Entrepreneurship and money are like a game of chess, riddled with traps and opportunities. Your success in the game largely depends on how you make your move: a smart move could break you even while a rookie move could put you asunder. One of the finest ways to get it right is by learning from the moves made by successful business leaders and entrepreneurs. Today we take a look at some of these financial and entrepreneurial moves taken by a few of Kenya’s top business magnates.
Getting your cashing time right: You must always know when to cash in on opportunities, and how to get your timing right in making major business transactions. For instance, Naushad Merali is one of the few local billionaires known to make quick multi-billion deals. In 2000, he made Sh. 1.6 billion in one hour! He co-owned Airtel (then known as KenCell) with French firm Vivendi. When Vivendi decided to quit the local market, Merali bought off Vivendi’s 60 per cent stake for $230 million (Sh. 23.7 billion in today exchange rate). An hour later, he sold the same stake to Mo Ibrahim’s Celtel for $250 million (Sh. 25.8 billion in today’s exchange rate). His moves this year have included a Sh. 75 million loan repayment from Eveready whose interests he had been earning since early 2016, and a Sh. 1 billion investment in agribusiness.
Diversifying risk: Always know when to diversify your investments. Take the Muguku family, synonymous with poultry farming. After starting out as a poultry farmer, its patriarch, the late Nelson Muguku, built the family’s multi-billion empire by investing hugely in Equity Bank. By 2014, at the peak of a bull-run on the Nairobi Securities Exchange (NSE), the Muguku family, cut its Sh. 10 billion worth stake in Equity Bank from 6.08 per cent to 0.9 per cent and ventured into real estate with a Sh. 3 billion investment into the Karen Waterfront project. According to financial analyst Aly Khan Satchu, this was part of an optimal portfolio strategy for diversifying risk. Since then, the NSE has been on a poor performance streak that last year eroded the worth of the family’s 32.8 million shares at Equity from over Sh. 1.7 billion to around Sh. 989 million.
Spotting opportunities: Last year, Centum’s James Mworia was named as the highest paid CEO in Kenya, with a monthly salary of Sh. 16.7 million equal to an annual income of Sh. 201.1 million. Unknown to many, though, is Mr. Mworia’s rise to the top. He started as an intern filing documents despite holding a law degree, and being an Advocate of the High Court, a certified accountant and chartered financial analyst. He told an entrepreneurship boot camp that was organized by Africa Talent Bank in 2015: “When opportunity comes knocking on your door, it does not come written ‘my big break’. It might come as a small job or a small introduction… I could have looked at that filing job and dismissed it as below my capability, but instead I said ‘what is the opportunity here?’”
