10/09/2026
THE 5 REASONS MANY KENYAN BUSINESSES ARE DYING
Walk around Kenyan towns and estates today and you will find businesses opening and closing almost every day.
A shop opens.
Six months later, it is gone.
A restaurant opens.
A few months later, another business occupies the space.
Someone starts selling clothes.
Someone else copies them.
Someone opens a photography business.
Another person buys a camera and starts the same thing.
Someone sees a neighbour selling meat and thinks, “This business is making money.”
They open a meat shop in the shop opposite side of the road.
Then we wonder:
Why are so many small businesses dying?
There are five major reasons.
1. WE START WITH MONEY INSTEAD OF A PROBLEM
One of the most common questions I see Kenyans asking on social media is:
“What business can I start with Ksh 100,000?”
Sometimes this question is asked in a Facebook group created to discuss football or celebrity gossip.
Sometimes in a group connecting people from a particular town.
Sometimes in a general WhatsApp group.
But notice the problem with the question.
The person is starting with money, not with a problem.
They have Ksh 100,000 and want to find something to put it into.
That is backwards.
The better question is:
“What problem do many people have that is not being solved adequately?”
Then:
“Can I develop a solution that people are willing to pay for?”
Then:
“What resources will I need to deliver that solution?”
Capital is important.
But capital is a resource, not a business idea.
If you don't have a valuable solution, Ksh 100,000 doesn't magically create a business.
It simply gives you Ksh 100,000 to spend discovering that nobody really needed what you were selling.
2. WE BUILD ME-TOO BUSINESSES
This is another major problem.
You see someone making money and conclude that the business itself is the opportunity.
George has started a photography business.
You start photography.
Your neighbour has opened a meat shop and seems to be doing well.
You open a meat shop.
Someone opens a boutique.
You open another boutique.
Someone starts selling cosmetics online.
You start selling cosmetics online.
But there is a fundamental mistake here.
You are copying the solution without understanding the problem that created the business.
A good business is not simply:
“Something that makes money.”
A good business is a solution to a real problem.
And the bigger the problem, the more valuable the solution can become.
If 100 people are already selling exactly the same thing to the same customers, you have entered a fight for an existing market.
You may survive.
But you need to ask yourself:
What makes my business different?
What am I solving better?
What am I doing that existing businesses are unable or unwilling to do?
If you cannot answer that question, you may simply be adding another copy to an already crowded market.
3. WE DON'T HAVE ENOUGH KNOWLEDGE TO RUN THE BUSINESS
This one is underestimated.
People think business is about buying and selling.
It isn't.
A serious business requires an enormous amount of knowledge.
You need mathematics to understand numbers, pricing, margins, forecasting and statistics.
You need finance and accounting to understand cash flow, costs, profitability and financial controls.
You need marketing to understand customers, positioning, communication and distribution.
You need psychology to understand why people buy, why they trust you, why they don't trust you and how people make decisions.
You need technology to understand how systems, automation, software, data and AI can improve your business.
You need to understand people.
You need to understand markets.
You need to understand your industry.
You need to understand history because today's markets didn't appear from nowhere.
Depending on the business, you may need knowledge of science, engineering, law, logistics, agriculture, manufacturing, economics and many other areas.
You don't have to become a professor in every field.
But you must become knowledgeable enough to make good decisions.
And this is where I think many entrepreneurs have a serious disadvantage.
School does not teach you everything you need to build a business.
You can leave school with certificates and still know very little about building a company.
That is why serious entrepreneurs become self-taught.
They keep learning.
They read.
They observe.
They ask questions.
They study their customers.
They study competitors.
They study industries.
They learn from mistakes.
They acquire the information that their business demands.
The entrepreneur who stops learning eventually starts making decisions using outdated or incomplete information.
4. WE UNDERESTIMATE THE HUMAN AND ENVIRONMENTAL FACTORS
Even when someone has a good idea and sufficient knowledge, business is still being operated by a human being inside a real environment.
Your personal condition matters.
Your discipline matters.
Your health matters.
Your ability to concentrate matters.
Your emotional stability matters.
Your ability to delay gratification matters.
Your ability to keep going when things become difficult matters.
And then there are environmental factors.
Government policies can make some businesses easier or harder to operate.
Taxes, licensing, regulation and bureaucracy can affect the economics of a business.
Corruption increases the cost of doing business and can distort competition.
Consumer culture can encourage people to spend money trying to look successful instead of building productive assets.
Indiscipline can destroy businesses from inside.
And sometimes entrepreneurs sabotage themselves.
They spend too much.
They make poor partnerships.
They refuse to listen to customers.
They become emotionally attached to a failing idea.
They give up too early.
They refuse to change.
They take money out of the business before the business is strong enough.
So we must be careful when we say:
“This business failed because the owner was incompetent.”
Sometimes the founder made mistakes.
Sometimes the environment was hostile.
Sometimes both happened at the same time.
5. WE UNDERESTIMATE CAPITAL
Now, after everything I've said, let me make an important clarification.
Capital DOES matter.
You cannot build every type of business with zero money.
Some businesses require equipment.
Some require premises.
Some require technology.
Some require employees.
Some require inventory.
Some require marketing.
Some require research and development.
Some require significant working capital before they can become profitable.
So I am not saying:
“Money doesn't matter.”
It does.
What I am saying is:
Money should not be the first thing you think about.
The first thing should be the problem.
If you identify a valuable problem and develop a compelling solution, then you can start figuring out how to finance it.
You can start small.
You can test the idea.
You can get early customers.
You can partner.
You can reinvest revenue.
You can seek investors.
You can borrow where appropriate.
You can find other ways of mobilising resources.
But if you start with money and have no valuable problem to solve, you are starting from the wrong end.
SO WHAT IS THE REAL PROBLEM?
I don't think Kenyans lack entrepreneurial energy.
We have plenty of it.
Everywhere you look, someone is trying to make money.
The problem is that wanting to make money is not the same thing as knowing how to build a valuable business.
Entrepreneurship is much more demanding than:
“I have some money. Let me open something.”
It requires you to identify a real problem.
Understand the people experiencing that problem.
Develop a better solution.
Acquire the knowledge required to deliver that solution.
Build systems around it.
Find customers.
Manage money.
Manage people.
Adapt to the market.
And remain disciplined long enough for the business to mature.
So before you ask:
“What business can I start with Ksh 100,000?”
Ask yourself:
What problem can I solve?
How many people have this problem?
How are they solving it today?
Why are they dissatisfied with the current solutions?
Can I solve it better?
Will they pay me for solving it?
What do I need to learn before I attempt it?
And what resources will I need to build the solution?
That is where entrepreneurship should begin.
Not with the money in your pocket.
With the problem in the market.
