By NKIRUKA NNOROM
The Managing Director of African Capital Alliance, ACA, Mr. Okechukwu Enelamah, has said that funding is one of the key things an entrepreneur requires when setting up a new business.
He made the remark while speaking on “Sources of Capital for SMEs: the Options and Requirements”, at the weekly radio programme organised by the Fidelity Bank, saying that start-up capital could be sourced from ‘family, friends and foes’.
Much as capital is important to starting a business, Enelamah said that potential investors should not focus solely on how to raise capital, but must spend quality time to plan and think through the business before starting up so as to increase their success rate.
“In the industry, people talk of the three Fs, – family, friends and foes. People typically start off with their own savings, with family, friends and foes – those who are prepared to support them any way as an act of trust. What they all have in common is relationship with the entrepreneurs when they are building their businesses.”
However, “To increase your odds of success, one of the most important things is proper planning and execution because planning is where the business comes in. For a lot of people, when I say planning, here, I mean the ability to think through and it may be a fancy business plan but it has to be well conceived.”
The ACA boss explained that people naturally go to sources where they have existing relationships to access funds because they do not have track records that could help them access institutional capital. “From there, they can move to the next stage and with the right legislation and encouragement in the arena they find themselves, they can always rise and thrive and then we can also come in to aid them rise to the next level. But they have to make the bold step of starting up first,” he said
He also stressed the need for human capacity development to enable entrepreneurs attract the right kind of personnel to their business, saying, “In execution, I would say the most important thing is to have the kind of people around you that will increase the odds of success.
An entrepreneur may bring the idea, but he may need a general manager that brings traditional general management skills to organise the team. If he can’t afford that, then he might need somebody else that complements him because two heads are better than one”, he said