NAIROBI, KENYA: It takes an astute entrepreneur to identify a growing sector, invest in it early and have an expansion plan in place. Peter Gikungu Chege, 31, is one such entrepreneur.

He started out hawking undergarments before getting into the mobile money business. He got in while the sector was still growing back in 2010, and together with his wife, started operating an M-Pesa agency at 24.

Eight years later, his company Gipps Enterprises boasts more than 200 M-Pesa tills that have created jobs for about 500 people across the country, and bring in an average of Sh187,000 a day in commissions.

Peter takes Hustle through his growth journey.

You got into business rather early. What led to this?

I started from rock bottom. After I finished my high school education, my parents couldn’t afford to take me to college. Money was so tight that I couldn’t get my KCSE certificates due to fees arrears.

So I started hawking female and male undergarments. This business was hard because I had no specific premises and had to make do with whatever the weather was.

Despite the challenges, though, the business gradually grew to include other clothing items.

Did you eventually open a permanent shop?

Yes, in 2006. A friend sold me his music shop in Dagoretti market. I was to pay him Sh25,000 for the shop, but I couldn’t afford to pay for his stock. At the time, I had saved up Sh75,000 and after paying him, I was left with Sh50,000 for the rent, deposit and my own stock.

I ended up having challenges paying rent consistently and keeping the shop well-stocked. At one point, the landlord served me with a notice to vacate.

The shop, which I had named Gikungu Enterprises Shop and later renamed G-Tech Communication, eventually stabilised three years later. I was selling electronic appliances by this time.

How did this lead to your becoming an M-Pesa agent?

When I opened my shop in Dagoretti, an M-Pesa business was nowhere in my plans.

One day, however, a friend jokingly suggested I open an outlet because the only M-Pesa agency in the area always had long queues.

This got me thinking. It sounded like a great business opportunity, a low-hanging fruit. I visited Safaricom headquarters for information on how to become an agent, but ended up frustrated after learning I’d have to own a registered company and have bank statements going back six months.

Did this dampen your desire to become an agent?

No, if anything it made me more determined to find a way. I visited Safaricom again to ask if they could accept my personal bank statements, but they declined.

I shared my frustrations with my wife, Esther, who also wanted to venture into the M-Pesa business.

She became my business partner and together we registered Gipps Enterprises.

I kept applying to be an M-Pesa agent and was turned down twice before I was finally accepted in July 2010. My company was awarded five lines to begin with.

Was the business the low-hanging fruit you thought it would be?

Not really. The first year was tough. I had to pay rent for five business premises, with most of the money for this coming from my electronics shop.

The M-Pesa business was making only Sh18,000 a month, and had total monthly costs of Sh65,000, excluding my salary. At the time, we had seven employees. After some time, we started making losses. It was so tough that even Esther urged me to quit.

And yet, here you are. How did you manage to turn things around?

After six months, I decided to recruit three sub-agents to share the losses. That meant I could get 20 per cent of revenue without risking my capital.

How well did that plan work?

Splendidly. I was very good at networking and by 2014, I had recruited 100 sub-agents. To date, we have more than 200 sub-agents under Gipps Enterprises. We have five head office tills and super-agents to help the sub-agents meet customers’ demands for float.

So how do you manage such a huge network of agents?

It’s quite challenging and expensive managing them all. However, I work with committed teams that make it easier to keep an eye on things. We have business groups for sub-agents to help maintain clear communication, and regularly have training exercises.   

How did you get them to work with you instead of other agents?

I realise that sub-agents play a huge role in my expansion plan, so I’m always appreciative of their efforts and make them feel like part of a unit.

One of Gipps’ most attractive aspects is our customer service, something which is also attractive to sub-agents. For instance, we have four lines to provide 24/7 customer service.

What challenges have you faced with the outlets?

One of the biggest challenges one has to deal with in an M-Pesa business is fraud and robbery.

Fraudsters are very clever and every time we discover their ways, they change the game. This can lead to huge losses in revenue.  I have also had to deal with rogue sub-agents who take for themselves customers’ money when it’s erroneously withdrawn. If the sub-agent refuses to pay, that becomes a cost to the company.

How do you get over such hurdles?

I have learnt that perseverance is one of the key traits of a great entrepreneur. I take every challenge as an opportunity to learn and grow.

With the right vision, a passion for what you do, great customer service, the right people in your team and adaptability, you can overcome business challenges more easily.

Which of your accomplishments are you proudest of?

The first award we won in 2010, the Hongera na Ma-Agent. For that, we received two mobile phones and Sh80,000 in cash. We later went on to win the Best Improved Store award and got Sh100,000 for this. Our third award was for being one of the top three best-performing super agencies in the Nairobi West region in 2015.

How has success in business impacted you on a personal level?

I was able to get my high school certificate after which I enrolled for a degree in business management and administration.

I’ve grown to own my house and got to a place where I can provide for my family comfortably. My business has also given me the opportunity to travel abroad and to give back to the community in various ways.

The secret to success in business, I’ve found, is that you need to have a vision of what you want to achieve and pursue it. Give your business 100 per cent and you’ll see results. There are no shortcuts.

What’s next for Gipps?

In the short term, I aim to recruit more sub-agents to get a bigger market share of the mobile money business. In the long term, the plan is to diversify to related products and services, such as mobile phones. We also intend to start a charitable foundation.