Angels paving the way for affordable housing in Africa

The lack of affordable housing is a major obstacle to further economic development across the continent.

September 3, 2012

AngelHub (@AngelHubZA), South Africa’s premier business angel investment group’s latest investment will enable disruptive Namibian-developed technology, the Kavango Block Brick (http://www.kavangobrick.com), to address the continent-wide challenge of affordable housing.

The lack of affordable housing is a major obstacle to further economic development across the continent.  In South Africa alone, the housing backlog is 2.6 million houses.  Many of these customers fall into the so-called gap market, representing would-be homeowners whose income is too high to qualify for government subsidies but too low to qualify for bank loans.

Appalled by these conditions, Heinrich Schroeder designed the Kavango Block Brick system as a means of providing affordable, dignified housing to poor communities across the continent.

The Kavango Block Brick is made from conventional raw materials (sand and cement), but with unique features that allow for easy assembly by low-skilled workers. Each block is fitted with a tongue and lip, enabling the blocks to efficiently interlock, which are then stacked to form isometric wall systems. Two apertures are provided to allow for plumbing and electrical fittings, which means that no chasing need take place in the structure – maintaining the integrity of the building. Only the most basic tools – such as hammers and trowels – are required for assembly.

The system has been accredited by the National Home Builders Registration Council (NHBRC).

“The Kavango Block Brick has an innovative design that allows for rapid, safe home construction,” says Paul Solomon of Cape Peninsula University of Technology. “Building a house is as easy as snapping blocks together like puzzle pieces.  The resulting structure is sturdy, efficient, and affordable.”

Ben Bertolini, experienced asset manager and now CEO of Kavango Building Solutions, has been using the system for some time and is enthusiastic about its possibilities. “Labour is the most expensive component of any building project – representing up to 30-50% of the total cost. This patented system does not require artisan skills and reduces the construction time from the roughly 30 days it would take to complete a 50 square metre building using conventional bricklaying methods to about 10 days.”

Bertolini believes that we should be building safe and durable homes that can be transferred from generation to generation. I believe this system can help us achieve that goal. “We don’t only want to provide a house for shelter; we want to provide a house that is an asset, that can be used to generate income and or to raise funding at a bank, which means that the house must be bondable. This is how the gap between the rich and the poor can be narrowed.”

Bertolini reports that interest has already been received from countries such as Botswana, Nigeria, Zambia and Rwanda. “It’s an African solution to an African problem.”

The potential social impact coupled with its innovative technology was precisely what drew local angel investment group Angelhub to the system. Through AngelHub, Kavango Block Brick received funding to commercialise its product in its first Southern African test markets.

“Technology will drive Africa’s next wave of growth,” says AngelHub’s Brett Commaille (@brettcommaille).  “The Kavango Block Brick technology dramatically improves the homebuilding process in terms of ease of installation, reduced costs and time.  Add its patent protection and certification and you have an inherently scalable business by licensing the technology, which will always be attractive to investors.  The result: incredible customer value – and enhanced quality of life.”

In addition to angel funding of R1m – R10m, AngelHub provides extensive mentorship, resources, and access to professional services to the early stage companies that make it through the group’s rigorous investment screening process.

“In the case of Kavango Block Brick, our investment could pay dividends not only for investors but for entire communities across Africa,” Commaille concludes.