Entrepreneurship: Investment Tips For Beginners Most people think that you need a lot of money to make a lot of money. Given the chance, you could accumulate the funds you need to do just that. However, you could also save a fortune and lose it all in one drunken weekend. Owing to the fact that Kenya has produced less billionaire than there are trees in West Pokot, becoming an entrepreneur is not as easy as saving a sackfull of bank notes and buying a plot of land. Having the money is not enough. You have to think above and beyond conventional investments. The only problem is, how? This is what we would call thinking big. Big ideas will always attract the attention of big people and even bigger institutions. One of Kenya’s top entrepreneurs, Naushad Merali spoke at an entrepreneurship club meeting sometime in 2012. The purpose of the event was to empower Kenyan SMEs for global competitiveness. He offered the following investment tips: Start Where You Are Simply put, start small. You should invest money that you can safely do without in the short term. If a financial emergency, such as losing your job or having your car breakdown should occur, it is best not to touch the money that you have put in your investment. “A business needs to grow step by step,” explains Chris Gathingu, another entrepreneur and the brains behind Tangazo Letu, a local water company that he started when he was 26 years young. “You can’t have something blow up to a national system overnight unless you want it to blow out just as fast,” he argues. See Beyond the Obvious/Ordinary This is what we would call thinking big. Big ideas will always attract the attention of big people and even bigger institutions. Merali feels that young people should come up with exceptional ideas. Ideas worth the attention will definitely get funding; and that’s how the take-off phase comes about. Seizing Opportunities Starting an investment is all about spotting and seizing good opportunities. Mr. Merali recalls how farmers in Uganda were pouring milk because there was a shortage of milk processing plants. He saw that as an opportunity, and established a plant there. Convenient Business Partnerships Aspiring investors should also consider choosing the right partners for doing business. You will need to choose someone whose vision and interests are aligned to match yours. “We had to vote out some members of our Chama,” says Duncan Maloba, an Accountant whose team of entrepreneurs has invested in Treasury Bills. He explains that when some partners can’t seem to see eye to eye, buying them out becomes a reasonable solution. Naushad merali and Chris Gathungu are not the only successful investors here. There are others like Aly-Khan Satchu who began his career in finance in a bank post room, mailing letters. Two decades later, he became a man of letters, renowned as a speaker and author. Dinfin Mulupi interviewed him on Kenya Yetu and he, too, offered a handful of investment tips that could work for you: Be focused – Satchu advises that you should keep your eyes on what you really want to achieve. He says that the world is like a cafe with loads of tables: one table is yours – find it and sit there. If you try to eat from every table, you will waste your time. Know your business – If you know what you do, and do well, you will succeed. Be optimistic – Have a ‘can do’ spirit and keep trying until you succeed. Think long-term – Forge partnerships and invest in ideas that will benefit you not just today but tomorrow as well. This will help you determine the amount of risk that is acceptable or not. Collaborate – 1+1 = 5 – That’s the new way. Satchu tells you that monopolist thinking is an ancient concept. Set a strategy. Understand what you want your portfolio to achieve and then develop a strategy to meet the criteria whether it be income, growth, small companies, big caps or purple popcorn. Everything should be planned. Be determined – The more determined you are, the more serendipitous things become. Start small – Start with what you have and don’t expect to be a millionaire overnight. As a boy Warren Buffet was doing newspaper rounds. When he was only 11, he bought his first 3 shares in a City Service Corporation. Because he started small, was focused and he had no unrealistic expectations, he is now amongst the world’s richest men. Work hard – Listen, there’s no such thing as a free lunch. If you have not done your homework, don’t even try. Just do it – “The opportunity you have in front of you today is a multiple of what our parents had,” Aly Khan asserts, “and a multiple of what their parents had.”
Posted on: Tue, 26 Nov 2013 07:06:34 +0000
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