Date Archives December 2019

A Few Lessons from Kenya's M-Pesa

In the course of a research I am currently participating in, I came across some facts about the success of M-Pesa in Kenya which gave me food for thought about how business success can come about. First of all, in my experience, whenever someone mentions M-Pesa, it is typical to think about Kenya! Meanwhile, there are several countries which speak Swahili in southern Africa and several countries where the service has been deployed or tried. Kenya stands out because of the incredible success story surrounding the product. Here are some key contributors to the success of the product:

The Unknown Innovator

There is an unverified claim by one Michael N Gichuri that M-Pesa was originally develooped by him. If this is true then it is a case of Esau selling his birthright. Many young entrepreneurs sell out too easily to the highest bidder. I think it makes sense to ask an investor to let you have shares in the product you have developed rather than selling out completely. That is if you really believe you have come up with something of value. That said, I want to add that often, new thinking from young people can be the key to a large company’s next breakthrough.


M-Pesa was launched through a partnership between Safaricom and Vodafone. There are scenarios in business where a heavy financial, political backing or other similar strong influence is necessary to get that bright idea of the ground. Partnership could also take the form of collaboration with other young entrepreners who offer services related to your primary product. Maybe you can patronize each other, do trade by barter or even form a consortium to pay for external services such as advertising or office space together. The survival of your idea should be more important than the desire to boast that it was your idea.

Thorough Testing

In the official version of the history, M-Pesa operated in pilot mode for two whole years before the Kenyan government approved “go-live” in 2007. This is critical in any endeavour both for big companies and startups. In this day and age of stiff competition and disruptive innovation, it is important that the first impression the public has of your new product is not negative. Thorough testing or at least public awareness that the product is still in the trials phase will help to win trust and guarantee a product that will last long.

Meeting a Valid Need

Kenya had a bonafide financial inclusion problem. A large percentage of Kenyans did not have bank account and many in this category lived in the slums or in the villages which were often difficult to reach. If your product does not really meet a genuine need, it might as well be a hobby not a business! It is easier to sell a customer what he really needs that to educate him of a great discovery you have made to improve his life.


During the year 2008, quite a lot of Kenyans were apprehensive of moving too far away from their families due to post-election violence. Thus M-Pesa was a convenient way of sending money without endangering oneself. In addition, people had lost trust in the banks due to discord among bank executives bordering on ethnicity. It thus became wiser to save money in Mobile Phones!

Wrap Up

In summary, a great idea brewed at the right time has a good chance of making huge impact once the right partnerships and due diligence are in place. A little lesson on copying is worth touching here. Copying is a great way to leverage what has already worked elsewhere but we must copy intelligently! It is important to understand as much as possible the hidden details of the original otherwise the copy will prove to be a far cry from the original. I sure hope this has been of some use. Let me know your thoughts!