Our advisory board member, Amma Gyampo, was recently interviewed by Entrepreneur.com and we think it’s worth sharing with you:
Amma Gyampo serves on Ghana’s National Taskforce for Impact Investing, she is an Angel Investor supporting women-led businesses and serves as Investor Relations Director for the Lady Angel Network.
A business development advisor and entrepreneur with over 20 years of consulting and programme management experience in diverse sectors, including agriculture, tech and telecoms, hospitality and tourism. Amma’s current focus is on supporting entrepreneurs, investors and the West African Diaspora to realise the potential of Africa and the UN’s Sustainable Development Goals, particularly in the emerging field of Impact Investing.
But she was once also a young, emerging entrepreneur who had many lessons to learn. Passionate about youth development and funding women entrepreneurs, Amma is sharing these lessons and many others in her bid to support the growth of SMEs.
Q. What do you wish you had known before you started your business?
I wish I’d known what kind of business and personal parameters to apply to the businesses I started up and that I’d been more disciplined with managing cash flow. We had far too many outstanding invoices and big clients that were highly undisciplined with paying invoices on time.
It was a catch 22 though. When you’re a new business and you’ve secured big name clients that are great for prestige, but who are killing you in terms of cash flow, it’s difficult to make the right decision for the business – or to even know what that right decision is.
We had to learn the hard way that we needed to cut off some big clients that were simply too costly to serve.
In terms of parameters guiding the kind of business you decide to start, another big lesson was that entrepreneurs need to carefully consider practical things, such as currency fluctuation exposure, import vs export, local market vs international markets, the corruption factor, and an over dependence on the wrong caliber of a third party (i.e. those who will let you down or get very greedy and start making demands for a significantly bigger piece of the pie after you’ve started engaging clients at a certain price point). This scenario happened to me in my early days of doing business.
Other parameters include your business location. For example, as a working mother, I have to consider my home, school, work, supplier and partner locations. These are my personal parameters, but you will have your own personal parameters to consider before you start up.
I also wish I’d been more considerate of all these factors at the beginning. I’ve learnt through my own experiences and those of others that these can make or break your business as well as significantly impact your personal life.
It’s important to evaluate such factors at the start of your business planning phase, in addition to the product, the organisational structure and culture, essential partnerships to support your start up and so on.
I’ve always adopted lean-start-up practices, which have been helpful. So, this final piece of advice is for those flashy entrepreneurs out there who like the finer things in life and want everyone to know they have arrived: the truth is that you’ll never have all the money you need sitting there waiting to be invested in your new business; you’ll need to find ways to phase your growth, introduce additional services, hire new people and so on.
Hold off on setting up that fancy full-scale office or buying that new car. Instead, focus on acquisition of customers. This will generate the revenue that will then allow you to push the business to the next level.
With revenue, keep a close eye on your costs and expenses, as these will simply wipe out your potential profitability if you don’t have a handle on them.
Q. If you could go back, where would you put more of your time and resources, and where did you put too much?
I would definitely allocate more resources to research, marketing and sales. I’d also focus on making better hiring decisions based more on character and attitude than apparent skills or experience.
In particular, I’d spend less time trying to change bad attitudes. It’s just not possible. I’m now brutal in this regard when it comes to running and advising businesses. You can teach skills, but you can’t teach character.
Some of the employees we experienced the most stress with, came with an attitude that ultimately brought down and infiltrated the entire team from top to bottom.
In the early days, this was an issue we had to grapple with for months. I eventually let a few employees go – and I cannot tell you the exhilaration we felt when we realized the complete transformation within our business.
It was achieved by challenging and stretching some of our remaining team members; giving them more coaching, more responsibilities and monetary incentives – and they stepped up to the plate in what felt like an overnight transformation. That has been such a motivation to me as a leader.
We all make mistakes in the early days. Ours included rushing into business initiation and not dealing with toxic staff swiftly enough. Having learnt from these mistakes has only re-affirmed the fact that leaders should never lose their sense of intuition, never be afraid to let toxic staff go and to look out for character over so-called qualifications or even recommendations.
Always utilize probationary periods in your employee contracts, stretch, push and test their abilities to be taught, be managed and most of all be developed to become prime supporters of your business.
Q. What have been your 3 most valuable lessons learnt in the planning and launch phases of your businesses?
- Challenge your assumptions. Pass them on to objective parties to challenge further and challenge them again.
- Do your customer discovery and market research. In Africa, like anywhere in the world, that includes going to your prospective location and conducting footfall audits (several times during the day or week or even month if necessary).
- Start lean and be minimalistic before you add too many layers of complexity. Additional services or products can always form part of your growth strategy. For launch, keep it very, very simple – you should be able to define your business offering in a single, punchy, short sentence, or you’ll confuse your clients from the outset.
Q. Knowing what you know now, what is the best practical advice you can offer new entrepreneurs?
In Africa, there are so many basic needs that are yet to be fulfilled and services that are yet to be made accessible to a large number of people on low incomes. Everything is green and that is why so many powerful stakeholders are rushing to come do business on our continent.
To new entrepreneurs, I say look around; look out for problems and how you can find creative ways to provide solutions for the masses that need them.
Look for solutions that address the need for clean water, affordable electricity, insurance products, access to microloans, access to affordable healthcare (maternal healthcare in particular) and quality, affordable education.
These all fall within the UN’s Sustainable Development Goals, which in themselves outline succinctly the challenge areas that offer a triple opportunity for our entrepreneurs on the ground in local districts across the continent to make money, as well as a positive socio-economic impact.
Keep the solutions to problems at the forefront of your mind, rather than lifestyle offerings, which can form part of your growth plan as a business person. Always start with scale in mind though, as that is where your business success and growth will come from.
Q. What lessons have had the greatest impact on your startup journey?
As a woman in business, and as someone who has learnt over time that I am more of an ideas and strategic-thinking type of leader, it’s important to understand where your strengths are and what kind of life you want to live.
For me, work-family-life have to be part and parcel of the same thing. As women, we put a lot of pressure on ourselves to ‘have it all’ or achieve some level of mythical ‘work-life balance’, but as we progress on our startup journeys, I cannot emphasise enough the need to actively seek out partners and advocates to help us minimize the stress points, lighten the burden of our own weaknesses and ultimately help our businesses grow in a way that does not deplete us or wear us down.
We all know how tough and lonely entrepreneurship is, but we can do ourselves a big favour by partnering up with others. Get that third party accounting firm that offers flexible packages for SMEs; get that sharp guy or gal that has managed some of the coolest social media accounts you’ve followed recently; seek out a mentor who can guide you and advise you on how to grow your business or connect you to the right network.
Lastly, assuming you’ve challenged your assumptions multiple ways and engaged with your client base to form some initial market research as a basis to start your business, do keep an open mind. Keep an eye on your metrics and don’t be afraid to fail fast or pivot if the signs and feedback are compelling.
Original article: https://www.entrepreneur.com/article/333029amma gyampoSMEsstart lean