Break the founder's curse by listing, NSE boss tells companies

NSE Chief Executive Geoffrey Odundo. [Wilberforce Okwiri, Standard]

Nairobi Securities Exchange (NSE) Chief Executive Geoffrey Odundo has touted public listing as the alternate to break the founder's curse among small businesses.

He said that what is lacking in the small and medium enterprise space is aspirations among the business owners.

As such, not so many enterprises survive past the lifetime of the founder, which is referred to as the founder's curse.

Mr Odundo said if the businesses are listed on the stock exchange, then this curse could be vanquished.

"One of the things we are missing in this country is aspirations. People start companies and when the infamous founder's curse comes, it expires with them."

He said founders need to start thinking of creating businesses that outlive them.

"You must create business that is aspirational. And one of the great aspirations is to list at the exchange," he said.

Odundo, who was speaking during the launch of Stanbic Bank Kenya Sustainability Report 2022 in Nairobi on Friday, also noted that adopting sustainable practices for small business can also help create long-lasting enterprises.

Stanbic Bank Kenya and South Sudan Chief Executive Joshua Oigara said the lender is working to grow enterprises from grants and transform them into bank clients, commercial partners and later NSE-listed businesses.

"You get very excited about the possibility of creating new enterprises and I always believe in these startups. Give them another 10 or 20 years, some of them will be your biggest businesses across our market," he said.

He said job creation and enterprise development is not only a Kenyan or regional problem.

"The world has faced a great challenge, and I learnt last week that China, for the first time, is stopping to publish the number of unemployed people because the challenge has gotten much more complex," Dr Oigara said.

"We have our own difficulties in Kenya. As you build job and enterprise development, you build business sustainability."

Data from the government shows seven out of 10 micro and small enterprises do not survive past five years. Of these, 46 per cent never made it past their first year of operation.