Zimbabwe’s richest man on start-up secrets you need to succeed

                    Strive Masiyiwa started building his business empire with just $75.

Mr Strive Masiyiwa, Founder and Chairman, Econet Wireless speaks on August 5, 2014, at the US-Africa Leaders Summit in Washington, DC. During the entrepreneurship summit in Nairobi, the tycoon said his integrity was a powerful bait that attracted capital from his business associates as he navigated a treacherous start-up journey over three decades ago. FILE | JEWEL SAMAD  AFP

In Summary

Strive Masiyiwa started building his business empire with just $75.

• Integrity: Mr Masiyiwa says his integrity was a powerful trait that attracted capital from his business associates as he navigated his treacherous start-up journey more than three decades ago.
• Loans: “Face up to your creditors with humility. Sometimes when you are running a business, things don’t always work out the way you planned. You might find yourself having borrowed some money, or taken some goods on credit; then that payment you were expecting does not come through.”
• Honesty: Mr Masiyiwa says in case you are unable to pay your suppliers for any reason, be frank about it. This builds trust. He says he was once in this situation and he honestly told the supplier that he was unable to pay as agreed. Surprisingly, the supplier agreed to supply him until on credit until he was able to pay.

By EDWIN OKOTH
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When Kenya hosted the Global Entrepreneurship Summit in July, the most discussed topic was how start-ups could access capital and successfully sail through the teething challenges.
Zimbabwe’s richest man Strive Masiyiwa had a fascinating story to share.
“I only had $75 when I started my first business and I really did not know where to get the other funds,” Mr Strive Masiyiwa told delegates at the summit.
He said his current multibillion business went through very trying times at the beginning.
At one point, Mr Masiyiwa said he was hard-pressed to pay his supplier. So, how did he weather the storm?
“I got goods from my suppliers, which I was to pay in a month. Two weeks later, I approached my major supplier and told him I will not be able to pay him. He asked me when I would pay and I simply answered ‘I honestly don’t know’. He told me to sit down and we had a candid talk.”
The 54-year-old, who was among the GES panelists discussing access to capital, said innovation is critical as a start-up positions itself for funding.
CONFESS CHALLENGES
The tycoon said his integrity was a powerful bait that attracted capital from his business associates as he navigated a treacherous start-up journey over three decades ago.
He said his supplier was shocked that he had the guts to confess his challenges.
“We talked at length and he was shocked that I had the courage to approach him with the confession that I was not going to pay when most people simply default and even disappear when faced with the situation I was in. He decided to supply me in credit until I stabilised and be able to pay. I grew very fast,” he said amid loud cheers and a standing ovation from the delegates.
The billionaire now has his fortune in Econet Wireless Group, the telecommunications firm he founded and controls.
Econet Zimbabwe, a publicly-listed subsidiary of the group, is the largest mobile phone network in Zimbabwe with over nine million subscribers.
HONESTY AND INTEGRITY
The company also has operations in Botswana, Lesotho and Burundi, as well as investments in telecom companies in New Zealand and the US.
The businessman is now a key mentor for many budding entrepreneurs including those who keep in touch with him through the social media.
He says honesty and integrity are key ingredients of a successful business journey.
“Face up to your creditors with humility. Sometimes when you are running a business, things don’t always work out the way you planned. You might find yourself having borrowed some money, or taken some goods on credit; then that payment you were expecting does not come through. And now you owe money, lots of money and the creditors begin to chase you for the money,” says Mr Masiyiwa in one of his Facebook posts.
“The most important thing to always keep in mind, when you are in this situation, is not to lose sight of the fact that the other party, once trusted you by giving you goods on credit, or by giving you a loan. So don’t get angry with them.”
APOLOGISE
He is particular about how businessmen ought to treat those they owe in terms of the language. He says one should be quick to apologise regardless of how the person you owe approaches you.
Mr Masiyiwa’s invaluable advice could not have come at a better time for Kenyan entrepreneurs. Most traders Money spoke to admitted having had bad experiences with those who fail to honour their promises of payment. Some get agitated when pushed hard to pay. This scenario is largely associated with disintegration of business partnerships and collapse of viable start-ups.
Ms Azenath Mbiwa has learnt from the best. Some of the customers she was supplying onions were dishonest. She was bringing the onions from the neighbouring Tanzanian and her business suffered immensely because of broken promises of payment.
How did she get into the mess? Her network of distributors was growing fast as referrals brought in more budding and established traders, who joined her supply chain, thanks to her flexibility in providing the onions and collecting the money after the produce is sold out.
SWITCH OFF PHONE
“I started accepting even new distributors who I trusted due to the fact that we had established a tight network with those who referred them to me. I, however, noticed that many of them began defaulting and coming up with stories after which they dropped out of business due to debts,” Ms Mbiwa told Money.
“Most of them I would later discover had lied to other businessmen and dropped out of previous business ventures.”
Her experience mirrors that of Ms Mwasaru, who runs a flower business at the Jomo Kenyatta International Airport.
“I stopped supplying to a trader when he switched off his phone on the day he was to pay me. He even closed his shop and told those in the neighbourhood to lie to me that he had been arrested,” Ms Mwasaru told Money.
“Even after he repaid in full, I could no longer do business with him.”
LACK OF TRUST
The depressing tales of the two entrepreneurs are replicated in many businesses today. Indeed many start-ups in Kenya fail within the first three months of operations with lack of trust being a major contributor.
The inability to pay for goods or services under whatever circumstances is a real test of faith between traders. Emerging from such a situation without scars of bitterness is key for the survival of your business.
The modern business environment has been so clouded with characters, who do not honour their financial obligations that even members of investment groups have to guarantee each other when lending to themselves.
Businesses may not entirely survive on trust and honesty but the role it plays in positively shaping business operations is key and go a long way in determining whether or not your young venture will take off.
It is important to appear in person when needed by the person you owe just the way Mr Masiyiwa did. Phone calls or even worse text messages and emails could exacerbate the tension