Modern Alchemy: Transforming small-scale gold mining with community-centered innovations

Bahebe, an engineering sciences major, is a native of Tanzania, where he saw firsthand the harmful impacts of artisanal mining—the world's largest source of mercury pollution. Twins Thomas, a mechanical engineering student, and Ed, an economics major pursuing a minor in human-centered design, joined Bahebe in launching gold-mining startup Mwamba, Swahili for "rock." The trio persevered through a ban on gold exports, industry skepticism, and COVID to lead an effort now recognized by the UN, World Bank, and World Gold Council as a for-profit model for holistic development.

How did you become aware of the gold mining ecosystem?

Bahebe: I was born and raised in Mwanza, the northern region of Tanzania known for having the largest population of small-scale miners in the country. Being part of the community, I became aware of all the problems and challenges involved with the industry. One of my missions was to study abroad and come back to make a difference. I remember sneaking into my dad's room to look at his mining licenses so that when I got to college they would remind me that the mission is to learn about geology, learn about mining, come back, and do something about it.

One thing that really drove me at Dartmouth was the holistic approach to education. You can learn anything without overly specializing, which builds and shapes you as an entrepreneur because you need to learn economics, psychology, and all those different subjects to take on the challenges you will encounter later. That's proven really helpful as a cofounder and director. Everything that comes to you is new, so you need to be multifaceted to understand the different aspects of everything.

How did you connect with Thomas and Ed?

Bahebe: I think it was during orientation week...
Thomas Cornew: We shared a lot of classes and we became close. The end of junior year is when the first little nuggets of maybe we should try to do something together started to form.
Bahebe: It started with a project class at Thayer where you had to find a problem and then come up with a solution. It was perfect—we'd been starting to talk about maybe trying to do something in the gold-mining space. A huge, pressing issue is the rampant use of mercury as an extractive agent, so our initial idea was to build a mercury retort, essentially a fume hood that's got a back-end distilling unit. It captures and condenses all of the mercury vapor coming off of the burnout process to prevent it from going into the environment. While we were thinking about solutions, the brainstorming process helped us realize there's a bigger problem. This is an industry that was producing five percent of the world's gold. So, we're thinking, "We've got 500,000 people producing billions of dollars' worth of gold with shovels, buckets, towels, and a little bit of mercury. Imagine what they could do if they had proper backing and support and industry-norm technology." Everyone knows mercury is evil, but they've got to feed their families that night. Miners make five times more than their counterparts working in the agricultural industry. It's a huge economic uplift in these rural communities to start engaging in gold mining. 
Cornew: We agreed to do anything meaningful, we would have to build processing infrastructure to fully discontinue use of mercury. During winter our senior year, Ed and I went with Sam to visit Tanzania for three weeks to look at this problem first-hand. We left incredibly encouraged. The tricky part was that the technology we were trying to deploy is well understood but very expensive. Everybody we talked to was desperate for the system, called a CIP [carbon-in-pulp] plant. It uses a different extractive agent that can be very easily controlled, and there's zero environmental harm if you're managing it properly. The yield goes from 30-percent extraction rate with mercury and gravity to 95-plus with this CIP system—but it costs millions of dollars to build one of these facilities.

How did you begin pulling funding together?

Cornew: The base funding came from an on-campus phone and computer repair business I sold to underclassmen my senior fall. It let us go buy permits, gold, go to Tanzania, and get the initial attempt going. We also had other investors who were classmates of my sister [Sophia Tu'19] at Tuck. Then Professor Bruce Sacerdote [’90], who was Ed's economics professor at the time, said, "What you're telling us sounds great, it's checking all the boxes, but it's Africa. We don't know anything about Africa. You don't know anything about Africa. Why should I give you my money?" So it was a big test to prove we could export gold—at an absolute minimum get it out of the country and sold—and then we'd be able to get some seed funding.
Bahebe: One of the biggest challenges at that time in Tanzania was the president had stopped all mining companies from exporting gold. Luck played a real big role there: We were the first company to be granted an exportation permit when the country reopened. My brother showed up to our graduation with a couple of ounces of gold, proving to potential investors that we could export gold. That closed the initial funding, and we all said "no" to the jobs we had lined up.

Did things start to fall into place after that?

Bahebe: No. You have to understand, we were nobodies. We learned it all by stubbing our toes on every corner in the dark to figure out which way was straight. ... The first year and a half we were just broker-dealers. We were taking money, buying gold, and flipping it for arbitrage. It was ruthless.
Cornew: In that time, we were also building on the ground, staying connected with the locals and doing a lot of research. Sam traveled the entire northern region; he went from mine to mine, spending a lot of time in the villages and talking to people and getting to know the challenges, finding out how the gold is produced and really learning the reality of the entire supply chain, from production to how the gold gets traded, aggregated, and exported.
Bahebe: We gained all this knowledge from the ground, we had to teach ourselves and learn the complexities of the process. You can't just show up and say, "Hey, I want this deal." You’ve got to talk to people, be part of the community, to have access to the information and tribal knowledge that led to the development of this industry. The risk was so high. You have to understand what you're paying for: Is it actual gold? Where does it come from? You learn the hard way that trust is earned.

Bahebe (blue shirt) discusses construction updates to Mwamba's Miti Minane underground mine in Geita, Tanzania.

Are you also considering your first processing center?

Cornew: It was only about 18 months ago that we started construction and eight since we started producing our own gold. From 2019 to 2022 we got a little dazzled by some slightly larger opportunities that existed in the country. We met two established geologists who owned medium-scale mines that were drilled out and weren't developed yet.
Bahebe: This was far more in line with what international investors were used to seeing. Tanzania is at the bleeding edge of all the regulations for small-scale gold mining. For most established mining investors, you say the word "artisanal," and the only thing they think about is the illegal miners they are in constant conflict with. Trying to convince investors that you're raising money to work with these people just didn't go anywhere. So we thought, "Okay, we've got these two medium-scale mines that represent a pretty sizable amount of gold in the ground. If we can find the funding to develop both, that'll establish us as a reputable, solid medium-scale mining company." That led us to a crazy fundraising period, where we exploded in pretty dramatic fashion after a failed merger with a public Canadian mining company. Three weeks later, COVID hit.
Cornew: For about a year, Mwamba turned into a side hustle, which was tough. Then Sam—who was in Tanzania keeping the team alive—found us some money.
Bahebe: None of us gave up. We were still communicating with people, networking, and doing research. I narrowed my research to people from Dartmouth who had taken geology classes and now worked in the mining industry—and came across Mac Jackson [’83]. We sent him an email about Mwamba, and he was intrigued. We scheduled a call and sent a geological report that supported the potential of the projects.
Cornew: Together, we had synergy, the same focus, the same vision. Within less than a month he was able to invest—and Mwamba was reborn. After looking at the data, Mac's feedback was to "buy every piece of land you can in this area." That's all we focused on for eight months. Established mining companies weren't making any further investments to find the next mines and grow their portfolio in Tanzania. So that left huge vacancies over one of the only parts of the country where you could reliably find gold mines. The exploration licenses we own now total 1,900 square kilometers [1,200 square miles] over this region.

How is it different this time around?

Bahebe: In the mines we operate, it's a joint venture with the small-scale miners. So each day we'll reconnect and engage with the small-scale miners to be able to run operations.
Cornew: And Mac connected us with the world's second-largest gold mining company, Barrick Gold. We're now in a joint venture where they have committed $23 million to explore the area. When Barrick builds a mine, it usually has a multi-billion-dollar price tag. By partnering with us at the scale that they did, it cemented us as a reputable player in the mining industry. All of a sudden, that partnership let us raise a ton of private capital that we funneled into what we originally wanted to do: build processing centers and work with local miners.
Bahebe: Almost our entire team is Tanzanian, which is one of the reasons we've been so successful. We are a local foreign mining company. We can approach every conversation with trust and a kind of openness that doesn't exist if you arrive as a foreigner. And now we have the government's full support.

What are your next steps?

Cornew: We were invited in 2019 to be an advisor to the UN Environment Programme's planetGold project. It's part of a huge international push to formalize and regulate artisanal and small-scale gold mining because it produces 40 percent of all the mercury that's introduced to the environment every year. This is a domain that Ed generally owns—he's been the one really driving all these initiatives.
Bahebe: They really like what we were doing because we're a for-profit company pursuing social impact goals, whereas the only other players in the space are NGOs that aren't sustainable after the money runs out. And the World Gold Council recently published a study where we one of only two companies in the world named as notable success stories.
Cornew: The support of the UN and World Bank is great, but it is only supercharging what we are already doing. We have three active mines, a processing center, and a growing pipeline of future projects we are building in collaboration with the local community. From a metric point of view, we'll measure success by how many kilos of gold we're producing a month across how many sites and how many mines. From a social impact point of view, it's going to be how many young adults from the local community we trained to be competent welders, boilermakers, metallurgists; how many careers we created; how many tons of mercury we prevented from being introduced to the environment, how much money we reinvested into the community. We want to take this model and build more centralized processing facilities, partner with local miners, make the needed investments to modernize their operations, and hugely boost the economic output to generate real wealth for these communities.