Can you build a business for just 25k USD?
November 25th, 2013
In 2011, 88mph made our first investments in Africa in connection with an investment event. The format was to invest in minimum one startup – only 48 hours after meeting them for the first time.
We had received 60-70 applications online, and cut that down to the 10 who would come to this 48-hour event. Friday evening started with 30-minute interviews of all the teams. We looked closely at all the teams during the 48 hours, and ended up investing in 3 of them. Tusquee Systems, 6ix Degrees, and Ghafla!.
Of those 3, Ghafla! is the one that has really taken off. But, like most startups, it was never a smooth ride or walk in the park. After about 3 days, the Ghafla! two-man team was reduced to a one-man team, due to a disagreement. Not uncommon at all for startups. They also started quite slow, but about 4 months in, Majani started experimenting with entertainment news, it started working, and it was clear that Ghafla! was on to something.
Mr Majani’s insane curiosity, bordering on annoying, made him perfect to lead an entertainment news site. Surprisingly, contrary to all other investments I have made, we had a problem getting Majani to actually spend any money, which was bizarre. Majani himself led the way with a 150 euro/month salary, and he expected his staff to follow his example. He put himself 100% into Ghafla!, which is quite obvious if you look at his self-promotion stunt in CEO magazine, where he was dubbed the African Zuckerberg.
The article about the most influential Kenyan celebrities, where he is listed as # 1, on his own site, is another classic Majani move. And it’s exactly this quality of not giving a f… about what people think, and putting your personality on the line to create a company that can make a difference – compared to established media like Nation and Standard Media – that has enabled Ghafla! to become the brand it is today.
Ghafla! has now hit a milestone of over 10M page impressions and over 1.5M unique users monthly. It is Kenya’s 4th largest website. They didn’t raise 2M USD or even 100k USD, nor did he make it in TechCrunch. But success is not raising money, success is making money, and creating a sustainable business.
Ghafla! is now highly profitable, and spent only 25k USD getting there. The founder sits with the majority, and is in the control seat. There are no VC’s with liquidation preferences, or that will push him to sell his business. I am sure, in time, it will become one of Kenya’s leading media brands. The internet in Kenya is young and this site will only grow bigger and stronger as time goes on.
For all these reasons, I felt Ghafla! deserved a post here. Because making a profitable business on just 25k USD, is an achievement far greater then raising millions of $$. So, congrats to Ghafla! and Mr. Majani. Well done. 88mph is very happy to have put 25k on the line. I am sure we will make at least 10x on this one.
Best,
Kresten Buch
Founder 88mph
