#OverwoodChat – Exploring Starting a Business in Nigeria with FAMILUSI AKIN BABAJIDE

#OverwoodChat – Exploring Starting a Business in Nigeria with FAMILUSI AKIN BABAJIDE

Starting a Business in Nigeria with FAMILUSI AKIN BABAJIDE

FAB is a creative, serial entrepreneur & the Group CEO at The FAB Group, a Pan-African firm with interests in Media, Hospitality & Fashion.
He is passionate about developing ideas into substantial life-impacting products & is equally driven by building businesses & people.

Entrepreneur that inspire

I would have to say, Richard Branson.

He is as restless an entrepreneur as I am.

In starting a business try to ensure: 

1. You are solving a problem 

2. You have an exclusively unique solution to this problem 

3. A lot of people have this problem 

4. A great number of people are willing to pay for the solution you’re providing.

A business is as good as the number of people willing to pay for the product or service.

It is even better if you can get people to return to you for the same product or service.

The folly I have found with most entrepreneurs is believing the hype of their products without validating with paying customers.

1. Conduct market research (SWOT analysis is a good place to start

2. Get an understanding of the different considerations a potential customer will make on the path to purchase

3. Know the specific problem your potential customers are having i.e pain points 

4. Try different channels to reach the potential customers

Licenses will vary from industry to industry and this research you must do by yourself.

However, if you’re trying to build a credible business I would advise that you first register your business with the Corporate Affairs Commission. 

In my case, for our media business, you’re required to get a certain media license after taking and passing an examination. For our hospitality business after inspection, you’re required to secure a food and beverage license.

You must find the applicable licenses for your industry.

Most industries have an organisation or a governing body that the industry practitioners report to.

These usually have a constitution (a set of laws) guiding the formation and operations of a new or existing business in that industry. Think CBN for banks

Ensure you find this organisation and ensure you secure and digest these to know exactly what you’re getting into. If you cannot interpret the laws ‘therein’ please do consult a lawyer for interpretation.

Bootstrapping is a path to financing a new venture that I have favoured over the years.

It involves building a company or business from the ground up with just personal savings and cash flow from the business. It requires no external support at all.

You could also leverage family and friends contributions to start a business. Another path to funding that is getting increasingly popular is crowdfunding (see http://kickstarter.com)

Bank loans are another option. Private equity investment is yet another option.

We will need a whole tweet chat dedicated to this to break it all down. However, make sure you get a good understanding of each so you know exactly what you’re getting into.

For every new business I’d say: 

1. Start with your network and for the ones you convert 

2. Ask for referrals (you could offer incentives) 

3. Build an email database and send out periodic emails…

4. Build a social media presence 

5. Offer to write about your industry in news outlets 

6. Look for speaking opportunities that target your market 

7. Collaborate with complementary businesses with a ready database of your target market

You will know you’re ready to scale your business, typically when you have more customers than you can serve.

This may mean you need to invest in more/better human resources, better systems and processes or a level of automation you currently do not have or cannot afford.

It is a good problem however you must evaluate what your unique position is and then determine exactly what is needed for you to scale. Afterwards, you must either find the money or partner with an individual or firm that can get you to scale or just strategically outsource.

Don’t forget that upon successfully scaling an operation, the requisite sales must be on standby.

1. Stick to a strict expense budget

2. Invest all excess inflow in diverse instruments

3. Monitor returns and keep your lifestyle aligned to return on investment, never to investment itself.

My father taught me hard work but I learnt that being strategic about where I put my effort is key to getting results.

As much as I am called a serial entrepreneur, I now know that focus is key to being effective.

I have learnt to value VALUES in partnerships. Partnerships are great and partners could want to get in business for different reasons. Ensure your values align.

“Follow your passion’ may be decent advice but not the best. Most times your passion gets ‘turned on’ the moment you become successful at a venture.

Don’t get carried away or stuck on your original idea that you do not allow it to evolve.

Avon originally sold books door-to-door; Nokia originally sold paper; Wrigleys originally sold baking powder; Colgate manufactured soap, candles and starch – get the picture.

Let a lot of your decision not be driven only by what the product or service can do but on how it will generate inflow.

Think of cash in business like you would blood in your veins. The moment the blood stops flowing through your veins you die and so will your business if the cash stops flowing. That must never be you.

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