Expression of Interest (EOI)

Research on suitability of Creative Capital Model in Africa (Kenya, Nigeria) 

Reference Number: 83433009

1.  Context

The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH is a federally owned international cooperation enterprise for sustainable development with worldwide operations. The GIZ Office in Kigali covers GIZ’s portfolio in Rwanda and Burundi. GIZ Rwanda/Burundi implements projects on behalf of the German Federal Ministry for Economic Cooperation and Development, the European Union and other commissioning authorities in the following priority areas: Sustainable Economic Development, Good Governance, Climate and Energy, Digitalization, Extractive Governance and Peace and Security in the Great Lakes Region.

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• Background information

Digital Entrepreneurship

Digital entrepreneurship is a key driver of economic growth and digital transformation in Africa. Entrepreneurs have the potential to modernize the economies and societies of their countries, to find innovative solutions to development problems, and to create new perspectives and employment opportunities.

Nevertheless, many young technology start-ups in Africa are often still unable to make the leap to international market maturity. There is a lack of access to capital, customers, talent and digital infrastructure. In order to be successful, entrepreneurs need a functioning ‘entrepreneurial ecosystem’ consisting of startup support organizations, reference customers, investors, funding agencies and training partners. However, many ecosystems are fragmented, and tech start-ups lack important networks, access to (additional) financing and opportunities for further development.

GIZ: Make-IT in Africa II

GIZ implements the project "Make-IT in Africa II" on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ). It is part of the BMZ initiative "Digital Africa". "Make-IT in Africa II" is a multi-year program (10/2020-04/2024) that follows on from the predecessor project "Make-IT in Africa", which was implemented in the period from 2017 to 2020. The main focus of the project is to support national and pan-African entrepreneurial ecosystems to become resilient and sustainable.

Specifically, Make-IT works in three fields of action: 

1. Competence development in the area of market-oriented corporate management - through capacity building of start-ups, gender-specific "human capacity development" measures and the establishment of partnerships between start-ups and key ecosystem actors
2. Competence development at the level of intermediaries - through capacity building of intermediaries such as startup support organizations, angel groups and the organization of networking events between African and European start-up and innovation actors.

• Harmonizing framework conditions for innovation ecosystems - by organizing targeted policy dialogues and networking events, evaluating the gender sensitivity of the cooperation partners and publishing a toolkit of instruments and methods.

For further information on Make-IT in Africa, please see https://make-it.africa/.

• Brief description of the project

Around 90% of startups ultimately fail, and the reasons leading to failure are well known: Undercapitalization, scaling challenges, lack of a competitive advantage or realistic IP. However, what about the 10% that succeed? What did they do to beat the odds?

To create a pathway for market success, startups need two essential assets groups: venture capital and creative capital.

Venture capital is formed of the financial and operational assets invested in a new, unproven business enterprise. Creative capital comprises the design and development assets that bring an ingenious idea to life. But while venture capital gets the most attention, it is the creative capital that helped many of the 10% startups stand out by creating and amplifying stories and visualizations that deliver on customers’ needs and wants. Several of the Tech unicorns like Airbnb, YouTube, Pinterest, Behance have benefited from “creative” founders who were physical and digital product designers, educators, developers, and visualizers. The secret of selling technology is not to talk about technology.

The Challenge

Early-stage startups rarely have the expertise and resources in place to realize their product vision. According to the minimum viable team theory, a startup should ideally consist of three different types of founders with three different character traits and resulting tasks: The hipster, the hustler, and the hacker.

The reality however often looks different. Many tech startup teams in Africa are geared towards tech talent. As a result, building or securing creative capital capabilities is either left out or too expensive as they need to be purchased externally. Hence, despite the key role creative capital plays, startup founders do not have the luxury of committing to the journey as it usually requires financial commitments they cannot afford.

In sum, the following concerns have been observed:

• Startups are usually largely focused on the product (technical side) as opposed to have a distinctive brand baked into their idea as early as possible
• While there is a lot of focus on Venture Capital, it is the creative capital that can ultimately last longer and deliver bigger, sustainable returns
• Having access to these expertise and resources gives startup a real jumpstart in the market, however its access is often out of reach as startups cannot pay market prices

The Opportunity:

Creative Capital is a model that delivers the expertise of industry leaders across Product, Brand, and Growth to startups on an equity for services basis allowing startups to access these critical resources even in a state of limited cash inflow. The model is successfully being applied in more mature markets and has proven to be able to provide startups with an invaluable jumpstart, to better prepare them for scale and investment, and to help de-risk an already arduous journey. But ultimately startups need to own their product which means being self-sufficient as soon as possible as seasoned investors aren’t going to be confident about investing in a startup whose product is “outsourced”. As such, creative capital is short term. It´s aim: to get startups to a valuable 1.0 or 2.0 and ready for scale and investment.

Creative Capital as such can be seen as “co-founders” for hire. It is partnering with startup founders and providing them with hands-on support. Given that a Creative Capital Provider (so-called Creative Capital Studios) are delivering in return for equity, they are incentivized to do the right job and stay involved for precisely the time and depth required to make the impact and then get out of the way. Given the high risk involved, some Creative Capital Studios opt for cash plus equity deals when engaging the model in order to offset costs, plus establish a two-way ‘skin in the game’ relationship.

While technically creative capital can be applied across several fields and disciplines, the following focus areas have been found to be the most impactful:

• Brand Strategy & Execution
• Product Strategy & Execution
• Growth Strategy & Execution

Creative Capital differentiates itself from other startup support resources by strongly focusing on execution capabilities (action) as well as investing in what can be vs. what is.

Source: https://creativecapitalstudio.nl/

The Creative Capital model can either serve both as an alternative and complementary funding stream for startups depending on how they intend to maximize its benefits. On the latter, founders can leverage the growth garnered through creative capital to further raise funding for their businesses.

“The fastest new risers in the post-Covid era will take their investor pitch deck and immediately hold a brand mirror up to it.” sifted.eu 

Make-IT in Africa’s key objective is to provide relevant support to the innovation ecosystem across Africa. We hence seek to explore existing potentials in fully supporting the growth of businesses across the continent. As Creative Capital has proven to be a successful model for start-ups in other continents such as Europe and US, our goal is to perform a comprehensive assessment of its potential for African start-ups.

Scope:

The Creative Capital model tends to work better with later stage start-ups and in more advanced ecosystems (a certain level of trust needs to be there already). As such, the research should be conducted in Nigeria and Kenya. 

Period of assignment: From 03.04.2023 until 02.06.2023.

2.    Tasks to be performed by the consultant

We are looking for a contractor to assess the feasibility of the Creative Capital Model for the African context by conducting comprehensive research.

The consultant will therefore support GIZ in managing the following work packages and the accompanying milestones of the implementation of this project:

1. Conduct Desk Research on Creative Capital. This deliverable aims at assessing existing data on creative capital to enable the formulation of an informed hypothesis for further testing. The following activities are hence required:

• Map out (potential) ecosystem actors and their roles within an African Creative Capital Model.
• Identify and gather the pain points of startups and ecosystem enablers – accelerators, VCs, etc. This will serve as a basis to further assess the role of Creative Capital in mitigating these challenges
• Identify potential Creative agencies that fit into the African Creative Capital model for further engagement.
• Formulate hypothesis for validation through engagements and assessments. 

Documents to be provided (ENGLISH language):

• Summary of Creative Capital Model based on own desk research including potential pitfalls
• Assessment framework and interview guides
• Overview of key ecosystem actors to be engaged during the research 

2. Consultative Discussion & Co-Creation sessions with Relevant Ecosystem Players. This task will enable the validation of the hypothesis formulated from the desk research as well as exploring and designing possible routes if and how a CC model can work in the African context. Here, ecosystem actors and stakeholders identified through the desk research will be engaged through interviews, explorative workshops, and other mediums that best enable the attainment of this objective.

The consultant must administer engagements based on the potential role of each actor within the African CC model (startups, VCs, VBs, Hubs, etc.) 

Documents to be provided (ENGLISH language):

Deliverable from this task must capture the following:

• Outcome of assessment/interviews with each segment of actors.
• Highlight major findings gathered from each segment
• Identification of existing challenges within the broader ecosystem
• Determine the interest of CC among ecosystem players
• Possible routes how CC Model can be applied in Africa 

3. Reporting and Recommendations Here, the consultant is required to document findings from the assessments and provide recommendations based on the outcome of the validation process. The consultant produces a document that fully captures key findings from the research conducted and make a case for CC’s potential in Africa, backed by relevant data from the interviews and assessments conducted. The final document must capture the profile of companies offering (or ready to offer) CC services to startups in the select regions (Nigeria and Kenya). 

Documents to be provided (ENGLISH language):

A final document that captures overall findings from the research. The document must encapsulate the following:

• A clear case for CC’s potential in Africa
• The why, what, and how of a CC model for the African context
• Profile of actors that are ready to deploy a CC Model to startups
• Suggested approach on how to pilot a CC Model in Nigeria / Kenya (required trainings, matching mechanism between start-ups and CC providers) 

In addition to the document above, the consultant must prepare a comprehensive presentation that captures key findings and recommendations on how Make-IT in Africa can pilot CC Model in selected markets 

The contractor is required to show his research approach and design in the ToRs including the number of interviews, workshops or other formats. 

Certain milestones, as laid out in the table below, are to be achieved by certain dates during the contract term: 

3.      Concept

In the bid, the bidder is required to show how the objectives defined in Chapter 1 are to be achieved, if applicable under consideration of further specific method-related requirements (technical-methodological concept). In addition, the bidder must describe the project management system for service provision.

Technical-methodological concept

Strategy: The bidder is required to consider the tasks to be performed with reference to the objectives of the services put out to tender (see Chapter 1). Following this, the bidder presents and justifies the strategy with which it intends to provide the services for which it is responsible (see Chapter 2).

The bidder is required to describe the key processes for the services for which it is responsible and create a schedule that describes how the services according to Chapter 2 are to be provided. In particular, the bidder is required to describe the necessary work steps and, if applicable, take account of the milestones and contributions of other actors in accordance with Chapter 2.

The bidder is required to draw up a personnel assignment plan with explanatory notes that lists all the experts proposed in the bid; the plan includes information on assignment dates (duration and expert days) and locations of the individual members of the team complete with the allocation of work steps as set out in the schedule.

4.      Personnel concept

The bidder is required to provide personnel who are suited to filling the positions described, on the basis of their CVs (see Chapter 7), the range of tasks involved and the required qualifications.  

The below specified qualifications represent the requirements to reach the maximum number of points.  

Team leader 

Tasks of the team leader

• Overall responsibility for the advisory packages of the contractor (deliverables, quality and deadlines)
• Research Design of the desk research and the consultative discussions
• Quality assurance and monitoring of all deliverables
• Coordinate the overall timeline, particularly ensuring that deadlines are kept and milestones achieved as set out
• Ensuring that GIZ Rules & Regulations (e.g., data security, data privacy) are carried out within the work packages
• Coordinating and ensuring communication with GIZ and all involved stakeholders of the project (regular check ins according to agreed milestones)
• Personnel management and coordination of the team to ensure efficiency and consistency in delivery
• Responsibility for checking the use of funds and financial planning in consultation with the officer responsible for the commission at GIZ
• Presentation of the final report to GIZ

Qualifications of the team leader

• Education/training (2.1.1): University qualification (Master’s) in International Economics, Business Administration, Finance, Management, or related fields
• Language (2.1.2): Working proficiency in English C1
• General professional experience (2.1.3): 7 years of professional experience in consulting projects in the area of start-up/ entrepreneurship Ecosystem
• Specific professional experience (2.1.4): 5 years of experience in organizational management, research design and exposure to Venture Capital, Venture Builders, Innovation Ecosystems and different models of investment
• Leadership/management experience (2.1.5): 5 years as project team leader or manager in a company.
• Regional / Global experience (2.1.6): 5 years of managing projects within the areas above within the African continent (especially Western and Eastern Africa)

Expert 1 (Kenya)

Tasks of Expert 1 (Kenya)

• Support on the successful delivery and completion of all milestones in relation to project delivery
• Provide expertise and guidance regarding the Kenya ecosystem
• Support of desk research on Creative Capital (CC) approach within the Kenyan ecosystem
• Preparation of the consultative discussions for Kenya
• Engage, coordinate all different/needed players
• Conduct consultative discussions with relevant ecosystem players
• Ensure quality, consistency, and efficiency in delivery of all deliverables with guidance and leadership from the team lead
• Support on the preparation of the final deliverables 

Qualification of Expert 1 (Kenya)

• Education/training (2.1.1): University qualification (Master’s) in International Economics, Finance, Business Administration, Management or related fields
• Language (2.1.2): Working proficiency in English C1
• General professional experience (2.1.3): 5 years of professional experience in consulting projects in the area of start-up/ entrepreneurship Ecosystem
• Specific professional experience (2.1.4): 4 years of experience in the preparation and conduction of qualitative research and exposure to Venture Capital, Venture Builders, Innovation Ecosystems and different models of investment
• Regional experience (2.1.6): 5 years of entrepreneurship ecosystem experience in Kenya

Expert 2 (Nigeria)

Tasks of the Expert 2 (Nigeria)

• Support on the successful delivery and completion of all milestones in relation to project delivery
• Provide expertise and guidance regarding the Nigerian ecosystem
• Support of desk research on Creative Capital (CC) approach within the Nigerian ecosystem
• Preparation of the consultative discussions for Nigeria
• Engage, coordinate all different/needed players
• Conduct consultative discussions with relevant ecosystem players
• Ensure quality, consistency, and efficiency in delivery of all deliverables with guidance and leadership from the team lead
• Support on the preparation of the final deliverables 

Qualification of Expert 2 (Nigeria)

• Education/training (2.1.1): University qualification (Master’s) in International Economics, Finance, Business Administration, Management or related fields
• Language (2.1.2): Working proficiency in English C1
• General professional experience (2.1.3): 5 years of professional experience in consulting projects in the area of start-up/ entrepreneurship Ecosystem
• Specific professional experience (2.1.4): 4 years of experience in the preparation and conduction of qualitative research and exposure to Venture Capital, Venture Builders, Innovation Ecosystems and different models of investment
• Regional experience (2.1.6): 5 years of entrepreneurship ecosystem experience in Nigeria

5.      Costing requirements

In your tender, please do not deviate from the specification of quantities required in these ToRs (the number of experts and expert days, the fixed budget specified in the price schedule), because this is part of the competitive tender and is used to ensure that the tenders can be compared objectively. 

Assignment of personnel 

There is no travel needed for this assignment

Workshops, training

A EUR 3000 budget has been allocated for in-person workshops and/ or focus groups, covering following costs relating to the planning and running of workshops:

• Room hire
• Catering
• Workshop materials
• Other costs relating to the workshops

This budget will be invoiced against proof of implementation.

Other costs

none

Flexible renumeration

There is a fixed budget of 3.000 EURO as flexible remuneration item, which is already in the price schedule and could be used for additional costs by existing cost positions after email confirmation of the project management (DV) of GIZ. This budget will be invoiced against proof of implementation. 

6.      Inputs of GIZ or other actors

GIZ and/or other actors are expected to make the following available: 

• none

7.      Requirements on the format of the bid

The structure of the bid must correspond to the structure of the ToRs. In particular, the detailed structure of the concept (Chapter 3) is to be organised in accordance with the positively weighted criteria in the assessment grid (not with zero). It must be legible (font size 11 or larger) and clearly formulated. The bid is drawn up in English (language).

The complete bid shall not exceed 10 pages (excluding CVs).

The CVs of the personnel proposed in accordance with Chapter 4 of the ToRs must be submitted using the format specified in the terms and conditions for application. The CVs shall not exceed 4 pages. The CVs must clearly show the position and job the proposed person held in the reference project and for how long. The CVs can also be submitted in English (language).

If one of the maximum page lengths is exceeded, the content appearing after the cut-off point will not be included in the assessment.

Please calculate your price bid based exactly on the aforementioned costing requirements. In the contract the contractor has no claim to fully exhaust the days/travel/workshops/budgets. The number of days/travel/workshops and the budget amount shall be agreed in the contract as ‘up to’ amounts. The specifications for pricing are defined in the price schedule. 

Caveat: The assessment grid is attached to this EOI

8.    Submission of offer

The Expression of Interest should contain the following:

• Technical Proposal:
  • A cover letter expressing your interest in this assignment
  • Technical proposal with a brief description of why you would be considered as the most suitable for the assignment, relevant expertise, and a detailed, clear methodology, on how will be your approach to complete the assignment
  • CVs of the expert proposed
  • Company registration certificate (RDB)
  • VAT registration certificate
  • Latest tax clearance certificate
  • Proof of successful completion of related assignments.
• Financial Proposal: indicates the all-inclusive total contract price, supported by a breakdown of all costs. The costs must be in RWF and VAT 

Please submit electronically your EoI (technical & Financial offer) in 2 separated emails and should be in PDF files to this email ONLY: RW_Quotation@giz.de  until latest 12^th March 2023

Please you must write on each email subject this sentence: 83433009 Technical/financial offer, without this sentence, your offer may not be considered 

Hard copies are not allowed this time 

GIZ reserves all rights

9.      List of abbreviations

AVB                     General Terms and Conditions of Contract (AVB) for supplying services and work 2018

ToR                     Terms of reference

BMZ                    German Federal Ministry for Economic Cooperation and Development

CC                       Creative Capital

VC                       Venture Capitalist

VB                       Venture Builder

MVP                    Minimum Viable Product