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The African SMEs story: Transforming waste to energy

The African SMEs Story, hosted by Linda Ochugbua, aims to propagate hope, telling stories of businesses across Africa and sharing from their knowledge and experience on how they are surviving through the COVID-19 pandemic. It is an initiative of Support4AfricanSMEs, in partnership with Business Day, Clark Energy, Sun Group and more.

The latest episode features Maurine Birir, the founder and CEO of Kenyan social enterprise, Worldgate Enterprises that converts agricultural waste materials to fuel called briquettes, a charcoal substitute that contributes to environmental conservation. Worldgate has created more than 100 jobs for youth and women, and distributed over 1600 tons of clean energy fuel throughout the country since 2014. As the CEO, Maurine works to empower vulnerable youth and women within the community with social entrepreneurship skills. She is also a Mandela Washington Fellowship 2019 alumni in business and entrepreneurship, a regional Young African Leader Initiative (YALI) alumni, a Tony Elumelu Foundation fellow, a 2018 Vital Voice growth fellow for her work empowering women entrepreneurs in the renewable energy sector, and a certified ambassador in the Kenya Climate Action Network.

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While waiting to get into employment after her degree in environmental science, Maurine began volunteering and learnt about briquettes and their impact on the environment, and decided to go into the business of manufacturing the fuel source.

Worldgate Enterprises currently produces local briquettes for local consumption, but plans to expand and begin exportation in the future, and will venture into the huge market in Africa and worldwide for industrial briquettes. Their major competitors are other briquette manufacturers, and indirect competitors who produce other forms of fuel like charcoal and biogas, but Worldgate’s competitive advantage lies in the fact that briquettes are cheaper than other sources of fuel and last longer.

She acknowledges that accessing funds is not easy, especially without an already-running business, because people find it difficult to buy into the vision. Worldgate raised initial funds by bootstrapping, with Maurine and her business partner, friends and family raising funds within themselves. When the business had taken off, funding got easier because of access to financial services like government and bank loans.

Reflecting on the lessons learnt so far in doing business, Maurine encourages entrepreneurs to carry out market research to be sure that people will buy their idea, as initially her business targeted the wrong market and experienced losses. Another lesson is partnerships: businesses must create relevant partnerships related to their businesses because these will help in tough times. Businesses should also work with trends and be innovative and creative, because without constant market research, they end up irrelevant.

She has faced challenges acquiring and transporting raw materials for her business, which can result in the end product being expensive and therefore more difficult to sell. Talent recruitment also poses a challenge: graduates sometimes are not willing to take on so-called “dirty jobs” or venture into micro and small businesses, and instead wait for government employment. Maurine notes that this requires a change in mindset, for young people to see the opportunities in going into entrepreneurship that creates solutions to identified problems in their community, and generate revenue from them.

For those looking to start a briquette business, she advises them to first ensure there is a market for the product, then source for raw materials within their community such as paper, husks, and charcoal dust, and acquire other equipment such as dryers, packaging materials, and storage space. Such a business can be started with $2000 and, scaled with $5000–$10,000. She also advises potential enterprises to start with what they have and scale, and assures that the business can break even within a year, if proper market research is done, and with the right raw materials and a good mentor.

Maurine acknowledges that African governments need to do more for SMEs, such as creating funds for them to tap into, especially during dire times like the current pandemic, and providing infrastructure to ease transportation and export easier. She also notes that many SMEs are overtaxed when they buy machines and raw materials, and advises more beneficial tax regimes.

To other SMEs dealing with the impact of the COVID-19 pandemic, Maurine notes that although many are experiencing challenges in maintaining the normal run of business, the pandemic is temporary. She encourages businesses to listen to clients and diversify if necessary, in order to make a living while waiting for things to recover.

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