We need to be creative in the way we source funds for our businesses

Jaluum Herberts

So the other day I had a discussion with one of my social media friends she asked, “why don’t you go into investment management?

Some of us want to invest but are so sure we can’t manage the investments in order to turn the money into more money.

We fear our investment management inadequacies will lead to loss of our investments.

You could for example get savings and investment clubs and manage their portfolios because most know how to collect money but don’t know what to do next even when they’re too proud to admit it.”

I closely listened as we had a 40 minutes long discussion about financing and investment.

I must say a lot of the things she said have been on our mind, have been on our agenda from the start.

When I started YOUNG TREPS a few years ago, I didn’t do so just to have something that can help a few people and make some money in the process.

I started something that would change the business landscape in this country, later region or even continent with the focus on home first.

If you look at places where entrepreneurship thrive you’ll notice three main factors: great ideas, technical expertise and availability of money.

Of those three, the last (money) has been our biggest challenge.

Compared to the other places, our options in that regard have been so thin. If anything commercial credit has been the only (monopolic) source.

This lack of diversity has left us with one option that comes with all the monopolistic characteristics that come with monopolies/unchallenged players.

Last time I wrote about Islamic banking (you can find the article on my Nile Post column or Young Treps blog) as another option of financing.

As a firm with have been trying to build the idea and culture of social/crowdfunding. This could provide another window of financing adding another option into the fray.

Savings and investment groups can be a good starting point with the right mindset and approach towards investing which is still generally lacking in most.

That’s another area I have had an opinion on for sometime. As a firm we have made it our agenda to harness the power of collective pooling of money for investment both as a culture that needs to be built and a financial option that needs to be explored.

The idea is to have a hedge fund in the future through which interested individuals can pool money and invest and slowly by slowly we are building towards that direction.

This may take us maybe 20-30 years to have this culture fully accepted and entrenched within our people.

I have personally run a crowdfunding drive that raised Shs 24M two years ago and now running another to raise Shs 40M with Shs 3M already raised in 4 days.

If we can show our people that this can work just like it did in China, has always done in Europe and America then they will be more and more receptive to the idea. With time more and more people will be willing to risk more and more money having seen that it works.

The start is always slow and this is a mindset we are dealing with something that averagely takes 20 years to fully rewire. We are here for the long haul and will patiently work towards this.

If we do then we shall have opened up the space for financing wider than we can ever imagine. We shall have broken the monopoly of commercial lenders, created a competitive environment that will see them push back in credit terms.

Lower interest rates, longer payments periods because the competitive environment created in the financial space by other options like Islamic banking,social/crowdfunding, venture and angel capital.

Jaluum Herberts Luwizza is a Speaker,Writer and Contributor with the Nile Post.He is also a Business Consultant at YOUNG TREP East Africa’s No.1 Business Management and Consultancy firm that helps people start and grow profitable businesses.

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http://www.theyoungtreps.com

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