Entrepreneurship in Africa: creating Zoona

Last week during his visit to Kenya, Obama reiterated his belief in entrepreneurship as the ‘spark of prosperity’ – in Africa in particular. So far this summer, I have found no shortage of young Zambians and Malawians who share this ideology. So why aren’t there more young business owners in Africa?

I decided to speak to Brad Magrath – one of the two Zambian brothers who founded Zoona – about how they managed to become so successful in a supposedly hostile continent for new businesses. Here are the entrepreneurial lessons (with a healthy dose of Brad-style one-liners) that I have learned so far:

1. It’s not about the idea, it’s about the execution

I find that many of my peers – both in Zambia and back home – think they have what it takes to run a business but are waiting for ‘the big idea’. Brad and Brett Magrath’s first entrepreneurial attempt was a positive role model comic character; their second was a startup in Bangladesh; their third ended in a hairy border crossing with a shoebox…but that’s a story for another day. Just as they thought they might have to give up and go back to their office jobs, the idea for Zoona was born. Don’t waste time trying to think up the next Airbnb, Uber, or LinkedIn – if you think you want to start a business, just do it.

Each of the meeting rooms in the Zoona Cape Town office is named after a stage in the Zoona journey

Each of the meeting rooms in the Zoona Cape Town office is named after a stage in the Zoona journey.

2. Scarcity is the mother of innovation

Many of the budding business-owners I have spoken to here think they need to go back to school or get more capital before they can follow their dream. But according to Brad, there is never an excuse for not making a minimum viable product and testing your business theory. Talk to potential customers, create a low-tech prototype…find a cheap way to prove that people will be willing to pay for your product or service, then worry about investment later.

3. In Africa, raising capital is not the silver bullet

The first investors in Zoona (including Accion) were American, not African. Brad has a firm theory that, in the US, investment is more risk-tolerant – people will evaluate your company based on what they think it will be able to achieve. In Africa, investors want to see proof. They want to see revenues and a team with a demonstrated ability for execution.

4. Earn the right to say ‘no’

It took 18 months from when Brett and Brad decided they should be ‘investor-ready’ to when they accepted their first investment. They focused on building revenues then formed an independent advisory board so they could practice producing monthly financials and reports, ready for potential investors. In doing so, they earned enough working capital and experience to be able to turn down any ‘paper tigers’ – funders who only want to add you to their list of investments but who are not willing to go through the door with you. Make sure investors are absolutely aligned with your values.

5. Have values.

As much as your business might take new forms over time, you need a true North that will help you to avoid bad decisions. I’ll admit, when I first read Zoona’s six core values (on the posters, on the website, and just about everywhere you turn in each of their offices), I didn’t fully appreciate how much management relies on them to inform decisions. Then Brad called me in front of a white board on my third week, gave me a pen, and asked me to list my first impressions of Zoona according to these six headings. The Zoona management team did not just pick six words they liked – they picked the six things they wanted to be held accountable for. You can’t have values that sit on a poster in a cupboard, you have to create behaviors and habits that constantly reinforce them.

6. “You have to go from a skateboard to a car.”

On my first day, Brad announced this to a room full of Zoona staff and I had absolutely no idea what was going on. Despite their sky-high ambitions to ‘dominate’ Africa, the Magrath brothers also believe in incrementalism. Businesses need to find out what their core is and get really good at it. Don’t try to build a car from scratch; build your skateboard into a scooter, your scooter into a bicycle, your bicycle into a motorbike, and then build your car.

7. Having said that…one day you’re a chicken and the next day you’re feathers

Zoona moves incrementally but, boy, does it move quickly. Brad told me about Mixit (who?) – the original instant mobile messaging service that stood still for too long and was overtaken, spectacularly and brutally, by Whatsapp. This is particularly true for businesses in the tech world; hence why Zoona knows it has to continue to grow, innovate, and disrupt aggressively. You have to be agile, manage change, stay ahead of the crowd, but relish competition.

It is hard to summarize the recipe for creating Zoona in a single blog post. But, I appreciate that in creating a successful startup, the Magraths are not kicking away the ladder. At the very core of its being, Zoona is about training and equipping emerging entrepreneurs. Without any capital investment, young Zambians and Malawians can become a Zoona agent – and a self-employed business owner – overnight.

Since my project is about creating entrepreneur training tools, selfishly, I’d prefer if our agents remained life-long Zoona business-owners. But if one or two of the agents using my tools became the next African Mark Zuckerberg or Richard Branson…well, I guess that would be pretty cool too.

kirsty

Kirsty Gray is working out of Lusaka, Zambia, with fintech entrepreneur Zoona on an insights and agent reactivation project.

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One Response to “Entrepreneurship in Africa: creating Zoona

  • Great post, Kirsty! It’s really interesting to hear more about their entrepreneurial journey.

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