If you were to ask many young Kenyans of business ideas, you would get dozens of brilliant ones. While numerous ideas exist, majority of them may not be realized or implemented owing to lack of capital. Below are some of the capital avenues available for aspiring entrepreneurs in Kenya:
Personal savings
If you are thinking of starting a business in the future then personal savings would be ideal for a small start up. Setting aside some money from your earnings every month for a given period might just give you the capital you need. And though this saving may not suffice, it can help you attract other funds from friends, relatives, or even family. Savings moreover give you a soft landing spot with banks and other financial ventures for top-ups.
Joining financial groups ‘chama’
It is said that unity is strength and in instances where going it alone seems impossible, joining chamas would be an excellent avenue for sourcing capital. Coming together as a group or joining an already existing reputable group with regular contributions gives you financial strength. After considerable contributions, members can access bank loans or even Youth Fund and Uwezo Fund from the Government. Chamas provide convenient ways of saving. So you could consider joining a chama to enable you raise that capital for start up or expansion.
Venture capitalists
Venture capitalists or firms are individuals or companies with funds to invest in return for an equity position in the business. For instance, a venture capitalist could invest Ksh 200,000 in exchange for 30% of your company’s worth. What you need to do is to convince them that your business idea is viable and they will be ready to invest. If you are just starting, you will need to provide a convincing business plan for your venture. Those already in business would need sales projections or past performance of the business including profits. While you may give a big portion of your worth, they are good for those lacking funds to start or expand their businesses. Examples of venture firms in Kenya and Africa include, The De Silva Group and Grofin.
Friends and family
This is an area many have not or do not consider as a source of capital for startup or expansion. There is no one who is likely to believe in your ideas more than your family and friends. Out of this, they would be willing to fund your startup or growth. They could give you loan or even free contributions which might help you with the business. Friends and family have an added advantage of marketing your business through referrals. There are individuals who have started business from family and friends’ support. So do not look further when you could get funds right near you.
Personal assets
Your own assets could be a valuable source of funding for your start up or expansion. In this case, you could look around for things you can do without. This calls for sacrifice and self denial in order to get that precious cash. You could do without a washing machine, a hoofer, or even that home theatre. These could be used as security for securing loans or even turned into cash, hence getting the capital.
So instead of sitting down and letting your business idea die owing to lack of capital is not a good idea when one could explore these available options. You have to work and think even harder to get that capital.
