How to get a winning strategy for African entrepreneurship

Muhammad Yunus, the Bangladeshi economist, won the world over by his simple act of empowering women and youth in his country through microfinance and training. He did this through the much acclaimed Grameen Bank that lent to small business owners. His model has been replicated the world over as the ultimate in eliminating poverty. But does this model of entrepreneurship eliminate poverty?

In 2007, Jonathan Morduch studied over 250 cases in India, Bangladesh and South Africa to verify the narrative that this small scale entrepreneurship does eliminate poverty. He concludes that the celebrated microcredit only acts as a transfer payment to help the recipients cope with the ups and downs of poverty.

David Roodman rightly puts it that “the best estimate of the average impact of microcredit on the poverty of clients is zero”. In South Africa, research indicates that 94 per cent of the money was used for basic consumption. The businesses helped the women to meet their needs, but did not give them enough to save, invest and create wealth.

Why didn’t this model work? A limelight on some of the world’s successful entrepreneurs will give us a glimpse into what works.


Bill Gates came from a modestly rich family. He was not trying to alleviate poverty; he was doing something he loved. He didn’t have bread-and-butter problems, hence was able to spend years learning coding and developing the right codes without being distracted by his basic needs.

The Rockefellers were Jewish merchants. They were in the middle class by the time they were starting the process of wealth creation.

The patriarch strategically positioned his sons in all the major towns of Europe where he had business interests. The result was a free flow of information and goods from trusted family members.

Warren Buffet is the son of a US congressman and Steve Jobs did not come from the ghetto.

Locally, James Mwangi did not start from scratch; he took over a building society with some resources. Manu Chandaria came from a family that could afford some capital.

In essence, one needs access to some tangible opportunities before they can succeed as an entrepreneur. Coming from a wealthy family enables one to access capital and create helpful networks. Patronage and nepotism in business, politics and social access is a reality all over the world.

3,000 buyers set to attend flower expo in Nairobi next month

Some 3,000 flower buyers from the US and Asia are expected in the country next month during International floriculture Trade Expo (IFTEX).
Dick Van Ramsdonk, the President HPP exhibitions, the organisers of IFTEX, said they expect at least 2,000 buyers from the US alone with the rest coming from other regions.

He attributed the high number of US visitors to the direct flights Kenya is initiating with the country.

The direct flights are set to begin next month after the US government approved non-stop flights between the two countries. The country’s flowers are a sensation in the US, flower exporters said, but until the approval, it has been costly and lengthy to ship the products to the world’s biggest market after the EU.

In the past, Kenyan exporters accessed the American markets through middlemen, which meant that US flower buyers purchased the flower at exorbitant prices.
“The beauty of Kenyan flowers was visible at the recent China Flower Trade Fair in Guangzhou and the World Floral Expo in Las Vegas (US) held early this year on different continents with similar high levels of attraction to the country’s flowers,” Ramsdonk said.

Ms Jane Ngige, CEO Kenya Flower Council (KFC), said Kenya is going into the US to supplement the market with medium-sized head roses, which are not supplied by South American growers.

Kenya Railways gears for SGR launch as more rail vehicles arrive

Kenya Railways has received another batch of locomotives and rolling stock as preparations for commissioning the standard gauge railway enter final stage.

Three passenger locomotives, eight coaches and 120 open-top wagons arrived at the Mombasa port aboard two ships from China on Friday.

This consignment brings the total number of locomotives delivered so far to eight (for freight) out of the expected 43, two shunting locomotives out of the eight that have been ordered and 330 wagons out of a total of 1,620 expected.

The first batch of locomotives arrived in the country in January with the second, third and fourth batches arriving in February.

The SGR train services will be commissioned on June 1.