Hustles and hurdles of starting a business

By Nancy Kathendu and Margaret Ngetha

Picked n Packed  was founded in 2012 by two sisters Nancy & AnnMarie Kathendu using personal savings. The hurdles that drowned us at the commencement of this company accumulated into losses that wiped out the initial personal investments leaving us stranded in the middle of the harrowing waters of anger, devastation, and frustration. However, all was not lost in vain as we recapitalized using contributions from family and additional personal savings. We were putting our personal and family‚Äôs capital on the line risking it all for a company that already failed, but looking back I honestly have zero regrets. In no time the business grew and required additional assets. Consequently, we sought to borrow from the local banks on the grounds of a straight forward asset-backed finance facility unfortunately to our dismay the bank took over three months to approve the facility, and once approved, they demanded collateral in the form of land, personal guarantees and joint registration of the vehicle. Reflecting on the business’s financial standing we accepted the terms and were able to comfortably service the loan. In fact, when we needed a second loan to procure a vehicle the bank only needed the joint registration of the vehicle as collateral. It may seem like a subtle gesture, but to us, it was a step ahead into being a financially accountable, transparent, and prosperous company.

Considering most agribusiness establishments are classified under SMEs the struggle for finance has been a nightmare for us as has been for any other upcoming SME. The thing that I am not 100% sure about though is whether our struggle to access financial support has been because we are an SME or merely because we are women fighting for our space in this Agribusiness sector. This continuous financial headache has compelled us to grow using funding from ongoing operations crippling a lot of projects resulting in a slower growth rate. Nonetheless, one of the projects that was instituted in 2015 finally received funding through the AgriFI Kenya Challenge Fund. A distinction must however be drawn between Agribusiness and Agritech businesses as Agritech businesses have had the upper hand in financial funding. This disadvantages us as we are unable to tap into the financial resources offered to  Agritech businesses that we so greatly desire.

In this male-dominated financial world the financial needs of women are just as pressing as those for men. I am aware financial gender equality is a procedural and gradual shift in the financial sector however I am confident if the opportunities to financial access were conducted under blind appraisals I am certain the number of women accessing finances would increase. This coupled with the provision of business case development skills and mentorship programs  to women will drastically improve the professional outlook of ideas presented for funding.

At this juncture, I am aware of the many fingers pointing me towards affirmative financing as a p alternative source of funding for women. Yes, I completely agree that affirmative financing is targeted for women and youth however as a woman who has tried to access these funds the requirements are no different than those from mainstream banks. Moreover the financial ceiling is set very low and thus it did not make sense to borrow Kshs 50,000 for  PnP. I am not bashing affirmative financing all together I am just trying to suggest a reconsideration of the loan ceiling and reconstruction of their collateral requirements. Moreover, affirmative financing agencies should strive to use all media forms and outlets to reach women entrepreneurs that may need funding.

Finally, even with endless hurdles and complications, I have my sister and role model Annmarie to thank for supporting me and even more importantly believing in me. Being the only entrepreneur in my family and circle of friends she has been my greatest advisor and pillar of strength.

Aluta continua!