The emerging power of youth business in Kenya

There is a remarkable business revolution happening quietly in Kenya. A large number of youth-run businesses are sprouting up in different sectors and disrupting current modes of business, bringing in new opportunities, and creating more employment.

These are Kenyan companies in clothing, fashion, cosmetics, food distribution, entertainment and various other services. Many start off as home-based businesses that expand using online platforms and using commonly available services to promote their businesses.

2NU is a fashion house started by a fashionista. Her friends loved her sense of fashion and she was soon selling clothes from her home. Then she started travelling and bringing selected pieces for sale. Now she is designing and creating her own brand which receives orders from as far as the United States and Europe. Today, many of Kenya’s glitterati are her clients.

Bu-ke is a company that produces organic soaps and hair products using locally grown teas and herbs. The quality and packaging are world-class. Home 254 produces sportswear that make Adidas look boring. Spinners & Spinners is a company that transformed the old knitting that we associate with our grandmothers into the quality and fashionable knitted clothes.

A number of companies, working with restaurants, are taking advantage of working-class people in Nairobi who are too tired to cook to organise home delivery. The list is endless. Unfortunately, many of them do not get the recognition they deserve.

Most of these companies are riding the Internet revolution and using Instagram, Facebook, Tiktok, WhatsApp and the phone to market and connect with their customers. They hire boda bodas for delivery and supply logistics. They use Mpesa for payment.

Nothing could be simpler. Last year, I attended a conference in China and the one line I remembered mostly was that “retail business was growing at 15 per cent but online was growing at 255 per cent”. Clearly, the youth are aware of this trend.

The business model looks simple and effective like most successful models. Competition has increased and many of the successful ones have started to dramatically improve the quality of their products, packaging, efficiency and reliability of service. 

The realities of big business is beginning to catch up. Marketing on the internet has become crowded, forcing these entrepreneurs to improve their game. The increased sophistication of online marketing is forcing these traders to seek online specialists, thus creating opportunities for tech workers. Some have even set up signature stores. Clearly, they are moving into the big league faster than expected.

With increased growth and sophistication came challenges. The most celebrated case in business history is Steve Jobs who founded Apple only to be fired because he could not manage the increased complexity of running his own business. Clearly, there is a deep disconnect between being a genius who can produce magical products to marketing them and running a business.

They had to bring in business specialists. As soon as the financial systems were set, the original mastermind came back. The same case applies here. You can only fly below the tax man’s radar if you are small – or to use our lingo “Jua Kali”. As soon as you grow big, then you need some financial expertise.

There are small accounting firms like Chartafai LLP. These small startups assist other small startups with simple bookkeeping, moving to professional accounting and finally offer business advisory services. These entrepreneurs are beginning to realise that without properly audited accounts and some cat and mouse games with the taxman, they will never be able to access either working capital or equity partners.

Unfriendly policeman

The Kenya Bureau of Standards (KEBS) is another challenge. KEBS was set up to regulate and control standards which are critical in protecting Kenyan consumers. The challenge for KEBS is not to stop these Kenyan entrepreneurs because they cannot meet international standards, but to assist them to meet and comply with the necessary standards. KEBS should evolve from being the unfriendly policeman to becoming a friendly guide.

We need to recognise, celebrate and support these businesses to become international brands. We should set up a special fund to support young Kenyan designers and entrepreneurs.

Perhaps we need an annual event to promote and celebrate these entrepreneurs. They are enhancing Kenya’s image and encouraging other young Kenyans to move from being job seekers to entrepreneurs. What could be better than this?

Mr Shahbal is chairman of Gulf Group of Companies. [email protected]