So, You Want To Start A Business?

Here is a nice (long) video in which Mr Edward Hess talks about starting a business. He starts out talking with the most common causes of start up failure and ends with taking questions from the audience. The whole talk is filled with interesting and insightful comments by Mr Hess.

Throughout the talk, he stresses one thing: why would a customer want to buy from you? He says that you have to look at this question and answer it realistically. I’ve had the good fortune to start a few businesses and I have to admit that figuring out why people will give you their money is probably the best thing you can do for your business.

Please watch the video:

What do you think?

How To Get Out Of Debt

Q: My query was is there a way i can get back to my finacial freedom after i took a loan with Barclays bank and currently paying through the nose with the big interest.also this has lead me to bad credit and i am always in a debit account so getting a top up is impossible.please advise. thanks

As I see it, there is no set path to come out of debt, everyone’s case is different. They key is proper financial management. If one has good money managing habits, they can theoretically get out of debt with ease.

There are two paths here:

  1. Income + Borrowing + Spending both = DEBT
  2. Income + Saving + Investment = WEALTH

Unfortunately, many many people follow the fist path. It is not fair to blame them though – we are only human and our wants can sometimes take control of our emotions and end up in us making wrong financial/money decisions….

So how does one go about getting out of debt? Here’s one plan. Kindly note that it is not the only way and there may be better methods out there.

First, take a piece of paper and list down all your sources of income (things that put money in your pocket every month). Next, list all your expenses (things that take money out of your pocket), including what you need to pay every month to service your loan(s).

If the total income is higher than the expenses, that’s super! Otherwise, you are in the red and things will only get worse unless you take control now. But how? First, do not get any further into debt!

Next, You MUST reduce your expenses (or increase your income!) so that you can comfortably pay your bills every month without accumulating more debt. Try your best and cut down on everything that is not an absolute necessity – make sure that you only pay what you absolutely MUST pay. If you can move somewhere where the rent is cheaper, do so; if you can cut down on your monthly bills, do so; if you spend money on anything that you don’t need to survive, stop that. Cut down your expenses brutally.

Doing this will make you able to service your loan. If, after you reduce your expenses, you find that your income is now higher than your expenses, put the surplus into paying off your debt. In fact, pour any spare money into the repayment of the debt. Think of the debt as a drain on your money – if you pay it off, you will have money to spend on other things. Put all your disposable income into paying off the debt until it is gone. If you have a savings account with money – consider using it to pay off your debt. Think of it this way: why earn 1 – 5% interest on your savings account when you have a loan that you pay at 18%? Use your savings to reduce the debt.

If you have more than one debt/loan that you need to pay, then you need to list them down and compare them. Which has the highest interest rate? Pay that one off first. You can do this: pay the minimum amount on the other debts/loans while focusing the rest of your money on the one with higher interest. Once you finish it off, move to the next highest interest rate debt/loan. Keep doing this until you pay off all your debt.

And when it is gone, then follow path two – which leads to wealth.

Basically, do as much as possible to acquire Assets while avoiding Liabilities. We can define assets as things that put money into your pocket and Liabilities as things that take money out of your pocket. For example, unless your are a taxi driver, buying a car is, in effect, buying a liability . Imagine that – who ever goes out of her way to buy a liability?

Income + Saving + Investment = WEALTH

Photo courtesy of alancleaver_2000.

Simple Business Registration In Kenya

Following our call for help, we can finally report on how to register a simple business in Kenya. It is our hope that this post will help demystify business registration in Kenya and make it simpler and more accessible to more people.

How To Register A Sole Proprietorship/Partnership In Kenya
The procedure here is pretty easy and should not cost more than Kshs 900/-. Here is what you need to do:

  1. Pick out a business name that you wish to register. Write a simple letter addressed to the “Registrar General”. This letter need only ask the registrar to confirm if your chosen business name is available for registration.
  2. Make your way over to Sheria House, and to the Registrar of Companies within the Sheria House compound.
  3. Go over to counter No 1 and hand in your letter(s). You will need to pay Kshs 100 for every name that you wish to register. This is what is called “business name search”. The process takes three days to a week, max (usually). You will receive a blue receipt.
  4. Three days after handing in your letter, go back to Sheria House and show the attendant your receipt. If your chosen name is available for registration, you will receive a letter from the registrar of companies that, basically, tells you your name search was successful. You will also receive a form, Form BN/2.
  5. What you need to do is fill out Form BN/2 as completely as possible. If you are registering a sole proprietorship, the part where it says “Particulars of proprietor or partners” will bear only one name, otherwise you can put in up to 20 partners (for a partnership).
  6. Go back to Sheria House and hand in your completed Form BN/2. You will need to pay Kshs 800/-. After a week or so, you will have to go back to Sheria House to collect your business registration certificate. Congratulations, you shall then have registered a new business!

Concerning Partnerships
The process of registering a sole-proprietorship and partnership is the same at Sheria house.

However, because of the unique nature of partnerships (the fact that one partner’s actions can make other partners equally liable) it is recommended that one also registers a partnership deed that clearly defines rights, duties and obligations of all partners.

A partnership deed once drawn up is supposed to be registered as a public document at the Ministry of Lands.

We hope that someone, somewhere, finds this article useful. We shall publish one on limited companies shortly.

The map below shows the location of Sheria House in Nairobi. You can also use this link to view the map.

View Larger Map

Please do note that we have no lawyers on the Like Chapaa team. If any of the above is erroneous, kindly help us correct it. If you live outside of Nairobi and you know what the procedure is like in your town/city, please help us incorporate that information in this post.

Form A Kenyan Company

Last week, I called out for help in making business registration easier in Kenya. I got a lot of responses (thanks!!!). Interestingly, a lot of these responses simply just pointed me to this website: formAKenyanCompany.

The site says this about itself: is an online specialist in limited company formation covering everything necessary to facilitate the formation and/or registration of a company in Kenya . All types of Kenyan company formation can be catered for and everything necessary to set up a limited company in the Kenya, including filing and all required documents, including the memorandum and articles of association are provided. Our automated on-line formation is quick, simple and affordable enabling the immediate check of company names with the Company Registry. All formations are done electronically with our incorporation system and delivered manually to the respective government offices. All costs include all necessary documents and filing fees at Sheria House and the company formation process is usually complete within 7 days.

Nice, isn’t it? Do check it out!

Let’s make it easier to register businesses in Kenya

Hi wonderful readers

A few days ago, I was helping my niece to register a new business. She wanted to register a (limited liability) company. We found someone to do it for us – the person, a lawyer, charged us Kshs 20,000/-

Now, I was just thinking. If any man/woman in the street wants to start a business and needs a company, they would need to also pay this 20,000, wouldn’t they? For many start up businesses that I have known, this amount is simply too much. The money can be better used elsewhere.

In the spirit of helping all of us become better, financially and otherwise, I was thinking if at all we can do anything to make it easier to register companies in Kenya.

The biggest hurdle is drawing up the Articles & Memorandum of Association, isn’t it? While at school, we were taught that there are draft copies of these documents at the registrar. Is that so? Are they usable?

My idea is this: can we make draft copies of these documents that can serve “any business under the sun” and make them available for free download to anyone? In my humble opinion, it would be of massive help to aspiring entrepreneurs out there.

While at it, perhaps we can also do the same for partnerships, sole proprietorships and other forms of businesses. Ama?

What do you think? I’m no lawyer so, who wants to help?

How To Unsubscribe From Bidii Afrika

A couple of my friends have been subscribed unwillingly to this Google Group: Bidii Afrika. Maybe you’ve heard of it? It has a nasty reputation for spam.

Unsubscribing from a Google Groups is very easy so I was somewhat surprised that my friends had been having trouble. I found out why as soon as I joined the group. At the footer of every email, the group owner puts some helpful on how to unsubscribe:


Only that it isn’t very…helpful. Sending an email to: will NOT unsubscribe you from the group. Sigh.

The correct instructions are here, from Google themselves.

How do I unsubscribe from a group?
You can unsubscribe from a group through our web interface or via email. To unsubscribe from a group through our web interface, just click the “Edit my membership” link on the right-hand side of the group’s homepage. Then click the “Unsubscribe” button on the page that appears.

To unsubscribe from a group via email, send an email to For example, if you wanted to leave google-friends, you’d send an email to

Please note: If you unsubscribe from a group that only allows members to see group content, you may not be able to read that group’s pages anymore. If you want to continue your membership in a group, but don’t want to receive group email, select the “No Email” option on the left side of the Edit My Membership page and click “Save these settings.”

So the correct email to use should you want to unsubscribe from Bidii Afrika is:

Any Good Banks In Kenya?

Last week one of my friends and I walked into a bunch of banks in Nairobi with the sole goal of getting an account in the name of our startup business. It was not a good experience by any means. Pretty much all of the banks had requirements that made life difficult for us, including sill high fees, a requirement for references (where are we going to get those?) and other things that didn’t sit well with us.

Anyone know a good bank for a startup business?