Family Businesses Driving Growth in Kenya

Interview with Joseph Okelo, Association of Family Business Enterprises (AFBE)

Image courtesy of the Association for Family Business Enterprises

Interview with Joseph Okelo, member of Association of Family Business Enterprises (AFBE).

My name is Joseph Okelo and I am a second-generation family business member. Prior to working in the family business, I was a senior manager in a global corporation, but now I work as a Director in Makini Schools, a private school chain based in Kenya. This business was founded by my parents in 1978 and began as a nursery with 7 children, but has since grown into a primary and secondary school in 3 different locations, with over 3,000 students.

Today, I want to share my story of the Association of Family Business Enterprises (AFBE), the first membership-based, independent, non-governmental association run by and for family business owners in Kenya.

What motivated you to start AFBE and how were you able to make it a reality?

In 2013, I attended a function by a family business association in France, and I realized that family businesses all over the world faced similar challenges. They need a support mechanism and a place to share experiences and advice, and because there was no such platform dedicated to family businesses in Kenya, I chose to start AFBE.

I started off by calling a few of my friends who were also members of their family businesses and invited them to an informal brainstorming session where I shared my idea. Our gathering of 10 people all liked the idea and I was able to make AFBE a reality towards the end of 2014 when I formally registered the association, and by mid-2015 we became fully operational.

How does AFBE work and what kind of activities does it operate?

AFBE is a member-based association whose objective is to provide a platform for family businesses in Kenya to share, support and learn from each other. For a family business to benefit from our operations, they need to register as members of the Association and go through a vetting process. We also have a steering committee in place to oversee the implementation of the association’s strategic plans.

As a new association, our primary activities focus on recruiting members through events that create awareness about the Association. Our first event was a golf day, which attracted over 150 players, and we also had two family business talk sessions that showcased a successful family-owned business to the attendees.

In future, we hope to hold conferences, workshops, and talks and partner with academic institutions to offer courses on family businesses. We will hold networking sessions and hope to partner with other similar associations globally to share ideas and experiences.

Why is it important that Kenyan families have this community provided by AFBE?

ABFE’s the first association of its kind in Kenya. There hasn’t been a vehicle for engagement and representation for family businesses in Kenya despite the fact that family businesses account for about 75-90% of business organizations and employees in Kenya.

Our vision is to promote and support these businesses to prosper into future generations. In Kenya, family businesses often do not continue past the lifespan of the founder. As such, our activities are focused on ensuring growth, harmony, and sustainability for the family business.

The association has been received with enthusiasm and the membership is growing fast, which is an indication that this was a much-needed platform for family businesses. Based on the positive feedback we continue to receive, we expect that this will have a substantial impact on the family business space not only in Kenya but within the region. We will be able to quantify our impact after this year when we will have been in operation for at least one full year.

What are the opportunities and challenges that family enterprises face doing business in Kenya?

The current state of business in Kenya is dynamic and sometimes volatile. There is a lot of optimism as well as a growing movement towards innovation and entrepreneurship. The government has realized that entrepreneurship is key to the economic growth of our country and as such, is encouraging people to go into self-employment. Consequently, there is an increase in families starting businesses in Kenya.

As the economy grows in Kenya, so too does the market and with the signing of economic treaties, Kenyans now have open market access to 5 countries in eastern Africa.

That is not to say that it is without challenges. Corruption and lack of adequate infrastructure is still an issue, and some areas have poor roads as well as expensive and erratic electricity supply, which hampers many businesses.

Why do you believe in family-run businesses and what motivates you to continuously try and improve the environment for family businesses to operate in?

I believe in family businesses because they are integral to the economy of any country. As I mentioned earlier, over 80% of Kenyan businesses are family-owned and their importance cannot be underscored. I also believe that they can be immensely gratifying to work for despite the challenges.

I am motivated to continuously work to improve them because they are often overlooked and even undermined by some governmental institutions. There are many industry-specific associations, but many people don’t think about starting or joining one for family businesses. Yet when people are told about our work in AFBE, they immediately see the importance and relevance.

I am also motivated by the fact that many family businesses have succeeded and performed very well over the years and serve an inspiration to make nascent ones grow to such heights of success.

What is the top 3 advice that you have to give to family businesses as someone who has worked with them for so long?

  • Hold regular family meetings
  • Assemble an effective advisory board
  • Create an honest and open working environment.