By Dolapo Adeyanju
It’s no secret that some businesses fail. It’s a bumpy ride that is often lonely and sometimes yields no results. Is this even more true for young entrepreneurs? Kevin Kibet – a 25-year-old social entrepreneur from Kenya and an Anzisha Prize fellow who is changing that narrative summarized his experience as a “roller coaster ride.”
Kevin, who launched his agribusiness enterprise FarmMoja Limited in 2016 found himself in a particular space where a lot of patience is required between the time of investment and cash inflow. He said: “The commodities we produce have long gestation periods, between 3-4years. As a result, they do not generate immediate returns on investment.”
Although such commodities are of high commercial value and profits, many investors avoid them because the investment market is more focused on early returns. Kevin explained that “In the early days, it is almost outrightly impossible to attract investors when you are young and the earliest returns are in 3 years or more.”
“Youth believing and investing in youth”
During their early stages, many Very Young Entrepreneurs, like Kevin, rely on the help of family and friends. Sharing his uncommon and impressive narrative on the latter support group, he said: “When it became difficult to raise funds in the early days, my co-founder and I reached out to two of his childhood friends who became interested and invested about 20,000 USD in the business.”
This is a rare testimony of “youth believing and investing in youth” and a big motivation for Kevin to expand his business operations. According to him, it marked the beginning of his success stories because the investment exposed his company to other business opportunities and networks, such as the Anzisha Prize Fellowship, which changed his perspective on pitch competitions and leveraging networks to access and scale investment.
“Coming into the Anzisha Prize Fellowship with not just an idea, but a plan in place based on the funds we received, gave me an edge and something to leverage when approaching potential investors.”
Very Young Entrepreneurs could leverage on networks to raise institutional capital
Interestingly, young entrepreneurs like Kevin are gradually changing the narrative of an investment bias against young founders while exploring ways to connect with the right investors and mentors. A strategy that recently landed FarmMoja its largest third-party investment is partnership and mentorship from notable organizations and individuals.
“Recently, we leveraged our personal and professional network to acquire new funding that will substantially help us to strengthen our model and inevitably, achieve our aim of reaching more farmers and generating over 70,000USD in profit annually. This investment was made possible by a referral from one of our “mentors” who works with a reputable African organization.”
He emphasized the importance of having a legitimate, credible, and influential mentor who could guide investment decisions, recommend potential investors and investment channels, and vouch for the enterprise’s credibility. He said:
“Having a mentor who could assess our deck, advise accordingly, and build our fundraising capacity really worked for us in securing this investment.”
“Partnership is great but what is more critical is ‘with who?’”
Through his struggles for investment, Kevin emphasized the role of partnership and networking with the right actors and stakeholders along the value chain.
“Optically, partnership with the right people can bring a lot of credibility and legitimacy which could further help to raise investment. Substantively, young people need partners who could provide technical support and share their experiences on how to develop useful models, prepare pitch material, and prepare investment deck.” He added that “Partnership is great but what is more critical is with who?”
Talking about the essential business attributes required for scaled investment, Kevin mentioned resilience, a deep level of inquisitiveness, and readiness to learn as some of the attributes that have worked for him over the years.
He said: “Half of the time, you’re told that you are not the best fit. However, you have to be resilient not to make people’s truth yours. Also, you need to get feedback from investors and potential investors on why they have decided to invest or why they have not invested in your business. During this period, you need to continue learning and taking such feedback to refine your investment deck and pitch materials.”
“Be ready to be lucky”
In his final notes, Kevin advised his counterparts to learn to network with the right people, let their passion sustain them, work hard, and speak the right investment language by telling compelling stories that can convince investors about the expected financial returns and long term impact of the business.
He said, “Young people must study their potential investors to know what interests them and how to communicate with them effectively, honestly, and concisely. More importantly, they must be ready to get lucky”
Kevin Kibet is the founder of FarmMoja and a 2018 Anzisha Fellow