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Doing business with friends: Does it work?

Students at the annual ALA Enterprise Festival
Students at the annual ALA Enterprise Festival

Here’s how young African entrepreneurs are solving youth unemployment with their peers.

By Lionel Tarumbwa

A lot has been said in the past about entrepreneurs and relationships, particularly starting a business with peers. The popular perception has been greater odds of success are found in people willing to forgo their friendships. We looked into this a little further.

Anzisha Prize 2020 Second Runner up Cecil Chikezie says: “The journey of an entrepreneur is a difficult one. You might forget meetings with friends, you might even forget to reach out a little more than a few times.” Cecil’s words resonate with the majority who see friendship as something that, inadvertently so, comes between a person and success.

“The objective of entrepreneurship is to help those around you.” The CEO of Eco Maaka, which is an e- an e-commerce company that connects local fuel briquette producers to a client base, is all about helping people, and doing so sustainably. His reflection is a pointer of how it is important sustainable VYE ecosystems with a solid support system of mentors, parents, and investors. Anzisha has been working with several stakeholders to bring together the different pillars of a support system that enhances the chances of success for young entrepreneurs.

“My friendship circles have played a key role in marketing my business, they also played an important part as my first customers and continue to be so.” He adds, “There are also people I employed, involved in the day to day operations who have since become good friends because of our close business relationship.

Through its work with VYE’s over the last decade, Anzisha’s research has shown that Very Young Entrepreneurs tend to employ their peers. Specifically, 11 of our 2020 fellows created jobs for 148 people prior to their selection by Anzisha and 60% of these were for peers under 25 years old.

Cecil is not alone, other fellows in Geoffrey Mulei and Vanessa Ishimwe employ a combined workforce 81 in their enterprises with a good 61% of them under 25.

“Starting ventures with friends is good if done well, we have Bill Gates and Paul Allen with Microsoft or our own Shola Akinlade and Ezra Olubi of Paystack as good examples. It is dangerous to do business with friends simply for the purpose of doing business with friends,” Cecil went on to warn aspiring entrepreneurs to be mindful of the vision and purpose that any particular friends have for being involved in business.

One other Anzisha fellow, Farai Munjoma of Shasha Network, noted that he has not only employed his peers simply because of close personal relationships. Of the two members on his team, one has interned at McKinsey San Francisco and is on his way to Goldman Sachs and the other is on his way to a Big Four accounting firm.  

“I have tried to build a team that has experience with issues that we are dealing with at our current stage. Lionel has brought accounting and finance experience that has helped us get funding and plan our business’ financial strategy. Takudzwa’s management consulting experience and Stanford exposure has brought critical  and analytical thinking skills that have been crucial in building and developing our flagship product,” says Farai.

Through the support of mentors and experienced coaches, young entrepreneurs have transcended many of the challenges of dealing with peers in their business. They have learnt to handle the workplace relationship with impressive maturity that can be matched to the world’s most prestigious C-Suites.

The main push for the promotion of entrepreneurship among Africa’s youth is to drive economic participation among the growing youth population. It is impressive to look at how the dividends of promoting very young entrepreneurs have started paying off as peer-to-peer employment grows.

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