The entrepreneurship culture in Nairobi

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I’ve been astounded by the amount of entrepreneurship in the Kenya. It feels like every Kenyan I meet has their own company, at least as a side-hustle (and checking the stats it looks like ~60% of Kenyans are self-employed). I admire how much people trust in their ability to get out there and build something new.

Some examples from people I’ve met are: Making lotions and skin creams by hand, electric car rental service for hotels, online fashion curation store, self-employed realtor, family company giving technical assistance on setting up corporate software, making and selling toys online (1).

A high level of self employment is typical in low- and middle-income countries. It’s a necessity, because types of well-defined, predictable jobs that Americans tend to wander into (whether a white-collar job at a big corporation, or a cashiering job at Wal-Mart) simply aren’t available in the same volume in poorer countries. There aren’t that many large companies (2).

I imagine some of it also comes from a cultural, though I don’t know enough about Kenyan culture to say where exactly it comes from.

In the US many more people have the option to take a job that doesn’t require them to innovate and create. These jobs have a lot going for them from the individual perspective – stability, health insurance, often higher pay. But at a societal level, the existence of these jobs lowers the number of people who are engaged in trying to create new and valuable things, which is probably a dampening effect on growth.

It’s been inspiring to see how widespread the belief is here – especially among people in their 20s – that they can just get out there and get things done.

 

1.     Lots of them are retail sales and feel like a digital evolution of the self-employed people running outdoor food stalls.

2.     As an illustration: The largest company in Kenya (by market cap) is Safaricom which makes up over half of the value on the Nairobi Securities Exchange. It has a market capitalization $11B (total NSE value is $19B) and ~5k full-time employees (though Safaricom has many part-time workers – see footnote 2). This is very small by US standards where the 50th largest company (Honeywell) has a market cap of $140M and ~113k employees.

For reference, Kenya has ~1/7 the population of the US (50M vs. 330M).