When Kenyans in the US want to send their families back home a goat for Christmas, they use Mama Mikes. This online shop, nicknamed e-mbuzi (‘mbuzi’ is Swahili for ‘goat’) because of the many goat deliveries it makes, was founded by Segeni Ngethe in 2001. Ngethe shared his experiences of running an online retail business in Kenya with How we made it in Africa’s Dinfin Mulupi.
What inspired you to start Mama Mikes?
I witnessed the 1990s dot-com bubble in the US when Yahoo and Google had just started. Americans were just starting to trade stocks online and book tickets online. I was fascinated by the technology. I kept wondering ‘where is Africa in all this?’ I started Mama Mikes in 2001 to help Kenyans in the US support their families. All my friends said it was a great idea but two months later none of them had placed any orders. Someone in Texas whom I did not know saw the website and made an order and we realised that it could actually work.
I worked with my mother who was based in Kenya. I would get orders in the US and she would buy and deliver goods to families of clients in Kenya. In 2005 I decided to come back home to build the business. At the time we were doing about 300 transactions per month. Mama Mikes became its own persona. People begun to believe that there was actually a Mama Mike who takes care of their stuff.
Describe the typical Mama Mikes customer
Today we are doing 1,000 transactions in a month. Our customers are mainly Kenyans abroad, foreigners whose children are studying here and missionaries who support organisations here. They use Mama Mikes to buy things for their dependents. They buy among other things shopping vouchers, mbuzi (goat), airtime and electronics or even pay electricity bills, school fees and rent. We mostly deliver goats for dowry settlements and parties. Goats are very African. We have started making deliveries in Uganda. We are going into Tanzania very soon. We want to be present across the whole of East Africa.
What are you doing to capture the local market?
For a long time Mama Mikes has been getting orders from Kenyans in the diaspora. We are shifting focus to the local market so that we can have customers here who make orders through Mama Mikes. We are doing this on a pilot basis to understand the local market. Currently most orders are from Nairobi and Kampala. Today it is possible to deliver anything in Kenya: flowers, cakes, gift baskets and other traditional gift products. The success of mobile money transfer services has made the payment for goods very easy. We want to be the leading player in the online retail.
Explain some of the challenges you have faced
There were many things I did not know about running a shop when we started. Things like managing cash flow. The retail business is all about promotions. I did not consider these things; my focus was code and building a nice website. I have always wondered whether if I had a partner some of these challenges would have been easier to overcome. I have had a great learning experience though.
What is your take on Kenya’s technology environment?
We are enjoying great times technology-wise. Kenyans are very fast in adopting new technologies compared to other African countries. We might be the first country that will do away with physical money.
Your future plans for Mama Mikes?
We recently won a US$50,000 grant from the government. We want to grow that $50,000 into $500,000 in the next 24 months. We would also like to enter into money transfer, which we have not done due to legal barriers.