Business Partnership in Kenya: Joan Muthoni and Margaret Wairimu were fortunate to secure good jobs in the legal, information technology and insurance sectors after completing their university studies. And for four years, they ran the employment course without a hitch. “Our jobs were quite satisfying. The salaries we earned were sufficient enough to meet our daily financial obligations and targets,” says Margaret who is in her late twenties.
Towards the end of 2015, though, the duo became more ambitious. “We often interacted with entrepreneurs and had good bosses who also encouraged entrepreneurship. We began to think that entrepreneurship was journey we could undertake,” says Joan, who is also in her twenties. “We also felt as though we were stagnating in our careers and wanted more challenging ventures.”
But making the jump from employment into entrepreneurship was not easy. They pair says that perhaps because of their tender age, they were not sure if they were ripe for such a risky move. “Deep down, we had some fears. What if we failed; would we get jobs as equally good as the ones were about to quit? Would we hack the world of business?” says Margaret.
The duo sourced a team that included their friends and the acquaintances of their friends. We tabled potential ideas that we could turn into a business and had them pore through them to evaluate their viability in the market,” Joan says. Eventually, they settled on an insurance idea.
“Our idea identified a host of problems in the insurance market from which we could develop solutions that we could mold into a booming business,” says Joan. The duo says it was clear on the kind of solutions it wanted to bring into the market. “Since the insurance sector is quite populated, we wanted to be different by identifying numerous key issues in the insurance sector that we could address through technology. These included efficient premium collection, fraudulent claims, poor customer retention and lengthy processes in addressing legitimate claims,” she says.
Setting the business off was not as easy as they had anticipated. Margaret says that they faced a serious challenge in developing adequate start-up capital. “We initially pooled Sh. 500,000 together. We could not take a loan at the time since we were trying to develop the business concept and solution. Also, we did not have adequate assets that we could place against the loan,” she says.
In early 2016, they named their business MyInsure Limited and started developing web and app based insurance solutions. “We started an insurance technology firm with an automated system that we designed to improve on the issues we had identified,” says Margaret.
But nurturing their business was not akin to watching the sun set. Once they opened shop, the duo faced intense resistance from established players in the insurance sector. They were seen as unwelcome disruptors. “There was too much rigidity and slowness in trying to digitize insurance services or adopt insurance IT platforms,” says Joan. The negative perception associated with the insurance sector did not make tings any easier to bear.
Although the business is yet to get where they would want it to be, the pair says that it has grown to include a bigger team with the requisite skills to take it to a higher level. “We now have a team that comprises of experts in software development, insurance analytics, business development, legal, finance and cyber safety,” says Joan.
Looking back, the duo says that it lost too much time trying to set up. “Time is money, and we lost too much of it at the beginning. This was because we were not as heavily invested in the business as we should have been. This caused us to lose traction and we got caught up by competitors,” says Margaret.
Currently, the growing competition and mushrooming of firms offering related services has been their biggest challenge. “Nevertheless, this is not too disruptive since we have developed a product that sets us above our peers,” she says. “In fact, over the next five years, we expect to scale our operations regionally and establish ourselves as the insurance technology firm to call on.”
Despite such challenges though, the duo does not regret jumping into the entrepreneurship bandwagon. “It is true that unlike our heydays in employment, our earnings are now determined by how well we execute our business. It is risky since the security of an employer no longer exists, but the toil is worth it,” says Margaret. “You cannot be entrepreneur if you don’t believe in the power and versatility of your ideas.”
Business Partnership in Kenya: Joan and Margaret’s five takeaways:
- Before you launch a business, have your close, qualified acquaintances gauge its worth. This will spare you the loss of starting a business that will inevitably shut down.
- Don’t expect to break even the moment you start a business. Growing a business is not an overnight job. You must be prepared to put in the work.
- Do not run your start up as a side hustle to just kill time. Be heavily invested from the word go.
- Even in business, two can go far if they are in agreement. Partner up with someone who shares your vision.
- Do not let age hold you back from your entrepreneurial dream.
This feature on business partnership in Kenya was first published in the Saturday Magazine.