Startup Kenya

The indecipherable expression on a young man's face as his business partner threatens to sue him for everything is definitely the best scene of Andrew Sorkin's The Social Network. Mark Zuckerberg just stares at his best friend Eduardo Saverin who is flipping out after being screwed out of their business.  Jesee Eisenberg potrays  Zuckenberg the youngest (self-made) billionaire in the world ($6.9B as at Oct 2010) who built facebook into a network of 500 million friends but lost his only friend along the way. No, this is not a how-to get into your business partners pants post. Rather I want to talk about the little considered but very important relationship that you have with your business partner  and how to balance the pursuit of profit with keeping the friendship going. I cannot overstate the importance of maintaining a healthy friendly relationship with your business partner. As Eduardo found out, the minute the friendship starts deteriorating, so goes the business r

My friend Roger clearly remembers those particular words from the telephone call. After many days anxiously spent waiting for it the bank had called him that sweltering December afternoon. The call effectively put a nail in the coffin for Rogers’ fledgling insurance agency. Twelve months earlier, Roger had started his business with unbridled and unstoppable optimism. He quit his well-paying but stressful job as a marketer in a large company, much to the distress of his pregnant wife.  But Roger quit because he had a dream. He dreamed of giving his unborn son everything he ever wanted. He dreamed of an end to the despondent dependancy on his pay cheque. He dreamed of hours of relaxed recreational family time. Driven by a lucid, Technicolor vision of his dream Roger took a one million shillings loan from the bank to start his agency, only to have the bank take it from him one short year later. The auctioneer came the next day, a greasy-faced, pot-bellied, squinty eyed man wearing a

While consulting for our online company registration service, Incorporator I find myself answering the question "What is the difference between a sole-proprietorship and a company?" Anybody who is considering starting a business must consider what type of business structure is needed for his or her particular situation. In Kenya there are three types of structures that one can use to start their business. 1. An LLC, or Limited Liability Company 2. A sole proprietorship 3. A Partnership A Sole-proprietorship and a Partnership are registered through the same manner (Form BN/2) with the exception that a partnership has more than one owner and although not necessary, entrepreneurs are advised to register a partnership deed as well. In this article all references to sole-proprietorship also include partnership. Understanding the advantages and disadvantages of each structure is important when deciding which one you want to use for your company.

In the January of 2002 a young man found himself battling against frustration and despair as he saw his barely four month old company go up in smoke. It was his first real business venture and he had sunk all of his meagre savings into it, only to find himself unable to convert his enthusiasm into sales. Four months without a single sale he only had well worn shoes to show for his effort. When he started the business, he thought he had it figured all out. He had bought a mobile phone and a decent second-hand computer and sublet a small office in town. He listed down 500 prospects, wrote an introduction letter, and proceeded to call and visit the prospects. Four months and several disappointing calls and visits later, he had only managed to see a handful of prospects and none were yet to give him any business. Meanwhile his landlord was on his back asking for rent and he had run out of money to make telephone calls. He had no option but to close down his fledgling busine

It seems even giants can be rattled. Since Bharti/Zain welcomed the birth of Kenya's second republic with the lowest call charges across mobile networks, their counterparts on Waiyaki way (Safaricom) have been as busy as bees. I can now exclusively reveal through my inside sources the happenings at Safaricom these past three weeks, some of which are utterly shocking. 1. Shutting down the Facebook Page Even before Zain introduced their game changer tariffs, the official facebook page for Safaricom http://www.facebook.com/#!/SafaricomLtd?ref=ts was peppered with negative comments from users. After Zain's tariff launch however, it seems people went full time on #chukifm on the Safaricom facebook page, complaining on every single comment from Safaricom. Sample some posts from users below: "...as long as u guys stil continu stealin our credit usin ur unlimited internet shit,u suck in evrthn u do.actualy,u stink!"  "MASAA YA KUIBA...i want my 21 mb of free da

Since my post on why I won't be ditching my Safaricom line any time soon , I've been getting a lot of love from Big Green affiliates broadcasting the post. What these fellows should have been doing is sorting out the many issues with their products and services. Since everybody likes lists, I'm going to put up another one today - on the 10 things that I really hate about Safaricom. 1. Masaa ya Kubamba tariff. Surprised? Don't be. This is the most annoyingly complex product Safaricom have ever devised in their evil labs. First of all, how to determine what you'll be charged based the card you use to top up might make sense to the financial division, but it is absolute torture to the consumer. To make matters worse it isn't clear what happens if you top up 100, use 50 then top up 30 with M-PESA, sambaza 80, redeem bonga points, okoa jahazi, receive 100 through sambaza: what tariff are you on? 2. Okoa Jahazi They should call this product Tuna shylock, at 10%

Stephen Alala, co-founder of SoftLaw once told me an interesting story about a lawyer who while doing an assignment for a venture capital firm was so enthralled by the work that he decided to quit the practice and join the angel investors. At the next meeting with the other angels, intending to wow the board he excitedly gave a presentation on a new business venture that would make the firm triple-digit returns on their investment. He was therefore surprised that after he finished his pitch the expressions on the faces of the board members all around the table were unimpressed, bored, and even disgusted. One of the friendlier faces explained the mood with a question "it's all well and good that this idea can make money, but will it race up my pulse, make my mouth dry, keep me from sleeping at night, and wake me up early in the morning twitching and excited?" Simply put, these angel investors had already made tons of money, and that alone could not excite them. What the

For those who've been reading my blog you know that I have a love/hate relationship with Safaricom. One week I will lavish praise on them, the next I'll be trashing them. With such swinging passions, it is easy to find inspiration to write on them, and resultantly I do it often. This week I'm at it again, giving my 3 reasons why I'll be sticking with Big Green and ignore the Vuka to Zhairtel wave currently going on. 1. Data Services. Safaricom's recent press release responding to its competitors drop in voice call charges captured one thing right on the mark. They are no longer just a mobile telephone company, they are a total (communications) solutions company. Just like DoCoMo of Japan, Safaricom early on realized that voice services were not enough and their future lay in data/internet services on mobile phone handsets. They've gone ahead and backed this conviction with some serious investment in 3G, fibre, WiMax, and now 4G. Safaricom has not stopped a

It’s time to take Safaricom down. It’s time to chop up that green giant into smaller pieces. In just 10 short years, Safaricom Ltd has grown from a small unprofitable subsidiary of Telkom Kenya catering to the uber rich into Kenya’s largest telecommunications company, ISP, and bank. This behemoth, with its size, information control, and growing database of personal information of its clients threatens our economic stabilty, individual liberties and our sovereignty and  cannot afford to left this unchecked. At the end of this speech, fellow toastmasters you will join my petition to have Safaricom Ltd, be broken up into smaller, more regulated companies. 1.       The first and most obvious reason why we need to break up Safaricom is because of its sheer size. In every category, Safaricom is a lumbering giant. It has over millions of Kenyans using its services and makes billions for its shareholders and government.  While these numbers may bring comfort to it’s over 500,000 shareho

I hope this battery lasts.... I've mentioned in previous posts that I went to more of a concentration camp than a high school. No really it was that bad. Can I hear a shout from all my Rongai Boys peeps. Apart from the usual high school "chores" all students in form 1&2 also had intensive farm duty. I'm talking about at least two hours every morning before breakfast, half day Saturdays, and at least 6 weeks over holidays! The work was not cosmetic either. We ate from the farm and the supervisors ensured it produced. The piggery for obvious reasons was considered the worst but personally I found cutting and chopping 160kg of Napier grass before breakfast for the cow unit far worse. Something far worse though was midwife duty. Apparently pigs need a lotof care when ... birthing... calving... pigling? So when a sow was in 'labour' form one's would take turn at night seeing that when the process began, it went smoothly. Thus, one very cold, very dark n

Peer to peer sharing is the public enemy number one for anyone in the digital media industry. The ease at which someone can download movies, music, and software made significantly easier by high speed fibre-optic connections has eroded the earnings of producers and artists worldwide. I would love to say that I can throw the first stone, but sadly the lure of free stuff is too strong even for me. It is with this backdrop that I managed to watch a fairly good camera copy of the surprise early 2010 blockbuster Alice in Wonderland. I didn't expect too much, but once again Tim Burton pleasantly surprised me. Alice , based on Lewis Caroll's fabled children book has been updated for the modern audience and given extra pizazz by the always entertaining Johnny Depp as the Mad Hatter. Before this becomes a movie review, I'd just like to re-iterate one of Alice's quotes that deftly captures the topic of my post today: curiouser and curiouser. This is how I describe some of the t

When we are young most of us dream of being rich and famous. I was no exception and I made sure I started working towards this early in my youth. I sold contraband, got three jobs, started a business, and did consultancy, trying to add up the shillings and cents to meet my goal. At some point though (especially after finishing college) I discovered that sometimes the goal was just getting by. The reason I'd wake up in the morning, get myself to the office, answer calls and emails, meet clients and suppliers, write reports and proposals, balance books, was just to make payroll and rent. And even when the money came, it didn't bring any satisfaction, after spending  16 hour days doing the same-old, same-old. When my business finally gained stem I really thought I had escaped the rat race, but by settling back into a routine just to 'survive' I realized that all I had done was change lanes. To further drive home the futility of it all someone told me that the worst thing

A Gado cartoon of people sitting on the fence demanding for their own colour left me ROFLMAO. In case you haven't caught on yet, its about fence sitters to the referendum on the proposed new constitution. More than give me a serious rib ache, the cartoon also prompted me to stop sitting by the sidelines and take a stand. It is therefore with a profound love for my country and belief in a better Kenya that I submit that my answer to the referendum is a big yes. As part of my education, I had sought to find out what the NO camp objections were, and what I discovered shocked me so much that I felt compelled to respond. You can read my response here www.yes4kenya.org

I woke up this morning with the lyrics of Boomba Clan's song Sina Habari . The exact line was where one asks "Nairobi Water niliwafanya nini, siwezi fua siwezi osha mwili " while fully soaped up in the shower but with no water from the shower head. Needless to say I was also having a dry tap morning. I remembered someone mentioning that with the new constitution, I could sue the government if they did not provide water. I decided to check it out and see exactly what it says. [Aside] Checking out the constitution is now much easier thanks to a great new website called katiba.mobi who get my two thumbs up for their fantastic effort. I wish though they would include a search on every page, and Previous/Next navigation as it would make the site so much more useful. Finding the article dealing with water was however much easier than the PDF file from COE that I've been using. Article 43(1)(d) does give every person the right to clean and safer water in adequate quanti

Away from the controversy, I sought to know what the draft law says about holding two passports. This is of particular interest to me as one of the services we offer under formAKenyanCompany.com is work permit registration. I regularly communicate with many folks who are curious about the provision for dual citizenship in Kenya. In the current constitution that's a flat no, but I wondered what the draft law said. A very brief section 16 spells out the main criteria for dual citizenship, you must first be Kenyan by birth. Section 14 describes what a citizen by birth is: (1) on date of birth, one of the parents is a Kenyan citizen, (2) applies to persons born before the effective date of the new constitution or (4) a child found in Kenya who is less than 8 years old. The birthers would find this interesting as it means that Obama is still a Kenyan citizen, and even if he had renounced Kenyan citizenship when he turned 18, then (5) allows him to acquire citizenship on application.

A detour from the constitutional debate. This week there has been a very public back and forth between Safaricom on one side and CCK, Yu, Zain, and Telkom on the other. The brouhaha is over a set of regulations published by CCK, which you can view here and here . Now, I'll be honest I tried reading the regulations but I got bored, but if I'm to believe the arguments of CCK and Safaricom then I'm going to give this one to Safaricom. Why lie Safaricom deserves to be market leader. Not only have they cranked out great product after great product, they've done this while keeping their business very profitable using the "just good enough formula". In case you have not read The Innovator's Solution , by Clayton Christensen and Michael Raynor, then I'll explain. The just-good-enough formula means that a product need not be perfect to be marketable, it must only meet the minimum threshold of the job the consumer is trying to achieve. The clearest example

Jumping straight into the fray, I want to get started on one of the more thorny topics - kadhi's courts. The churches have made this one of the stickling issues to their opposition of the draft constitution, so I sought to read the clauses myself and see what all the noise was about. At first glance the sections on Kadhi's courts in the current constitution (s.66) and draft constitution (s.169,170) appear similar. Both give parliament the power to determine how the Kadhi courts will be run Both make the courts subordinate courts. Subordinate courts means that their decisions can be appealed on and overturned by superior courts.  Another similarity is that both specifically state that these courts will deal only with matters of a personal nature, to people professing Islam. I have noticed at least one difference. In the proposed constitution, in addition to professing Islam one is also required to submit to the jurisdiction of the court. I'm curious how this works, if

I've got to say, I'm pretty pleased with myself. I recently acquired something which makes me very proud, no its' not a 52" flat screen TV (damn!) but a spanking new voter's card. Despite chronically suffering from last minute syndrome this time round, I managed to get my card well ahead of the deadline, on April 16 to be exact. I never voted at the last referendum, mainly because I had no card and didn't really care about it. Things are different this time. After seeing the devastating effect of politics gone awry I am now keen on putting my best foot forward in making sure my voice counts with what happens in this country. It is why starting today I intend to vigourously examine the proposed new constitution to determine whether it merits my YES vote or should be given a big NO. I will warn you that I might already have some biases, being human after all but will do my best to keep this examination open-minded and impartial. So go get your voter's c

Shocking title right? Yes, despite this technology being around for eons it's only today that I've managed to upload a video on the ubiquitous video sharing site YouTube. I had not seriously considered business opportunities in entertainment until I came across a young man by the name Deejay Kalonje. Apart from being nominated as best DJ at the Chaguo la Teeniez awards 2010 this extremely talented young man has shown me that there is money to be made in showbiz. Let the video speak for itself, you can then vote by texting "VOTE b1e3" to 8878. More on this later

In Form Two at the height of my adolescent self-importance I felt that I knew much more than the (what I thought at that time to be) idiotic teachers who wasted my day when I could be expanding my mind reading Plato. One exception which was sharply brought home though was my American english teacher who had a Belgian name, Ms Koch (we called her Ms. K though, because pronouncing her name for the mandatory greeting of the teacher would have wasted half a lesson). Ms. K knew her stuff and when I tried to impress her by saying that creative writing was my favourite type of writing, she reminded me that all writing is creative. I remembered Ms. K today as I finally finished today's article of my new daily business blog ( blog.my-shillings.com ). In deed all writing is creative, and is more than just stringing together letters and words. A belated apology then to my "colleague" at Business Daily who I tore into some time back with a post in this blog. On second thought, I ta