Private equity (PE) is a developing feature in many African markets whose growth is facing many lips and bumps in a public that grapples to understand it. Coined from their private nature of raising and investing funds, PE firms, instead of approaching banks and the capital markets to raise funds, approaches sophisticated investors. They promise a return slightly higher than that offered by traditional assets which include government securities among others. Centum, is an example of a private equity firm in Kenya and has historically invested in private companies such as Isuzu East Africa, Almasi Beverages and Nairobi Bottlers.

Currently, one of the PE firms, Cytonn, is in the spotlight for failing to meet its obligations to investors. Founded in 2014, the firm has experienced its highs and lows. I credit Cytonn for raising billions of shillings in a record short time. For instance, as of June 2021, two of its unregulated products (CHYS & CPN) had an asset-base of Kes.15.9bn vis-a-vis liabilities amounting to Kes.14.3bn. So is all the heat and condemnation on Cytonn warranted?

Most Private Equity funds invest in long term projects with characteristic challenges arising from their long life. In Cytonn’s case; there is value, only that the Cytonn promise was over ambitious with time. Cytonn recruited clients with short term views to finance its long term portfolio, exposing itself to liquidity risk and a tarnished reputation. Coupled with a slumping market for real estate, they have to attract new strategic investors to boost liquidity. Its short-term minded investors remain with few options, such as converting their debt into residential units, extending the maturity periods or taking legal action.

I opinion that we blame the Capital Markets Authority (CMA) for being the proverbial dog that barks without biting. In cases such as the Atlas Africa Industries where CMA failed to enforce proper financial reporting. CMA watched Imperial bank’s floatation of bonds worth Kes. 2bn only for the bank to go under a month later. Commercial Banks on the other hand have brainwashed fixed deposit investors by offering them peanut returns on their “safe” investments. Investors are also to be blamed for not reading investment proposals carefully, underestimating potential risks involved and how the Force Majeure clause can be exercised. I conclude in the words of Peter Lynch, “Never invest in any idea you can’t illustrate with a crayon.”


Trickle-down economic structure is an old song in the playbook first proposed by Reagan in 1980s.  This is where the government grants tax cuts to the wealthy to stimulate investments which in turn creates employment. In my opinion, this approach is derogative in its form as it allocates wealth to a handful and makes employees dependent on government and a few fortunate corporations to earn and pay their debts. This economic structure thrives where captains of industries influence legislation and governance. It is the perfectly explains why industry tycoons influence politics.

Regimes such as that of former American president Donald Trump created an enabling environment for the rich to participate more in making a nation’s wealth by taxing them a little less. This, which is otherwise referred to as horse and sparrow theory suffocates middle and small players in a country such as Kenya who’s dominant population is the middle class. This middle and majority class drive and sustain the whole economy. When it is left out in a trickle-down economic structure it may result into huge poverty gaps and limit economic democracy.

Attempts to allocate money to the poor may prove futile as we cannot really predict what someone can do with their money. Who thought it was a good idea to give the rich a tax break assuming they will put the money back to their business? The rich may not reinvest the cash back to the business and may opt to hold it in their bank accounts. This will make it easier for banks to offer loans to startup businesses at lower interest rates which in turn indirectly stimulates investments among the middle-class.  The rich consume less and save more as opposed to the middle class. Ultimately money lands in the hands of the rich.

No government can control all the variables of a free market. If the government focuses on eliminating corruption among the rich at the top of a trickle-down hierarchy and create an enabling business environment, everyone benefits albeit measure.  If the government tries to control market dynamics all are worse off. Until we accept this, we will be erroneously stuck assuming we can manage an economic outcome that will only lead to failure.

Daisy Tum | Columnist, IGBR


The passing of Dr. Christopher Joseph. Kirubi in June, 2021 ceased a moment for all industrialists to reflect on the habits that made a corporate bigwig. I have taken some time to analyze the demeanor and person in the late Chris Kirubi with the particular objective of highlighting what made him different and successful in building a business empire of his size. Through testimonies shared by some of his family members, friends and employees in memory of their time with him, I have learnt that Chris was truly larger than life. He was a man of style, class and influence. Dr. Christopher Kirubi never compromised his standards especially in grooming, driving and dinning. The polo and golf enthusiast also loved to brag about his businesses. He did all these with one single objective, to attract value.

Chris invested in value creation and value attraction. These he did perfectly by risking his money while banking on his reputation. He knew the boardroom language and negotiated skillfully with other multinationals, governments and high-net-worth individuals who possessed the value that he wanted to attract. He also attracted people to work for him, by creating employment opportunities and by leading them appropriately. Dr. Christopher J. Kirubi invested in almost all sectors, travelled to leading cities, associated with men of caliber and pulled his own sit on the national dinner table where power is designed and negotiated. He groomed his two children, Robert and Maryanne, to take after him the control, management and ownership of his businesses, a strategy to make his empire last for more than a lifetime.

He had enough controversies, but from his success we can borrow a thing or two in creating stronger businesses. Foremost is negotiation. In business one must learn to negotiate, this is the power that gives you way to networks and value. Second is the law of attraction which works well when you coordinate your strengths to your favour. Finally, Appreciate. Dr. Kirubi wanted to be appreciated just as he appreciated others. This final law could have made him a contradiction in many ways; a capitalist who truly created jobs, donated generously and paid huge taxes. The legacy of Chris Kirubi shall live on.

Rick Okinda | IGBR Editor

Opinion Column: Why You Need To Think Beyond Profits

money, profit, finance

Evolution of the world is now being fueled by technological innovations. Firms are realizing huge profits and tech-advanced countries recording a rise in their GDP. Despite the ongoing COVID pandemic, there are some bigtech players who are ripping big from the digital economy. While this kind of industrial revolution is great news to business bigwigs, it remains a threat to lives and livelihoods in so many ways and by so many measures.

Human welfare is directly dependent to immediate offerings of our planet. The downsides of the digitized world are fast endangering the future of human generations. This has instigated active dialogues and heated debates on how we conduct our businesses. Sustainability has become a 21st century defining objective for governments and corporate entreprises.

While good businesses are still in pursuit of profits, great businesses are going beyond profit goals. They are now seeking to address ecological and social concerns in the world around them. They are pursuing sustainability. Sustainability which is not an act of philanthropy nor generosity but about businesses building a growth model that will be effective now and in the long run.

Sustainability is not only beneficial to the society but also to the business itself. For instance, reducing operational losses, supporting human capital and paying attention to employee’s concerns is likely to increase labour productivity and attract more creative minds which can be a big asset to the business. Sustainability calls for more efficient products and services and this can be driven by innovation. Sustainable outlook also plays a role in boosting the company’s brand .A strong brand attracts employees, customers, business partners and investors. This helps the company to stay relevant and competitive. It is why you need to think beyond profits.

‘What matters is not the size of the pie but what is inside of it. It is the set of ingredients used in making the pie and whether these ingredients will continue to be available in the future.’ With regards to building sustainable businesses, it is not only about economic viability but also about sustainability into the future. This kind of sustainability is attained by paying attention to human and ecological concerns.

By Daisy Tum | IGBR Columnist

Workplace Review: Why They Employed You

job, interview, hiring

Primitive Bible translations have not used terms such as employer, employee or employment in reference to human resource. Instead, terminologies like master, servant, lord, slave and service are used from the book of Genesis through to Revelations. Today, labour is resourced through employment and resourced personnel are referred to as “employees”. Employees who are modern-day slaves/servants are protected by local and international labour laws as the society keeps on evolving towards labour equity and justice.

While we remain thankful to positive changes that have taken place since slavery to employment, it is important to ask whether the master/lord has changed into an employer and whether the slave has advanced to become a servant. In my study, I’ve made findings by answering the question, why are employees paid a salary? My answers are three: to appreciate them for work done, to motivate them to keep working and to make them forget their dreams. The first two are positive and are reflected in payment of competitive salaries, leave days at work, flexible work schedules, protection of the employee from hazards and fair employee appraisal. The third reason why employees are paid a salary is non-progressive. It is found in the capitalist master/lord who wants the salve/servant to forget their dreams and think about the employment only. Such an employer is playing safe with labour laws by: paying non-competitive salaries, resetting his watch to forget leave days and weekdays meant for resting, biased promotions and overusing already skilled, qualified and experienced interns/volunteering staff without monetary appreciation.

The employee should protect his/her employment by being honest, productive and innovative. The employee should also overcome slavery through wise spending of employment income. Such wise ways of spending a salary include saving, investing and re-investing at least 15% of gross payment consistently. Finally, the modern day slave should find freedom in using leave-days, off-days and after-work free time in other fulfilling activities that advance his social welfare.

By Rick Okinda | IGBR Editor

Opinion Column: Human Behavior That Can Make or Break the Team.

meeting, business, brainstorming

Can conflict be the solution for transformation or is it the problem? What is conflict like to you? Do you feel afraid and freeze? Do you feel courageous and fight?  We can’t ignore conflict as it shows up a lot in our lives. We can use conflict as the energy source for innovation, creativity and transformation at the workplace if we learn from it. Conflict is a human behaviour that can make or break the team.

What really creates conflict? Fast it happens in an organization setting. Organization being a group of more than one person coming together under a set culture to pursue a goal. In such a setting, frictions that build up to conflict are likely to arise from three key factors. First is unmet needs which can be physical, emotional, spiritual or psychological. Second is the difference in value systems as to to how things are done and how people behave. Thirdly limited resources; which maybe be money, time or property.

However we can deal with conflicts. Mostly we find people choose validation than confrontation, our brains take some short-cut unknowingly and we are always wired to favorably judge ourselves and harshly judge others. We need to be vulnerable, question the source, and teach habits for management of differences and understand that there is more than one way that is right.

Emotions, logic and empathy are equally important when we are resolving conflicts at any point of our lives. Emotions helps us identify where our deep value or need arises, logic help us identify the root of conflict and challenges they present and move towards a solution, and empathy ,helps us understand how others are affected and validate them for feeling that way.

Conflict is not the problem. The problem is when people choose to diffuse it rather than use it. In all aspects of our lives we can turn conflicts to profits, learn from it and make it the fuel that will drive change. Learn to handle and resolve conflict as a business leader, employer or employee.

By Effie Odhiambo | IGBR Columnist

Opinion Column: How To Do Business With Government

The three most prominent business models are: Business to Consumer (B2C), Business to Business (B2B) and Government to Consumer (G2C). These three models are helpful when one is positioning him/herself in the market. There is however a fourth business model that is often not sustainable for reasons that I will highlight in the next paragraph, which is the Business to Government (B2G) model. In a B2G model, an entrepreneur targets government as a major consumer of his goods and services.

Kenya has forty eight governments in total, 47 seven of which as are devolved at county level. This implies that 48 entities plus other government agencies, departments and parastatals that procure supply opportunities every fiscal year. These tenders are awarded on merit, as it should be, and there are certain requirements in terms of regulatory compliance, experience, skills and capability to supply goods and/or services to these governments and their agencies. Therefore, a sales department in B2G model is supposed to be keen about tender openings by governments. This can often be done by checking tender notice websites, daily newspapers, alerts from networks with civil servants and email enquiries. Another important step to winning government tenders is by applying to be pre-qualified as a supplier or contractor or a professional service provider in as many government departments as possible. This increases your chances of winning tenders for recurrent yet short government projects.

Government tenders may however be unstainable due to fluctuations in the government’s demand curve, bureaucratic payment procedures which may lead a business into debts, political influence in winning and executing government tenders, unfair competition in winning the tenders and difficulty in pricing goods and services supplied to government as prices are not set by forces of demand and supply as it should be in a free market. If you want to do business with the government, aim at taking tenders that you are capable to handle in terms of magnitude and working capital requirement. It is advisable not to take a pure B2G model as a way to mitigate the risks that come with doing business with and for the government.

Intellectual Enterprise: Kenya’s fastest growing sector.

Have you heard your former colleagues say they are selfemployed? Some have already built sustainable businesses while others are in the process. But what exactly is self-employment in a fairly learned country with limited capital goods? (Capital goods are commodities, often referred to as raw materials that are used in manufacturing to make consumable products). In a country with an influx of bright minds, thanks to the good 8-4-4 education system that made white and blue collar scholars, lack of capital goods creates a huge gap between knowledge resource and capital resource for production. Self-employment among the white collar class in Kenya is likely to mean consultancy. To the experienced professionals, consultancy means running a firm that wins tenders to advice governments, multinationals, established corporations and NGOs. On the other hand, to fresh graduates and senior college students, consultancy means getting short and subcontracts with established consultancies, offering outsourced professional services to private individuals at senior levels, exporting labour through academic writing, and copywriting for SEO and actually travelling abroad to countries with sufficient capital goods to work for better pay. According to a CBK report released in January 2021, diaspora remittances have steadily increased to become Kenya’s leading foreign exchange earner ahead of agricultural exports and tourism. These remittances are made by Kenyans who go abroad to work. In Kahawa Wendani and parts of Kasarani area in Nairobi, all bills by a majority of the residents are paid from online writing and forex trading. Economist, David Ndii calls himself a public intellectual and has actually been hired to think and strategize for a living. Ndii is one among many intellectual entrepreneurs in Kenya. Knowledge is a resource that can be exchanged for money. Kenya is ahead of its peers in the continent as it is producing the best minds in tech, law, research, medicine, engineering, economics and finance on the global stage. Government can best support this fast growing sector by democratizing access to fast internet and upgrading the quality of education in all parts of the country.

Columned by Rick Okinda

IP Rights in Kenya: Secrets to healthy business competition

Intellectual property rights (IP rights) involve protection of trademarks, copyrights, patents, industrial designs, and geographical indications among others. Kenyan economy is growing very fast and expanding its scope to include ecommerce and digital space. Protection under IP rights enables the business owner to enjoy monopoly and subject of the IP rights to the exclusion of others. IP rights protection is vital when starting a business because it protects the innovative and creative capacity of the founder and enhance healthy competition in the business environment. Protection of IP rights promote consumer welfare in relation to goods and services where they apply. The promotion of consumer welfare is done through granting of exclusive rights to the proprietors or
entities that founded and expressed the business idea being protected. IP rights protection links the consumer and the manufacturer whereby the consumer can easily identify and associate products with their respective owners. Kenyan law recognize and protect IP rights starting with the Constitution and the relevant statutes for each category of IP rights. The IP laws in Kenya also establish institutional frameworks such as Kenya Industrial Property Institute (KIPI) and Kenya copyright Board (KECOBO), which are tasked with the mandate to register and protect various IP rights in all business sectors. Entrepreneurs should therefore first register their patens for scientific innovations or trademark their brand names, logos and slogans before starting the business. First person or entity to successfully lodge documents for registration gains priority in enforcing IP rights protection to the exclusion of others. An entrepreneur should first register the expression of Idea for protection before sharing it with anyone in written form. The importance of registration is that the proprietor acquires exclusive ownership rights and such expression of idea can only be replicated by any other person with permission and license of the founder. – Column by Boaz Bwire

Why Facebook? A brand new reason to be online in business.

In my career as a business plan consultant, I have asked my customers how they acquire new customers and how efficiently they get to communicate to and with them. Feedback from a sample of them has been the same, “Facebook”. So I have gone ahead to ask myself, Why Facebook? When I first opened a Facebook account, all I wanted to achieve was to be at par with my classmates in form three who were already in Facebook and telling lots of stories that they collected and shared on the platform. Indeed, since inception in 2004, Facebook has grown to become the world’s second most visited site with billions of visitors every week. It is no longer a static site as its algorithms and features keep changing. Facebook has evolved from just a social network to an ideal business platform through its unique infrastructure for information exchange, communication and connecting to
maintain and form relationships. Consultants, Corporations and SMEs have a cost effective alternative to connect with their potential customers through Facebook. With the continued advancement of WhatsApp Business, Facebook Messenger and integration of Instagram with Facebook, Facebook has proven to be ideal for business ahead of its competitor Google which owns G-Mail, G-Suit, YouTube and Chrome among other tools for business. In summary, follow the numbers. Facebook has these numbers regardless of size and specialization of the entrepreneur. “Twothirds of Facebook users say they visit a local business Facebook Page at least once a week.” (Kawaf, & Istanbulluoglu, 2019).

Columned by Rick Okinda.