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The joys of investing in Somaliland

“How are you going to make money in a country that doesn’t even exist?” That was probably the question that many people had at the back of their minds when Mohammed Yusef told them he would invest in Somaliland.

LONDON — Others perhaps did not even know Somaliland had declared independence from Somalia in 1991 and that, in spite of not having been recognised internationally, it does have – unlike Somalia – a working political system and a strong business sector.

Mr Yusef of course knew. Although he now manages a very successful investment firm in the United Kingdom, Invicta Capital Limited, he has always kept in touch with the land where he was born six decades ago, while it still was a British protectorate.

“If what my parents say is true, I always had a mentality for trade, for business, and it’s not inconsistent with the family history because the family originated from a fishing village on the Gulf of Aden,” he told the BBC’s series African Dream.

“My great-grandfather was one of those people that would trade with Aden.”

Mr Yusef was educated in the UK where he trained as a solicitor and practiced as a commercial lawyer before starting his own law practice specializing in commercial law, copyright and media law in London.

In 1999 he founded Invicta, a private equity firm providing finance for the media, commercial property and renewable energy sectors which, according to its website, has raised over £1.4bn ($2.3bn) of investment capital.

Minding the gap

His Somaliland business is handled through a company called Prime Resources which has a staff of nine people in Hargeisa, the capital.

According to him, the firm has invested in mining, and oil and gas exploration and is about to embark on a $40m exploration programme. It is also evaluating business opportunities in Somalia in the agricultural and property sectors.

“When I first started looking at investment in Somaliland even my professional colleagues would say: ‘You’re mad. This doesn’t make any sense’,” he remembers.

“Not only did they confuse Somaliland with Somalia but it does have the problem of being an unrecognised country,” he told the BBC’s Mary Harper.

“But actually nobody ever made money from following the herd and the most money is often to be made where there is a mismatch between what people perceive to be the place and the reality of what it is, and Somaliland is exactly in those kinds of circumstances where there is a huge gap between the reality and the perception.”

“So actually there is a method to my madness and it isn’t inconsistent with the basic principles of business: Go find yourself a situation that nobody else has spotted and be prepared to hang on in there while everybody else catches up.”

“There is no inconsistency between what we look for when we invest in an opportunity here [in London] and what we look for over there, except that the potential rewards in Somaliland are far greater, ironically.”

The Hollywood connection

Mr Yusef’s first business venture was buying and selling a film library.

“I was lucky in that I knew who my buyer was going to be, so it was one of those crazy situations where I knew I could buy for X and sell for Y,” he said.

“In many ways, it’s the worst first lesson to have in business because you run away with the idea that business is actually quite easy.”

However, this experience was probably helpful to him when, later, he decided to specialise in structured film financing.

Invicta has been involved in the financial side of many successful film projects, including Wallace & Grommit: Curse of the Were-Rabbit, Da Vinci Code and James Bond’s Casino Royale.

Although now he manages big money, Mr Yusef says that he started with very little.

“I had enough capital to pay the rent of an office for six months. I think it was enough to pay the secretary and assistant. That was it.

“But it didn’t take much. It never takes much. Not having money is never really the obstacle, it’s the excuse.”

‘Fascinating people’

Mr Yusef says that for him one of the most exciting things about his business is meeting people.

“You meet fantastic people, even the ones you don’t like. They’re fascinating”.

He believes that it is often easier to get to know others in stressful situations because they cannot “keep their pretences up for very long”.

He also takes delight in the intellectual challenges offered by his job.

“Every situation is different from the last. And the mistake often made is to assume ‘Oh, I know how that story is going to end’. So there’s always that tension – positive stress is what I call it – that keeps one going,” he says.

“After a while, it may sound a bit glib to say this, the money motive isn’t the main driver. Once you’ve reached a certain level of security – you’ve paid the mortgage if you still had one and taken care of the basics of life, and you can afford one or two luxuries – people who accumulate businesses and business interests just to make more money are a little bit unwell, I think.

“The biggest driver for people in business, if you look at it, is the creative drive, to create something from nothing and step back and say: ‘That was nothing then, look at it now’. I’m sure that’s the key motivator for most people who are successful in business.”

And what advice would he give to someone who wants to start in business?

“Control your fear and never give up because you will fail more than you succeed, and I think that’s the thing that my father taught me more than anything else, and that’s that ultimately you will prevail if you take your losses as well as your successes and learn from the losses. We learn nothing from success and everything from failure.

“I think the thing that separates the natural businessman and, let’s say, a business consultant, is the tenacity that is required. Many people give up on their dreams and their ideas faster than they should, and even when they do fail, they should figure out why they failed and then look for the next opportunity.”

African Dream is broadcast on the BBC Network Africa programme every Monday morning.

ABOUT:

Mohammed Yusef

  • Age: 60
  • First business venture: buying and selling a film library
  • Trained as a solicitor
  • Practiced as a commercial lawyer before founding his own law practice in London
  • Founded Invicta Capital in 1999
  • His Somaliland business is handled through a company called Prime Resources
  • Prime has a staff of nine people in Hargeisa

BBC

Wednesday, Jan 25, 2012

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  • Boqoljireh

    Smart Somalilander. We should be proud of you Brother. Keep supporting your country and you will succeed Insha Allaah. How about me asking a job in your new business in Somaliland? I am fed up to stay further overseas [diaspora], and am good worker with experience of 45 years of everything you may require me doing. Strange, inst it, someone asking you a job through this comments column?

    But its reality, I am someone who is willing to go back and take with me what is left of me, to help myself and my country.

  • Khaalid

    Great article but i must point out that riba is haraam and should not be something done

    • Dacar

      where did you see the riba or interest. This man buys or invest films and commercial property sells later on. go back read before you say RIBA, please people like you should not make any comments please thank you. don't take personal more power to my fellow somali man may allah give you more successful investment in the near future.

  • Jans

    Interesting, these are the lives of Somalilanders. Very impressed with him I wonder if he would mind taking on Somalilander youth that want to get on in business/investing. Simply from a mentor perhaps even internships it would give him cheap or free labor so certain parts of the year and the young Somalilanders would gain experience!

    So glad to hear this story, Somalilandpress we need more stories like these.!

  • madahweyn

    mashallah listen to this wise man : Investing in somaliland and somalia !
    You can make money everywhere you want if you really try . Africa is the new land of opportunity !

  • misslovely

    wow you are so rich manshalaah you will make big differences to the lives of our youth back home because they need jobs

  • misslovely

    Ali are you jealous go and make your own money

    • ALI

      I am not jealous am stating the facts as they stand. He is example what is wrong Somali people all around the world. he is tribal and small minded like any waryaa.

      You don't believe me? do not look any further but somaliland press (supposed to be independent news organisation). where is my comment? deleted? why?

      I

  • Jabuuti_Hanolaato

    You are uttering trite comments.

    FYI: Djibouti is bigger than Slovenia, Israel or Kuwait. In fact, Djibouti ranks smack dab in the middle of all countries in the world with respect to land size.

    Coastal cities in the Horn:
    Djibouti mean temp: 30C/86F
    Moqadishu mean temp: 27C/82F
    Berbera mean temp: 30/86F

    I compared coastal cities-comparing apples to apples, so to speak.

    Hargiesa's mean temp is comparable to Arta's in Djibouti Republic.

    This is not my point. All of these are just trivial matter, at least to me. My point to you is refrain using clan/tribe to label or demean someone with a counter view that was merely expressing her opinion about the current fiasco in the Horn.

    Last comment from me on this subject.

  • Mahamed sambuus

    @jabuuti Don't worry i get your point bro' !
    People need to fuel their position instead of insulting
    You. You should not even care about answering to this people.
    If they don't agree with you its up to them to make a simple objection.
    All in All it's sad to see such an article trashed by such sillyness.

  • mohamed cheers

    MR Yusuf is welcome to invest in Somaliland. This is good investment which will make
    Somaliland more stronger both Nationally and Internationally.
    Cheers.

  • m.ali

    @ jabuuti-hanolaato, your comments about Somaliland is a negative one. After all your President knows the day Somaliland is recognised that will the demise of Jibuuti. Your country has no agriculture, you depends on foreign aids, after all the income is only the port, beside that you do not grow anything unlike Somaliland. Also Many big business people in Somaliland for many years were original from Somaliland. The real Jibutians have high respect about Somaliland, even when President Silanyo went to Jibuti he was given red carpet by your president. No one is forcing other to join Somaliland. Evry clan signed agreemnt in Las Anod in 1991 as Somaliland. I am not sure whom are you talking or which clan. But all clans who pretends to have like awdal or Khatumo are all diapora ones, the ones who live in Somaliland and enjoying the peace do not support those guys.

  • Mustafe

    Why are you guys feeding trolls like Jab-Butti hanoolaato?!!
    the insignificant 20k km sq enclave is no match for Somaliland in anyway so why waste your energy on responding to some ilko qoran nobody!

  • Gobaad

    Jabuuti_Hanolaato , we are not forcing anybody, we want you guys to leave us alone and look after your houses because you are spending uselessly time and energy unleashing your spite,ill-will, and hate against Somalilanders. Do something useless with your time and energy.

  • Gobaad

    Maasha Allaah, it is good investment and he brought money and created jobs for his hometown. I hope that other diaspora would emulate him as well to come and invest in their own Country. Good job, Mr Yusuf, you are on the right track.

  • Gobaad

    Hargeisawi-In-London, Saido Ali is Dhulbahante, an old Somali singer claiming a land they don't own. Waa Islaan wahktigan khaatumo xumaysatay oo intay cibaadaysan lahayd cayda Isaaq ku dhaqaaday. so, don't give a heed to anything she says. Baryahan damboodhan wayiska nacnac layahayde.

    • Hargeisawi-In-London

      I think you are referring to Sado Ali Warsame. Sadia Ali Aden is a "Human Right Activist" based in Virginia.

  • Ahmed Omar Woolwich

    The pleasures of ignorance are as great, in their way, as the pleasures of knowledge. Mr Yusef and his British business associates are snakes and will soon be exposed. #brokenbritain #scum #2faced #Vagabond

    (Hashtag # is a tweeter terminology for those who don't know)

  • Kayse

    While I congratulate Mr Yusef for his personal achievements both in academia and commercialism, I failed to see anything he has done for Somaliland. Sure he is employing 9 in Hargeisa but the 99.99999% of his personal wealth are in UK/London in the hands of white people (not racist).

    If he is to do anything for Somaliland and wants respect from real Somalilanders like myself, he should use his number one talent/skill or asset which is him been a lawyer. Sure he is commercial lawyer but lawyers know lawyers and he can hire legal professions who know about international law and its political aspect who can fight for Somaliland's legal rights.

    Well done Mr Yusef for your millions but they are just your millions and no one knows you in Somaliland. More people know the regular agent of SomTel more than you because SomTel is hands on with Somaliland.

    Mr Yusef is just trying to benefit from Somaliland's situation by acting like a bridge between UK and Somaliland…we can tell UK groups that no one knows Mr Yusef in Somaliland and he is not involved in this country.

    He is not the only wealthy Somaliland enjoying the high life and using its misfortune to take advantage of it.

    Mr Yusef, personally I know him and he happens to be same reer as me but that's irrelevant. Enjoy your British wealthy life my brother but dont act like a Somaliland hero when no one knows you.

  • Mohamed cheers,

    @Kasye
    I definitely agree with you there, i mean if this so called business man really care about the welfare of our people & our country at large he wouldn't hesitate once to transfer all his wealth//assets back into somaliland economy.
    cheers.

  • Kayse

    Mohamed cheers

    No one should transfer their entire wealth or saving to one place–haven't you heard "Don't put all your eggs in one basket"? No one should risk their entire saving including family to a place you don't live 95% of the time. Its good to strike a balance. Have your own personal wealth but don't forget back home.

    I am just saying Mr Yusef should use his law firm for Somaliland but of course he needs to pay his employees and he can fund them through mining and exploration rights in Somaliland.

  • F. A.

    Kayse I really want to hug you bro (no homo). But you are most of the times right big time. If I had allot money I would totally invest in you bro because you know allot :)

    And mister Yusef please listen to your heart and do what is good for your familie and country.

  • osman ibrahim

    Somaliland needs more capable investors like Mohamad yusef. it clearly shows that he's a very successful businessman. Congrats ….

    Osman Ibrahim

  • http://www.insidermonkey.com/hedge-fund/paulson+%26+co/18/ John Paulson

    A hedge fund is a fund that can take both long and short positions, use arbitrage, buy and sell undervalued securities, trade options or bonds, and invest in almost any opportunity in any market where it foresees impressive gains at reduced risk

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