How To Pull Off A Successful Corporate Merger With RBI’s Heitor Gonçalves

What’s News In This Story?

This interview is part of the “Tomorrow Lives Here” Conversation Series presented by Miami Business School


–A veteran of venture capital, Heitor Gonçalves has been at the center of multiple corporate mergers and turnarounds. 

Gonçalves also worked multiple strategic roles for Anheuser-Busch InBev

He is now at Restaurant Brands International (the multinational who runs Burger King and Popeyes).

–Based in Miami, Gonçalves spoke to Miami Business School Dean John Quelch about the biggest challenges to a successful corporate merger and the biggest differences between the beer and restaurant industries. 


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DraftKings CEO Jason Robins On How Growing Up In Miami Prepared Him For Success

What’s News In This Story?

This interview is part of the “Tomorrow Lives Here” Conversation Series presented by Miami Business School



DraftKings CEO and co-founder Jason Robins grew up in Miami. 

–And it was that upbringing that turned Robins into a sports fanatic from an early age. 

-He took that passion into the business world with the launch of DraftKings in 2012. 

-The company is in the daily fantasy sports industry and allows its customers- people who manage fantasy sports teams, to compete for cash prizes.  

-In a wide-ranging conversation with Miami Business School Dean John Quelch, Robins talked about how he and his two co-founders got the company off the ground despite fierce competition, what he learned from his UM economics professor father and about the power of differentiation in startups.

Don’t Miss:

Lennar’s Stuart Miller Thinks That Miami’s Homebuilding Market Is A “Tale Of Two Cities”

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Lower East Coast Is Bringing Miami’s Hipsters And Zine Fans To Allapattah

What’s News In This Story?


–Lower East Coast (3418 NW 7th Ave, Miami) is a small storefront that features zines and has a hipster feel.

-It’s one of those independent places that Miami doesn’t seem to have enough of.

–Founded by longtime friends and coworkers Steven Sanz and Rees Escobar, Lower East Coast is starting to get some buzz in the Miami artsy scene. 

–It also serves as a pop up venue for musicians that Lower East Coast Management represents, and others. 

–The shop is one of the anchors to a bunch of recent activity  in the Allapattah area. 

The full story: 

Lower East Coast is a small hipster shop that specializes in selling local zines, independent magazines and local apparel brands that are a bit obscure and weird.

It’s also something that co-founders Steven Sanz and Rees Escobar say that they have to do for Miami.

“We’ve been friends for a long time and we’ve been talking about doing something for Miami and this is what we landed on,” Sanz said in an interview with RISE NEWS.

The shop is an outgrowth of Lower East Coast Management, a local talent agency that manages the careers of artists like Denzel Curry and PSYCHIC MIRRORS.

Sanz and Escobar first met over 15 years ago and have similar interests.

They decided to launch a Lower East Coast storefront during last year’s Art Basel.

Since then, they have hosted a series of pop up events with artists they manage, and others.

They also sell street wear brands like the Miami based Stray Rats and their own original tees.

“Everything we do is small batch runs,” Sanz said. “What we do is very niche. When you work with the young art kids, the rarer it is, the cooler it is.”

The interior of the shop is an all-white industrial space with high ceilings. It also features wood bleachers were you can sit and read through the collection of rare zines.

Ultimately Sanz said that they are trying to create a sense of community in Miami with Lower East Coast.

“It’s inspired by places we visit in New York and London,” Sanz said. “We need more mom and pop shops here. It’s something we’re missing.”

***HOT TIP-  You can also watch World Cup games and hang at the store. Lower East Coast is also partnering with Hialeah thrift and consignment store, Ropa Vieja, to sell a variety of select 90’s soccer kits and a custom, limited edition World Cup T-shirt. 

**IF YOU GO: Open Wednesday through Sunday from 12 PM to 8 PM.

Lower East Coast (3418 NW 7th Ave, Miami, 33127)

——Here’s Something Completely Different: ——

The TV Weatherman Who Is Trying To Save Miami From Drowning

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Have a news tip about this topic or something completely different? Send it to [email protected]

Get Your Side Hustle On With These 7 Ideas

Millions of strapped-for-cash millennials are putting their entrepreneurial spirits to good use with the good-old-fashion side hustle.

The sky is the limit when it comes to making money outside of the traditional day job. It’s a good thing too, because collectively Gen Y is facing $1 trillion in student loan debt, according to Entrepreneur.

There’s no illusion that one is going to make a million dollars right out of college, but “don’t let your dreams be dreams.”

Turn a passion into a pursuit for extra cash, pay down student loans, invest in the market, or start a savings account.

Currently, 35 percent of millennials are involved in some type of side business.

So, what are people doing for supplemental income?

Many things, some of which are pretty creative.

Online freelancing

Writing is my favorite gig because it’s fun, flexible, and a great creative outlet.

Proficient writers who are equally good at hustling their work can make $10,000 a month.

For those making that much, though, freelancing is probably their full-time job.

Even if you don’t make a ton of money, freelance blogging on the side can lead to bigger and better opportunities if you’re producing quality work.

The extra cash sure comes in handy, no matter where you are at in life.

“It can be worked into any college student’s schedule and can be a great side income for everyone looking to accelerate student loan pay-off,” writes Alexa Mason, who now earns more than $5,500 a month in freelancing.

Mobile gaming

Turning a childhood passion for computer games into a career may start out as a side hustle.

Dong Nguyen, who created the mobile game Flappy Bird in three days, probably didn’t think he would get rich, but he did.

Photo Credit: giochi Android iPhone/ Flickr (CC By 2.0)

Granted, he began coding his own video games at age 16 after being inspired by Super Mario Bros.

In 2014, Nguyen said his simple game was earning around $50,000 a day in revenue through its in-gaming advertising.

Aspiring entrepreneurs can learn a great deal from the successes of people who’ve gone before them.

A prime example is Niantic, Inc. CEO John Hanke, who created 2016’s hottest trend: Pokémon Go.

“A TRS-80 was the math computer in our school when I was in probably the seventh grade,” Hanke said in an interview. “I was hanging around watching older guys and they were playing the original Star Trek game with ASCII graphics. I ended up spending hours and hours in the computer room doing that. A couple years later, I saved up my money mowing lawns and bought an Atari 400 with $500 and a tape recorder to save all my programs.”

Sell Products

Everywhere you look on Facebook, someone is trying to sell something to you.

To make money, you need to sell the products to your friends and family.

These multi-level marketing companies come in the form of Avon, Amway, Scentsy, Rodan+Fields, and doTerra.

People know these high-profile brands, and buy the products.

Multi level marketing (aka pyramid selling) is not a new concept, is completely legal, and is a big-dollar industry.

“Amway’s global sales in each of the past few years have exceeded $8.8 billion,” according to the company’s blog. “Since 1959, Amway has paid out nearly $60 billion in bonuses and incentives to its distributors worldwide – more than any other direct sales company in history.”

Not a path for everyone and not without controversy, the move in recent years to encourage millennials to try their hand at “salesmanship” by selling products has gotten many pushing products on the side.

Tutor children

Are you a music or math wiz? Pass your passion on to kids who could use your help. Tutoring is a legit side hustle – one you can feel good about. Teachers will often tutor on the side after school or during lunch to make extra cash. There’s also online tutoring available via Skype, for example.

Another advantage of tutoring is the ability to set your own rates. Some people make anywhere from $25-$90 an hour, depending on skill level and what the market will bear.

Pet sit

Die-hard dog owners love their dogs more than life itself, so the thought of leaving their beloved pet for a few nights in a cold kennel by himself is truly heart breaking.

Photo Credit: brando.n/ Flickr (CC By 2.0)

People would rather hire ‘temporary pet parents,’ or pet sitters, as an alternative to boarding their animal.

After a rather unpleasant and expensive kennel experience, Aaron Hirschhorn found the pet sitting niche to be rather lucrative.

He decided to start his own company after boarding his dogs in a kennel on the West Coast while he traveled to the East Coast.

It cost him $1,400, and one of his dogs was hiding under the desk for two days afterwards.

He rounded up a hundred pet sitters for beta testing, started his own website called DogVacay and convinced investors this was a business worth funding.

Today, the company has collected more than $22 million in venture capital and spans 10,000 cities in the U.S. and Canada.

Uber – Lyft – Juno

The ride sharing economy has boomed over the past several years.

The crazy thing is it’s not just a simple side hustle of driving people around anymore, either.

Photo Credit: Carl/ Flick (CC By 2.0)

There’s a side hustle within the side hustle.

There are people selling tomatoes out the back of their Uber cars, others passing out “life coach” business cards as their passenger gets out, and there’s even a guy trying to rope his passengers into a life insurance pyramid scheme, you name it.

One of the most famous stories is of the guy who came up with rideshare karaoke. Jonathan Guarano bought a camera and a GorillaPod, attached the setup to the dashboard of his silver 2014 Nissan Versa, and asked his passengers to sing along to the music.

The video of him and his passengers singing to the Weeknd’s “Can’t Feel My Face” went viral with over 4.7 million views.


Etsy is transforming itself from a niche craftseller website into a launching pad for at-home entrepreneurs with the creation of Etsy Studio, which is a marketplace dedicated to selling craft supplies and DIY tutorials.

Etsy is simultaneously adding a new service called Shop Manager to improve the seller experience.

Etsy that up, yo. Photo Credit: Toms Baugis/ Flickr (CC By 2.0)

“It’s the company’s largest expansion ever,” according to Fast Company. “And while Etsy is still dwarfed by the likes of eBay and Amazon Marketplace, the Dumbo, Brooklyn-based company attracts a loyal following of 1.7 million active sellers who reaped $2.3 billion in sales in 2015.”

As you can imagine, all of the above side hustles take hard work and perseverance. The money is there for the taking if you want to invest your time and energy…or you can always put off paying back those student loans for another 20 years.

RISE NEWS is a grassroots journalism news organization that is working to change the way young people become informed and engaged in the world. You can write for us.

Start Up To Offer Incentives To Get Lawyers To Provide Veterans Free Services

This piece is from Jurbid, a legal start up. 

They serve and protect – the legal profession fails them. Veterans in need.

While today should not be the only day we honor the fearless and brave men and women who protect our great country and ensure that we can go about our lives safely, it is an important day to take note how we fail them at home.

Currently, there are nearly 40,000 homeless veterans. In fact, veterans make up nearly 20% of the male homelessness population.

Sadly, women veterans are the fastest growing homeless population in the US.

Women veterans are four times as likely to become homeless as male counterparts!

Per several sources, New York and Florida have among the highest veteran homelessness population in the country.

It is estimated that there are 3,500 homeless veterans in New York City alone! In Central Florida, there are about 4,500 homeless veterans.

Why are so many veterans homeless you may wonder?


They are often unemployed and disconnected from their families upon their return home because of mental illness and substance abuse.

They are simply not given the proper support to be re-integrated in civilian life.

They don’t know how to apply for social benefit programs that are designed to help them.

Lawyers are trained to provide such services and can ensure that veterans receive the benefits they deserve.

Currently, there is very little legal support for them.

How can we as proud Americans live with ourselves knowing that these veterans are in dire need of support and help and they receive none?

Jurbid will make a stand.

Starting today, Jurbid will provide the lawyers in its network incentives to provide pro bono services to veterans including free or discounted services.

Additionally, all veterans will receive a 5% discount off their paid legal service.

We are here for you because you have been there for us.

With much respect and love.

Your Jurbid Team.

Jurbid is your legal connection. Our innovative platform connects you with top quality legal counsel. From employment disputes to immigration. You can learn more at

This piece is part of the RISE NEWS Marketplace, a place where startups and other companies can post articles about what they are up to. If you would like your company to be included, please email [email protected]

Cover Photo Credit: Embajada de los Estados Unidos en Uruguay/ Flickr (CC By 2.0)

ITT Tech Closed Down Out Of The Blue, And Its Students Got Royally Screwed

The dramatic and sudden closing of all ITT Technical Institute campuses earlier this month left 40,000 students and 8,000 employees wondering what’s going to happen to them in the future.

The good news is debt incurred by ITT Tech students will likely be forgiven.

The bad news is that the credits they earned may not be transferable.

Plus, because of ITT’s reputation, it’s embarrassing for current students and even former graduates to list it on their resume.

What’s more is the closures could lead to a housing crisis for some veterans who were receiving housing allowances. The list of potential problems goes on and on.

As a for-profit school, ITT Tech was not accredited by the Higher Learning Commission, which requires certain standards from its schools.

ITT Tech had 130 campuses in 38 states. Thirty percent of ITT students nationwide are veterans.

The Higher Learning Commission will not allow regionally accredited schools to accept credits from for-profit schools that are not regionally accredited, like ITT, for example.

Why did this happen?

A week before ITT closed its doors, the government banned the school from enrolling new students receiving federal aid. ITT relies on federal grants and loans from students for the majority of its revenue. ITT pulled the plug on operations as a result.

However, the Department of Education has been worried about the college for several years.

ITT was facing lawsuits and federal/state investigations from the Consumer Financial Protection Bureau and the U.S. Securities Exchange Commission.

The last straw happened last month when the college’s accreditor (Accrediting Council for Independent Colleges and Schools) said that ITT was not in compliance and “unlikely to become in compliance” with its criteria.

Today’s postsecondary environment is in a constant state of flux and adapting to the changes is an opportunity for institutions to adapt to and succeed in the current climate, writes Jay Halfond, the former dean and professor at Boston University Metropolitan College.

Unfortunately, it isn’t happening on every level.

“For-profits pray for someone in the White House who will protect their federal source of funds and ignore their (own) accountability,” Halfond wrote.

In 2014, Time magazine ranked ITT Technical Institute No. 2 on its list of “The 5 Colleges That Leave the Most Students Crippled By Debt”.

Among ITT Tech graduates with loans due in 2011, 22% had defaulted by 2014.

The for-profit University of Phoenix had a lower default rate by percentage – 19% at Phoenix vs. ITT Tech’s 22%.

But the total number of students in default from Phoenix was much higher – 45,123 Phoenix students versus 11,260 ITT Tech students.

Now what?

The death of for-profit schools will likely continue which gives other institutions like online colleges with hearty programs the opportunity to absorb some of that business.

A prime example of a school that saved itself from closure is Regis College in Boston. Regis was once a small, private, all-women’s college. They opened their doors to men in 2002, which helped the school thrive. Another move that helped saved the brick and mortar school is when Regis expanded their nursing program into the online realm.

Online options could be a way for former ITT tech students to re-enroll in school without having to move.

A list of career colleges and trade schools that have formed agreements with ITT to make it easier for students to transfer credits can be found here.

There are two main options for the ITT students left in a lurch.

They can transfer credits to another school with a comparable program, but those students won’t be eligible for federal student loan forgiveness.

If they choose to cancel their loans instead, anyone enrolled at the time or withdrew within 120 days of the school’s closure has the legal right to have their federal loans forgiven under a “closed-school discharge” agreement.

The problem with that route is that students must start all over if they want to further their education.

U.S. Secretary of Education John B. King Jr. has warned students to steer clear of companies offering to help in exchange for money.

Applying for any form of loan forgiveness is free.

The future of for-profit colleges

Enrollment in for-profit colleges is declining.

DeVry University said the number of students taking classes is down 23% this year and the University of Phoenix is down 22%.

Harder government scrutiny is one of the reasons.

Other major players will start to shut their doors if they don’t change the way they do business, which is one of the reasons DeVry is trying to differentiate itself.

A few days ago, DeVry Education Group announced it will voluntarily limit the amount of federal revenue it receives back to the 1992-98 federal ratio.

Today the rule requires for-profits to receive at least 10% of their revenue from nonfederal sources, and DeVry plans to increase it to 15%.

Regulatory scrutiny is not going away. Here’s another interesting thing to follow: The Accrediting Council for Independent Colleges and Schools (ACICS) is the organization that accredited ITT Tech and said they were fed up with the school’s noncompliance issues.

But ACICS may be terminated real soon as recommended by a federal panel, according to Inside Higher Ed.

“When we see schools provide extremely poor outcomes for students – or even commit fraud – while maintaining accreditation, that is a black mark on the entire field,” said Ted Mitchell, the under-secretary of education in the Inside Higher Ed article.

RISE NEWS is a grassroots journalism news organization that is working to change the way young people become informed and engaged in the world. You can write for us.

Cover Photo Credit: ITT Tech/ Facebook

WATCH: What Real “Ladies Of The SEC” Have To Say About That Slut Shaming HuffPost Piece 

How Donald Trump’s Campaign Is Basically A Start Up Company

By Mario Moussa and Derek Newberry

Donald Trump has had some rough spots in his campaign. He damaged his credibility early on as a candidate by making a string of confusing and ill-advised statements about punishing women who have an abortion and expressing scant concern about nuclear proliferation.

His campaign manager, Corey Lewandowski, had been dogged by charges that he assaulted a Breitbart reporter. Even worse was the shellacking Trump took in the Wisconsin primary, losing by a shocking double-digit margin.

Reports had said that with the “Make America Great Again” campaign was in evident disarray, Trump’s team of advisors were working on a “reboot.”  As the presumptive Republican nominee, there a bright spot in this story. The reboot.

After years of studying collaboration at the Wharton School of Business, we concluded that the best performing teams do it all the time.

As situations change, they change. In other words, they reboot. We have no special insight into Trump’s nomination, but as teamwork experts, we do feel the candidate deserves credit on this key point.

Let’s look a little more closely at what the man who wrote the book on deal-making can teach us about the art of teamwork — and especially the reboot.

Trump launched his campaign with the clear goal of broadcasting his message directly to voters. He all but ignored the traditional retail activities such as meet-and-greets at churches and state fairs, rubber chicken dinners, and gatherings with local politicians.

Delivering taunts, insults, and over-the-top promises at debates and large rallies generated what many observers have claimed is over a billion dollars of free PR. His new convention manager, Paul Manafort, said the campaign model was “predicated on a historic approach to communicating with the public.”

But then, as the gaffes mounted, this shoot-from-the-hip approach stopped delivering easy victories by late March.  What to do?  That’s right: time to reboot, and redirect energies.

Which Trump did – and fast. Because, even with an impending nomination, there are still obstacles ahead. Trump brought in Manafort, who has his own team of like-minded aides who will also join the campaign. Lewandowski has hired specialists who worked with Ron Paul and know how to win over delegates, one tough-talk conversation at a time.

Desperation moves?  Recent media coverage might lead you to that conclusion. We see a different perspective. The Trump campaign is like a team of Silicon Valley entrepreneurs who raised money, launched a venture, recognized quickly that their business model was failing, and – to use a popular high-tech term – pivoted.

Successful teams at Facebook, Slack, Pinterest, and many other companies had to pivot several times before they became winners. This is not easy to do for a startup or campaign team, and it often produces conflicts. Not surprisingly, Trump’s meetings with his staff have been reported as highly contentious.

So, how to have a successful reboot? When we advise executives about managing their teams, we emphasize a few guidelines illustrated vividly by Trump’s latest public moves.

Always work toward a goal but avoid becoming too attached to it, because situations change and you might have to adjust. Define and redefine roles on your team as your work evolves, and seek to put the right people in those roles.

Have frank discussions – which will often be contentious – about what they need to do. Be clear about how you want the members of your core team and related teams to work together.

As General Stanley McChrystal puts it, leaders need a “team of teams” to run an organization. Above all, remember that it is really hard work to align and re-align a group of people collaborating on achieving a common purpose.

Because managing a successful pivot is such hard work, most teams fail to deliver hoped-for results. Yet at the moment, we think Trump’s campaign is increasing its chances of officially clinching the victory soon by rebooting.

You might even consider doing it on your own team, if recent performance has been disappointing. Of course, in politics as in business, despite the promises of overconfident leaders, there are no simple solutions and no guarantees.

But by following a few guidelines, you can give your team the best shot at achieving what Trump himself might call “yuge” success.

Dr. Mario Moussa and Dr. Derek Newberry are the authors of Committed Teams: Three Steps to Inspiring Passion and Performance. Dr. Moussa teaches in the Executive Programs at Wharton School of Executive Education. Dr. Newberry is a lecturer at the Wharton School of Business. For more information, please visit, and connect with the authors on Twitter, @Committed_Teams.

RISE NEWS is a grassroots journalism news organization that is working to change the way young people become informed and engaged in public affairs. You can write for us.

Cover Photo Credit: Darron Birgenheier/ Flickr (CC By 2.0)

WATCH: Mark Zuckerberg Talks About “The Facebook” Before It Was Huge

This is an interesting video that we just came across. And for all you young entrepreneurs out there, it also has an important lesson- you can never really know where your idea or business is going.

In the video, a young Mark Zuckerberg talks about his dreams for “The Facebook” and they are pretty different than what Facebook has become a decade later.

Take a look and tell us what you think in the comments below:


RISE NEWS is a grassroots journalism news organization that is working to change the way young people become informed and engaged in public affairs. You can write for us.

This Gen X’er And Her Two Young Daughters Are Trying To Revolutionize Millennial Menswear

Who says that you have to be a millennial in order to know what they want?

After spending five years as a housewife, Mary Di Fede-Garcia, age 47 and a resident of South Florida, decided that it was time for a change.

She focused on the men’s online clothing market for young people, sensing that it was a soft market.

Then Di Fede-Garcia launched Solsburry last December.

Solsburry is a website where men, mostly millennials, can find affordable clothing.

According to Di Fede-Garcia, Solsburry was chosen as the name of the brand because of a story told by former Genesis front-man Peter Gabriele.

“Peter was not getting along with his band member, Phil Collins, and he got to a turning point in which he needed to decide between going solo or take the back seat at the band while Collins was the lead,” Di Fede-Garcia said in an interview with RISE NEWS. “Peter went to a place in England, called Solsburry Hill, where a sense of change came to him, decided to go on his own, and became very successful.”

Picture 1

Mary Di Fede-Garcia, second from left, with her husband Alex and two daughters at a party in 2014.

Change has come to Di Fede-Garcia’s life as well, but the creation of Solsburry, the brand, was not an easy feat for her.

She had to face two of her greatest challenges: the Internet and social media.

“While I was building the brand in my head, I said to myself: ‘Let me face my biggest fears right on’,” Di Fede-Garcia said. “’If I am technologically challenged and I manage to do well on the web and social media, then I would know that there is nothing I can’t conquer.’”

To overcome her fear and after working for some months with a web developer, Di Fede-Garcia established Solsburry on the web, and it is spreading its name in social media channels such as LinkedIn, Facebook and Instagram.

Di Fede-Garcia has had support from her family in figuring out how to efficiently use social media as a branding and sales tool.

“Seeing her struggle since the beginning in not knowing how to do certain things on the web led me to help her,” Mary’s 18 year old daughter Lauren del Pino said.

Lauren is helping with the social media marketing efforts for the brand while her 22 year old sister, Danielle del Pino, is leading the web styling and selection of clothing for the brand.

“My sister helps out with the social media section because that is natural for her,” Danielle said. “I love helping out putting together the styling and the organization for the brand, and, of course, the photoshoots.”

The two daughters not only help their mom build and maintain the brand but also, along with their friends have provided significant inspiration since day one according to Di Fede-Garcia.

Picture 3

A view of a Solsburry photo shoot.

“My daughters have male friends who visit the house, and they are always commenting about how the women’s clothing market is over saturated while the men’s one is missing attention,” Di Fede-Garcia said. “I decided that I wanted to provide quality clothing that is durable, easy to wash and wear.”

Solsburry, is aiming at providing clothing for young men from high school to young adults who are starting their careers- men who want clothes that make them to look good but are also affordable.

Di Fede-Garcia said that she understands that young men at those stages have other priorities that are more important than looking good.

She also contributes a portion of the proceeds from each piece sold to some charities each month.

More Info On Solsburry:

[email protected]

Phone: +1 (305) 275-1829

Toll Free: 1 (844) 834-1829

RISE NEWS is a grassroots journalism news organization that is working to change the way young people become informed and engaged in public affairs. You can write for us.

Photo Credit: Solsburry/ Submitted.

Africa’s First Billion Dollar Start Up Is A Bet On The Rise Of The Continent’s Middle Class. But Is It A Smart Bet?

For decades, the narrative around African business has been pretty negative. But things are changing as demonstrated by the recent achievement by the Africa Internet Group– as it became the first ever African based “Unicorn” start up company.

Africa Internet Group just received an $85 million investment, valuing the company at over $1 billion, and making it a “Unicorn”.

AIG is essentially Silicon Valley, but all packed into one business.

They invest in and help manage over 30 African companies like Easy Taxi, Jumia, and Lamudi, which mimic the Uber’s, Amazon’s, and Zillow’s of the world.

Glassdoor reviews from former employees of AIG give it a 3.2 rating out of 5 with 21 reviews. The pros largely coalesced around the work: always busy and challenging.

The cons all focused on the same issues surrounding management, with every negative review either highlighting a lack of communication or unrealistic expectations for their subordinates.

These complaints about management seemed to be shared by ownership, as last December, the company began to lay off upper level staff left and right, with one of its largest companies, Jumia, firing over 300 workers in Nigeria, its largest market.

It is not unusual for one startup to go through upheaval like this, but when many companies all operating under the same umbrella go through the same issues, it is a bit worrisome.

However, AXA and Orange would not have invested in AIG at the valuation they did unless it was satisfied with its executive team, so one would think that this massive shakeup is largely a good thing for the company.

Given the timing of the overhaul and the subsequent transaction, this management purge was most likely a contingency for these large firms’ financing, because ultimately, they are not investing in AIG, but in the rising African middle class.

The common theme amongst AIG’s portfolio is e-commerce, as they have laid the foundation of their company on the emerging proletariat.

The size and the economic maturity of the middle class is the subject of fierce debate, as companies like Nestle serve as cautionary tales; their billion dollar expansion hit a rut and was forced to scale back its African workforce by 15% once returns proved to be smaller than expected.

WATCH: Inside a Africa Internet Group Office in Lagos, Nigeria. 

Much of the investment in Africa has been based around the notion that one third of Africans are “middle class,” which emerged from a 2011 paper from the African Development Bank Group which stated that the middle class had tripled over the last 30 years.

However, the AfDB defined it as Africans living off of $2 to $20 in purchasing power per day, with it divided into three separate tiers which further muddied the certainty surrounding the definition of “middle class.”

Standard Bank released a study last September that looked at 11 African countries which account for over half the continent’s GDP, and found the size of their middle class to be 15 million people, or about 300 million less than AfDB estimated for the entire continent.

The middle class of the largest African country by GDP, Nigeria, is estimated at 11%, with 86% of all Africans reportedly falling under “low income.”

The Pew Research Center provides extra support to this assertion as they estimate that just 6% of Africans qualify as “middle class,” which they define as living off of $10 to $20 per day.

90% of Africans are estimated to still live off of less than $10 per day according to Pew.

However, even though the data seems to hint that investors may be too bullish, it does not mean that they should reverse course and become bearish on the many different African economies.

Capital is still flowing into the continent, as foreign direct investment is up over 12% since 2008.

Additionally, some of the struggles companies like Nestle experienced could be due more to cultural misunderstandings than a lack of disposable income across Africa.

“There was no presumption [from the AfDB] that this middle class would exhibit Western modes in terms of consumption of food formula for middle-class babies [Nestlé] nor for whisky [Diaego],” Kayizzi-Mugerwa, one of the chief economists for the AfDB said. “In the latter case, Africans have always had a partiality for beer − irrespective of class – and the beer companies are doing roaring business.”

Many African countries are still dealing with structural issues that go back centuries, as Egypt’s inflation is 210th in the world due to the instability that has arisen over the last 5 years.

Nigeria needs to modernize its workforce as 70% work in agriculture, yet farming accounts for just 20% of its GDP.

South Africa, which remains the model for many African countries, has 66% of its workforce comprising the services industry, which accounts for 67.4% of its GDP, yet the rest of the continent’s labor pool is much closer to Nigeria than its most modernized nation at its southernmost tip.

The historic investment in Africa Internet Group must be seen as a larger investment in Africa as a whole, because without a modernized Africa, the e-commerce that AIG provides would have no market for buyers or sellers.

Africa is still an emerging economy, but it has shed many of the 3rd world caricatures that the West has forced upon it over the years, with Sacha Poignonnec, CEO of Africa Internet Group providing a mission statement for the company that could be construed as one for the entire continent as well:

“We want to be profitable but we are very long-term oriented. Amazon is a great model to look at. They have a great valuation, they have a great customer base. Everyone one is confident that Amazon has a great future but they are still yet to make money.”

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