Important money lessons our businesses have taught us

Going through various Facebook business groups, one question keeps popping up: “I have this amount of money, what business can I start?” Most young people tend to believe that as long as they have the start-up capital, then the business is bound to succeed.
Is this the case though? We had a chat with four young business people running successful enterprises. Yes, they got their footing and have stable businesses, however, this stability came with numerous challenges and a bagful of lessons, many of them related to money. They share several tips about cash that you need to know before establishing a business.

Nancy Amunga, 27
Founder and director: Dana Communications Limited
Before establishing her business in 2014, Nancy had had a couple of jobs, including directing Beba Beba, a TV show that aired on NTV a few years ago. Before establishing the business she had in mind, she saved for two years, having done her research and established that such a company would be capital intensive.
“We offer delivery (courier) services and recently extended our services to clearing and forwarding to serve a larger market,” she says. New in business, while attending a business event, a representative of a certain company announced that they were financing young people to acquire motorbikes. One only needed to pay a specific amount of money upfront and then clear the balance in installments. It was like an answered prayer for me because I had intended to buy motorbikes but did not have enough money. I took Sh70, 000 from my saving and paid the said enterprise, which, I would soon learn was a fraud. I never received the said motorbikes nor did I get my money back,” she says.
Through this experience, she learnt not to be quick in getting into deals, as well as the importance of doing due diligence before committing her money.
“I also realised that in business, there are several areas where money is needed and that it comes and goes. This has made me careful about how I handle my returns. I always ensure that I put my money in profitable ventures.” Months into the business, Nancy also realised that it was quite difficult to track her returns or expenses, a factor that could easily ground her business. “Having and maintaining a proper book of accounts has overtime enabled me to grow my business, which now has more than 10 employees.”
Take home: Keep reinvesting into the business and delay gratification.

Michael Njeru, 29
Director, Tufilamu Pictures

Michael Njeru owns Tufilamu Pictures, a multifaceted production and content company

“I established my company at the beginning of 2016, a year after completing my undergraduate studies. Prior to that, I had been actively involved in film production, so I knew a number of things about the industry,” he begins.
The business started out as a creative hub where individuals with unique and dynamic skill sets came together. In fact, initially, it was referred to as “Tufilamu Pamoja” let us film together. When more partners came on board, we renamed it Tufilamu Pictures in 2017.
“Before embarking on any production, we have to set aside an amount of money which helps a great deal during production-based emergencies. In addition, the aspect of investing is critical to the growth of a business. When it comes to this industry, drawing up a master plan that caters for all aspects of filming end to end ensures correct investment and guaranteed returns, he says and adds,
“I remember instances when the company had maxed out on its savings. That, combined with few funding opportunities and slow business, we were forced to slow down significantly. It was a great learning lesson for us,” he points out.
To grow from one level to another, Tufilamu Pictures work with creative teams and technical crew on project basis. The core administrative team has three people but teams working on a particular project can be as many as 30.
Take home: Stay hungry and work smart. The former keeps you going and ensures growth. The latter improves efficiency and final output on all levels.
Muthuri Kinyamu, 29
Co- founder, Turnup. Travel

In 2017, Muthuri and his business partner, Brian Gatimu, established Turnup. Travel, a tour company that offers themed travel experiences for millennials.
Although the business was founded in 2017, they had come up with the concept the previous year.
“We met during a concert held in Mombasa County and discovered that we had many similar interests. Then, both of us were in employment. I was leading a team of content creators and Brian, a trained microbiologist, had turned into photography, production and acting,” he says.
To get the enterprise running, the duo pooled resources drawn from their savings and set off the business, even though they continued working full time.
“Even though we had saved enough to kick-start the venture, we thought it wise to test the waters before resigning from our jobs. We had to ensure that the money invested was making substantial returns, enough to run the business and pay us,” he explains.
They eventually felt confident enough to resign from their jobs.
“We discovered that the tourism business has peak and off peak seasons, therefore, we had to strategise to ensure that we had enough to run the business and pay our staff and ourselves and other individuals that we indirectly work with such as tour drivers, tour guides and other suppliers.
If going into business, or if new in business, Muthuri advises having a conversation about money with your loved ones or those dependent on you.
“One of the things that most entrepreneurs forget about business is that while your income will sometimes be unpredictable and fluctuate, some factors such as provision of basic needs and other commitments will remain constant. To protect the business’ returns, we took medical and life insurance policies,” he says.
When the venture was up and running, the partners learnt yet another lesson. To survive in the murky waters of tourism business, they had to look for other ways to augment their income.
“Besides the tour operator business, which is our core, we produce a travel and adventure vlog series which is soon to be showcased on one of the local TV stations. We also have a venture called Turn Up in Motion, a multi-disciplinary content agency purely focused on planning and production of digital content for marketing agencies, big corporations, nonprofits, county and national governments. The above has enabled us to even out our revenues throughout the year.”
He adds,
“We started off as a tour operator for new age travelers, but we realised that through the platform, we could inspire people, educate our audience and clients and influence them to consider new destinations while still making money.”
Take home: Start with what you have and save as much as you can. Moreover, build connections and relationships on the way up - do not burn bridges. It could all end someday.

Shirlene Nafula, 27
Founder and CEO, Crystal River Products Ltd

In 2014, Shirlene, then 22, resigned, her intention to travel to the UK to pursue a master’s programme. It did not happen. She was denied a visa.
“Then, I was flat broke and at a loss of what to do. I did not want to go back to employment. I was inclined to business, specifically the beauty and cleaning products sector. I have a background in microbiology and biotechnology having studied a Bachelor of microbiology and biotechnology at the University of Nairobi, however, I did not know anybody running such a business and had not operated any venture before. I formally registered my business in 2015,” she says.
To kick-start the business, Shirlene turned to her family for help. Her mother helped her buy the materials she needed while her grandmother lent her Sh10, 000, with which she registered the business and printed business cards. The business started in her mother’s house.
“At the beginning, it was extremely tough. I did not have business knowledge. At first, I employed on a full-time basis, and come end month, the sales could not even meet half the business expenses. I had to re-strategise,” she says.
The strategy involved adopting an incentive model where employees earn on commission. Further, to ensure that there was adequate cash flow, she pulled out her products from supermarkets due to the long payment period, opting for cash-on-delivery basis.
“To grow the business and ensure that it was making significant returns, we sold door-to-door and went from one shop to another looking for market. Even though my team of sales people still do that sometimes, we have since employed the services of distributors who buy our products wholesale. We have also taken advantage of social media, trade fairs and networking events to market our products. For a business that started with Sh10,000 in my mother’s house, we have managed to do well such that we can now afford to rent office space.”
In 2017, in an effort to strengthen her business, Shirlene applied to participate in the show, KCB Lions’ Den, a TV program that invites young entrepreneurs to pitch their business ideas for financial, social and intellectual capital - she impressed, so much so, she got an investor willing to invest in her business in exchange for a stake in the company.
“Some of the greatest lessons that I have learnt is first, the need to plough back profits into your business if what you seek is growth. It is a strategy that has worked for us. We are even planning to re-introduce our products to the supermarkets because we can afford to wait for payment. Besides this, you need to understand that in business, money comes in and goes out just as quickly, so you have to be very careful about the investments you make. It is therefore important to set aside some money to run your business when the market is not doing well. You also need to embrace patience, trust the process and stay focused on your vision.”
Along the way, her drive and determination has won her several awards, including Business Daily’s Top 40 under 40 in 2017.
Take home: While you are in the business of making money, do not make it your sole goal. Focus on quality and customer care and eventually, money will come.