In this second installment of the Unusual Entrepreneur Interviews for 2013, I have with me today, Bassey Daniel the founder of SMEclub –a Multipurpose Co-operative Society.
I met with Bassey Daniel for the first time last year August and we connected immediately because of our shared passion for rebuilding Nigeria through entrepreneurship development. Since then, he’s moved on to become a customer, a friend and above all, a vision partner as we interdependently support one another’s dream!
This is one interview you don’t want to miss, because Bassey Daniel is not only an unusual entrepreneur, his unwavering dedication and determination to the development of entrepreneurship in Africa, not only in Nigeria is inspiring. He’s not just a talker, he’s a doer and for that, I strongly believe you will learn so much from his unusual story. As you will soon see, he has so much to share.
Take it away Bassey!
Interview Questions Part One
ENTREPRENEURSHIP: Awakening the Spirit of business
1. Can you please tell us a little about yourself and your business? What do you do? How do you do it? Why do you do it and who do you do it for?
My name is Bassey Daniel, formerly a banker, now a business and financial consultant. I have several business and social interests, but the one I choose to talk about here is my role as President of SMEclub Multipurpose Co-operative Society. I am driven by a passion to help serious-minded young people actualize their business dreams. I believe that our socio-economic growth lies in promoting the spirit of entrepreneurship and supporting small businesses.
2. How would you describe your entrepreneurial journey into the world of business? Were there any key incidents or life changing events that inspired your decision to become an entrepreneur?
Well, I was a banker for over 15 years. At some point in my career I was asked to manage what was called the “SME Desk”. If you can remember, back in 2001 or so, the Bankers Committee decided to create the Small and Medium Industries Equity Investment Scheme (SMIEIS). Nigerian banks decided to contribute 10% of their net profit every year to a fund for equity investment in SMEs. In my bank I was essentially the investment analyst. My job was to review investment proposals submitted by entrepreneurs and recommend viable ones to the bank’s investment committee. I didn’t see a lot of properly packaged proposals. Even when the business idea itself was brilliant, few people were able to demonstrate that they would be able to translate the idea into a viable business.
One big lesson I took from that experience was that, while most entrepreneurs would mention investment capital as their number one constraint, the biggest challenges are really lack of necessary business information and entrepreneurial/managerial competence. That realization is what gave impetus to start SMEclub, as a community and resource centre to help build entrepreneurial capacity in Africans and provide access to world-class enterprise development tools.
3. When you started out in business, what specific idea, purpose or vision was your key driving force?
The idea behind SMEclub was to create a platform for business people to interact and learn from each other, access good quality business information, access professional services, network and tap into financial and other enterprise development resources.
4. What is your take on the general notion that entrepreneurs should build a business around what they naturally love to do?
I subscribe to it completely. Passion drives excellence and productivity. A time comes in every business growth process when the going gets really tough. At that point it takes passion to weather the storm. I honestly believe that the key reason for the high mortality rate of small businesses is wrong choice of business. There are way too many me-too businesses out there. It also partly explains the prevalence of mediocre approaches to business. An entrepreneur who loves and takes pride in what he does is more likely to pay attention to quality and excellence, rather than just pursue profits. He is also more likely to put up a fight and make sacrifices to save his dream when the going gets tough, rather than simply throw in the towel and move on to some new “great opportunity”.
5. What is your personal life mission as an entrepreneur? That is; what contributions do you want to make with your life or what would you like to be remembered for as an entrepreneur through the businesses you create when you die?
I want to make a positive impact in everything I do – to promote quality, professionalism and excellence. I have invested in small businesses spanning several different sectors and this general principle guides our operations in each one. So, I like to think of myself as someone with a passion for excellence. In terms of the legacy I would like to leave behind, it is associated with the SMEclub. By the time I retire I would like to have built a strong institution with a reputation and track record for helping young people start and grow their businesses, thus creating jobs, building their communities and realizing their business dreams. More than anything else, I would like to be remembered as Founder of SMEclub, an organization that helped many businesses start and grow. I would like to leave behind a long list of highly successful “SMEclub alumni” businesses.
6. What would you describe as the purpose of entrepreneurship? That is; what role do entrepreneurs play in the world?
Like I said earlier, I believe the future of every economy lies in the hands of entrepreneurs. Every major economy in the world today owes its ascendancy and prosperity to the spirit of enterprise. Governments can only do so much. While capitalism has its disadvantages, I believe it is still better than other options because it promotes creativity, innovation and rapid development by encouraging and rewarding free enterprise. The decline of communism is a strong indication of its inefficacy.
Interview Questions Part Two
STRATEGY: The unusual execution of business best practices
7. How do you identify business opportunities and what metrics do you use to measure their viability?
Business ideas simply come from just paying attention to the world around us. Nobody can claim to be a guru on generating business ideas. I make it a point to observe trends, both locally and internationally. When I visit malls overseas, it is not just to shop. I pay attention to how things are being done, what new products are coming into the market, new trends in consumer behavior and think about how they might affect certain business sectors and industries.
To determine the viability of any new business proposition, I ask a few questions;
- Are there enough people in the chosen target market who will be willing and able to buy the product/service at the price required to deliver a profit?
- What does the future hold for this industry, sector, product? Is the market growing, flat, declining?
- Are there diversification opportunities? Can the product be sold to different market segments or is its success tied to the fortunes of a specific sector?
- Is there a committed management with the ability to manage all aspects of the business – technical/production, marketing, administration?
8. Do you have mentors, business coach or external consultants that you work closely with to grow yourself and your business? If yes, to what extent would you describe their impact on your business? If no, are there any particular reasons?
I have a network of friends and professional colleagues I use as sounding boards, but I have never thought of myself as needing a mentor or coach in the real sense of the word. So you could say I have a support ecosystem of contacts who deserve credit for my growth. It is that same form of ecosystem (a network of business professionals and mentors) that SMEclub tries to establish in every community so that every entrepreneur would have fairly easy access to the help they need.
9. How do you strategically use your time as an entrepreneur? What key activities would you recommend entrepreneurs use their time for?
To remain strategic means to constantly have the big picture in mind when making operational decisions. That requires a conscious effort. It requires discipline. It is very easy, particularly in the early stages of business, when the promoter has to do everything, to be so absorbed in the daily grind of the business as to lose sight of the big picture.
I would recommend a number of things:
- Create a vision and mission statement first for yourself, then for your business. Make sure they are heartfelt. That is, don’t borrow a catchy statement from an admired company. Think through what doing this particular business means to you; how it will help actualize your personal goals. Going back to the subject of loving what you do, if your business goals are not consistent with (and support) your personal goals, you are in the wrong business.
- Develop a business plan (a combination of operational and financial plans) for your business and set SMART goals.
- Spend a few hours every week (maybe on weekends) thinking about how your daily activities contribute to your strategic plans – the big picture. Is there anything you are doing which is inconsistent with your strategic goals?
- Make time (i.e. don’t claim to be too busy) to review your business plan every quarter (3 months). Are you meeting the goals you set? If not, why not? Are the goals still realistic? How has your environment changed? How do the changes likely to affect your business? Do you need to change some of your strategies?
Taking time to reflect in this way may make the difference between success and failure.
10. How do you generate profitable customers for your business? What unusual approaches do you adopt for marketing your products/services?
Different strategies work for different business types. It depends on the market segments being targeted. Electronic media such as email, internet, mobile and social networks offer the best returns on investment for certain market segments. For others they do not give much mileage. Traditional media are still relevant and powerful – radio, TV, print, outdoor, etc. We use a combination of several methods to achieve the objective, but because most of our offerings are targeted at middle-aged people and younger; we use more of internet based channels. I don’t know if any of our methods can be called unusual. We probably could use some ideas on unusual media and methods, particularly if they offer improved ROI – we are not interested in being unusual for the fun of it.
11. Many entrepreneurs complain about not succeeding in business due to lack of adequate funding, what is your take on this matter and how do you cope with funding issues in your business?
I agree that it takes money to make money, but business people need to be creative. Sometimes paucity of funds is good in that it forces people to think outside the box. I typically encourage entrepreneurs to think of how they can reframe their requirements. Some useful questions to ask yourself might be:
Do I really need to rent an office or can I operate from home for now?
Do I need a computer, printer, and copier or can I use a business center for now?
Do I need to buy that delivery van immediately or can I hire one for now?
Do I need to stock all those goods or can I just buy a few samples and purchase inventory on demand?
Do I need to pay for that website now or can I start with a Facebook page?
Do I need to finance that contract myself or can I start with clients who are willing to mobilize me?
Do I need to hire permanent staff and start incurring overheads today or can I use freelance talent and pay only when I have an order?
The other point about finance is that most entrepreneurs would never need to borrow if only they could find the discipline to manage their finances prudently. A lot of business funds gets diverted to personal use and is never returned to the business. Most don’t see the need (or lack the discipline) to separate their personal money from business money. I typically encourage business people to open a separate bank account for the business and keep business transactions separate from their personal transactions. Instead of drawing money from the business for personal expenses they should pay themselves a salary. If they need to draw money from the business for personal use they should document it as an IOU and pay back once they can.
12. When starting out a new business, who are the likely possible partners or professional service providers you would recommend every entrepreneur work with?
You may register a business name yourself, but if you want a limited liability company, you need a lawyer to guide you through the incorporation process. Make sure you have the technical ability to produce the goods and/or provide the services you are offering the market. Make sure you have competences for marketing and book keeping. If you are not good with these aspects of the business (nobody really can do every single one of these things well by himself), find partners who can, employ staff who can or outsource to third parties.
It is typical for small business owners to want to do everything themselves as they try to minimize their costs. That makes sense, but bear in mind that certain duties require professional training to perform. Trying to bite more than you can chew is being penny wise, pound foolish. At the very minimum try to have a team of professionals at your disposal including a lawyer, an accountant and a marketing expert. They may be paid professionals or friends willing to do you a good turn – whatever works for you.
13. The pricing of products/services is always an issue for entrepreneurs, what unusual approach do you take when it comes to pricing?
Your pricing strategy really depends on the competitive dynamics of your industry. If you are selling a commodity like garri or rice you really have no choice but to stay within the market’s pricing range because there is little you can do to add discernable value to the product that would justify premium pricing. Outside of commodity markets there are greater opportunities to add value in any or a combination of the “4 Ps of marketing” to justify a premium price.
As a general principle I would say:
- Make sure you are targeting the right market for your product. Don’t try to sell Mercedes Benz cars to people who are looking for Keke NAPEPs.
- Make sure your pricing is competitive. Identify competitors who are offering similar value propositions to your market and make sure your pricing is relatively within a reasonable range.
- Consider your costs. This doesn’t necessarily mean adopting a “cost plus” approach. Pricing decisions are typically more market-driven than cost-driven. If you find that charging the market price for similar offerings will leave you operating at a loss, it is an indication that your business model may be wrong, or there is something about the competition you don’t know.
Interview Questions Part Three
MISCELLANEOUS: Resourceful Recommendations, tools, books, and ideas for entrepreneurs
14. Since you became an entrepreneur – someone who solves problems for people profitably; what has been your most outstanding accomplishments in the context of business?
I would say that setting up SMEclub is the achievement I am most proud of, not because it has attained its potential, but because it is probably the most significant selfless endeavor I have undertaken.
15. What would you describe as your major setbacks and what lessons did you pick from them?
I have had many setbacks as an entrepreneur. I don’t know if I can measure them in terms of significance, but one recurrent lesson is that change happens. No matter how well developed your plan might be, always prepare for change. Always think about a plan B. That way, you will not be completely caught napping when change happens.
16. Where there any particular questions you expected me to ask that is beneficial to entrepreneurs and I didn’t? Kindly share with us such questions and their relevant answers here.
I think the questions have been pretty comprehensive, but I wanted to seize this opportunity to invite your readers to checkout www.smeclub.net. We are building a great community and resource centre for entrepreneurs, which they will want to be part of and benefit from.
I’m so convinced you had more than you asked for in this interview. But just in case, he missed out something, what more would you like to know about the unusual Bassey Daniel?
You can ask him further questions below in the comment section and I will be sure that you will get an answer directly from him.
Also, what did you learn from this unusual entrepreneur? What lessons, what philosophy of his strike you the most?
Bassey has shared his unusual story with you, now is time to hear from you. Can’t wait to hear what you have to say!