A factory running three shifts can still be a poor investment. Full order books, crowded loading bays and a rising headcount say a great deal about activity and much less about value. As more capital moves into African industry, that distinction is getting harder to make and more expensive to get wrong.
Capital is changing course
Between January and September 2025, deal activity in Africa was led by industrials and utilities, reflecting a reallocation of capital away from consumer-facing ventures, according to the African Private Capital Association (AVCA). Industrials was the fastest-growing sector, recording 57 deals and averaging 23% annual growth. Some 72% of industrials investments were technology-enabled, aimed at logistics digitisation, manufacturing automation and the modernisation of service infrastructure. Utilities, meanwhile, surged 75% year on year to 28 deals.
The policy conversation is moving the same way. The World Bank devoted its April 2026 Africa Economic Update to making industrial policy work in Africa, and the African Development Bank reports that manufacturing output across the continent is expanding.
Gene Grand welcomes the shift, but he is wary of how easily “industrial” becomes a label rather than a judgement.
“Busy is the easiest thing to see on a site visit,” he says. “What I want to know is whether the business would still be standing if its biggest customer walked away next month.”
Test one: its place in a regional supply chain
The first question is where the asset sits in a regional supply chain. A plant that turns local inputs into goods needed by several neighbouring markets is in a very different position from one assembling imported parts for a single buyer.
Assets that sit at points many supply chains pass through, such as ports, processing hubs and cold-storage networks, tend to be harder to replace. Technology can strengthen that position. Digitised logistics and automated production, the areas most technology-enabled industrial deals have targeted, often make an asset faster and more dependable than the alternatives around it.
Test two: how concentrated the margin is
The second question is how much of the margin depends on a single customer or corridor. Many African industrial businesses grow up around one anchor contract or one trade route, and that is often a perfectly sound way to start.
Concentration in revenue and concentration in margin are different things, though. A company may sell to a dozen customers yet earn most of its profit from one. Separating the two often shows a business to be more fragile, or more resilient, than its top line suggests.
Test three: the route to a second market
The third question is what it would take to serve a second market. An asset that could supply a neighbouring country with modest changes has options. One that would need new certification, new logistics and a new sales team to cross a border is, in practice, a single-market business, however large it looks.
For Gene Grand, this third test is where much of the long-term value lies.
“The assets I find most interesting are the ones already built to cross a border,” he says. “Regional trade is still a small share of the total, which means the companies ready for it have a very long runway.”
Room for Africa to trade with itself
When it launched its new Africa Industrialization Index in May 2026, the African Development Bank pointed out that intra-African trade stands at just 14.4% of total trade. The index found that 41 of the continent’s 54 countries improved their industrialisation scores, with Morocco overtaking South Africa as the continent’s leading industrial economy.
The small share of trade that stays within Africa is the opening. As cross-border trade deepens, industrial assets that can already reach a second and third market are positioned to benefit first.
Applying Gene Grand’s test does not require complicated models. It asks three plain questions about position, concentration and reach.
“Industrial investing here rewards precision more than speed,” he says. “Get those three answers right, and the growth tends to follow.”
