Kenya is a vibrant economy, of young people (75.1% are below 35 years), who are always on the lookout for the opportunity to underwrite their dreams of succeeding in their own business. I know this because one – I am one of the guys we like to call “hustlers”; and two – before I really settled into this new identity, my day job in the world-beating Kenyan mobile money industry, was to dissect and intimately understand the anatomy of the Kenyan Hustler

The long-standing narrative has been that Micro, Small, and Medium Enterprises (MSMEs) play an important role in the economic growth and social inclusion in Kenya, but this cliche really means nothing unless you can attribute some hard numbers to what MSMEs really bring to the economy. The Kenya Association of Manufacturers (KAM) figures that MSMEs contribute approximately 40% of the Kenyan GDP with the majority falling in the informal sector. While this begins to put things in context, my experience is that there is no better custodian of this information than the telco industry; who have collectively become the proverbial “man behind the curtain” – seer and master of intimate insights into kind of informal business transactions that flow quietly below the surface. So as a former insider, and off the top of my head, I can already tell you that less than a tenth of mobile money users are responsible for more than half of the value of P2P transfers. This segment of ‘subs’ (subscribers) are the main drivers of mobile data and voice usage and collectively have the highest smartphone penetration. They use mobile money twice a day on average, and mostly for informal business payments. I would wager that these informal business payments disguised as P2P transactions is the major reason the big daddy of mobile money – Safaricom’s M-Pesa – created the new ‘Micro SME Wallet’ feature on individual M-Pesa Wallets, with the aim to separate normal P2P transactions from business P2P transactions.

On a more enlightening note, this behavior has become so pervasive in the collective psyche of the Kenyan Hustler, that it was been entrenched in pop culture by the famous Kenyan rapper Khaligraph Jones in his seminal piece – Tuma Kitu (Send me something), where he immortalizes the phrase “tuma pia na ya kutoa” (include the withdrawal fees). The phrase has become lingua franca among Kenyan Hustlers who love P2P Transactions because they carry little risk of exposure to the prying eye of the taxman, but on the other hand, are not willing to take on the transaction cost associated with the convenience of receiving money on their mobile phone…but I digress, let’s jump into the three archetypes that make up the Hustler Segment in Kenya:

  1. The young and restless hustler

Imagine if you will, a young matatu conductor. Let’s call him Kevo (short for Kevin), and he is someone who happens to be “cash-rich” from his daily earnings, while plying the lucrative, though somewhat chaotic matatu sector in Nairobi, Kenya. With at least US $25 to $30 in his pocket at the end of each day, it’s going to be hard to place him in the income bracket you would imagine him to be without knowing these fast facts about just how much loose cash he has to work with. He will probably have the latest Chinese smartphone manufacturer Tecno has to offer, which he uses to keep up with pop culture such as the latest pop music.

Kevo has ambitions to one day have his own fleet of Matatu public service vehicles (PSV). It’s this ambition, coupled with his humble background of growing up in Nairobi’s lower-income Jericho neighborhood that drives him to develop a saving culture where he puts away at least half of his daily earnings using the ‘lock savings feature’ on his mobile wallet. He already owns a motorcycle taxi (bodaboda) which he rents out and receives daily payments from the bodaboda rider over P2P mobile money transfer.

  • The boardroom hustler

Keeping with the theme of Kenya’s Matatu industry, allow me to introduce you to a good friend of mine named Jamo (short for James). He owns a growing fleet of 3 Nganyas slang for fancy 28-seater public transport buses, that play loud pop culture music, and are decked out vibrant graffiti…Imagine a nightclub disguised as a PSV. He also has a day job as a sales manager with an insurance company. Now, James did not grow up as comfortably situated as some of his yuppy colleagues. In fact, he went to high school with Kevo who works for him on one of his matatus and he knows that the only thing that separates them is that he had the opportunity to go to college and land this fairly comfortable job.

His fear of going back to the less savory corners of Eastlands drives this propensity to hustle and use his salary to invest in his matatu business. At the end of the day, Kevo is tasked with remitting at least $80 for each of the three matatus via mobile money to Jamo – no excuses or explanations. This money is then used to pay off any maintenance expenses and bank loans associated with the business. He also shuffles around money on his flashy Samsung (of of his rare indulgences), between the small liquor store he runs in his neighborhood and the matatu business according to the immediate “business need” i.e. restocking, paying rent, bribing cops, paying off protection rackets, paying local taxes, and more – and most as direct P2P transfers to the payee.

  • The mature hustler

The final category of a hustler is Kamau, a middle-aged veteran in the insurance industry. He cut his teeth as a young agent selling policies to Government employees from an Indian run brokerage in the ’90s. He hustled his way up through the ranks, and about 10 years ago, left to start his own brokerage. When he ventured out to start selling policies on his own, his first stop was the Matatus he had taken to work for over 20 years and whose business his Indian boss would not touch with a ten-foot checkbook! He knew all the drivers, conductors, and owners of the vehicles that plied the routes he took regularly, and even after buying his first car, continued to take matatus at least three times a week to save up on fuel costs and really just to stay close to the young hustlers who’d become his friends.

It was easy to get the business because he knew which insurance companies had tailor-made policies for this industry; often seen as chaotic and highly risky. Because he understands their earning cycles, he came up with a two-month credit cycle. This allows the matatu owners to make premium payments in installments by sending the agreed amounts to his mobile money wallets. He has a team of young sales reps who chase new business and follow up on payments. All of these are sent to his seven mobile money accounts (on seven different SIM cards, in seven different feature phones!) which he maintains so as to skirt the daily transaction limits for personal accounts. Kamau also runs his farm back in his rural village by sending money for whatever inputs are required. He plans to retire there as a farmer in a couple of years.

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