February 25, 2014
Every successful entrepreneur has experienced setbacks at some point in their business career. For most, it is an essential part of ‘growth’ in a competitive business environment. I sent an email to a handful of entrepreneurs, asking them to share their business failures, what they learned and how they built on them.
Here is what they wrote:
Charles Kofi Fekpe, Founder of CFekpe Consulting. UK/Ghana
My Biggest mistake since setting up CFekpe Consulting Limited was not to have been ready for ALL opportunities and to have underestimated them when they came. I had just registered my company then and had begin looking for assignments to take on. I met a friend who asked me to send him a proposal together for him to show his director of training the following day. I didn’t have one but also thought I wait till the following day. After all, he was my friend right? Well, Wrong. That was in 2004 and I missed what would have been my first biggest deal. I have learnt my lessons. (1) I have asked myself all the “WHAT IF” questions that could come up if an opportunity should arise today, and I have all the core answers. Success, I have found, is having the answers to questions that are not even yet asked. Its about getting there first and waiting for others arrive (2) I treat everyone as a full business client – opportunities I have learnt, don’t come in special clothing or packages. So, even when my 3-year Old daughter told me she’d like to talk business with me, I immediately arranged lunch with her. The only proposal she put on the table however was that she wanted a bicycle for her birthday.
Dr. Yemisi Akinbobola, Founder, IQ4News.
When I first launched IQ4News officially as a news website in 2011 [it has been a personal blog for four years prior], I was so excited to have received funding to follow my dreams.
I developed what must be the longest business plan ever – 87 pages – detailing my strategies.
For the first few months I focused on creating content for the website and emailing our media kit to every possible potential advertiser I could think of. No one replied, but traffic was good reaching 40,000 in the first 3 months. I kept at it, whilst doing other part-time work on the side – I had bills to pay. I made my first advertising sale 6 months later.
While I won’t describe IQ4News 1.0 as an epic failure, because it wasn’t, I was nowhere near prepared to run a business as I felt I was, at the time – I was focused on being journalist and news editor that I forgot to be publisher. Looking back at Yemisi of 2011, I both smile and cringe – I still remember running after one of our coaches at the incubator to find out why he wasn’t as excited about the website design as I thought he would be; “how will you make money” he asked. The answer then was so simple “sell geo-targeted advertising” I said confidently. He smiled and walked away leaving me puzzled.
Three years on, as we are about to launch IQ4News 2.0, and I finally understand his smile – I found out the hard way that selling advertising is not a sustainable business model for a news website, and even if it had been, I had set strategies and targets that were unrealistic and that I did not follow. I just had a dream and ran after it full throttle, forgetting the developmental steps I had planned.
Eric Muta, Founder and CEO, Problem Solved Ltd. Tanzania
I had a full-time job as a software engineer and created a small computer program that helped speed up processing of forms related to importation of goods at the Dar-es-salaam port. Within one month of use at that company, revenues jumped up by $300,000 and I thought I could quit my job and sell the program to make the same amount of money for myself and be rich in no time! My mistake was not realising that the only reason the company could generate $300,000 in one month was because it already had a name, an office, hundreds of employees and thousands of customers. It had the fuel and my program was just a match that lit a big fire. With a new company that had no customers, no history and no employees, I struggled to get anyone to buy the program and 18 months later I ran out of money and was forced to get a job. Lesson learned: code is not a product, and a product is not a company. To get from code to product to company to profit, you need to have all the supporting infrastructure in terms of an office, employees and customers. That takes time to build and you need to have enough capital to survive until it is all in place.
Njeri Rionge, Co- founder of Wanachi Online, Kenya
To be successful as an entrepreneur you must have a clear vision, and driving forward to achieve that vision requires 100% of your involvement. As an entrepreneur, as a business owner, a business coach and mentor, at networking events and social events over the years I’ve often found myself talking to colleagues and peers about the benefits that might be achieved if successful entrepreneurs and business leaders could share their experiences with new and growing start-ups.
How positive it would be if upcoming business leaders could learn from our mistakes, and get practical advice from a wealth of accumulated knowledge aggregated under one roof. So why not put together an annual summit to make a positive contribution to the growth of Kenyan businesses, and bring together business leaders to talk about a range of subjects that would give practical help and advice to start-ups and SMEs wanting to scale up their businesses in Nairobi?
The Ignite Summit: Scaling Your Business Upwards was a good idea, and interest was (and remains) high both from delegates, speakers and potential sponsors, but the time required to organise an event of this scale as an addition to my ‘day job’ was something I greatly underestimated. I was not able to give it 100% of my involvement. What I learnt from staging the first Ignite Summit in 2012, was that all that research, preparation, enthusiasm and positivity will take you so far, but if you spread yourself too thin, you will eventually come unstuck.
Frank Boateng, Country Director EQUIPXP, LC and Co- Founder of Darko Fresh. Ghana
There are hundreds of mistakes, but I believe that is the only way to gain hands on experience! I remember during our water project construction and planning we did not factor potential regulatory delay and boom! We had to go back to do additional testing, product name change and re-submission.
This caused us money, as we had to re-do all our branding efforts again and has to pay staff for three months before production started. Lessons are that entrepreneurs must be innovative and creative in thinking during project planning. They must not discount anything during project planning stage.