understand the dynamics KEY ACTION POINT: •Create a curriculum for the financial sector on the creative product because it is a specialized product.

High-Level Panel on Government Policy and Impact Capital.

The conversation began by unpacking the concept Impact Investment through a presentation made by Daniel Maginga, Investment Executive, GroFin, Tanzania, who described Impact investments as investments made into companies, organizations, and funds with the intention to generate social and environmental impact alongside a financial return. He provided a background of what kind of investment Grofin has made to two creative industries companies, Rwanda Textile Importers and Traders Limited and Aniella Ventures Nigeria Fashion – shoes and clothing namely: Pre-finance support (Develop investment ready SMEs, Provide access to appropriate finance) and Post-Finance Business Support (Reduce failure rate by supporting entrepreneurs, Develop and grow sustainable SMEs that deliver impact).

After this presentation, the moderator, Ms. Maria Sarungi Tsehai, Director of Productions at Compass Communications Ltd, invited the panelists to take their seats and they held a cordial conversation on Government Policy and Private Capital for Impact Investment for the Creative Industries in East Africa.

The panelists included: Hon. Dr. James Ndahiro, EALA MP, Rwanda, Hon. Dr. Harrison George Mwakyembe, Minister of Information, Culture, Arts, and Sports Tanzania, Stephen Gugu, Co-founder Viktoria Venture, Kenya, Daniel Maginga, Investment Executive, GroFin, Tanzania and George Gachara, MD, Heva Fund. The discussion was focused around the following questions.

Is the creative economy a viable sector for impact investment and what kind of investment is required?

The participants agreed that creative sector was a viable sector for investment.

• Mr. Maginga pointed out that impact investment was an important financial instrument for the sustainability of the creative industries since it did not only provide finance but also business support for up to eight years for Small and Medium Term Enterprises (SMEs) • Mr. Gugu reminded the audience that creatives must adapt to the entrepreneurial principles since investors look for competitive advantage and size of the market • Mr. Gachara pointed out that Heva Fund had proved that it possible to invest in the creative industries by providing tailor-made products to suit the creative sector. In addition, he said Heva Fund invests in creative entrepreneurs in providing knowledge on copyrights, fair business practices, payment of royalties and business registration

What kind of policy and legislation is required to attract private sector investment in the selected creative value chains and to mitigate the risk of investing in the creative industries that mostly are situated at the precursor and embryonic stages of industrial growth?

• Hon. Dr. James Ndahiro said that heads of state of EAC member states need to review the EAC Creative and Cultural Industries Bill, 2015, in consultation with their regional intergration ministers, before it is can enacted and then domesticated at country level • Hon. Dr. Mwakyembwe pointed out that the government of in the process of establishing the Tanzania Arts And Creativity Fund. He said he could consider the Southern Agricultural Growth Corridor of Tanzania (SAGCOT) model, which is an Investment Blueprint for the agriculture sector, in the design of the fund, because it has a public-private partnership arrangement • Mr. Maginga advised that the government should finalize the legal process of establishing the fund to be able to attract philanthropists and fund managers. He suggested that the government can work with organizations like CDEA with creative economy incubators that can provide business development support of creatives, then the government can provide funding to the creative entrepreneurs and organizations in Tanzania • Mr. Gachara proposed that there is a need for curriculum review to enhance creative economy literacy by financial institutions • Mr. Gugu suggested that providing policy guidelines for impact investors to match funds raised by local creative entrepreneurs would reduce the risk associated with investing in creative industries. This would also become a learning curve for investment stakeholders showcasing what to expect when you invest in the creative space. He said the shared-risk approach would be more attractive to first-time investors in the creative space The Sector Parallel Sessions

Textile and Fashion Industries

The session was moderated by Mr. Ismail Taifa, University of Dar es Salaam (Tanzania) and highlighted the fact that there is lack of industry knowledge to enhance the development of textile and fashion industry in Tanzania. This includes the current fashion schools and universities producing students who are not market ready. In her opinion, Ms .Grace Matovolwa, Director, World of Weaving (Tanzania) thinks the biggest challenge to the industry is lack of professionalism in the industry. Ndesumbuka Merinyo, Chairman, Tanzania Fashion Designers Association (Tanzania), said that while the VETA curriculum has passed the competence test against standards set in the UK, the institution does not adhere to it. There also no competent fashion teachers.

Mr. Merinyo also pointed out that if Tanzania had a national dress, then this could develop the cotton value chain. This is because if you impact on the cotton farmer, cotton ginneries, industries right up to the designer and then the domestic market.

Mr. Johnvianney B. Ndyamukama, Senior Textile Specialist, Textile Development Unit (Tanzania), mentioned that there is a levy charged to textile factories in Tanzania that goes to the Vocational Education and Training Authority ( VETA) that covers training, operations and other garment operations, as well as a higher education grant. He mentioned that the industries also offer internship for the VETA students, but key challenge is the focus of the industries is on develping machine operator skills and not garment making skills. .

Ms. Santa Anzo, MD at Arapapa Fashion House, Chair for AGOA Association of Uganda, said USAID desires to make fashion 100% value addition. She pointed out that the East African Trade and Investment Hub would like to focus on investing in standardization, skilled man power, overhauling production to compete in numbers and quality.

What are the key challenges in the textile and fashion value chain?

• It is very difficult to get funding from impact investors for skills development. The sector still needs development funding grants for it to get to the threshold of attracting impact investment • Shortage or lack of state-of-the-art textile factories (spinning, weaving, surface designing to printing) • A weak infrastructural framework for handcrafted clothing sector. A good example is the situation in Tanzania where the handloom cottage industry has suffered a big blow and practitioners have suffered a harsh economic decline in recent years. This has been caused by lack of proper and reliable supply of yarn for their different needs for various products, lack of loom makers and loom parts suppliers • Unsatisfactory training / educational framework for competence-based education for textiles and fashion technicians and design experts; and college education for industry educators and entrepreneurs.

• Dire need for empowerment of professional bodies (stakeholders’ associations) in the fashion industry. These are the proper actors and focus groups in supporting their members in their professional and business endeavours What impact investment actions are required to promote industrialized and handcrafted garment manufacturing in the EAC regional market that meets international standards for the global market?

• Inflows of capital in the form of subordinated loans or guarantees to industry players • Loan guarantees for viable local investors in acquiring updated technology and machinery and engagement in partnership formations with investors from experienced / ‘developed’ economies • Revamping of small scale industries infrastructure support framework , proper financing and capacity building to be directed to institutions like SIDO, direct capital injection to industry actors (the local clothing handcraft industry investors)

• Grant support for already established and newly established training centre and colleges e.g. VETA and VETA-approved schools offering tailoring, garment making, textile technology and fashion designing courses; and higher learning institutions offering undergraduate and graduate programmes for the same. Gatsby of UK has shown the way in such kind of support • Grant support for capacity building e.g. institutional capacity building, incubators and joint manufacturing initiatives for fashion designers and garment manufacturers. The focus should aim at achieving highest competence and quality of design, manufacturing, packaging and marketing within the fashion industry in the region

Gold and gemstones/ Accessories Design The session was moderated by Ms. Elizabeth Mbabazi (CDEA Advisory Board Member, Uganda)and highlighted the fact that with the mineral wealth that East Africa has to offer, it is a wonder that East Africans still grapple with poverty.

Hasnain Sajan, CEO of Tanzanite Experience, (Tanzania) stated that as a company that mainly deals in tanzanite, the main challenge that they face is that of patenting and copyrighting designs. “The software exists and can be adopted for the Tanzanian market and the rest of East Africa.”

KusKus Jewels’ co-founder, partner and creative director Sekela Nyange (Tanzania) stated that material accessibility was her biggest problem. KusKus Jewels has not yet delved into the gemstone industry, and uncertainty still looms in the air about doing so.

Nancy Joyce Bondo’s Manyatta House of Accessories (Tanzania) deals in beads, thread, with plans to enter the gemstone market. “The main issue is that you will sit in a meeting with a government officialand he will note down your predicaments with such concern, but the concerns will remain untouched,” Bondo lamented.

Marketing Head for fashion jewellery brand, URU Diamonds Julda Makundi (Tanzania) stressed that brand awareness is a challenge, on top of high taxes.

What safeguards need to be in place for impact investment in gold and gemstones jewellery industry in Tanzania/ East Africa?

• Extensive Research: The drawback with the gold and gemstones jewellery industries is the lack of records; data. To be taken seriously, records need to be presented, so that as Jewellers, there can be published market data. It is not the responsibility of the government to do this research, but the responsibility of the jewellers. Today, the jewellery industry is worth a billion dollar one and now more than ever, jewellers can sense the competition. Everybody is looking at numbers so jewellers need to ensure that we have these numbers so that the governments can take the industry seriously.

• Intellectual Property (IP) Rights Protection: If designs are deemed creative and artistic enough, then copyrights in jewellery design are established as soon as the design has been created. If it is not eligible for copyright protection, then this is when design patent protection becomes very important As long as the design is new and sufficiently different in appearance from all prior designs, whether or not it is sufficiently creative to be protected by copyright, design patent protection, will still cater for the designer’s creation. There is no point having all these social media platforms to display designers’ creations, if there is a dire fear of their designs being replicated. Not being able to display their work on social media would box their marketing opportunities in and slow down jewellers’ growth • Brand awareness: The government needs to put more emphasis on other aspects other than extraction. They only focus on extraction and exporting. There are actually designers in the country who can add value to the ores before they go out of the country • Lower taxation rates: High tax rates that contribute to the already high running costs make it even harder for all artisans and jewellers alike to produce pieces efficiently • Skills development among locals: “It is cheaper to cut tanzanite out there rather than here, mainly because of the skills’ lack in East Africa with regard to stone cutting,” Hasnain Sajan retorted.

More vocational institutions focusing on the attainment of these skills is vital • Transparency regarding mineral location belts: People from the ministry of mining need to tell investors where to mine. Government has information on mineral location in the mining belts.

An online platform should be created for this sole purpose. On the online platform, an investor can register for a small amount and get access to these specific sites so that the time costs and such are reduced. Online indication is helpful, since it would cut down investors’ costs

Film/Content Production for Digital Channels The session as moderated by Dr. Mona Mwakalinga University of Dar es Salaam (Tanzania) who began by providing a background about what Impact investment is and then asked the speakers to show its relevance to digital content producers.

John Riber, MD at Media for Development International Tanzania (MFDI-TZ) insisted that there is need to invest on quality content as a way to attract funding. He also applauded Tanzania’s Bongo movies film makers for their efforts though there is room for improving the quality of production.

Dorothy Ghettuba, CEO of Spiel Works Media (Kenya), believes the only way to fund a film is to have a self-investing model by generating funds for film projects, distribution of own works to audiences, while keeping books of accounts well maintained, so as to attract mechanisms such as Angel investors.

Aaron Zziwa, MD of Zarron Motion Pictures (Uganda) who works with both downtown and uptown filmmakers to suit markets and attract funding from organizations or investors. He also uses a self-funding model by collecting revenues from his commercial productions to fund his creative world class film productions.

Amil Shivji, MD of Kijiweni Productions, is an award winning producer with a strong belief that grant-making or donor funds come with their limitations, yet there is a room for a filmmaker to maintain the creative rights for the content produced. His pride lies with his production AISHA where he was the contracted producer and yet he can take the film places such as festivals. He also believes grants are a source of quality productions.

What guarantee funding mechanisms need to be put in place to mitigate the risk of investing content production for digital channels?

• Risk-sharing through co-production: Co-productions will ensure quality content and broaden the returns in a win-win situation. This aspect also opens up audiences to both filmmakers. If a collaboration is of Tanzania and Uganda, the film could sell in both countries and will be known by audiences from these two countries. This will attract the impact investor to invest in a film that has a guarantee of market in two countries.

• Personal Investment: Filmmakers need to invest in their own productions. Ms Dorothy Gettuba gave an example of how Spiel Works Media has plans of setting up an online distribution channel for her own productions on subscription basis. She will use the returns for her next productions.

• Strategic partnerships: Filmmakers must be able to secure partnerships with other players in the sector such as make-up artists, costume designers and sponsors to acquire smooth production. Since such partnerships could be a source of money-saving, when one has limited source of funding for the productions. The filmmakers also should secure venues and cinemas, if available in their areas for premiers and box office run down of their films.

Music/concerts and Festivals in the Tourism Circuit The session was moderated by Nanjala Nabola (CDEA Advisory Board Member, Kenya) asked the panelist to introduce themselves and their organizations.

Yusuf Mahmoud, CEO & Festival Director, Sauti za Busara made the following points.

• Sauti za Busara started as a 100% donor funded initiative for the first 1-3 years. Now the festival has diversified and income is made from 3 revenue streams, 1/3 donors, 1/3 ticket sales and 1/3 sponsors • Sauti za Busara is not motivated to make the festival for tourists, it strives to give locals access to the festival by keeping local prices lower than tourist prices

• The festival stimulates economic growth of the entire community at almost every level and has impacted greatly on the island tourism activities.

• The government has not been able to support the festival financially and there has never been an official agreement between the two parties, however individual government officials have supported the festival in one way or another Second Panelist, Mr Faisal Kiwewa, Director, Bayimba Foundation, pointed out that over the years, Bayimba has commercialized their events by bringing in sponsors and selling tickets as well. The programming for Bayimba has always been 60% local artists and 40% international artists.

Key points: • The government has supported Bayimba by waving 70% of event permit fees and all travel permit fees for festival personnel.

• The private sector has played a big role in the growth of the festival, especially private alcoholic beverage companies.

• Bayimba`s focus has always been on the artists, the culture and the community.

• Bayimba is focused on sustainability; they have bought land and are working on developing it to be used for other activities including hosting the Bayimba International Festival of the Arts • The challenge of spaces for performance is still a big one. The plan to demolish of the national theatre/Uganda Cultural Centre is a big blow for the festival. Bayimba has been pushed to create a new home for the festival, but more initiatives are needed to create more spaces for performances Third Panelist, Miss Aziza Ongala, Events Manager, Wikendi Live said Wikiendi Live is a live music event in Dar Es Salaam Tanzania dedicated to showcasing traditional African beats and fusion.

Key points • Wikiendi live supports bands with a strong cultural & heritage theme • Wikiend live is supported by donors and is currently funded by the Danish Royal Embassy • The concert has to be free because of BASATA requirements. For the concert to be commercial, all fees will have to apply • The concert is focused on the youth, to be able to make local cultural music to young people What would impact investment for the music industry in East Africa within the framework of sustainable tourism look like?

• Cultural organizations becoming investors in the music industry, since they already understand dynamics of music industry in East Africa e.g. the case of Bayimba Foundation • Governments in East Africa prioritizing cultural tourism in their investment plans by highlighting infrastructure development for concerts and festivals, cultural villages/theme parks as one of the investment areas • East African government developing an East African festival calendar and have proper marketing strategy for this.

• Corporate sponsorship branding and supporting cultural heritage music events e.g. Airtel Sondeka Festival in Nairobi, Safaricom Jazz Festival in Nairobi What commitments should government, private sector and development partners make in this ecosystem?

• The East African governments need to recognize the cultural sector as an area for impact investment and have a clearly defined role. The government’s role should be to support the sector by putting in place the right policies, infrastructure, strategies in place to facilitate the festivals and concerts and not create more huddles for the events

• For the corporate sector, their role should be corporate social responsibility • The media needs to play a role in providing platforms for cultural/heritage music so that they can attract commercial sponsors • Formal or technical education should have be available for artists and for other support services such as managers, festival directors, production crews, sound engineering etc • The East African governments need to facilitate the platforms for multi stakeholder conversations such as Mashariki Creative Economy Impact Investment Conference to stimulate changes for the sector • The mobility of artists in the East African region should be made easy to facilitate movement throughout the region to stimulate growth of cultural tourism through festivals and concerts • The government, private sector and donors should work together if they want to make the sector more sustainable

Day 2: Plenary Sessions Impact Investment Vehicle for the Creative Sector This plenary session was moderated by Mr. Robert Mwapembwa, Chairperson of the Tanzania Visual Arts Association (TAVA), which aimed at making a case for an impact capital vehicle for supporting the creative economy ecosystem in East Africa. The speakers of the session were: Faisal Kiwewa, Director, Bayimba Foundation, George Gachara, co-founder and member, The Nest Collective and Ayeta Anne Wangusa, Executive Director, CDEA. In summary, the session discussed how the three organizations as principles have decided to establish an endowment fund to ensure the sustainability of their programmes. The three organizations are open to welcoming other arts organizations in East African to join the initiative as co-principles. The organizations also took note that part of their sustainability plan would be not be reliant on the endowment fund savings, but also have a business model for their organizations. The organizations are yet to finalize the details of what % of the interest accrued will go to running costs, acquisition of assets and investing in other arts organization initiatives.

Making a Case for the Endowment Fund Faisal Kiwewa: We cannot survive the next 10 years if we keep fundraising from only traditional donors, since most donors do not cover all our needs. We are thus putting measures in place to diversify our funding sources.

We came up with a regional strategy that will sustain the legacy we are building. We want to be a position whereby if one of us cannot sustain certain % of their budget, the others organizations can help.

We have decided to set up an endowment fund, which will also be used to invest in the creative sector in the coming years.

The endowment fund will be operated from a fixed account that will not be utilize but use only the interest arising over a period of 1 year. We intend to raise $1m over a period to be decided.

George Gachara: The Nest Collective is interested in the endowment fund because it focuses on supporting artistic financing and financing of arts institutions.

Arts programmes have been predominately financed by donor funding from Europe and the America.

However, due to changes in the geo-politics their priorities have changed and they stopped funding for the arts. As responsible managers of arts of programmes, we need to think of our sustainability. We decided that every year we will need to save $10,000 and continue to fundraise individually for the endowment fund.

We want to create a facility that understands the dynamics of the creative industry. This does not mean we are going to displace the traditional funders.

Ayeta Anne Wangusa.

The discussion of mutual collaboration began when The Nest and CDEA met at a meeting organized by CKU and we discovered we both had plans to establish an investment fund. We decided to co-opt the Bayimba Foundation to discuss the idea of our sustainability and this how the idea of formulating an endowment fund started.

While our focus is to establish an endowment fund, we also should consider structuring ourselves to be that vehicle to attract investment funding to the East African region. We could use the model of the Southern Agricultural Growth Corridor of Tanzania (SAGCOT) Investment Blueprint, an example of a vehicle of mobilizing resources for the creative sector from government and the private sector Key messages from the conversation: “There seems to be a feeling that traditional funders are leaving the cultural sector we would like to say that is not the case….British Council is still here. Yes there are new dynamics like Brexit, the migration issue in Europe…which means we are leaving the old ways of working but not leaving the sector completely…” Rocca Gutteridge , British Council East Africa.

“I feel that this room is sensitive on the nationality of money. Today we are sensitive about the exit of our partners and now there is the idea of looking East. However, there is also the idea of looking internally. We have a challenge to start to recruit local philanthropy…” George Gachara, The Nest Collective.

“We want to create relief for our donors… we want to say to British Council, you gave me $20,000 last year, so this year give me $10,000 because we are getting it from our savings. We are building a case of building sustainable institutions, so even the donors can have a best practice to share,” Faisal Kiwewa, Bayimba Foundation.

Pitch Platform by Creative Enterprises

This plenary session was moderated by Ms. Elizabeth Mbabazi (CDEA Advisory Board Member, Uganda) for creative enterprises in the film and fashion and design accessories industries to pitch to the impact investors in the room. Three of the enterprises had gone through an investor prepping session with Viktoria Ventures an an Angel Investor Network based in Nairobi prior to the conference.

Below is a summary of the pitches and the action points for improving their pitches.

A. Broadcasting 1. HMT Media HMT Media has been in existence for seven years and recently, they started working on children’s animations that will bring educative and entertaining information to children. HMT Media self-funded the pilot, but they needed from the investors $30,000 in order to be able to fully go on with this project in terms of marketing and production. HMT Media is made up of a group of young and self-taught animators.

Action Points / Feedback • Images are not children-friendly and might be seen as scary • What are the numbers- what are the projections, the forecast?

• Need for proper breakdown of where the funding will go 2. Ubongo Kids Animation company for children that is educational and entertaining. Their producers are already available in a number of countries in various languages. Accessible on all media platforms, TV, radio, online.

The pitch was very well researched, good breakdown on numbers and forecast. People in rural areas are able to access their films through vibandas (Video Kiosks). They require donor funding in order to further their program and become profitable by 2020. They need $2 million to get where they are going.

They have currently accumulated $800k.

Action Points / Feedback • Consider making their programmes available to kids via tablets for children • Presentation was done well and thus was very informative • Investors were impressed with their presentation 3. Kijiweni Productions Tanzanian-based production company that is currently working on their second feature film, T-junction.

The have $60,000 raised for the shooting of the film, however, they needed $15,000 from potential donors in order to help with post production. They intend to release the film throughout East Africa and make their first DVD release.

Action Points / Feedback • What are the numbers, projections for return etc. Comment by audience member, “Get used to working with numbers, you beat two blockbusters, by how much?”

• They should also look towards other film funding organizations such as “GoodPitch” • The EU will be releasing some money for funding in September, they should be on the lookout for that.

B. Accessories Design 1. Uru Diamonds Locally made and hand crafted gemstone jewellery. Apart from Tanzania they exist in Kenya and South Africa and hope to eventually open shop in other places as well. Uru wanted support from the government to reduce taxes, because as a local brand that makes jewellery locally and at an affordable price for locals, they felt that the government should take an interest in what they are doing.

Action Points / Feedback • Audience offered names of organizations and potential contacts that would help with their cause.

• The Copyright Society of Tanzania (COSOTA) showed interest in supporting them.

2. Fahari Stores Tanzanian based jewellery brand that was started and is run by women and a few men. They have show-cased their products in places such as Dubai where they did really well, however over the years it has become expensive to be able to go there. The funding they requested would go into purchasing of new modern machinery, something that they are lacking in. It would also go towards training and educating the women that they work with on the making of jewelry as well as working space.

Action Points / Feedback • They need to work on their presentation and make it something more attractive to look at as people don’t have time to read a lot of information and are easily swayed by images.

• They need to invest in a photographer that will take pictures of their products.

• They need to work on their marketing both traditionally and digitally.

3. Ruka Jewellery Recently established bohemian themed jewellery line based in Uganda. Her presentation was well put together, her numbers were very honest and generally the audience members liked her presentation. One of her challenges is getting consumers to see the value of her product. She requested for $12,000 for her line that will go into further establishing her line and equipment but most importantly for buying the gemstones Action Points / Feedback • More research has to be put into it.

• Advised to not be afraid of numbers.

• Faisal Kiwewa offered to invest 50% of her required budget.

C. Fashion Design 1. Shahbaaz Sahyed Young fashion designer. Has a small team of 3 people that are partners and currently not receiving any salary in particular. Winner of Swahili Fashion week 2016, emerging designer award. His clothing range is for women of all sizes between the ages of 17 to 35, middle to upper class.

Action Points • Projections are unrealistic, advised to have a look at his numbers.

• Because he is still young, he was advised to take time to understand the industry and the numbers as well.

2. GNAJ GNAJ is a Ugandan-based fashion brand that caters to both men and women. Its pieces are indigenous and are inspired by innovation and Africa. Their main challenges are transportation as well as exportation regulations not forgetting competition from other brands. They requested $50,000 from investors that will go into the opening of a physical store, manufacturing and production, marketing and e-commerce, mentorship and training as well as building up their staff.

Action Points / Feedback • The audience was impressed with the presentation and felt that the designer would go far.

• Designer however was not in touch with her numbers in terms of sales and total pieces made in the past year.

3. House of Kea Ugandan- based fashion brand that makes functional and affordable clothes: “We don’t do fashion for the sake of dreaming, we want to dream and still attain functionality.” Keziah started off as an architect and in 2015 decided to pursue her dream of fashion and moved to Uganda to start her fashion line House of Kea. Action Points / Feedback • Numbers and projections were an issue for donors.

Networking Session The conference concluded with networking cocktail moment of chatting and exchanging business cards.

Conclusion In conclusion, the conference met its objectives of holding a Multi-Stakeholder Platform (MSP) to discuss how to improve the investment ecosystem for the creative industries in East Africa, with focus on the textiles and fashion design, jewellery and accessories design, content production for digital channels and music/concerts and festivals in the tourism circuit.

Prior, to the conference, selected incubatees from CDEA’s Creative Economy Incubator got support from Viktoria Ventures on investor pitch prepping and were able are to pitch to an investors during the conference.

The research ďŹ ndings, conversations and pitch sessions revealed that there is need for a systemic approach to address the Industry, cultural, market, knowledge, regulatory and support framework conditions, to enhance growth and investment of the creative industries in East Africa. This calls a mechanism that will pool resources from local philanthropy, governments, development partners, private investor to address the framework condition challenges of the creative industries in East Africa.

CDEA looks forward to hosting the 2nd Mashariki Creative Economy Impact Investment Conference in May 2018, where it hopes to recap on gains made, enhance networking, learning and get stakeholders to make investment commitments.

With special thanks to the Conference Resource Team: Dr. Mona Makalinga, Issa Mbura, Amil Sihvji, Kemi Kalikawe, Jamila Vera Swai, Dr Kedmon Mapana, Webiro Wasira (Wakazi), Angela Kilusungu, Grace Matata, Nasreen Karim, Fravius Frederick and Rebecca Godwin, for a successful conference.

CDEA-Culture and Development East Africa Plot No. 25, House 1001, Mikocheni B, P.O Box 13355, Dar es Salaam, Tanzania Tel : +255 22 2780087 Email : Cdea.Tanzania@yahoo.com Website: www.cdea.or.tz