In addition to being CEO of Capital Financial, Andrew Longwe was also a 2015 Mandela Washington Fellow and participant in U.S. President Barack Obama’s Young African Leaders Initiative. Longwe has received accolades for his work including the World Bank Development Marketplace Award and the Commonwealth Youth Silver award.
With Capital Financial Services, Longwe aims to empower the poor, marginalized, and underprivileged with a focus on youth and women in Malawi through entrepreneurship training and business mentorship. More than 500 women and youth have used his company’s various loan products; 1,000 people have taken part in his business mentorship, and more than 100 participate in business coaching, according to the company’s website.
The Young African Leaders Initiative (YALI) is a U.S. effort to invest resources in the next generation of African leaders and entrepreneurs. Obama launched YALI in 2010 to support young Africans in growth and prosperity, and encourage them to strengthen democratic governance and enhance peace and security across Africa. The program encourages connection between young African leaders and Americans. Since 2010, the U.S. State Department has sponsored more than 1,600 sub-Saharan students and scholars.
How did you get into Young African Leaders Initiative?
Andrew Longwe: The American Embassy Malawi had advertised for a briefing session for YALI in my hometown Mzuzu. When I attended the briefing session I found myself fitting the criteria. Then when the online portal for applications opened I applied to be a 2015 YALI fellow. I did my interviews at the public affairs section of the embassy in Malawi and I was successfully accepted as a fellow in 2015.
What did you learn that was transferable to the realities of your African country?
Andrew Longwe: The business realities of African countries are the same as everywhere else. The same concepts that make business successful in America would make business better in Africa. The business module I learned fits well in my organization. Leadership is the same whether in Latin America or in Africa — the concepts are the same. When I began transferring skills I learned from the YALI program they fit very well even in the realities of Africa.
How would you describe the experience?
Andrew Longwe: It was wonderful experience. When a child doesn’t visit their neighbor he or she may think their mother is the best cook. We visited the U.S. We saw how people do other things differently to make life better. It was a great experience worth going through again.
How and when did you start your company?
Andrew Longwe: I started Capital Financial Services in 2013 when I found out that there is no company that provides loans to young people. This made me come up with some innovative ways on how I can reach the youth with financial inclusion while making some profit from the innovation. I spoke to friends to invest in my company and friends came forward and this is how I started. Today, I accept anyone who wants to invest in the company so that I broaden the lending base to youth and women.
How does your company work?
Andrew Longwe: My company identifies small youth- and women-led businesses and provides them with loans to improve the businesses or to start business in case of those who only have a business idea. Before the loans are given I train the clients in entrepreneurship, provide mentorship and business coaching and provide relevant skills required for successful business management. I ask the clients to provide 25 percent of their loan request up front as commitment fees and also 7 percent loan processing fees is paid up front. The loans attract 40 percent interest for a period of six months.
How did you fund the startup?
Andrew Longwe: I used my initial seed capital from myself and my co-founder and also (got) loans from various outlets. I also spoke with friends and people who want to invest in lending and some came forward to invest.
Did you face obstacles as an entrepreneur?
Andrew Longwe: I faced a lot of obstacles as an entrepreneur. First of all, I was dealing with the informal sector where the risk of business is the highest. I had problems with loan repayments and the model of loan recovery. At the same time I had problems with repaying loans I obtained from friends and clients. Recently I have perfected the model and the business has taken a new shape towards a bright future.
You have received many accolades; how does it feel to be looked up to?
Andrew Longwe: The best feeling I have is when my accolades changes people lives. A successful person is not known by how fat he is or how much wealth he has acquired by how successful are people around him or her. Every day when I hear we still have serious poverty in Malawi I go to work. Until Malawi becomes a better country than I found it, I don’t feel anything with my current accolades.