Life of a Kenyan small business in 12 charts


An excerpt from the LelapaFund Blog:

After a hectic six months discovering Kenya’s small business scene, LelapaFund is happy to share some insights from the ground with our community. Over 300 companies have joined our pipeline, learnt about a new form of raising equity capital – crowdinvesting – and are actively structuring their companies to benefit from it. Thanks to the countless meetings, workshops, site visits and afterwork nyama chomas, our team has acquired a wealth of knowledge about early-stage investing in Kenya, and built relationships of trust with truly dedicated entrepreneurs. We are most grateful to every entrepreneur for teaching us about their industry and daily challenges, and are excited to fine-tune the crowdinvestment solution to local needs. Happy reading!

From the iHub to the Kenya Association of Manufacturers, we have met with small business owners across the spectrum. Thanks to their high visibility and organisation in clusters, tech startups are the most represented group in our pilot phase. Following that, we’ve seen a strong showing from the consumer goods sector, which includes food production, fashion design, beauty and personal care products.

For the following charts, we define SMEs as companies older than 3 years with at least one sales cycle under their belts, and startups as companies younger than 3 years at idea or prototype stage.


As expected, the capital needs of SMEs fall squarely in the range dubbed the “missing middle” – amounts that exceed what microfinance lenders can provide, but are too small to interest traditional investment funds. It’s a tricky stage of growth to be in: entrepreneurs can either take on more debt which hampers their growth, or find a shareholder who might invest informally for controlling stakes or at unfairly low valuations to compensate their individual risk. The latter has resulted in a high degree of suspicion regarding local investors and a general reluctance to disclose company information. As an equity capital solution, crowdinvesting remedies this by allowing multiple minority shareholders to share risk, limiting their individual exposure and in so doing maintaining fair valuations and keeping control with the entrepreneur.

Read the rest of the story and see the other charts at

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