Valuable lessons from Kangema billionaires on how to grow wealth

In Summary Various studies show that having role models is essential for the success of start-ups. Experts invariably point out that one of the primary reasons new businesses fold up barely a few years down the road is that owners lack sufficient experience.

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Businessman Peter Munga during an interview in his office in Nairobi on May 19, 2015. PHOTO | DIANA NGILA | NATION MEDIA GROUP
By JOHN CHERUIYOT, DAILY NATION, KENYA

It is said when you are in Kisumu City, do not throw stones anyhow because the chances of hitting and injuring a professor are pretty high.

This is an indirect way that the lakeside residents proudly tell the world that the region easily has the highest number of PhD holders in Kenya.

However for Rwathia village in Kangema, if you throw stones around aimlessly you are more likely to hit not a man of letters but one of money. Why? Because billionaires abound here.

Just sample this: Equity Bank chairman Peter Munga is from Rwathia. The bank’s CEO James Mwangi also comes from the village. Investment banker Jimnah Mbaru is from Rwathia too, so is Britam boss Benson Wairegi. Other billionaires from Kangema include businessman Gerald Gikonyo and industrialist Chris Kirubi.

What is striking about these billionaire is that they closely work together, particularly Munga, Mwangi and Wairegi. Their relationship is so tight that they own shares in companies that are cross-listed at the NSE. They also share board directorship in companies such as Equity, Britam and Housing Finance. Their joint investments cut across any sector you can think of. At the NSE, they run the show, owning shares worth billions.

The question that any entrepreneur would certainly ask is: How can one own even just a fraction of what these investment gurus have attained?
Mr Munga shared with Money the secrets of amassing fortune that this group has been applying to astounding success.

He says becoming wealthy is never a far-fetched dream when you have a clear vision and unshakable focus. “Just know what you want in business, stay focused and everything will neatly fall in place,” he counsels.

He vouches for joint ventures which he says have high chances of success because partners pool resources and help each other out by sharing ideas. He however says partnerships would only stand the tough test of time if they are managed transparently and the partners are people of integrity.

Underhand dealings and back-stabbing bring businesses down, he opines.

While many joint ventures suffer from destructive wrangles, the Kangema billionaires have stuck together through thick and thin, guided by these principles as well as the desire to succeed and demonstrate that Kenyans too can join the top league of movers and shakers in the investment world.

Mr Munga says honesty is the cornerstone of any successful business. When business partners have no dark secrets between them, he says feuds do not occur and all the energies and resources are spent on building businesses and quickly taking up opportunities when they crop up.

“No brokers (among us). We don’t undercut each other. We don’t sabotage or willingly do som­ething to hurt each other’s business or establishments. It is an unspoken rule that guides how we relate with each other in both business and personal life. That is why you never see us quarrelling in public,” said Munga.

The tradition of Rwathia sons working together in business started with the late Gerishon Kirima and Mr Gerald Gikonyo who co-founded Rwathia Distributors. Munga says that from then on Rwathia became a business community whose ideals were forged and shaped by their forefathers.

This pioneering group of entrepreneurs set the pace by designing goals that they resolutely worked towards. Not even limited education blurred their vision and compromised their business acumen.

Sufficient experience

This has been an inspiration to many entrepreneurs from the area: “If they did it with so many odds stacked against them I can do it as well.” This seems to be the guiding philosophy of any budding entrepreneur from Kangema and specifically Rwathia village.

Various studies show that having role models is essential for the success of start-ups. Experts invariably point out that one of the primary reasons new businesses fold up barely a few years down the road is that owners lack sufficient experience. This setback is compounded by the absence of old hands in the trade to guide them through the rough patches of the start-up phase of their ventures.

However, in Kangema the script is different. Mr Munga says the area has become a hotbed of millionaires and billionaires because role models are not in short supply. The mentors, he notes have been the greatest motivation for business people because they are sure to get guidance from those who have “been there, done that”.

“Fortunately for Kangema, we have never been short of people to look up to because there have always been people to emulate from the area since pre-independence days,” says Mr Munga.

Another factor that is making Kangema such a force to reckon with in the realm of business is a deeply entrenched entrepreneurship culture. Having seen so many people succeed in business through hard work and resilience, many potential entrepreneurs believe that their dreams too are equally valid and they have what it takes to scale great heights of success.

They are imbued with immense confidence and solid self-belief because evidence of determination and of patience paying off abound in the many successful business people around them.

Mr Munga desired a good life from an early age. He would sneak out of school at Gaichanjiru High school (1960-1963) to work as a ball boy for former internal security minister John Michuki in Kangema who had just discovered a new hobby of playing lawn tennis.

“Michuki was a DO and I admired him so much that I said I would be like him. That informed my decision to join the Kenya Institute of Administration after form four,” Munga reminiscences.

Mr Munga, who was awarded an honorary degree by the University of Nairobi on Friday thanks to his inimitable entrepreneurship, had a humble beginning. He spent his time helping his mother to keep a family business afloat. This is where he learnt important lessons, key of which is patience, that would later be critical to him as an entrepreneur.

The tough challenges young Munga faced growing up in Kenya, which was then under oppressive colonial rule, solidified his mettle and emboldened his desire for a better life. He was there when the colonial government declared an emergency in 1954, and suffered its deleterious consequences. His woes were compounded when his father, Ben Kahara was detained by the imperialists. He and his mother were now left to their devices.

During those tough days, he witnessed and experienced unremitting poverty first hand and he vowed to persistently work to improve not only himself but also the living standards of the society.

Mr Munga says business is more fulfilling and makes more sense when you invest in the society. This is what motivated him together with Equity CEO Mwangi to launch the Wings to Fly programme that has gobbled up over Sh8 billion in scholarships to more than 10,000 students in Kenya.

He says the best gift that the society can bequeath its children is education. This, he adds equips them with the necessary tools to fend for themselves and prepares them to confront the myriad challenges they are certain to face.

He says businesses that find a good course to pursue for the benefit of the society have high chances of remaining robust and relevant for a long time..