We sunk all our savings into a risk and it paid off

Close-up of a businessman using a hammer to smash plenty of coins [Courtesy]

Some of Mark Mwangi’s young adulthood stripes were earned behind the wheel of a truck.

It was how he paid his way through university. Then fortunes would open up and he would find himself embarking on a long career in London as an investment manager.

However, all through the years he planned to find his way back home. He just had to figure out how to get by on return to Kenya. Then one day, he realised he could make something from his years driving trucks. And in 2018, Amitruck was born. Amitruck is a business that allows transporters like owners of pick-ups, vans, motorbikes and trucks to find and connect with their customers through a mobile phone app. And last year, he was able to secure funding from Greentec Capital Partners, a German firm that invests in African startups. Mark walks us through his business journey.

How did this dream begin?

I started the business with my brother Timothy. However, last year, he decided to step away from the company and go into religion as a minister. To start out, we pooled together our savings. But early last year, we raised some funds from investors and we are currently in the process of raising some more. A lot of the investment that went into starting up was mainly the time and effort it took to set up the business and get it going.

Do you think your previous job in finance helped in any way?

My career in investment management came in very handy at the beginning. In investment management, one is constantly trying to understand businesses. You spend a lot of time stacking the financials and business dynamics of global business and what this allows you to do is bring back that sort of 3D understanding of business back into your start up and make it a great business.

Last year, you managed to secure funding for your company from  Greentec Capital Partners, the German company that invests in African startups.  Why was this necessary?

Before this came through, accessing solutions for working capital had been very difficult and costly in this market. This greatly limited our growth.  To secure the funds, we went through the process of identifying who would be of interest to us and who would be interested in us and interested in investing in us. Once we did that we then went through another process of introducing ourselves to them. It took a great many phone calls. We explained the work we do, how it works and eventually, managed to secure the funding.

Having been there and succeeded, what advice would you give to startups about securing investors? 

Do your homework and gather the information about who is relevant and active in your start up area or business. I’d recommend a database such as gumroad.com which captures about 400 investors in the past year who have been active in this region. Put on a brave face and expect a lot of rejection and a lot of hard work, and have a clear idea on why your business is worth the problem you’re solving and how you are going to spend the money from the funding.

How does the Amitruck app work?

 The client (cargo owner) makes a request for a delivery including all details such as pick and drop off locations, times, weights and descriptions. We send that to all the drivers who can make the delivery and they submit their prices. They can see each other’s submissions which is the competitive bit. The client can see also see the drivers’ experience, prices and ratings and they can make their choice.  Once he does that he can track his delivery on the platform. The entire transaction happens online.

Why did you think this particular idea would work?

Studying the market, I could see the gap we could fill. Cargo owners were so reliant on brokers who would then walk away with a big chunk of money. Then it wasn’t always clear that the goods delivered this way were safe from theft or damage. Additionally, the process was tedious, manual and time consuming. Amitruck was set up to offer a convenient, competitively priced and secure place to get deliveries done.

So you connect trucks and other vehicle owners to clients; how do you price the transactions?  

We actually don’t price. We did that on purpose because we figured that there are too many variables in the market for us to do it efficiently. We allow our clients and the drivers to discuss and agree on the price based on things like the distance to be covered and if one is going off-road. We enable our clients to get the correct price for the service through their driver.

How has your client base grown?

We started with one client and then over time we grew through word of mouth. We have many clients now but our main B to B clients are about 50 with companies like Twiga Foods, Jumia, Tile and Carpets DHL among others.  That said, we’re still a typical start up. We are probably not burning through as much cash as we used to and we aren’t that profitable yet. We continue investing in the business for growth and that’s the reason we are always in the market looking for funding. We currently have 14 employees but we are growing quite fast to ensure we continue to deliver for our customers.

How do you market the start up?

Apart from a little marketing here and there on social media, most of our marketing work has been done by word of mouth by our clients who love what we offer.

In the two years you’ve been in business, what has been the biggest mistake you’ve made?

Holding on to a bad decision for too long. Whether it’s a bad hire or a bad client. Just being afraid to cut it and move on. That has been the biggest mistake I have made in my company.

What is the best business advice you’ve ever received?