By the time Tony Kibagendi graduated from university with a degree in education, he was sure employment was not an option for him. After all, Kibagendi was already running several successful businesses and making more money than the government would offer a high school teacher.
Kenyan Kibagendi told How we made it in Africa that he made his first million shillings while in university after investing in the 2006 initial public offering (IPO) of the Kenya Electricity Generating Company.
An early start
The 31-year-old entrepreneur started doing business at age nine. He would buy a packet of 130 sweets for KSh.60 (US$0.70) and sell each for a shilling. When he joined a high school 150km away from his home, he began saving his pocket money and used it to buy clothes at the end of the school semester. Kibagendi would then resell the clothes at a profit in his village where they were in high demand.
But it was while at university that Kibagendi’s businesses really took off.
“We used to buy second-hand T-shirts and they would always be printed Michigan State University or Ohio University. We did not have any such T-shirts for local universities. I started printing them for my colleagues and before long students from other learning institutions started asking for the T-shirts. They would sell like hot cakes.
“It became a big thing. I started printing T-shirts for corporate firms. I used the money I was given by the Higher Education Loans Board (intended for tuition) to buy T-shirts and do the printing. I used to make up to 200% profit.”
When he noticed that students on his campus did not have access to typing services which they badly needed, Kibagendi bought a computer and printer and opened a stall. He also used his position as a student leader to exploit business opportunities such as organising his university’s annual beauty pageant.
Kibagendi says that by his final year in university, business was so good he “almost quit” school.
With the money he made out of the IPO, Kibagendi bought a vehicle which he leased to a car hire business.
After graduating, he bought more vehicles and started his business which leases vehicles to corporate firms. He diversified even further by opening a chemist, a marketing agency and a full-service garage. Kibagendi has recently ventured into the media industry and launched online magazines.
“I am the kind of person who does not believe that the Jack of all trades is not a master of any. I believe in having several income streams. If you look at leading business people like James Mwangi [CEO of Equity Bank] and [businessman] Chris Kirubi, they have investments in various sectors.”
Last year, Kibagendi started a security company called Westwood Security which offers private investigation services and IT security for corporate and government departments. The mid-level security firm currently employs more than 120 security guards.
“Cyber crimes are becoming very rampant because the IT training we get here does not give us enough capabilities to prevent fraud at extreme levels. Cyber security is an emerging market. Our solutions are in very high demand.”
Kibagendi attributes his success to “very good networks”, adding that his two failed attempts to get elected into parliament (2007 and 2013) have helped him build relationships with other prominent businesspeople and opened numerous opportunities for business.
“I like to socialise. I always tell young people to go out and widen their networks. When you go out and meet people you get business opportunities. For instance, you might go out and meet somebody who is planning a wedding and they will need tents, chairs, flowers, a sound system… that is an opportunity for business even if all you do is connect them to a service provider and get a commission.”
However, Kibagendi reckons that he has made “enormous” mistakes along the way because he did not have a mentor.
“That is the most important thing in business. If I had a mentor I would have made it way back. I would have made fewer mistakes. I have invested in lots of businesses in the wrong sectors that lost me a lot of money. The mistakes I made are enormous,” he laments. “This is why I mentor a lot of young people today. Entrepreneurs need a sounding board.”
He cautions young entrepreneurs against doing business and “putting all the money in their wallets”. Instead, they should take the money to a financial institution, build their credit worthiness and take out loans to scale their businesses and diversify.
Kibagendi adds that entrepreneurs should be careful when going into partnerships. The wrong business partner, he says, can easily lead to the collapse of a very successful venture.
“Partners even in terms of marriage are very important. If you don’t have the right spouse you will not have the peace of mind to run your business particularly when the business is struggling,” he says. “Even in business, the wrong partner will always push you down.”
Labels: Chris Kirubi, James Mwangi, Tony Kibagendi Millionaire Kenya