When Patricia Karungi thought of starting a project to grow nakatti, a type of spinach, on one and half acres of land, her biggest challenge was how to find the money to kick it off.
She needed Shs 500,000 to clear land, buy fertilizers, seeds, weeding and pay workers. No financial institution was willing to come to her rescue – simply because the project was “not viable”.
“At first I had the idea but I could not start because I had no capital,” she says.
Thanks to GoBigHub, she got investors who funded the project. She is not alone. About six other small entrepreneurs have so far managed to get connected to investors willing to fund their projects through GoBigHub.
These include a fish pond project in Wakiso. The owner, Isaac, needed Shs 15m for it to run, but he did not have a penny. He approached GoBigHub and they have so far raised Shs 9m from funders, covering the construction of the pond, pay for the lease of the land for two years, purchase 10,000 fingerlings and placing them in the pond.
The other expense is on feeding them for at least three weeks. The rest of the money will be raised in the course of the project. They plan to sell fish around January with each tilapia going for Shs 8,000.
GoBigHub describes itself as a “for-profit social enterprise connecting local entrepreneurs to local investors.” It was founded early this year by Pascal Al Amin Ojijo, who is of Kenyan origin but lives in Uganda. It has not started employing people but it has three partners.
Ojijo is a consultant in communication skills, lawyer, and a coach on financial literacy and personal branding, among other things. The idea behind linking entrepreneurs to investors started when, in 2011, Ojijo graduated from the law school at Makerere University and started undertaking financial literacy trainings.
Here, the ministry of finance and Bank of Uganda spotted him and added him on their literacy teams as a coach. He still consults for the two institutions and others. Through the trainings he carried out, however, he noticed that while many people wanted knowledge on how to manage money, they actually did not have the money.
While many people had ideas for projects, which could yield money, they lacked start-up capital.
“That’s when I realised I needed to help entrepreneurs access capital and nurture their ideas,” said Ojijo, 34, who is an author. “I did not want to spend my whole life as a consultant, lawyer, or a poet.”
GoBigHub started in April this year. After about six months, the enterprise has managed to execute six deals worth about Shs 25m.
“It may look as little money but it means a lot to those businesses,” he says.
GoBigHub take 10 per cent of the revenue earned from the project as commission. For the small enterprises, which are worth Shs 20m and below, Ojijo says GoBigHub does not get their commission until the project matures and makes its first harvest.
GoBigHub also works on bigger projects. The enterprise is in the process of lining up two deals. One of them is a $240,000 power concessionaire project where a local community in central northern Uganda has come together to be a subcontractor to redistribute power in their villages.
The other is the funding of the establishment of a nursing and midwifery school in western Uganda worth Shs 360m. Unlike the smaller projects, GoBigHub does not wait for the big ones to mature to be paid. It takes five per cent of the money the moment the deal is completed.
Ojijo has gone ahead to partner with incubators such as Enterprise Uganda and the Uganda Industrial Research Institute to train and nurture some entrepreneurs.
While linking businesses to funders, Ojijo makes sure formal agreements are signed to avoid any conflicts. Being a lawyer, he helps draft the agreements.
Ojijo says he has been a financial literacy coach for many investment clubs and Saccos and some of their members or the clubs themselves have the money they can invest.
“There is money in the market,” Ojijo says.
He also publishes summaries of the projects and the prospects of the yields on the firm’s website and his Facebook wall.
“I have a lot of following so people look at them and call me.”
There have been challenges, though. One being that some people want to access funds but do not want to divulge crucial details such as the shareholding in the firm.
“It makes investors suspicious with some choosing to keep their money,” he says.
GoBigHub has also not started earning enough money to sustain itself. Ojijo uses his other income from his consulting job and other ventures to run it.
At his office at Tirupati Mazima mall along Ggaba road, a couple of start-ups that are unable to afford to pay rent are allowed to work from there. They pay Shs 10,000 a day, but they can access internet and power.
At the entrance of the office, a huge inscription reads, The Incubator, where a number of businesses have been nurtured. At 8am on a Monday morning, Abubakar Byamugisha is already in the office. He describes himself as an “incubate”, and his idea is being nurtured here. He has started a firm called Kagule.com, which intends to help businesspeople shop overseas, say China, or sell their produce there. It acts as an intermediary between the seller and buyer.
“GoBigHub has given us space, internet, and advises us how to run the business, especially on the legal part of it,” says Byamugisha, who is in his early 20s.
Mike Roy Innocent is another ‘incubate.’ His company, the Parrots, is already out there doing marketing and publicity for different organisations. He has already clinched deals with firms such as APA insurance and the Independent Magazine.
Meanwhile Karungi’s nakatti project will be ready next month and “we are looking at getting one buyer to buy the whole garden at once. We expect it to fetch Shs 1.3m,” she says.