Chicken Republic

Can’t tire of African entrepreneurship stories

I just read an unusually interesting and inspiring story in CP-Africa and CNBC Magazine about  Nigerian entrepreneur Deji Akinjanju, who built a multi-million dollar fast-food empire from scratch in 10 years:

Setting up a food-retailing business and moving into what he [Akinjanju] calls “the chicken space” has happened in a roundabout fashion. “It was manufacturing and retailing businesses that initially interested me. But then the idea of fast food came up and it seemed like the obvious thing to do.” His degree in the US and masters in the UK, followed by consultancy experience at Accenture (formerly Andersen Consulting) in London taught him to “analyse and reason” and “learn from mistakes” – and he got practical experience from his first business based out of Johannesburg, supplying UN survival kits in Burundi and Rwanda.

[…]

As he leaves the restaurant to watch his beloved Arsenal football team play Chelsea on TV, he reflects on how far he’s come. “I left Nigeria at 18 and came back at 34. Since then I do believe I’ve created a brand that stands for something strong. It’s not just about number of outlets. I’m chasing happy customers, happy investors and real service quality.”

After 16 years in the United Kingdom, Deji Akinyanju returned home to found one of Nigeria’s most successful food retailers.“I felt driven to go back and make an impact,” he said on his decision to return home.”It was at the time of transition from military rule to democracy and I wanted to help build an entrepreneurial private sector.”

Today, 42 year old Akinyanju heads one of Nigeria’s fastest growing retail chains valued at about $120 million. With about $2 million (N320 million) in seed funding raised from family and friends, he initially had a franchise deal with Chicken Licken, South Africa but quickly established his own brand Chicken Republic.

But he admits he has learnt most on the job, drawing on his own doggedness to carry him through the tough times. “When I started, I didn’t have much experience. If you have passion, the rest is easy to learn, but you can’t teach somebody to be passionate.”

When reading this, my first reaction is Hey, I can do this in the Ivory Coast!   Akinjaju was at about the same age as me when he started, and just like Nigeria a decade ago the Ivory Coast has recently seen a big improvement in governance.  Though, I’ll admit the $2 million seed fund from friends and family is tough to match, and there are many smart people who have tried to set up fast-food retailers in Africa and failed:

From an article about KFC in http://www.howwemadeitinafrica.com:

“We have seen a number [of our] competitors go into markets in Africa and loose a bunch of money and withdraw. Some of the bigger South African brands have gone in, paid some very significant schools fees, and then had to either withdraw or scale down their operations … The potential in Africa is enormous, but you got to be very thoughtful, and go about it the right way.”

It seems to be working out for KFC though:

Around 2007, KFC earnestly started to consider opportunities in the rest of the continent. Keith Warren  [Managing Director of KFC Africa] says that Nigeria, with its population of over 150 million people, was a natural choice. And in December 2009, KFC opened its first branch in Lagos.

According to Warren, KFC was very well received in Nigeria. “Our original development plans for Nigeria were quite conservative, and within six weeks, I was [in discussion] with the franchisees, and they were saying, ‘Forget that, we are now going to build as many stores as we possibly can’. We are finding that the only limiting factor we’ve got in Nigeria right now is actually chicken supply, and finding suppliers who are able to meet our global quality standards in sufficient quantity.”

Chicken Farming

The chicken supply issue is very interesting indeed. Akinjanju and his Chicken Republic is having the same problem, and is now setting up a large chicken farm in Nigeria:

Akinyanju turned supply challenges into opportunity and, in a business epiphany, the company has just invested in its first production capacity, opening a chicken farm 200km south of Lagos.

The plant will supply his restaurants as well as supermarkets and such is the demand for chicken in Nigeria, Akinyanju is focused on becoming the country’s largest poultry distributor, supplying cheap chicken to the masses. Demand – which is growing as national eating habits shift and more poor people climb the economic ladder – way outstrips supply because of strict import restrictions designed to help nurture a domestic industry. “There is an unbelievable shortage of chicken in the country,” he says. “The Nigerian market is three times as big as South Africa’s yet South Africa’s largest chicken factories produce 3 million birds a week. In Nigeria it is just 100,000.”

The Ivory Coast is lowering import duties on chickens, but it’s the same story there with small scale producers, and an increasing demand from a growing economy and a growing population.  The fast food space isn’t as developed in the Ivory Coast as in Nigeria, but it seems set to inevitably follow suit.

Akinjanju says he  sees demand to open maybe 300-500 outlets in Nigeria and expand in other African countries. He says he sees a cultural change happening daily with a large and growing younger population eating out more and more.

Hear him speak in this video:

Top Guy

Hierarchy

I’ve always found it weird to be dealing with organisations that are highly hierarchical. When ideas or proposals are judged more on the status within the organisation of the person proposing them, than on their own merit, something’s got to be fundamentally wrong. I guess it’s near impossible to do away with hierarchy altogether, but in any knowledge-based organisation I think it would make sense to de-emphasise hierarchical differences.

There’s tons of research around these things, but Im going to go with a quote from Stanford Professor Robert Sutton  commenting on why Google probably is a worthy No1 on Fortune’s best place to work list:

Google does not unduly emphasize status differences among people at different levels or within in the same level.  If you watch how people interact there — receptionists and executives, young engineers and senior executives, and people from less prestigious versus more prestigious parts of the company — the more powerful people treat the less powerful people with an unusually large amount of respect, even deference, and the less powerful people don’t cower or kiss-up nearly as much as I see in most places.   Yes, Googlers are sometimes guilty of being arrogant when it comes to outsiders (although I see signs of modesty creeping in), but I have to give Larry and Serge credit for creating such norms mutual respect from the start and building an organization that appears to have sustained them.

Still, despite all advantages of taking it easy with hierarchy, finding organisations that operate in an opposite way of Google is not difficult. Starting in Sweden one doesn’t need to go very far south to find places where highly hierarchical organisations seems to be the norm – I’d put Germany and France in this camp, as well as the Ivory Coast.

The boss is abroad, sorry, we can’t do anything to help you

One thing I’ve encountered many times in West Africa in both the public and private sector – and found equally frustrating each time – is that you got an organisation where only the top guy can take initiatives and decisions.  Anybody else in the organisation isn’t authorised to take decisions on even the smallest details so things can get done. So you have to get in contact with the top guy who is often very busy and hard to reach, and sometimes expects you to wait for hours to get an audience.

Here is a story I found in the Ivorian newspaper “Le Democrate” yesterday about importing cars that appears to be a straight forward example of the top guy phenomenon:

Le 2GE (Groupement de gestion des entreprises) chargées de confectionner les plaques d’immatriculation et de tatouer les vitres des véhicules automobiles manque de tôles. C’est l’amer constat que les importateurs dénoncent au guichet unique, depuis hier. Pour les usagers cette déconvenue entraîne un blocage du système de fonctionnement du guichet unique. Pis, les importateurs et transitaires dénoncent l’absence d’interlocuteurs capable d’apporter les solutions à leurs problèmes. Et pour cause, le directeur général de cette structure, Niamoutié Kouao est absent de la Côte d’Ivoire depuis un mois. Toute chose qui fait dire aux importateurs que l’Etat gagnerait à mieux définir la convention de concession qui le lie au 2GE, et par ricochet toutes les structures sous la direction de Niamoutié Kouao. Nos tentatives pour avoir la version de la direction sont restées sans suite. Cependant, nos colonnes restent ouvertes pour mieux éclairer l’opinion sur autre affaire.

Quick and shortened translation with the help of Google translate:

[2GE, the firm that makes the license plates for Ivorian cars has run out of sheet metal. Since yesterday, importers note bitterly that the whole import process has grind to a halt.  Worse, importers and freight forwarders denounce the lack of partners capable of providing solutions to their problems. And for good reason, as the General Manager of 2GE, Niamoutié Kouao has been absent from the Ivory Coast for the last month. Our attempts to get the version of the management were not responded to.]

I wonder how deeply entrenched the top guy phenomenon is. Could it possibly start changing if you have succesful companies operating more like Google making a mark on the Ivorian market? How does for example MTN’s corporate culture look like?

Like a Slow River

Then of course to be successful business-wise in a different culture than your own, you got to adapt.  You could see the top guy phenomenon as a competitive advantage of foreign firms that are aware of it, relative to those that act as if things are the same as on their home market.

“The slow pace of doing business in a country like Nigeria is often a source of much frustration for South Africans. I will tell you one little thing about doing business in Nigeria: time is like a slow river. If you can grasp this mindset and learn to manage it, you will do well in Africa.”

–  Nissi Ekpott, Nigerian entrepreneur based in South Africa, from the altogether interesting article Business culture in SA different than in rest of continent, says entrepreneur in How We Made It in Africa

Guess this Ekpott guy is right, there are frustrations but you got to live with them – almost embrace them – and it’s worth it as the opportunities are far greater than the frustrations.

Along the same line:

“This is the place to be . . . with all its challenges. Let’s go and work hard. I know there are hurdles and [conditions in Africa] are not every day the way we would like it to be, but look through that [and] see the opportunities because they are ample.”

– Johan van Deventer, MD, Freshmark (South Africa)

Catching the Entrepreneurship bug

Last Friday I got several month’s advance rent plus deposit from the new tenant moving in to the Cocody house. It’s the best single day positive cashflow since I started the business, and quite a great feeling – very different from receiving a salary.

I think it’s because the cashflow comes from pursuing one’s own independent idea/dream and building something from scratch, instead contributing to someone else’s agenda. It’s kind of like a waking up moment, seeing that it’s possible to opt out from a day-job at a big company and a life with terms to a great extent dictated by someone else,  and that opportunities and possibilities are pretty great.

Guess I’ve caught the entrepreneurship bug or something. As usual Steve Jobs expresses the whole thing very well, this time in a 46 second long video:

 

When you grow up you tend to get told the world is the way it is and you’re life is just to live your life inside the world. Try not to bash into the walls too much. Try to have a nice family, have fun, save a little money.

That’s a very limited life. Life can be much broader once you discover one simple fact: Everything around you that you call life was made up by people that were no smarter than you and you can change it, you can influence it, you can build your own things that other people can use.

Once you learn that, you’ll never be the same again.

The Maverick in Me

Richard Branson

Other holiday reading I’ve been doing is Richard Branson’s autobiography “Losing my Virginity”.   I had lots of “yes exactly!!” moments while reading it, and a few “ok, he is crazy” moments, but overall it’s a very inspiring entrepreneurship tale with lots of things that resonated with me in Bransons way of conducting business and outlook on life.   Just makes me wish I had started my business venture much earlier.

Things I liked:

• The emphasis on curiosity, adventure and having fun in business (and in life).  When working on my business, it really doesn’t feel like work at all – I enjoy it too much.  I think it was the same for Branson from the very start, just that he has done it full time his whole life, and for me it’s (so far) just a side-activity to my day-job.
  As for curiosity, here’s an excerpt from the Sense of Wonder post:

One of the things that I find exciting about West Africa and the Ivory Coast – is that it’s so different from everything one can experience living in Europe (or most of the rest of the world). It kind of naturally spurs a curiosity to figure out how the place works. Setting up a business is turning out to be a pretty good way of channeling that curiosity and exploring how things work. And it should work the other way too, that  curiosity – if it can be kept up – should be good for the business (and far from only for the business).

• Keeping things relatively informal with minimal bureaucracy and hierarchy. When things get too big Branson says he takes the deputy managers and promotes them to be in charge of a new company.  This way the Virgin group has 415 companies, and I have well… 3 very small ones: Real Estate, Taxis and Chicken Farm which are managed entirely independently.  Doing business in Africa has its issues, but one advantage is that the tax code, rules and regulations are kept relatively simple, making it easier to keep things informal and reducing bureaucracy.

• The screw it, let’s do it – attitude.

• “Maverickness”, not taking much notice of conventional wisdom and the way things are supposed to be done.

From the book:

Fun

First and foremost, any business proposal has to sound fun. If there is a market that is just served by two giant corporations, it appears to me there’s room for some healthy competition. As well as having fun, I love stirring the pot. I love giving big companies a run for their money – especially if they’re offering expensive poor-quality products.

“The maverick in me was also quietly amused that the guy who brought you The Sex Pistols could sort out your pension, too.”  – Branson, upon setting up Virgin Money

Love this quote.  Setting up a chicken farm in the Ivory Coast is quite a maverick thing to do for a full time employed engineer from Sweden I guess, but as maverickness goes, I see the bar has been raised.

Informal and restless

Virgin Money may appear to have been an incongruous departure for Virgin, the rock’n’roll company: it was a lateral leap in the same way as it had been from records to an airline.  But it was still all about service, value for money and offering a simple product.  The vision I have for Virgin does not run along the orthodox lines of building up a company with a vast  head office and a pyramid of command from a central board of directors. I am not saying that such a structure is wrong – far from it. It makes for formidable companies from Coca-Cola to Pearson to Microsoft. It is just that my mind doesn’t work like that. I am too informal and restless, and I like to move on.

Curiosity and Adventure

I have always lived my life thriving on opportunity and adventure. Some of the best ideas come out of the blue, and you have to keep an open mind to see their virtue. Just as an American lawyer called me to set up an airline in 1984, a Swedish ballooning fanatic asked me to fly over the Atlantic with him in 1987. The proposals come thick and fast and I have no idea what the next will be. I do, however, know that, if I listen carefully enough, the good ideas somehow all fit into the framework that Virgin has become. By nature I am curious about life, and this extends to my business. That curiosity has led me down many unexpected paths and introduced me to many extraordinary people. Virgin is a collection of such people and its success rests on them.

Embrace Change

If there’s a good business plan, limited downside, good people and a good product, we’ll go for it. In some ways it all boils down to convention. As you may have noticed, I do not set much store by such so-called wisdom. Conventionally, you concentrate on what you are doing and never stray beyond fairly narrow boundaries when running a company. Not only do I find that restrictive, but I also think that it’s dangerous. If you only run record shops and refuse to embrace change, when something new like the Internet or MP3 is launched you will lose your sales to the person who makes use of the new medium.

When we established as a mail-order record company, and thus dependent on the post, out of the blue came a six-month postal strike. If we hadn’t reinvented ourselves, we would have gone bust. There was no choice. Within days of the strike we had opened our first Virgin Records shop. It may have been up a dark, narrow flight of stairs above a shoe shop and have consisted merely of some shelves, a shabby sofa and a till, but in its own small way it taught us all we know about retailing. I can draw a straight line from that tiny shop to the Virgin Megastores in London, Paris and New York. It’s just a matter of scale, but first you have to believe you can make it happen.

No retiring

At this point [after selling Virgin Records and having £500 million in the bank] I could of course have retired and concentrated my energies on learning how to paint watercolours or how to beat my mum at golf. It wasn’t, and still isn’t, in my nature to do so. People asked me, “Why don’t you have some fun now?” but they were missing the point. As far as I was concerned, this was fun. Fun is the core of the way I like to do business and it has been key to everything I’ve done from the outset. More than any other element, fun is the secret of Virgin’s success.

You have to be out there

Even though I’m often asked to define my “business philosophy”, I generally won’t do so, because I don’t believe it can be taught as it was a recipe. There aren’t ingredients and techniques that will guarantee success. Parameters exist that, if followed, will ensure a business can continue, but you cannot clearly define our business success and then bottle it as you would a perfume. It’s not that simple: to be successful, you have to be out there, you have to hit the ground running; and, if you have a good team around you and more than your fair share of luck, you might make something happen. But you certainly can’t guarantee it just by following someone else’s formula.

Business is a fluid, changing substance, and, as far as I’m concerned, the group will never stand still.

Being real about setbacks

Lessons from James Altucher

One of my favourite blogs is James Altucher’s. In a recent post he writes about what he has learned from poker. Now, I don’t care much about poker, but  Altucher practically always has something interesting to say:

D) Poker is a skill game pretending to be a chance game. Many things in life are like that: sales, negotiating, entrepreneurship, etc. All of these things have the element of chance in them but the ones who are skillful will take all the money from the ones who aren’t. The problem is: most people think they are good because it’s hard to rank yourself and many people go into denial when they lose money. They tell people, “oh, I broke even” when they lost money most of the night. How do you get better at any skill game:

• – study and think about your mistakes. Don’t regret your mistakes. You’ll always make mistakes. The better you are, the less mistakes you make. The only way to get better is to thoroughly analyze your mistakes. So the more mistakes you have, the more opportunities you have to get better. Of course, this applies to everything you do in life.
• – talk to people smarter than you. Try to learn from them anything you can.

Acknowledging mistakes

Looking at my investments in the Ivory Coast I have indeed made lots of mistakes and had setbacks. I quite agree with Altucher’s approach of not regretting, but acknowledging and analyzing mistakes, and being real about setbacks as opposed to pretending to break even.

So, here are mistakes I’ve made in the last year:

• Not checking the equipment (like triangle and stuff) of the car before sending it to Abidjan to become a taxi.
• Getting the wrong person to manage the works on the Cocody house.  He was perfectly honest, but somewhat out of his depth managing the project. Guess I focused too much on integrity and not enough on competence. The real estate agency that’s in charge of letting the house took over the managers role and finished the works without hiccups.
• Not insisting enough on keeping advances small and not giving last chances to the carpenter who took money and never finished his work. A combination not being there in person, having the wrong manager, and following a law firm’s advice instead of my gut feeling, is to blame here I believe.
• Not acting early enough when rents go unpaid.  I haven’t written about the Yopougon apartments in a while, but after the crisis I’ve had a few problems with non-paying tenants and am in the process of replacing them.

None of the above has caused any material monetary setback.  The one material setback I have had since starting investing in the Ivory Coast, was when the two shops I had in connection with the Cocody house were looted and destroyed in a fire.  I learned about it at the same time as Gbagbo’s fall, so the bad news were overshadowed by much greater good news reducing the psychological impact.

Still, the shops always paid their rent on time with no hassle, so it  sucks to have lost them. The rents I collected during the 10 months or so the shops were in operation do not cover the building costs, so it’s a definite loss, no other way around it.  Here’s what’s left of one of the shops:

Quotes

And since I’m a sucker for insightful/inspirational quotes from dead (or sometimes alive, but mostly dead) people, here are a few of those:

“Don’t fear failure so much that you refuse to try new things. The saddest summary of a life contains three descriptions: could have, might have, and should have.”
— Louis E. Boone

“I don’t know the key to success, but the key to failure is trying to please everybody.”
— Bill Cosby

“The majority of people meet with failure because they lack the persistence to create new plans to take the place of failed plans.”
— Mark Victor Hansen

“A man can fail many times, but he isn’t a failure until he begins to blame somebody else.”
— John Burroughs

“Ninety-nine percent of all failures come from people who have a habit of making excuses.”
— George Washington Carver (American Botanist and Chemist 1864 – 1943)

“Ever tried? Ever failed? No matter. Try Again. Fail again. Fail better.”
— Samuel Beckett, playwright and novelist

“Many are stubborn in pursuit of the path they have chosen, few in pursuit of the goal.”
— Friedrich Nietzsche

“Our greatest glory is not in never failing, but in rising up every time we fail.”
— Ralph Waldo Emerson

“Take the risk of thinking for yourself, much more happiness, truth, beauty, and wisdom will come to you that way.”
— Christopher Hitchens (sadly among the dead ones)

“If at first you don’t succeed, try, try again. Then quit. No use being a damn fool about it.”
— W.C. Fields

A Window to Another World

Skype hitting critical mass in Abidjan?

I use skype a lot for communicating with the Ivory Coast.

Usually I have been talking to people I know very well, where I was the one introducing them skype and helping out downloading and installing it.

However, in the last months it seems something has happened, I see more and more people start using it independently, beyond the young well-off connected people that have been using it for many years.

The other day I had my first skype conversation with a junior guy at the law firm I’m working with. It’s a great guy, and he has been very helpful in a lot of situations. If he starts his own firm I’ll be his first client, but unlike most other people in the Ivory Coast I talk to over skype, I’ve never been in his home and I don’t know his family.

So I’m sitting in my living room at home in Europe. He turns up on the skype video chat, and in the background you have his relatively barren home – I think it’s in Abobo – with noises of cooking, children playing and people talking and occasionally showing up on the screen.     It’s a weird kind of feeling, like having a window to another world, a direct channel between the developed and developing world, right in your living room.

More wise words from Niklas Zennström

Today I watched an interview with Skype founder Niklas Zennström at Techcrunch Disrupt Beijing. Interviewer Sarah Lacy seems to get the importance of skype in the developing world as she opened up with:

I’ve just become a huge huge fangirl for skype, because I’ve spent 40 weeks travelling in the emerging world and it was the only way I could stay in touch with home, stay in touch with work and anyone in the US. I don’t think many americans realise how transformative this product is until they use it, and it’s become one of the few companies I really can’t live without.

Yup, amen to that.

Techcrunch Disrupt Beijing (click to get to the video)

Zennström usually has something interesting to say, and this interview was not an exception. Here are two questions that caught my attention:

Interviewer:
You know, it was not a lay-up. you got turned down by 25 VCs,  it was a very hard time in the market   I mean it was not  an obvious idea  you guys were not becessarily an obvious team, you had this distributed strategy. Why did none of these things hold you back, was it the power of the product,  was it luck, what was it?

Zennström:
I think a bit of everything, one thing is  determination, because there were a lot of times in the early days, the first year  leading up to the launch of skype  it was very very hard we couldnt raise money.   You know, it was just difficult times, so I think one thing was determination; never give up, and we  just kind of kept building and kept doing it, and then also we were lucky in terms of timing.  We just happened to do what we did at the right time. And then the product just took off and became viral – but we didnt know if it would. It was the time broadband starting becoming commonplace and for some reason no one had addressed what we were doing.

Interviewer:
What have you learned from your failures?

Zennström:
One of the big problems is that people are afraid of failure. Because when you start your  company you are so exposed. If it doesn’t work and it’s obvious that it doesnt work,  and then there you go: You wasted time. You lost money, you lost investors money, your money, and you lost your job.

I think what Silicon Valley is great at is the culture that when  someone says my company failed people  say: “Ok good, what did you learn from it?”  And thats the right approach  if you look at a failure as an experience that  you can learn from it’s pretty good and then don’t be afraid of it.

The worst thing that can happen… sure investors lose the money but hopefully a part of their business model is that you have some good investments and some bad investments, so that’s not the end of the world

If you then as an entrepreneur, if you start a company, it doesn’t work out, then you probably learnt a LOT from the experience. You probably learnt much much more than you would  from going to a business school or having your job at this  big company.

And the other thing also is it has been that people are afraid of… maybe you  have a job somewhere at a good company and you have a good career so you are leaving that, you are leaving your job security.  But you know, with the economy in this shape   job security in big companies doesn’t exist any more, so that’s another thing you know the risk is not so … the alternative is also risky.

The crisis of 2008 made this point hit home in my case.  The big company I worked for had three rounds of lay-offs – I kept my job but it became pretty clear that job security in big companies is not what it was. As mentioned in the Fragility and Robustness post, I’m thinking that the returns from my investments/businesses in the Ivory Coast could be safer than my day job salary.   And well, the whole safety thing is usually the main impediment to become an entrepreneur, and now it seems to be gone.

As for learning, business schools and formal education, I mean I spent five years getting a Master’s degree in engineering. I don’t regret it, but I’ve been starting to think that formal education could be a bit overestimated and entrepreneurial experience underestimated. I recall when my younger sister who is studying engineering said that she that MIT lectures available freely online were better than the actual lectures given at her university. I would hire someone (from the Ivory Coast or elsewhere)  with no formal degree, but who has gotten relevant experience by setting up a business and/or had the passion, determination and motivation to delve deeply into a subject through online resources like the Khan Academy and others.

I guess one still need universities or something like it for the human interaction important in learning, getting a network, and (unfortunately) as a gatekeeping function, but it’s got to be possible to organise the whole thing differently and better, and still get the same benefits.

Persistence

Persistence in blogging

I have been blogging for almost two years now, admittedly with a few gaps here and there (like the last two weeks), but in comparison to the average blog it seems I’m doing ok persistence-wise.  Apparently most blogs are abandoned after a couple of months:

Several studies indicate that most blogs are abandoned soon after creation (with 60% to 80% abandoned within one month, depending on whose figures you choose to believe) and that few are regularly updated.

Source: Caslon Analytics

According to a 2008 survey by Technorati, which runs a search engine for blogs, only 7.4 million out of the 133 million blogs the company tracks had been updated in the past 120 days. That translates to 95 percent of blogs being essentially abandoned, left to lie fallow on the Web, where they become public remnants of a dream — or at least an ambition — unfulfilled.

Source: Blogs Falling in an Empty Forest, NY Times

Persistence in business

I’m thinking – or maybe hoping – that persistance in blogging is a good proxy for persistence in setting up a business.

Few people know better what it takes to set up a business than Paul Graham, partner at Silicon Valley-based seed fund firm Y Combinator. Graham asked start-up founders what surprised them about starting a startup, and a common theme among the answers that came back was the importance of persistence, determination, character and commitment:

1. Be Careful with Cofounders

This was the surprise mentioned by the most founders. There were two types of responses: that you have to be careful who you pick as a cofounder, and that you have to work hard to maintain your relationship.

What people wished they’d paid more attention to when choosing cofounders was character and commitment, not ability. This was particularly true with startups that failed. The lesson: don’t pick cofounders who will flake.

Here’s a typical reponse:

You haven’t seen someone’s true colors unless you’ve worked with them on a startup. 

5. Persistence Is the Key

A lot of founders were surprised how important persistence was in startups. It was both a negative and a positive surprise: they were surprised both by the degree of persistence required

 Everyone said how determined and resilient you must be, but going through it made me realize that the determination required was still understated.

and also by the degree to which persistence alone was able to dissolve obstacles:

If you are persistent, even problems that seem out of your control (i.e. immigration) seem to work themselves out.

Several founders mentioned specifically how much more important persistence was than intelligence.

I’ve been surprised again and again by just how much more important persistence is than raw intelligence.

This applies not just to intelligence but to ability in general, and that’s why so many people said character was more important in choosing cofounders.

Sense of Wonder

Wisdom from 1985

I just read an interview with Steve Jobs in Playboy Magazine from 1985.  Tons of interesting things in it. One thing that caught my attention was that he stresses the importance of being curious and keeping a youthful or even childish sense of wonder about the world.

One of the things that I find exciting about West Africa and the Ivory Coast – is that it’s so different from everything one can experience living in Europe (or most of the rest of the world). It kind of naturally spurs a curiosity to figure out how the place works. Setting up a business is turning out to be a pretty good way of channeling that curiosity and exploring how things work. And it should work the other way too, that  curiosity – if it can be kept up – should be good for the business (and far from only for the business).

So if I’m no longer interested in stuff such as how Ivorian taxi drivers make a living, what kids in Yopougon use computers for, and the next ivorian parliamentary elections, then it’s probably time to stop and do something else.  Hopefully that time won’t come anytime soon.

Extracts of the Jobs interview:

Playboy: Why is the computer field dominated by people so young? The average ageof Apple employees is 29.

Jobs: It’s often the same with any new, revolutionary thing. People get stuck as they get older. Our minds are sort of electrochemical computers. Your thoughts construct patterns like scaffolding in your mind. You are really etching chemical patterns. In mostcases, people get stuck in those patterns, just like grooves in a record, and they never get out of them. It’s a rare person who etches grooves that are other than a specific way of looking at things, a specific way of questioning things. It’s rare that you see an artist in his 30s or 40s able to really contribute something amazing. Of course, there are some people who are innately curious, forever little kids in their awe of life, but they’re rare.

Companies, as they grow to become multibillion-dollar entities, somehow lose their vision. They insert lots of layers of middle management between the people running the company and the people doing the work. They no longer have an inherent feel or a passion about the products. The creative people, who are the ones who care passionately, have to persuade five layers of management to do what they know is the right thing to do.What happens in most companies is that you don’t keep great people under working environments where individual accomplishment is discouraged rather than encouraged. The great people leave and you end up with mediocrity. I know, because that’s how Apple was built. Apple is an Ellis Island company. Apple is built on refugees from other companies. These are the extremely bright individual contributors who were troublemakers at other companies.

Then there is this unrelated gem:

Playboy: At what point did you meet Steve Wozniak?

Jobs: I met Woz when I was 13, at a friend’s garage. He was about 18. He was, like,the first person I met who knew more electronics than I did at that point. We became good friends, because we shared an interest in computers and we had a sense of humor. We pulled all kinds of pranks together.

Playboy: For instance?

Jobs: [Grins] Normal stuff. Like making a huge flag with a giant one of these on it [gives the finger ]. The idea was that we would unfurl it in the middle of a school graduation.Then there was the time Wozniak made something that looked and sounded like a bomb and took it to the school cafeteria. We also went into the blue-box business together.

Playboy: Those were illegal devices that allowed free long-distance phone calls,weren’t they?

Jobs: Mm-hm. The famous story about the boxes is when Woz called the Vatican andtold them he was Henry Kissinger. They had someone going to wake the Pope up in themiddle of the night before they figured out it wasn’t really Kissinger.

Playboy: Did you get into trouble for any of those things?

Jobs: Well, I was thrown out of school a few times.

And this TED video covers the sense of wonder pretty well:

Obviously the right thing to do

A Plunge into the unknown

On professor Hans Rosling’s blog I read:  [If you go Hans who? – check this out!]

Today at the airport in Stockholm I met a happy Swedish couple flying out to their new investment abroad! They had renovated and opened a hotel on “Ihla”,  the historic capital in northern Mocambique. Obviously done the right thing to do.

My feeling here is, by golly I hope Hans is right, because I have just bought two plots of land in Abidjan, whereof on one I plan on building an apartment hotel.  So this is it, not only will the name of the blog start making sense, but if it works out I will reach the “within 3 year” goal set out in the mission/vision post last year.

The Prof has spoken

There aren’t that many plots of land available at reasonable prices in areas that are sufficiently central and upscale to be attractive to people (including european tourists) that are prepared to pay budget hotel prices for their stay in Abidjan. So when finding a plot that met all the criteria, I had to go for it, but only after a lot of due diligence including double and triple checking the paperwork – the key check is that the seller really owns the plot, checking that it isn’t in a flood prone area, and pretending to be a customer at nearby hotels to see how they were doing.

One the nearby hotels actually turned out to be one of those that are rented by hour, which is surprisingly common in Abidjan and not an indication of a bad neighbourhood, but still not quite a line of business I had intended to embark on.

Despite all these checks, encouraging remarks from Hans Rosling and the likelihood that the investment will have a strong tailwind by demographic and economic trends, it’s still a plunge into the unknown and I can think of an awfully great number of things that can go wrong, so I got to admit that fear is one of the emotions I associate with this project.

Quotes

Thus, it’s a good time for a mixed collection motivational quotes and other wise words:

“All life is an experiment. The more experiments you make the better.” – Ralph Waldo Emerson

“A goal properly set is halfway reached.” – Zig Ziglar

“Do not go where the path may lead, go instead where there is no path and leave a trail.” – Ralph Waldo Emerson

“What you get by achieving your goals is to as important as what you become by achieving your goals.” – Henry David Thoreau

(H/t Maren Kate at Escaping the 9 to 5 for the above ones)

As Randy Pausch said: “It is not about how to achieve your dreams. It’s about how to lead your life.”

Basically it is all about the curiosity to experiment and explore your dreams. Mistakes made are not about being good or bad. Don’t be afraid to pursue your dreams. Opportunities occur randomly. If the environment is favorable there is a great chance that these opportunities will be favorable. Work to create this environment. If you are not happy, change. Do something. Don’t whine. Do things with passion. Exploit and realize your potential and talent to the maximum extent.

From http://www.dailyspeculations.com/wordpress/?p=6260

“Peter Sims buries the myth that big talkers with brains and big ideas move industry and science forward. This modern masterpiece demonstrates that the most powerful and profitable ideas are produced by persistent people who mess with lots of little ideas and keep muddling forward until they get it right. Little Bets is easily the most delightful and useful innovation book published in the last decade.”

From: http://bobsutton.typepad.com/my_weblog/2011/04/little-bets-peter-sims-delightful-masterpiece-is-shipping.html

Laurence Peter (1919-1990):
“There are two kinds of failures: those who thought and never did, and those who did and never thought.”

Indira Gandhi (1917-1984):
“There are two kinds of people, those who do the work and those who take the credit. Try to be in the first group; there is less competition there.”

John F. Kennedy (1917-1963):
“Conformity is the jailer of freedom and the enemy of growth.”
“Efforts and courage are not enough without purpose and direction.”
“We should not let our fears hold us back from pursuing our hopes.”

John Cage (1912-1992):
“I can’t understand why people are frightened of new ideas. I’m frightened of the old ones.”

Robert Heinlein (1907-1988):
“Most people can’t think, most of the remainder won’t think, the small fraction who do think mostly can’t do it very well. The extremely tiny fraction who think regularly, accurately, creatively, and without self-delusion – in the long run, these are the only people who count.”

Anais Nin (1903-1977):
“Life shrinks or expands in proportion to one’s courage.”

Harold MacMillan (1894-1986):
“The man who trusts nobody is apt to be the kind of man nobody trusts.”

Aldous Huxley (1894-1963):
“Facts do not cease to exist because they are ignored.”
“Experience is not what happens to you. It is what you do with what happens to you.”

Christopher Morley (1890-1957):
“The real purpose of books is to trap the mind into doing its own thinking.”
“There is only one success – to be able to spend your life in your own way.”

Harry Truman (1884-1972):
“It is amazing what you can accomplish if you do not care who gets the credit.”

George S. Patton, Jr. (1885-1945):
“If everyone is thinking alike then somebody isn’t thinking.”

H. L. [Henry Louis] Mencken (1880-1956):
“Conscience is the inner voice that warns us that someone might be looking.”
“For every complex problem, there is a solution that is simple, neat, and wrong.”

“Now, now, my good man, this is no time for making enemies.”
-Voltaire, on his deathbed, to a priest asking that he renounce Satan

Winston Churchill (1874-1965):
“We shall never surrender.”
“I have nothing to offer but blood, toil, tears, and sweat.”
“A fanatic is one who can’t change his mind and won’t change the subject.”
“You have enemies? Good. That means you’ve stood up for something, sometime in your life.”
“The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty.”
“I am ready to meet my maker, but whether my maker is prepared for the great ordeal of meeting me is another matter.”
“Once in a while you will stumble upon the truth, but most of us manage to pick ourselves up and hurry along as if nothing had happened.”

Bertrand Russell (1872-1970):
“The whole problem with the world is that fools and fanatics are always so certain of themselves, but wiser people so full of doubts.”

Thomas Crum (-):
“Our quality of life depends not on what happens to us, but on what we do with what happens to us.”
“What would it be like if you lived each day, each breath, as a work of art in progress? Imagine that you are a masterpiece unfolding, every second of every day, a work of art taking form with every breath.”

“When I was a kid I used to pray every night for a new bicycle. Then I realized that the Lord doesn’t work that way so I stole one and asked Him to forgive me.”
-Emo Philips, stand-up comedian

“To believe a thing impossible is to make it so.” – French Proverb

G. M. Trevelyan:
“Never tell a young person that anything cannot be done. God may have been waiting centuries for someone ignorant enough of the impossible to do that very thing.”

Christopher Reeve:
“So many of our dreams at first seem impossible, then they seem improbable, and then, when we summon the will, they soon become inevitable.”

Sir Walter Scott:
“To the timid and hesitating everything is impossible because it seems so.”

Paulo Coelho:
“There is only one thing that makes a dream impossible to achieve: the fear of failure.”

Advice from the founder of Skype

Time for a quick break in the reporting about the Ivorian elections. This was after all supposed to mainly be a business/entrepreneurship blog.  In my defense though, the elections in the Ivory Coast have profound implications for anyone wanting to do business in that country.

Today, Wired magazine has an interview with one of Sweden’s most successful entrepreneurs; Niklas Zennström, founder of skype and many other IT-related ventures.

The interview contains a lot of wise words that I believe apply to anyone wanting to start a business, may it be in Voice over IP communications or real estate in West Africa.

Niklas Zennström

A little bit swashbuckling

I found this speech made by Amazon founder Jeff Bezos to the Princeton Class of 2010. It hits quite close to home.

Here’s the end of it:

(The full thing can be found at http://www.princeton.edu/main/news/archive/S27/52/51O99/index.xml?section )

I was working at a financial firm in New York City with a bunch of very smart people, and I had a brilliant boss that I much admired. I went to my boss and told him I wanted to start a company selling books on the Internet. He took me on a long walk in Central Park, listened carefully to me, and finally said, “That sounds like a really good idea, but it would be an even better idea for someone who didn’t already have a good job.” That logic made some sense to me, and he convinced me to think about it for 48 hours before making a final decision. Seen in that light, it really was a difficult choice, but ultimately, I decided I had to give it a shot. I didn’t think I’d regret trying and failing. And I suspected I would always be haunted by a decision to not try at all. After much consideration, I took the less safe path to follow my passion, and I’m proud of that choice.

Tomorrow, in a very real sense, your life — the life you author from scratch on your own — begins.

How will you use your gifts? What choices will you make?

Will inertia be your guide, or will you follow your passions?

Will you follow dogma, or will you be original?

Will you choose a life of ease, or a life of service and adventure?

Will you wilt under criticism, or will you follow your convictions?

Will you bluff it out when you’re wrong, or will you apologize?

Will you guard your heart against rejection, or will you act when you fall in love?

Will you play it safe, or will you be a little bit swashbuckling?

When it’s tough, will you give up, or will you be relentless?

Will you be a cynic, or will you be a builder?

Will you be clever at the expense of others, or will you be kind?

I will hazard a prediction. When you are 80 years old, and in a quiet moment of reflection narrating for only yourself the most personal version of your life story, the telling that will be most compact and meaningful will be the series of choices you have made. In the end, we are our choices. Build yourself a great story. Thank you and good luck!

Jeff Bezos

Now there is a bit of survivorship bias here. Those that left good paying jobs to start their own ventures and failed, instead of creating multi-billion dollar companies, are unlikely to be invited to make speeches at Princeton.  Still, I think Bezos makes a lot of good points.  Life does get more enjoyable and interesting if one doesn’t play it safe all the time, and dare to make original choices.

And I have a feeling that those who leave nice jobs to start companies and fail, manage benefit from the experience somehow like succeeding in the next try or taking the career in a new path.  I don’t think there are many regretting trying.

Translating this into my own situation, I am already determined to push the real estate venture in Africa until it either becomes much bigger than it is today or fails.  (And blog readers will see how it goes!) Even if the venture never provides as much money as my day job, at age 80 I’d rather tell the grandchildren about setting up a real estate company in West Africa than being a mid-level employee at a large corporation.