Finances present a serious problem for new businesses. Often there is total unawareness of the
importance of having enough financial “literacy” and knowledge in order to
ensure that the business becomes a success. Starting a business for the first
time or expanding their business (whether survivalists, micro-enterprises,
small businesses or multinationals), business owners don’t often know where
they can get help, or just how much some sound financial knowledge can help
them. They need to look at how much
money they have in order to be able to control expenditure and keep record of
this. It is precisely the act of keeping
record of their capital (cash) which will help them access bank loans. Financial institutions need evidence that a
person can run a business properly.
Secondly, entrepreneurs should be tough when negotiating deals. Funding
by investors should not necessarily be exchanged for equity but it can be for
Thirdly, I observed from interactions with entrepreneurs whose businesses
failed in Nigeria that they failed to separate their businesses from
themselves. The business should be a separate entity. Its funds should be seen
as ‘company money’ and not any individual’s money irrespective of the amount
invested. This is not to say that business people are not free to take their
profits when made, investment capital should be company owned. The live wire of
every business is funds. The more the business grows, the more funds it will
need. Emphasis should be made continuously on the need for solid cash flow.
Professionally, budgetary expertise is needed at each and every cluster when
starting a business. Lack of sufficient funds makes startup entrepreneurs to
continuously cut down budget and thereby running inefficiently.
In addition, proper record-keeping makes good business practice because the
records will help survivalists and micro-enterprises to keep track of their
transactions which will help them to decide if they have growth potentials or
not. Financial records will help place the company in check, the business trend
can be monitored and forecast, done easily.
Startup Businesses faced serious problems regarding funds to start and
run effectively, for example start-up capital, record-keeping, budgeting all
presented their kind of difficulties. In
terms of start-up capital, financial institutions do not readily grant these businesses
loans to help get founded. It appears that this is due to a lack of trust on
the part of the financial institutions. That is why startup entrepreneurs are
advised to have a scalable business plan. This is the ability to bring the
business plan to the smallest form it can take and still plan far ahead into
the multi-billion idea. By scalability, the startup capital required is
reviewed to an affordable level where the business can actually start and grow.
Once the business is formed, the need to hire financial experts is very
important, startup owners should not take accounting and financial management
for granted at any level. Counsels who are good with business analysis and
financial expenditure should be brought closely into the new establishment.
They’ll help with decisions that are very crucial. Making financial decisions
should not be a matter of optimism but in reality. It should be done very
professionally. If a single cent is to be spent, there should be a need for
such expenditure, well-articulated and calculated. The company should work on
pro-income expenses like advertising, marketing and sales than on social
services. Expenses on CSR or the likes can come in when the company is stable
and have excess funds to give away and not while it is just starting.
Therefore, it is very important to hire the best financial team to help keep
and grow company assets.
Families are seen as the cause of the demise of startup businesses. Family
and business should bekept as separate entities to avoid bankruptcy.
The National Orientation Agency (NOA) should embark on ‘National language
for unity program’. This program should have a target of unifying Nigeria
through language. The three major languages of Yoruba, Hausa and Ibo should be
made compulsory for all Nigerians and those doing business in Nigeria. This
will help in bringing to an end the gap between business people and their host.
The common English language and its dialect; the pidgin is not widely known by
villagers in rural Nigeria, especially in the north. Government should employ
the services of the national youths’ service corps in teaching languages all
across Nigeria for the benefit of startup businesses and for the unity of
Education of every citizen on the needs for both male and female
entrepreneurs should not be a burden for the stakeholders. Parents should
support their female aspiring entrepreneurs just as they do for the males,
having gender equality in mind.
Especially insecurity, indigenous challenges facing Nigeria must be
handled squarely by the Nigerian government and people. I urge the Nigerian
government to make use of the information technology and intelligent reports on
terrorist groups like the Boko-Haram and the Niger Delta Avengers and wipe them
out in no time to dissemble the fear most entrepreneurs, especially foreigners
face about going to do business in that oil rich region of the country.
The security forces should have a way of networking the entire map of
Nigeria via the navigation satellite. This advance technology will help monitor
terrorists activities and plans in their hideouts. Before any attack is
lunched, the armed forces can outwit them successfully. This is one of the
intelligent strategies in use in the western world recently.
Poverty is another serious problem in Nigeria. For startup entrepreneurs
to have funding, government should provide grants and loans to young business
people with very good business ideas. This will have an overall effect on the
economy as more jobs will be created and GDP increased.
Professionalism and Integrity
I recommend all aspiring and current entrepreneurs to have role models.
These mentors and tutors shall guide and advise the business person on almost
every aspects of startup and also provide some supports like funding which
every startup will need.
The companies should try and practice professionalism in all their
operations. The three ‘P’ of business should be taken very seriously. These ‘P’
are Product (or service), Process and People. The business should learn to sell
their product or services effectively, hire the best kind of people who will
work as a team and willing to organize a process that will attract customers and
stakeholders. One of the companies that know how to sell a product is the Apple
Incorporated. The fortune 500 company also run a People and Process oriented
business that is second to known.
The company management staff should undergo routine training both locally
and overseas. Some of the entrepreneurs that failed agreed that they only had
the ideas of their business but lacked the managerial skills to bring them to
light. That’s why corporate training on areas of challenges should be carried
out. There should also be an open feedback mechanism between the company and
all stakeholders. This will help the firms to know areas they would need more