News came out a few days ago about the sale of the Makini Schools Group to an international education partnership. It elicited mixed views, including concerns from parents with children at the schools about the new direction it would take and horror at the surrender of another indigenous Kenyan institution.
Another view was that Makini was a representation of an unworkable private sector solution to a failing Kenya public educational system. This was alongside other entities like water bowsers, generators, security companies and hospitals that middle-class and wealthier Kenyans opt to pay for out of their pockets, on top of taxes that are meant to cater for the same services.
The current economy has not been kind to many businesses, for various reasons. Whether it is the lack of local lending since interest rate caps were introduced, as Kenyan bank leaders have argued, or the economic slowdown from the prolonged election season in 2017, or delayed payments of pending bills by the national and county governments, the result of this has been seen in increasingly larger published sections of business auction notices in the Monday newspapers.
RIGHT TIME TO EXIT
I doubt Makini was in that league, but its sale brings up a discussion about the right time to exit from a business. Schools may not have financial results, but they have a more strenuous process — that of the annual public release of the school’s national examination performance in December and January.
The occasions become newspaper headlines and TV news profiles of jubilant kids who aspire to be pilots, scientists, and leaders of tomorrow. If a school has excellent marks, it means that it can attract more parents who are willing to pay more fees. The schools can hire more teachers, buy more equipment and expand to more locations to meet demand.
As we learnt in primary school, people will always need food, shelter, and clothing — and we can probably add finance, health, education, and communications to the list of human needs that will always need to be met. But it does not ensure that the companies that provide them will always be in business if they don’t adapt.
For example, most towns and shopping centres used to have several cybercafés, but they have now disappeared as their former customers have shifted their Internet browsing time to their mobile phones. Meanwhile, hotels on the Kenyan coast change ownership, get rebranded and discover new niches. Some of them don’t advertise for Kenyan visitors, and their notice boards have all advertisements in German, Italian, or probably Chinese now.
LEAVING A LEGACY
Makini is fourty years old and has 3,200 students now. Dr Mary Okello, was the first woman bank manager in Kenya, with Barclays in 1977. She co-founded the school with her husband, Dr Pius Okello, who passed away in a road accident in 2004. No numbers have been released about the Makini exit, but it is a cooperative exit, one that the school administration and new partners have tried to explain to parents and students.
Ultimately, what does one want in life and afterward for oneself and the resources at their disposal? Humans won’t live forever, but by turning ideas into enterprises, as sole owners, or business partners and later into corporations, people hope that their businesses will sustain them, and their families, for generations to come.
There are no correct answers to building up, running an empire and when to walk away from it. The Njenga Karume estate court headlines offer a cautionary tale for other Kenyan business titans. Chances are they all want to avoid the saying, “From shirtsleeves to shirtsleeves in three generations”, which indicates that wealth cannot be retained and sustained.
US billionaires like Mark Zuckerberg, Bill Gates and Warren Buffett have pledged to donate half their wealth to charities. But there is also Rupert Murdoch, who battled his sons before yielding chunks of his Fox media empire, and Sumner Redstone, another media billionaire who is 94 years old and battling cases with his family. He is now in poor health and reportedly can only communicate about a pending merger of one of his companies using a special iPad that is preloaded with answers of “yes,” “no,” and “f— you”.