With an Empire that incorporates concrete, cargo, framework, agribusiness, and now oil refining, Dangote, 60, Africa’s richest man has a transcending desire that coordinates the size of his undertakings. His Dangote Group has extended quickly, spreading into a new area crosswise over Africa just as into new ventures. Steadfast by the size and extent of his ventures, Dangote, makes brave moves that others would modest far from. Invested nearly $5 billion into sugar, rice, and dairy and now $12 billion into building of an oil refinery at the outskirt of Lagos.
The Graph – What excites you about Business?
AD It’s not all about making money. It’s about making impact. For more than 20 years, Dangote was just a trading company. Then we decided we wanted to be an industrial giant—and we had to start somewhere. It wasn’t just about cement. It was about industrialization. If you look at what Dangote Group is doing, it’s about improving people’s lives.
The Graph – As it always been your target – the oil business?
AD We had already started doing 300,000 barrels back in 2005. At that time I couldn’t even fathom a larger refinery. I had no financial capacity. Then in about 2010 we paid all Dangote Group’s debts, which amounted to $2 billion, and started accumulating cash. When we decided to build the refinery of our dreams, we reviewed our plans again and put the figure at 400,000. Then it jumped up to 650,000. So a refinery had actually been on the drawing table for years, but this is how we were able to finally push it through.
The Graph – You’re building one of the world’s largest oil refineries. Why oil? Don’t you worry we’ve reached peak oil?
AD let me tell you why we had to go into oil. Our strategy was to be an African company. When you look at the other options, it’s really agriculture—and agriculture doesn’t take that much money. We always invest most of our money back into the business, so when we looked at it in 2015 and projected our revenue for the next few years, we looked at what we had left after investing in fertilizer and realized we still had billions of dollars we could put somewhere else. The only place we could invest that much money was in the oil and gas business. So the refinery takes those dollars and allows us to invest in something we are used to, which is industry.
The Graph – Why oil now?
AD The majority of people here made their money through oil. But Dangote has never ever dealt in oil, which is to prove that you don’t have to be in oil. In Nigeria, oil has really damaged our thinking. Everyone is thinking about oil, oil, oil. And we are one company that has made a success without doing that. Also, people always say, “Oh, he’s in oil and gas—there’s a lot of corruption in oil and gas.” We didn’t want to be a part of that. There are a lot of friends of mine in oil, and they are doing the right thing. But I didn’t want to be a suspect, so that’s why we’re not in oil.
The Graph – So why go so big on oil instead of renewable energy?
AD In business you need to know before you jump into something. You have to do quite a lot of homework. For instance, Nigeria’s refineries were privatized in 2007. We bought two, but after a few months we had a new government that decided to void the transaction, thinking we got a very good deal. So since 2007 we’ve been actually working on building our own refinery, but we didn’t finally start something until 2015.
The Graph – Do you worry about not finishing?
AD I don’t have that worry. We have the most robust team anyone can put together, and we’ve been doing this sort of work together for years. We have actually never failed in delivering any project. We always deliver our projects on time and at cost. If we hadn’t delivered our projects on time, that would be something. We will definitely deliver, by the grace of God.
The Graph – It can be difficult to be successful at an industry you don’t know very well.
AD We don’t want to listen to the critics, because their intention is to destroy us. We are using our own money. This is my lifetime project. I have to back it up with my own life to make sure it is delivered. I know that, yes, it’s true, a lot of people have tried to deliver on refineries in the past, mostly governments. They couldn’t.
The Graph – So this is the most ambitious thing you’ve ever done?
AD It’s an ambitious project, yes, but we have others at that particular site, too. We have a gas pipeline, for instance. We are trying to bring gas to Nigeria. The total gas that will come out is on par with the likes of Shell and other people. This will transform Nigeria because, as we speak, we have about 6,800 megawatts of power capacity that has been installed but not been put to use, the reason being that we don’t have the infrastructure.
The Graph – Do you think it’s easier to be a businessman in Western countries?
AD I think it’s easier, yeah. It’s more defined. You can plan better. You don’t have issues of currency devaluation. There’s more clarity. Yeah, it’s better. The difference is here the profit margins are huge—much larger. And if you are not a big player, you have no way of survival.
The Graph – Regarding this refinery what are the difficulties you encounter as a businessman in Africa.
AD For the refinery, almost every single thing was imported from abroad. One of the difficulties was that most of our ports are not designed to receive heavy equipment; 75 percent of the cargo we need for the refinery cannot be offloaded in the port of Lagos. One piece of equipment weighed 2,870 tons! No port in Nigeria is designed for cargo that heavy. So we built our own jetty, about 1 kilometer in the ocean, which was a major project. We couldn’t get local cranes to hire, either. We had to go and buy 300 cranes. Then there’s manpower, which we also brought from abroad—almost 30,000 people, because we didn’t have a trained workforce for these massive projects. We are building housing for the foreign workers and expect to have between 35,000 and 40,000 workers at the peak of the project, including locals, whom we will house outside the refinery. So, you know, running businesses in Africa is good, but it’s not easy. You have to be on top of what you are doing.
The Graph – Will you ever get into renewables?
AD We will get into renewables, of course, but we’ll try and partner. Beginning in 2020 our major investment will be in the U.S. and Europe.
The Graph – By 2020, how much money can you put in the U.S. or Europe?
AD Let’s say that by 2025, I’m looking at between $20 billion and $50 billion. Mind you, we don’t do small things.
The Graph – what was it like for you growing up?
AD I grew up in Kano, Nigeria. After my school I went to Egypt and finished there. Then I moved on to Lagos to do business. I learned quite a lot from my late grandfather. He was in trading. I actually grew up with him. I didn’t know my parents until I was about 4 or 5 years old, and unfortunately my father died when I was 8.
The Graph – You later spent some time in Brazil. What was that like?
AD Brazil was having a lot of currency challenges then, as well as inflation, but they were very industrious. They have a lot of industries that have been built by entrepreneurs, and I got to interview quite a lot of them by going around. I sort of went to Brazil to convince myself to move into industrialization.
The Graph – What was the most powerful thing you learned there?
AD I went to a company called Arisco. It was my first time seeing more than 600 people working in a single factory. I went there to visit them and see how they started the business. They had begun very small: salt, then seasoning—adding garlic into the salt. By the time I was there, Arisco was producing 500 different items, even toothpaste. You couldn’t wake up in the morning without using their products.
The Graph – Do you ever worry about being too bold?
AD I never worry about being too bold. In business it’s good to be aggressive, but with a human face.
The Graph – Who taught you that?
AD Well, I’ve learned from a couple of things. I thought at first I was really aggressive until I watched this show, The Men Who Built America. I realized that actually they were much bolder than us. Someone like Vanderbilt, he built 50,000 miles of rail! That is a very bold move. That’s why anything we do, we don’t do it small. If there’s any human being who has done this equally, I am equal to the task to do the same. I actually have a sign on my desk that says, “Nothing is impossible.”
The Graph – Earlier you mentioned paying off your debts around 2010. How significant was that moment, and how did you celebrate?
AD It was a turning point. It helped us to be more disciplined. We are not trying to hide our heads from the banks. It has also given us a model to be very prudent and also be financially robust. Because normally people go out there and do project financing. We don’t do project financing. We leverage our current businesses and then build another new business. So in the head office here, what we do is only strategy and incubating various businesses.
The Graph – You talk about business with a purpose, and that might be also one of the reasons you say you’re successful. How many other businesspeople around the world, at your level, would you say are like that?
AD There are a couple, but in Africa there are very few.
The Graph – Why so few?
AD I think discipline. You need to be disciplined at what you are doing.
The Graph – Would you be interested in going into technology?
AD When I look at telecom, for instance, I think that would be very tough for us. We are a little late. Some players have been in this market for 17 years already. There’s no way you can go and jump over somebody after 17 years of their hard work. So I think we would pass when it comes to telecom today. There are other businesses that we understand better.
The Graph – Why not back more tech startups?
AD We can really do almost anything, but I think technology is not really one of the areas we want to go into right now. If I am going to invest in a tech company, I can buy shares, but it’s not something I want to go in and run. I am very passionate about industrialization—more than going into a tech company. It doesn’t make any sense for us to go direct there.
The Graph – Because of your portfolio?
AD Because of our portfolio, yes. If you try to do a little bit here and a little bit there, you get into trouble. We arrive with focus, and we stick to it. Right now, beyond the oil refinery, our focus is on agribusiness. Anything we are doing between now and 2020 has to be agriculture—that’s it. I don’t want to stretch myself too thin, and the best way to do that is we should deliver on things that were promised, especially because people are wondering if we’ll be able to deliver.
The Graph – Are you ever frustrated that valuations seem to be better in tech companies than in the industries like your own?
AD Honestly, I do. Look at the U.S., the way the tech companies are getting massive. And it’s still nothing compared to the GEs, yet those don’t get that kind of valuation. I wish that we’d entered tech, but our concentration has always been in Africa.
The Graph – You’ve mentioned wanting to buy Arsenal Football Club before. Is that still on your wish list?
AD Yes, but I don’t want to go after Arsenal until I deliver the refinery. Once I deliver, I will go after Arsenal.