Sammy Subu is the co-founder of online marketplace, Soko Huru.
Biggest decision: In 2013, I quit employment to venture into entrepreneurship. I did not make the jump over night. I carried out intense research that gave me the confidence. But what I discovered was that you will never be really totally prepared for entrepreneurship. Running a business is akin to a roller coaster ride. It has its ups and downs, days when you feel like tomorrow will be your last day in business, and days when cheques just come in.
Biggest money mistake: I committed this when I took a loan to start my first business, Fine Blendz. Never do this. You will be carrying dead weight on your shoulders by starting a business on a loan. This is irrespective of whether it works or not. Every month, you’ll be taking the much needed operational cash to meet your installments. In fact, you will be better off by saving first, or taking money from friends and family as seed capital rather than loans. The only point when you can consider taking a business loan is when you fully understand the dynamics of your business and competition, and be able to project sale numbers and the potential for expansion.
Saving method: I save 10 per cent of whatever amount I make. After accumulating savings for a while, I dig them out and invest. I use 20 per cent of my earnings to clear my debts. My ultimate goal is to reduce debts, become debt free, or only take credit that can convert to assets. I have come to learn that in order to have an efficient saving habit, it is important to keep away from the trap of collecting unnecessary luxuries. My philosophy is to live below my means. This is also the best way to create wealth.
Secret to success: I do not think there is a magic wand to this. It is all about going back to the basics. How bad do you want to succeed? Do you have the ability to get up every time you fall? There is also need to adopt an open mind in business. You have to be like a river by learning how to take the shape of the market. When starting a business, testing new ideas or products, it’s very important to stay lean at all times and also focus on getting enough data before you pump in more money. Invest in what gives you a return and don’t get attached to a business idea or concept. If it does not make you money, kill it, convert it into a hobby, or put it back in the shelf until the right time comes or once you achieve the perfect combination. For example, there was a time at Soko Huru when we heavily relied on our Facebook Page as our main marketing channel. The page had 1.3 million followers. One day, we woke up and found that the page had collapsed. We lost all the traffic and customers we had gathered. We had to go back to the starting point. It took us 8 months before we could get back on our feet again.
The wealth trap: Most people want to be rich, powerful, and famous overnight. But not too many people factor in the effort and sweat it takes to make it. The majority just wants to lazy around, watch tv, or do the normal stuff. But I have learned that to be number one in any industry, you must put in the work, double or triple your effort, and create your own luck where none seems to be coming your way.
If I could back in time: I would venture into entrepreneurship much earlier than I did. I would also explore business opportunities in the field of tech and probably practice computer programming.