Ways you can start a business without Money || Purity Wakahiu & Joram Ndung'u

our guests for this episode are busting all the lies and Ms you've ever heard about starting or running a business is very important but if the only reason you learn a business is profit then you you can close very fast I do not wake up every day and say I'm paying them so I send the let me shock my landord no you yourself Purity K Wako the K is for Kimo has a background in accounting but she also holds a master's degree in Business Administration from the University of Nairobi and without trivializing the Need For

Education she makes a very good case of why when it comes to learning experience is superior to academics why is it that a class Dropout is able to run a business succeed and someone with a master's degree like myself is struggling jongo quit his job in the finance sector at CEO level and you listen to joram talk he makes you understand he makes you appreciate the moneymaking process and he makes it very easy to learn from the mistakes he has made and possibly replicate his success you know you have to make a conscious decision yes

that you're not out to please anyone because if you are then you will stick there so that your friends say hey J is still doing very well and that time privately you in tears now both our guests quit their jobs to go into business and they're willing to share with us a blue byblue account on how you transition or how you can transition from employment to entrepreneurship first of all the immediately you are employed the day one you must start planning for your exit as soon from day one coming from the corporate the idea for

everyone is to do a big office have a big table so that you not downgrading yourself but you know those big things are overheads and they'll bring it is very easy and you know it's not hard to work for 20 years and live and wonder what was I doing for all this 20 where did the money go you're wondering where the money [Music] went Al just in case you like my outfits in this production and not only this production all the Productions anything I wear from head to toe please allow me to plug you to

zMAX Enterprises Pioneer Building ZX stes ask for they will you goodes take from Pinterest they will give you high quality outfits I have to tell you about their after Services they open for cons nothing to do with the just PL I'm your host Dr Kori and here's another reason to stay subscribed to our Channel how subscribe now is a good time to hit subscribe and turn on the notification [Music] Bell there are two types of business people there are two reasons people start a business one people who start a business because they have money and

people who start a business because they looking for money H what's the difference now which one was you have you have you seen someone say what business can I do ah yes those are the people who start businesses because they have money people who start business to make money yes it's someone who who is looking for another um what a source of income yes or they either leaving employment or they have been looking for a job for a while or they just finished school and now they need something to do yeah so they need to

make money so it's like they you look for a job M so that's what you you mean by you you you starting a business to make money but you've explained it very well J what what type of buiness you how did you enter into bu you KN what you getting into you started from scratch no for me I would say it was a chance in the sense uh I was buying a car for my wife yes so when we bought this car then I decided why don't I put it for sale and put a sticker

at the back you so I you were buying the car yes then you decided to sell it then I decided why don't I try selling it see if I can make something and then uh within 2 weeks I sold the car then I said this is something I would want to keep doing yes yes yes so I took the money proud back yes and those days there were not many showrooms so you would be the showroom driving along the roads with your number at the back so customers would call you and You' say where are

you I can bring the car you see yes then that's the way I began so build slowly slowly okay yes so did you surprise your wife first IDE no it's we had agreed we buy a car for her because I had one which I was driv yes so we needed to buy because we were going to work different directions M so when the car came we agreed together why don't we try and sell see if we can make some money so within the two weeks some money came so who didn't want to continue doing it

ah so then we agreed she takes a loan for the business so that we could be able to add another car yes and that's the way we began po po po selling one car at a time yes say you started this actually a practical story okay before we get to the details both of you uh have transitioned from employment into business right yeah uh what's the strategy to quit your job business that strategy maybe does not exist but inana why you're leaving like personally I didn't leave to go do business but I I I left

so that I could go take care of my my firstborn child I felt I I had very little time for him so I decided I have to leave but I did not just leave I mean took me a while because first my husband told me no you can't just leave like that and I was also very when I think about it I was really young because I think I was 28 so the first time I told him I want to quit employment to First L this child he told me no you can't do that M

and so it took me another one year waiting to leave work yeah so um as I was waiting I said thinking what if I I actually started applying for other jobs that I thought would be easier and give me more time but I didn't actually get go for an interview someone is asking why are you living that good company and actually you have no reason so um I started selling earrings by the way earrings and hard bugs and I had told myself if I can get the money I get where I work and work only

4 hours then I'm ready to quit so when I was still employed I started my side the few hours was you know I my off day the little time either before work or after I would spend just a few few hours selling jewelry and when I discovered I can actually say you know especially when you have an accounting background like myself we used to sitting behind behind computers it's selling is not automatic for you yes so it was very it was not easy for me to just quit and go selling stuff so um I I

trained myself to sell by selling things that I had never imagined I would sell so for me living work was not um I did business to help me leave employment because I needed to still have an income um but of course we reached an agreement with my husband that now I can actually leave because he also thought it was not I was not giving motherhood Justice okay so so sometimes the transition is not as automatic as possible maybe if you have worked for a long time you have planned you have finances that that is possible

but for a young person if you're below 30 I mean you're still very young to re an employment so sometimes not really a strategy it's more of why are you even living in the first place maybe you have a bad boss maybe the work is too much not really too much um it's not allowing you to do any other thing so the strategy for me I would say it really depends on what is pushing you what is placing you there's someone who is leing because um uh it is no longer sustainable to work maybe it's

affecting your health maybe the stress levels are high or maybe you're not even earning enough there are many reasons but whatever the reason you don't really need a very complex strategy you just need to do what you have to do okay yeah I'm coming back to earn the amount of M you deserve iting the money from employment you must have called your boss I don't I want to know how you like no it was actually a process or you quit gradually yeah because I wanted to quit in 2016 yes uh no 2014 mhm but then

uh I had a very uh bad and demanding Bo that time so my thinking was that that is the best time to quit and I actually prepared and I knew what I needed to come and do but then this offer comes which has more packs and then you say let me postpone the quitting but of course as you postpone the quitting you start doing other things that tire you so you get tired and your time to leave stretches uh ahead and that happened for me so when I got this new offer which I went into

for the next 4 years and you see four years is a long time so you think you're prepared but you've also got entangled in other commitments M that have disrupted your preparation yes yes yes so for me to quit uh I had actually thought I would not come to do c as much as I had done C for a very long time and for me the question was if I I supply for example Purity because I was doing supplies that time to showrooms yes if I Supply Purity what will I be doing my to 5

so I needed to do something that would keep me occupied 8 to 5 which I had not thought that time it was a showroom my thinking was I needed to do something else so I invested in production and I went straight to nail production bought machines bought AI sunk a few Millions yeah and then halfway I realized this thing will not work so the question was do I continue investing so that it can work or do I decide that I must quit and do what I used to do why did you decide to invest in

needs my thinking was I needed something that I would do yes you see if you're selling cars and you are a supplier you supply for example Urban Drive what do you do with the rest of the time because you can't go to Urban drive and see if they the reception waiting for them Tove your car so my thinking was that I needed something to do that would occupy my time and especially you are quitting employment when you're at a very busy position so you know what to do with your time when you go to work

now you are coming out here and maybe your time is not well arranged so you need to factor in that okay and that for me cost me to go to something else which uh didn't work at that point in time and being having a background in finance you hadn't done like market research and there's also something P says about her book business strategy any nonsense they are good to have but you didn't do you do them you even get analysis Break Even point and you have them on Exel sheet but when you come on the

ground things are very different for example somebody the guy who I was talking to would tell me once you drive off from the factory with your nails what you come back with is money the reality is when you drive off from the factory with your L you start spending and you're spending on the margin you have already calculated because there are many other costs that nobody tells you when you start now where the things start running there are many other things you see and you had not factored them in your business analysis yes or even

in your research ah ah okay again mostly the people you research to or from are not necessarily the owners because they'll not not tell you the truth so you talk to the marketing manager yes or to the guys who do the sales and the information they give you yes is what they do not the entire value chain so when you get in you discover the entire value chain is not what you were told uh we did about some some 10 times 10 tons of nails yes so okay once you've made the you buy the wire

the 10 tons yes you now come and uh make the nails and you hit the market ground yes and to move the 10 tons you you possibly it take 6 months mhm in the 6 months what are you doing you a new entrance but you see when you are doing your research you told 10 tons 2 weeks you're done oh so you start realizing here yes I need to change strategy bought from both of you very beautiful experience and I'll share that but before please break down to us you earn the amount of money you

deserve what does that mean and how can people change that first of all in Kenya we may not have as many jobs as we we you know as the population demands every graduate is looking for a job now if you go to the West Europe us let's say Australia there are more jobs than the people so you find someone doing three jobs a day why are they doing that to meet their bills M like if you go to the US you discover immigrants are the ones who do such kind of things they work so many

jobs the locals are fine with one job they pay their bill and they have a mortgage and all that so why I say you earn exactly what you deserve is if you are not earning what you deserve you must do something about it either you take now in Kenya typically we don't have extra jobs to take even that something else you can do other than complain about it oh yeah there's so much you can do Beyond complaining Beyond complaining of course ask yourself this if you go the downtown of of Nairobi let's say Tomo downwards

yeah how many people have degrees or at least how people are rning multimillion businesses but how many people have been to proper have proper education the way the way we are privileged to have mhm mhm very few yes MH and uh why is it that a clet Dropout is able to learn a business succeed and someone with a master's degree like myself is struggling it's because we over analyze and also you see your needs are the ones that drive you you see if someone if you look at our children nowadays you come with bread they

don't care they don't think bread is important you come with s they're just there what about our time yes you you if like you grew up in a village like myself you would go even to offer other people even when your parents don't know you do anything to earn money to buy bread so it's about necessity if again you look at the generations we are raising they're not they're not I don't know whether they are not motivated or what they're just okay they are so okay with many things they come home there's food they don't

actually they don't even want to move out now why you deserve exactly what you ear is because if you were not comfortable I'm telling you you do anything you find uh uh people with now learned people they have discovered money in small small businesses you find someone selling smokeys someone selling boiled M I see another girl in selling power and she's making money she's making money you find a lady sit in com and she owned several blocks of Apartments you understand okay because that person went all the way because they knew it's it's a do

or do there's no there's no what there's no plan b c d now the problem with our certificates we have Ed education certificates yes is the plan B C D all the way to e MH first you're wondering what will people say I mean um like where I was employed by my former employer we we dressed very well now you're leaving that dressing that dressing alone is very stressful to leave do you know that it's not something you uniform you need to dress up for your position but out here nobody cares out here you wear

your rubber shoes your T-shirt and jeans and hit the road nobody you know in Nai you can't tell how much someone is earning when when people come to buy cars at tban drive when you look at them you can't tell what they can afford some someone will come by million but when they walked in you even thought someone's driver but I think Jess maybe he has that but um anyway the reason I say that in my book that you earn exactly what you worth is because if you feel that you're not earning enough then you'll

have done something about it believe you me we may not have enough jobs like the us or wherever but in Kenya there are things you can do you can boil me and sell okay yeah even in the office where you work before we talk about overheads ear what you deserve I think I want to understand what the difference is between that and greed because my experience with joram joram sold me a car uh and it was I think if he sold it to the next person that came after me after I placed the deposit he

would have made a clean was it 150,000 like straight up you not take the [Music] money right now started sing in 2019 years 40 Years of exper [Music] dot with that there's a difference there's a line you draw in terms of greed and how that affects your business M you see one one is that in business you determine where you make your money ah so that the selling is a conversation to convert what you've already aced okay as the money you have made yes so that you're able to close it so if for example I

have bought this car at Price X I determine in my books that price x + y is okay for me okay so when you come I will not judge by your looks and say this one can add x + y + z i will pit it at the price I've already you know agreed with myself and stuff will sell for me I will be able to ensure that the car will move quickly M because the margins the the the sales people will also not seek to add something that is outrageous and that way you able

to determine that you can do many units small small amounts over time yes okay now when it comes to M uh price x uh you mentioned something in our previous meeting that in semi in business you don't you don't make money when you're selling you make money when you're buying what does that mean you see um for example people will come ask you if I import or buy here will I save the truth is you may not save even by importing because um you see when you're a car dealer every day you wake up actually

uh souring cars is more more tedious and time consuming and expensive to you as a car dealer than selling selling is easy because you don't even have to sell there are other people who can sell your cars other showrooms other sales people so for our business um it's about justess waking up every morning to look for for cars that you can actually be able to buy and resell because remember Kenyans are knowable they can be able to go to the website and find a Fielder and do the the calculation if I'm selling here at 1.6

they can get it at 1.5 but there are very very many other factors in our business so it's not just about finding a car on the website and buying so for us what we look for is a b gain so that this 100 you're saving the customer you can also be able actually to sell at exactly that price by the way if you come to Urban Drive you'll discover the prices you see in Japan and do calculations are almost exactly the same the same with Jam because us our the setting is very very different so

it's not always about saving it's about um the buying process is usually the where the the work is not the selling okay and when it comes to come on business is in the small details how stingy should one be with the overheads very very very stingy because if you you see like coming from the corporate M the idea for everyone is to do a big office have a big table so that that you're not downgrading yourself but you know those big things are overheads and they'll bring you down they will eat into your profit if

not your Capital so for a business you have to be very stingy with your overheads am I able to negotiate uh completely with my suppliers yes so that the cost of internet can go down because whether I sell or not that cost will still be there as in we are talking by asking how you're supposed to be yes we talking 11 million yes even uh the printing paper because if for example I buy printing paper at 1200 yes and I can get it at 700 the same printing paper why would I want to buy it

at 1,200 when I can save 500 okay so I have to look at those very many small costs at the end of the day at the end of the month what do they add up to and remember at the end of the day or at the end of the year they go into your expenses so if they are very huge and many then your profit is very K and you say something that actually compliments another thing you both you said both in our private meeting yeah profitability a business can okay two things one you may

have Revenue but you're not making profit profitability is not measured by the month right have Revenue as you can have money and you don't have money profitability luckily you have Finance experts here yeah so the truth is in business the most important thing especially in the Kenyan setup is cash flow M okay cash flow means uh the money coming in need to be excess of the body going out and that is why when you listen overheads are very important so profitability what you don't know is that we also sell cars either at cost or at

a loss M okay that's a big possibility a reality actually not even a possibility so what does that mean will you close business because you sold a car at a loss no you will not but you look at it this way I need money now to sort other things so you'll sell and sort the things you need to sort at that time and then forget about profit at that time now profit profit is very important but if the only reason you learn a business is profit then you you can close very fast because um the

even the way an economy is cyclic you know um a normal economic cycle is four five years 4 to 6 years so you'll find Kenyans complaining all things are very bad but it's just a normal economic cycle now the same with business business is not not every it's not possible so that's why we have a Propet and R if there was no losses then we would not even have a book called p&l I mean it's a reality that it's possible to do pnl but pnl is usually over a period of time that's when you need

to you you compile and what you need to do is record what what am I doing every day that that tracking is what is very very important otherwise you might actually see so much money even in your account but the truth is that money is not yours realistically it's it's not profit so profit is only makes sense over time because if you look at business the first thing you do is inest you put in money and you don't know when you'll even get back that money that you have put in for example leave an own

making profit you have invested you have built a showroom you have done so much you have done marketing you see marketing is not always relatable to sales it's something you do for the long term the the marketing budget you have you put in money maybe the impact of that marketing will come after a year for example or two years so that's why I'm very careful to tell people if if the first thing you enter into business the first month you're just checking how much profit have I made then you'll close very fast before your business

has even matured to give you money so how long are you suffering before you start registering profit and I believe this is breaking and you say some some some buses can take one year years before they break how do you know point you stud how how much loss is okay to take in before you break even that will highly depend also on the nature of the business like now in our in our business where we sell cars you cannot sell every car at a loss let's say you're selling five cars maybe one you can take

in a loss or a break or or cost the other four at you be able to make something because remember you have overheads to pay and overheads are paid by profit ideally that's that's that's what should happen your your profitability gross profit you remove expenses to get now the net but Le you alone cannot tell you how you're doing you can actually be sing but all that money is also going back to to be spent in in the overheads that was talking about how do you know when to quit actually you will know you will

know even your or husband will tell you this one the way you're going by you should not know your partner if you have one it's a conversation you must have at the table even when you think they don't understand even if you're a lawyer and she's a housewife okay you should be able to listen to her or him for that matter and there's a way when people look at things from outside they able to give you a better view because when you're inside something you you cannot see everything but when you're outside and that's why

I I highly propose after you have been working inside your business for a long time now you start start working on it you get outside and let watch it from outside otherwise you will be grading grading thinking you're moving and and you're going down so anyway profitability cash flow for me cash flow first profit rater it a business if you leave employment for example and you're used to the nice offices Jam talked about you know you when you leave you have this fig picture of how out here it is which is not true now you

get out here you discover things are so different takes you about one year to just you know get used to the reality takes you another let's say now up to 3 years now to accept that now you're out here now by 3 years you meet with someone and they look at you they what happened to you because you're not dressed the way you used to dress but you're okay with it but the first few years you still wonder make the right decision you're even feeling for yourself but um it gets better if you try a

business J was able to know happa and quit very fast many people are not able to do that so they drained everything they came with let's say you left employment you had your your retirement package so you keep you know digging a hole and digging and you know the right thing to do when you discover you're digging a hole is to stop digging and come out so that's something you must have a conversation with yourself but do as much refuse as possible you know as many things like now is saying he from the factory then

between the factor even to the market already that Journey already so much so now you see you able to go back and say ah this one this one this one this this the reality now should I continue should I wait so those are conversations you must have yourself it's not black and white unfortunately it's something you must seeit yourself maybe with people who who you trust and there are very few by the way when you're in business there are very few people who you can sit with and discuss issues many people don't understand so um

when someone quits their job invest start bus business when someone quits their job they should prepared they should have a buffer period like um you there's there's the luxury of quitting your job but there's being fired yeah right and there's a whole chapter on how to manage being fired from your job in your book but then my my my Min is uh for the person that has been fired how do you brace for the shock how do you transition into business like for one year period that's where you talk about downgrading how far how do

you BL for this Shob first of all the immediately you are employed it the day one you must start planning for your exit as soon from day one because it's true I mean you there's no company that is so big Beyond going down by the way there's nothing like that we saw nak which is very very unfortunate there's no business that is um that is very approv okay you know immediately you join a company the next thing you should start thinking is what if this job only last 3 months What If this job last one

month now the problem with Kenyans or many of us or maybe the African culture is the package is so good you forget to even infest you forget to keep something aside you forget that there's tomorrow and you don't know how that tomorrow will be so let's start from the beginning because so that by the time we capturing this person who has been working for 10 15 years and now they quitting and they have they have they're being fired Le and there's nothing now first even before we go far from I mean um in this firing

thing the same way a job without anything it's the same way you should assume that W the job has ended where do I start what do I have now how will I survive so if you're living in kimman four bedroom start with going to a two those are things you must decisions you must make very fast if you're driving your nice Mercedes Kori you must figure out how you can go as fast as possible to ad on a serious note if you if you sometimes you even be forced sorry I sell cars I really want

to sell cars but sometimes you be forced to let me for now mat you know until you're in such a place that and you know that saves you so that first if you're in debt it is not harassing you number two you can salvage the L you have and if you're starting a business now you have a a base where to start but if you want to continue the way you living that's how you up in depression because you want everyone else to know that before go to no company is fairly approved right no I

think this also caught me mhm yeah how comes Supermarket like closes and then on the same location another Supermarket opens and does well what's the science behind that there's actually a science there's a science um I don't talk much about nakat let me focus on our small it's just an example but like we said if you don't focus on the small details like J was putting it you know have you heard Kenyan saying [Music] money money has a way of just um you know and and money is emotional it studies you also it's like a

person actually needly because there's no time a business person feels confident enough and say you because every day is new the external environment is is here the dollar will misbehave you have no control at all actually Forex alone can come and wipe out your business for example political tensions like we we have during they can just wipe you out and you start again at zero I think one of the biggest Advocates one of the biggest Catalyst of poverty is not is not actually money by the way well um we may not be where we want

MoneyWise but one of the principles of money is this looking for money is not as hard as keeping it keeping is where the the secret is how long can you hold to money we discuss cacy yes do you know you have to make a conscious decision yes that you're not out to please anyone because if you are then you will stick there so that your friends say hey Jam is still doing very well and that time privately you in tears but you know you're telling people I'm doing well so you have to make a conscious

decision that this cost is okay I'm okay to lose up to this point yes yes yes so that I can begin again yes yes yes and and for me it was to say this I have sunk this number of milon M how much can I liquidate by selling the machines how much can I get back selling the machines selling the lry fortunately the land I had put up was mine so there was no rent so lock the premises decide that I need to go back to what I knew and that for me was the beginning

of C to be able to say that now you can create your company and move it up okay uh with thei even if today I have a lot of money there are reasons I have learned and I would not go back to production because you know everybody the politicians will tell you go to production but they also not in production mhm but production is very hard in the sense that the costs that you incur are quite High electricity you have Labor so by the time you're making your two sharings you need to divide that two

sharings to the electricity to the labor to the licenses to petrol and all those things yes yes yes so unless you doing it on a very huge scale that's why farmers yes the Kenyan economy does not support production yes but the person who sells buys from the farmer sells to the consumer makes money wonders why the farmer is not rich ah one of my favorite stories from you is how you buil your house yes uh and I think you unlocked something in my mind yeah over analyzing yes right and I think by your strategy uh

that would unlock the idea of everybody having a home where does your start I think for for for us let me say that with my wife yes we reached a point where we felt we needed to own a home yes because you paying rent uh twice for where I was living and for where they were living because you are not living at the same place that time yes so we decided that whichever way even if the transfer doesn't work we need to put up a home yes so where do we get the money we have

this idea of the nice home we want to do but we don't have the money M so we began by taking a loan buy the pro yes and then we also realized that we needed to be realistic to ourselves yes that we do not have a rich father Yes nor are we going to steal from somebody yes we are going to do that house over time M based on where we are okay so that we do not uh fail to do it yes because we are not able to do it to the Finish yes but

we do it bit by bit and so I took alone that bought the pro and began the foundation and then my wife also took alone that did the plastering and we moved in step by step step by step weren't you worried that uh you would get stuck at some point because people for example taking a loan to invest in a house is actually considered a liability in financial literacy C why weren't you scared of building using Al loan but but you see the liability would also be an asset in the sense that once I have

built I can be able to do Equity release so that I own a house that is also enabling me to get money to invest in business or to invest in something else so you have to look at it in the long term but if you say I'm I'm better off paying uh rent M who would ever allow you to take a loan with their house because you pay rent for 20 years but a bank that sees you've lived in your own premises and you're saying can you give me a loan of 3 3 million yes

against this house worth 20 million the bank will be able to analyze your cash flows and say yes okay and that for us was the motivation in the long term have our own home where our children would call home and also be able to avoid the rent and also prepare for business because for a very long time I knew that I would end up doing uh business not employment okay another argument that people have in terms of Home owning let's say you have a house and and the neighborhood you mentioned million right we you owning

versus paying rent 50k the commitment 203 million is too high where where is the balance the idea that you can use it for Equity the commitment you're doing you're not doing that million now you're doing that million over a period of 10 years yes so it's like somebody who who says I need to have that body shape or I need to lose this weight and stands in the field to jog he sees the figure he wants but he doesn't do anything about it he doesn't start jogging but he knows what he wants so I know

the house I want and I know I want that house complete in 10 years yes what do I begin doing today can I be able to take 500,000 and buy the plot because if I do not do that the place that I am standing to buy the pl today the prices will be different two years down the line okay so I'm also saying can I be able to save down by doing the decision today than doing the decision 10 years from now that is the most convincing account I've ever had of home ownership cuz uh

there was a conversation online not very long ago that actually owning a home is like investing in a dead asset for me that makes sense now in a makes sense uh when we come to uh investing um diversification who speak against a side hustle passive income [Music] is it a different experience for different people no no as a as a financial fitness trainer there's passive income and every every time people talk about Financial Freedom actually that's what they're looking for passive income is income that comes to you without you working M actively working MH for

example um without going to the to the to the yes to many details let's say um you have been you have been employed for a long time and your employer allows you to take unsecured loan and that is why what Jam is saying makes a lot of sense especially if you're employed and your employer has a um a relationship with a bank and that Banks gives what we call unsecured meaning even if you take that loan buy a plot or whatever the plot is not attached to that loan by all means you must make use

of that money reason being it helps you first be disciplined the way we were saying you can't sleep with a th for the generation if the 500 is already gone and you're left with 500 to use you because even if you don't take these loans you leave employment and you look back and wonder what exactly did with my money but the minute you commit and remember the banks only allow you to to you can't go 23 there's something called two3 Rule when you're taking a loan you must have at least a third of your income

coming to you after all the the liabilities are you know are taken away so passive income means MH if this house for example like now as the house we built When We Were Young using those loans when we were employed we no longer live in them but we have rented out that house that is for me that is passive income because uh we are not doing anything right now to earn that money for example example M that is some lital coins not much but H that income can save you somewhere now this is how I

like explaining passive income and I have put it on my book on liquid ways to invest your money in Kenya if for example you have been working 10 years and over those 10 years you have saved let's say 1 million Kenya sharings and you take that 1 million Kenya sharings and go put it for example in money market or buy boards you know such things the interest you get from that money you have not worked for that interest so that is Pur passive income at 10% that's 100,000 that's 100,000 per a year in a year

you break that down let's say 100,000 for the next year it's 10K 10K 10K and actually compound so it may up being way more than 100 maybe 120k so that's almost like earning 10K every month from money that you're not doing anything your money is is there when you need your money you'll go for it but this money is earning that is what we call perving income so the trick is in increasing the number the amount you can get if broken down if broken down monthly broken down monthly and compounding as much as possible compounding

means instead of withdrawing when you don't need that money let it bear let it be returned again it becomes now a capital again ands interest like that by the way compounding is very very powerful and um that is something I'm very committed to teaching especially the people who are getting employed now the 22 23 year olds in fact we had drh on the show you told us that after 6 years your money start starts to double and there's an example in your book in the water something like however big a p is yes water grows

double every I think every day it goes it double however big the pond is it take an equal amount of time to F yes and that is now the power of compounding compounding is very powerful but takes patience takes a lot of discipline the we saying with the here forget about what people will say okay because if you're leaving employment and like I have told you if you if you get employed today you must start thinking what if I am fired tomorrow if you don't live like that then you you might live a very wasteful

life okay and that's why in our generation you find someone lost their job and in one month you know why why are they dying and yet they were not born with this job this job came M so we must live with with the reality with the hope that what what can I do for tomorrow by the way there's something I want to tell you you know we are talking about interpret ship as if it's always making money I must surprise you and tell you um very very many people have have become very poor because of

Daring intership actually more people than succeed very few people succeed in enterpreneur oh yeah oh yeah look at the figures even the first year of business alone you'll find like 80% off and remember these people had either borrowed money from friends family Bank whatever that money goes as in you go goes and goes so IDE that person gets worse off by far than they were before that's reality the people who succeed are the people who have uh access to trying more and more more and more more and more you talked about diversification sometimes you just

try something like you find before someone succeeds in the bus they have tried 99 of them MH and failed and burnt money or lost money or whatever you want to call that and um we like making entrepreneurship look very fancy but I can tell you it's not easy when you're employed I I tell people who are employed please be an entrepreneur yourself look at it this way I'm sing skills and getting paid the minute employees start looking at employment that way then we'll not have issues of Integrity we not have issues of people stealing time

productivity level in Kenya is very low by the way it's like below 30% meaning if kingori you're supposed to be working 8 hours a day for your employer people are working two or three did you know that yeah we are stealing we are steing and I think that ties to something I'm coming back to you on yeah Kenya has very there's a word it's not difficult customers but there's something you said about Kenya as in the trust currency they risky oh risky risky Kya has risky customer we coming back to that um Jor yes something

overheads and then paying yourself paying yourself paying yourself how much internet costs how much your desk cost like how do you how do you go about paying yourself uh you you know when the business is Young you must determine whether you will pay yourself or not and in most cases you do not mhm M you do not because if you for example if I say the level I came out from employment and then I say I want that salary I would not be where I am because you know my salary was high and of course

they were what that position held and you know if you come out and say my position was this so I need to drive this car I need to have this salary you will close within a year so you must determine and most rurs like she's saying determine that I want to succeed so what are the critical things that are going to make me successful one is to determine what am I going to pay myself from the onset then my salary will keep growing as the company grows so that when now I have grown then I

can reduce a number of overheads which I know and accommodate a higher salary and there's a difference between your money and the business money business money I can have in my account 4 million yes that belongs to business because I sold your car and I sold another person's car my money there could be 10,000 so that money doesn't belong to me jam it belongs to common common as an entity must pay the suppliers so if I feel now so I can spend the way I want I will just close with people's money and that has

happened to very many car dealers where I'm not able to differentiate what is my money and what is the business money you can have 4 million and your money there is like is only 10 10,000 and you content because that is what you have earned so you must be able to pay your suppliers and remain with your 10,000 and be able to say tomorrow I'm me I make another maybe 10,000 or 5,000 and I build it over time so that true success of a business could be hidden in accepting what's yours and what belongs to

others and determining your salary because if you do not determine your salary then you be drawing from the business what are you drawing from and Purity has mentioned liquidity is very key in business so because you are liquid and you see you you know it's like going to the teer in the shop and you see I have 20,000 and you just say let me pick two so it's the same way because money is in the bank and you can see it possibly you can even access it from your phone and you say because I have

200 let me just draw 100 that 100 is not yours it is for the business so you must distinguish the account that pays you which is your salary account and you must draw from that don't draw from the business don't draw from the business because the business and you are two separate people hey wow that is that's deep I think understand some of the things that I take for granted of course I've interacted with a lot of um Finance material I've learned up and down and I'm glad you said that because you have something that

compliments what says it says you can read all the finance books in the world but nothing prepares you to the ground so the real business is on the ground [Music] yeah now you asked why would Market close someone else come and put a supermarket there and they succeed yes it is true the same way you find five ladies each one of them selling Tomatoes yes let's even assume they bought from the same person yes but one might go home with five times the sale of the other one business principles are very very interesting they're very

interesting um but I must say if you're running a business you must be in the right State of Mind mental your mental status I think for me and your mindset is more important even than profits sometimes you will take time even before you actually ear profit but uh things like Integrity like J has put here can keep you in the wrong land you may not be as flashy as everyone else you may not be the most flashy car dealership but you you are following the basics the basics things like honesty and that will keep you

in the business for a very very long time just to surprise you some of us have never seen the salaries we earned when you were employed we cannot afford to pay ourselves that actually your employees earn better than you number two you see the way you when you're employed you go to the bank and say I'm employed by aband that employee will get an unsecured loan from the bank because they have a p s but me I'll go and ask what do you do I learn a business they tell me no he'll tell me bring

a tile exactly that is the most ridiculous thing about our system oh no it doesn't work like that I remember when I left employment because of the loans are taken um through the employer scheme after many years after had cleared paying them the bank kept calling me can we now top you up then I would ask them are you sure the minute they had I'm no longer employed they would hung up very fast it takes so long before actually a bank can L you money as a business because it have to come check you know

check they'll trust that you're employed better than you you as an employer wow yeah I think that that that makes a lot of sense but then if you say that what are the alternative sources of a business for someone who's starting from scratch cuz we have we have we have we have dwelt so much on transitioning from employment for the person who has not been employed they just want to enter enterpreneurship straight up let me give you a practical example from where we me and jam sit as car dealers let's say you want to start

a car dealership you want to import cars and sell or you just want to sell cars on behalf of people yes you come to you actually first seek to sell other people's so have you ever heard people saying making money with other people's money that is exactly what it means let's say you want to sell clothes let me give it another perspective you go to someone who sell very nice clothes like the way you're wearing and say by the way I can Market these clothes you see how much is this suit 25,000 you know then

the will tell you if you sell I'll give you 5% I'll give you 10% that is one of the easiest ways to start a business without capital okay someone will come to up and drive a serious person everyone say they will sell cars but may cannot come and say I'll Market this car if I sell can you give me 10,000 that is how you start without money that's how you start a business without money and thank God for for internet and online business now you you you know initially we used to go to the Bazar

on Jam so you needed to take the physical car there the whole day there now I can simply come say I F you see your genuine person then because also there are a lot of our callers here selling our cars and saying they their and then calling people on the way so they come that they make their and they start like that slowly it is it's a process the process must happen there's no shortcut okay there's no shortcut so you can start that way you can also borrow money from relatives by the way most businesses

in this country are funded by friends and relatives you not believe that Rel yeah because before you have a relationship with the bank for them to be able to Le you as a business takes so long so long you will not believe it a very long time they'll come and see actually there's money but the paperwork the process it's too much such a Hustle but you can tell your relative give me money I'll refer you after 2 years and you find someone who's gracious enough and I want to beg Kenyans to to be repaying debts

because we really have a problem we are really risky like I told you and that's why you see our interest rates are very high we are not trustworthy there's a problem from that time that guy is your enemy yeah officially ah wow something told me and I believe you are very capable of answering it told me that everything as a cost you pay in cash you will close down yeahh this one has been supplied how do you balance you you you in business you must determine from the onset how do you want to man manage

your cost okay and how do you want to manage your incomes because you see if you say today I have sold so I go and pay all my expenses mhm how much money is yours there because like she's saying we sell suppliers cars so if I have sold a car today and maybe my money there is 10,000 and I have a bill to pay of 20,000 I have paid with whose money so I must determine that there are certain costs I will AC keep acing them so that I pay them at a certain point in

time and then I'm able to say at this point I'm accumulating money to pay these expenses for example is rentals you have to determine I pay rent by the fifth yes so by the 5ifth where will I have got that money okay so I do not wake up every day and say I'm paying rent so I send the one of the premises money but I keep aside knowing that eventually I'll do I'll do a certain payment let me shock my landord no you will shock yourself you will shock Yourself by having no money for f

and you see you running let's say you running 15 cars in the yard and people have gone for test drive if the car didn't have do you think that customer will want to hear a story they will wonder why wouldn't you have put well so there are things you must keep the cost and you know these costs must be taken care of wow they are not a surprise they will certainly crystalize at one point in time so are you keeping that money yes so that you're able to pay those costs and that also applies to

your income and uh one of the disciplines that I have in my place of work is to say yes you have sold the car today yes but can we agree that we do the payment for for commissions on this day okay so that you do not pay today and then tomorrow you are paying somebody else the next day you paying somebody else you have a certain Rhythm and cycle of payments for all your expenses okay and that's a better way to manage your cash flow because cash flow in the business is key cash flow is

King yes youate for that a lot uh what a test drive that f is on you the customers may not even end up buying yes you have a name for these costs oh fixed costs right fixed costs uh how you cannot beting with fixed costs no you can't they already fixed what's this strategy spreading them across over time but you should not ignore them the the let me give an example with another business other than cars let's say you learn a shop in town and rent is 30,000 a month yes you can decide from everyday

sale you see rent you must pay whether you're making profit or not you put away a th000 for example 1,500 yes now you can decide there's someone who supplies water in the office I pay them on the first um let's say another expense I pay them on the second so you distribute your cost almost maybe even in two weeks so that you see many things are supposed to be paid at the end of the month for suppliers those pay them instant you have sold your car you we give their money that one is nonnegotiable within

24 hours to that yes yes you those ones you have to pay those ones are but now the overheads are the ones we are talking about a lot so you can distribute them over time you can the way said at the back of your mind you know I need 300,000 I need 400,000 rent then you know what that means back to to the coins and that is why for US coins are very important for some aot of m a lot of Mone and yeah Distributing the cost is is the way to go M yeah so

the the secret to growing spoil how do you do you rise above the guilt 2K 5 [Music] we don't have guilt for sure you can't have guilt emtions no no no emotions you cannot run business you use your head more than the heart when you're running a business apply your your head more heart issues are very tricky the heart can be where do posible income coming come you've trained your mind that 2,000 means that just how do you find [Laughter] yourself you have to plan it for a number of months because as much as you

can make money you know there's something she said money is not made in a month m a month can be very bad and that's the month you have decided to buy 20,000 worth of a shoe what happens to rent and you have possibly sold you know you must not always sell at a profit yes you can be you can say this month I'm forecasting that I will sell so that I can be Reid because I have not been able to make profit and I still need to pay my fixed cost you know for a business

person you you have to have a book where your every expense goes even if it's 5,000 I've sent you 5,000 or Uber to go and take another car in Adams yes you know for the worker is 500 very Lal why do you want change but for me is 500 shs yeah because 500 Shillings accumulated 5 10 of them is 5,000 yes so I may ignore the 5,000 and that is where the roof is leaking so I must be able to say even for my own discipline if somebody who sells shoes and trousers comes to the

office every day will you be spending on oh this time they have nice things with shoes you buy next time they have trousers and shirts and you had not budgeted for them yes so you must be deliberate with how do you manage your expenses again you compliment something psychology of M wealth is in the money you do not spend yes so a door like you have money two things you've said money is not made in a month yes so when you buying something you have to look at what this costs you in terms of the

period of time you need to balance for you to afford it yes then that means the true making of money is in how you spend what you have exactly and that's what brings the idea how much you keep how much you keep yeah make it make sense yeah yeah and plus remember we said you're paying yourself a salary so if you to buy a shoe it has nothing to do with your business money so you're buying with your personal money because a shoe is personal okay but um in one of these books I have have

I highly recommend normal earning Kenyan you use a 60 20 101 I call it a 6020 10 10 rule where your personal not the business money the money you earn as a salary whether you're employed or you're the employer you can spend 60% of it assuming you're just a normal Kenyan not an extremely wealthy person yes 60% spend it 10% I call it black tax okay by the way that black tax is a if you have to spend more than 10 it has to eat your 60% 10% black tax black tax is very big in

Africa and in Kenya specifically for being born just so all that should fit in 10% if it is not fitting then it should go to where you expending the other 10 if you're a Christian or if you believe in giving gift to a c whether it's to God whatever 10% 20 you must keep okay and assume that money did not exist because we work we work for let's say um before the universities came and changed when we were going to school we used to stay 2 years after form four home and then we go to

university so most likely you finished University at 24 so between 24 and let's say um when what is the retirement age uh say 55 65 is it 65 okay 60 60 okay to 60 you're earning politician you're earning but now after 60 nothing so now between the 24 25 let's say 25 years to 60 and 60 s a bit you know let's call it 55 you have about um is that 30 years of active work M you're working this working remember let's say after that 55 you be eating what you you saved but remember I've

told you to keep 20% life will be normal you potatoes will be more expensive than they are today so that's why you must keep that money and that money now must you must invest that not just invest it let it now be interest compound that you know because that time you need you still need to eat you still need to dress you still need to give people what that now you're not working so it's very very important as Kenyans to start saving immediately in fact I like talking to people who are getting employed so that

I can prepare them for the future because it is very easy and you know it's not hard to work for 20 years and live and wonder what was I doing for all this 20 where did the money go you're wondering where the money went you should have asked that question immediately you started where will my money go you should give your money Direction money go here money go here other you be checking and wondering and in the world of today I think I'm starting to subscribe to the idea that it's not possible to be employed

till retirement I think it's becoming impractical to work till retirement actually what did we us to call it permanent and pensionable is a very it is no longer there look at just Co alone what did Co do you had a whole office block full of nice companies Co came working from home M okay you're working from home and nowadays it we are continually seeing trads where the the labor market people are hiring you and paying you for your performance okay this is what I did I pay you for that that is where we are moving

to so because this thing of I have whatever benefits you know just because I'm employed the long the longivity of being employed is no longer there not even because we people don't want it just the way things are evolving okay yeah J another thing I can quote Purity on me you should not hold money what's the difference between money is not made in a month let me accumulate what's the difference okay maybe I I first uh mention something she has said yes the the changes that are in the market today yes let's say you are

45 M and you at the seit level your salary is also a very high part of the company expense so if the directors are looking to reduce cost who will they target you're the easiest you the GU to go because your parts possibly are 11% of the total staff expense and that's a reality people must start preparing that as iary could be a liability yes the risk for me to be brought down by virtue of cutting cost yes so and companies are saying can we engage for 3 years so that it is easier for us

to disengage in case performance is not coming okay so that's a reality and people must start engaging and saying yes should that happen and my contract is not renewed okay okay what do I do yes yes but let's come to the issue of hooding money yes and uh you know letting the money also work for you mhm I can have the the money now yes but I have a plan for that money because I can see what that money will do for me so I'm not only holding it here for the s saying I'm holding

money you know I heard politicians say that Kenyans are holding dollars yes we've not seen that huge effect of their release because I don't think people are holding that money waiting for a big reap the reality is I can hold to the money now because I know that in Japan for example cars would be cheaper towards a certain period of time okay and I can be able to buy better that time than if I just spend the money by buying now M so I can postpone that decision by holding the money so that I can

be able to make a prudent decision that would give me more money okay okay now that's not the same as you know just holding that money for the sake of it because money must be able to work for you yes if it doesn't then it is not money it is something else and that reality must be a reality that you must be awake to that if I'm just holding this money is not in the bank okay possibly it is uh maybe in the bank but not earning anything okay then that money is not working for

me wow and that's why for a businessman I must be able to say how much money do I have and what is it doing for me okay yeah okay account accountability to yourself yes s so uh you also are big on when when you say Kenyans are risky Kenyans are risky customers Kenyans are also risky employees and you go ahead and give an example yeah your business makes money when you're there but you can't be in two places at the same time what's the remedy or what's the solution to that Superman you know we we

we like seeing how um how high the rate of employ unemployment in Kenya is there no jobs you keep saying that yes let me shock you that uh what we don't have is faithful employees mhm if you interact with many business owners they will tell you how the way dama told you maybe from her experience and even me from experience I have seen a lot of Integrity issues with Kenyan employees which is very very unfortunate so however much we saying that there are no jobs in Kenya no I don't think so the jobs are there

mhm but we don't have the right people to do the jobs because most people actually you know Kenyans keep saying politicians are stealing it is not politici this is a Kenyan program we need to run that um and if you look at it when people steal from their employers what do they do with that money they they spend it they just splash it it doesn't help them they not go open a business now it's running and you're like yeah idea most of it is just you know like it just goes like that yes now on

the on this money we keep looking uh four uh with time when you're running a business you know when you enter business most of the time you think I'll make money I'll make profits then you get in here things change mhm you stop thinking about how much will I make now you start looking at the impact you have 5 10 employees you're thinking I don't want these people to go home I don't like time we used to say we don't want to a single person home so things really change you want you look at the

impact you you you have in the market jam and I are are learning C dealerships on kabu road and people have lost money customers when trying to buy or import cars there to make sure customers money is safe so it is stop being about I'll make a lot of money because in reality you may not even make that money and then you get content with what you have that ret you're making then with time consistency you you discover you look at the people you have employed they still having children their kids are going to school

and now things now stop being it is stop being about you anymore it is now start being about the impact you you're having on this economy on our country in your families and you see a you know a huge you you see it very differently when you start looking at it that way yeah other it was just about money most of us would be closed yeah with debt how people find themselves in the fiza culture and fiza in this context not the product but the idea of you can't exit the the borrowing but before that

from an author of the books we are about to introduce people to yeah when you have two people like these people will have very different experiences if you start a business with everything you need versus if you start a business from scratch growing gradually you get to the same level uh what does this mean which one would you choose 5 million why because the lessons uh you run when you do not have everything they are very many and you keep them for long you can imagine if for example I began with uh 100 cars mhm

and there's no effort whatever you get that is you know you have not put a lot of effort and there are no lessons you hardly keep it naturally naturally is like if my dad was very wealthy and possibly he Beed me 20 million possibly I would not be having it now mhm but if I have built 20 million then I am very careful about that 20 million because there's a story behind the 20 million there are pains behind the 20 million there are lessons behind the 20 million so when you grow your business gradually there

are handles and lessons you learn that sometimes help you be able to keep what you make okay the the other thing is that when you you have grown with your business you know the mistakes you have made and you know when you cannot repeat that same mistake because you know where it will take you mhm a good example is for example what people say diversification and you say because I've made this money let me diversify and you're diversifying into a line that possibly you have zero idea here and you go and burn your money there

m so as you grow with the money that you're making po po there are lessons and pains that come that keep you on the narrow and the straight okay so that you're not able to meander as opposed to where you have all this money and you're just saying let's see how whether this thing will work okay and now this means that you you may not have had a wealthy dad but you are that to your children now yes uh are you are you do you think about the experience they will have when now they hit

the market now someone wants to start a business do you give them the money or how do you prepare them H to fend for themselves now one of the things I have deliberately done yes is I have three girls so one is in uh one has just graduated is in Kenya School of Law yes when she was in campus uh on the wrong holiday she came to the company to work and the reason is to see where does this money that pays my fee come from number two is to be able to understand the Dynamics

of business yes that you can stay in the showroom the whole day and nobody comes and you know I tease them and tell them my work is like a Watchman you do not know when the customer will come but you have to be there rest the customer comes and you're not there you have days then nobody will come not even days even days continuously nobody has come nobody has come nobody has opened the car than the guy cleaning but you have to show up you have to show up because you do not know when the

customer with money will come and you also know and I think you and Jesse I I walked into Jess Jesse's showroom in 2019 I bought from Urban drive and later the car WhatsApp groups right and when I got there and it was a that was not for people of My AG think how do you know now how do you treat who are dreaming how do you balance between the people who are dreaming and the people who are customer I think from the experience of selling yes it's just like you know a mother a mother will

say I know the child is crying how do they know sometimes it's very difficult for them to explain but you can have an instinct that this guy is going to buy and sometimes I tell my sales guy that guy is going to buy so take time with him because you can already see this one is not coming to open every other car they specifically are coming targeting a certain car and for sure you close the deal so that instinct to know that uh today is a good day because this guy has come and he may

be buying but you also have instances yeah people who just want to not experience because they may come another day yes and they may buy or they may never come but you have also learned something yes to be patient you know when I began selling cars I used to you know initially we sold you know you buy you sell then it reached a point where I'm not selling so my wife told me you know a car is not a piece of bread that you go to the shop and you say give me that bread you

have to somebody has to make a conscious decision you almost gave up I almost gave up but your wife yes you know when she told me you know a car is not a piece of bread yes that somebody has to come and say give me that loaf they have to you know some even to smell the car I'm sure Purity is a witness a customer can come and the car is brand new they this car has been used here but you have to explain to them that this guy is new you can even see the

paperwork so you take a lot of time with them and them between you anding is the customer decision if they do not make the decision for you they'll just you know drive up and they make it in up and dve or somewhere else so you have to do your best and I hope I I I take I'll take a mental note here ideally you guys should be competition kambu selling cars by the way I think when I was looking for the car I bought for you and I got it from you and when I was

calling to set this up I was like wow very good vibes the wife support as give up now again let me quote married to a 100 right this means exception people talk from maybe their personal experiences or what they have had for us we work together I think we have sat in the same office since 2016 sitting like sitting in fact used to have one table yes you see one of the things I have put here in the 70 REI of learning a business is your partner your life partner even if you're not working together

is either a success factor for your business or otherwise whether you like it or not and like you have heard him say the wife told him the wife does not sell C okay but she has something that can help him in his business remember I started by telling you you can be a lawyer and your wife is actually a housewife but you can come home with a whole case going to court tomorrow and your wife gives you a word or your husband and just like that you win so for me um how we sit in

the office we don't sit as husband and wife we we sit as people who have come to work and to with the same goal but very different so the truth is he has a he did marketing as a major I did accounting as a major but I am the one who is more of marketing now and he's the one who does the real Finance so so the truth is it's just how you look at it you you can fight outside because you need to talk about the it's the reality so we are not saying that

now you have to be to act you just have to know that this are business because think about you go to work you don't like your boss your boss has been very bad to you but when they ask you a question when they ask for a report you you just have to submit why okay remember you live you see this both in fact do you know you spend more time in the office than if you're employed than at home m and you have to put up with so many people that you don't like there remember

you can't beat them you can't call them bad names because you know you have to be diplomatic the same thing in the office you just apply diplomacy you just understand your personalities and and respect each other's boundaries and just work that's all about understanding you can do that that's doable but people don't have to do it I don't tell people now go work as a couple because sometimes not realistic just that for us that is what works for us okay yeah ah very nice I can recomend good experience on your from by I can my

experience has been the best I [Music] can no you know if you want to sell uh even shoes yes don't go to open where there are no other shops selling shoes because somebody has to make a conscious decision that they want to buy yes so they will be shopping and if they shopping they need to move from how do you compare if you to travel 5 km away to compare with the next shop mhm so even when I came and saw the space is empty I said this is the place I want to be you

decided yes and again it's you who now decide what is your value proposition that you want the customers to know you for do you want to be known for quality or do you want to be known for price and for us we chose the price proposition okay so that if in the next showroom then you can come and we can do a price that is Affordable for you ah and that has you know kept us moving okay because you have to decide what works for you in the mid of the competition so even if there's

a space next to us open yes because again when people see oh their showrooms here they stop they may stop at yours and not the neighbors and they may come and strike a de at yours me for two months I have business I'm looking for but from the relationship we've had from the meance culture not the product but the idea shortterm lending you can't you just borrow to survive you borrow to survive there there are two types of debt one is business debt and the other one is um personal M business debt is very easy

because what you should be checking when you're borrowing is um credit has a cost I think that is something Kenyans need to get in their heads credit if you use money today and uh you know you know when you use money that you have not earned then you'll pay for it that is the cost of credit it's what people call interest rates you know now for for business it's easier because you'll be looking at I'm borrowing this money at 20% and my business is able to give me 30% okay so is this 30 that's a

proje remember it can work or fail but for business easy because that's you can you can expense that cost every month and say these premiums I'm paying is part of my expenses so that's easy to deal with but of course remember the cost of debt ver as the return on income on sorry return on investment where are you putting I have bored 1 million where I'll put it will I get something over and above the cost will cost me to have this credit that is easy to deal with now the freezer comes with the the

personal debt where you you're perpetually borrowing and most of the time what I've discovered people who perpetually borrow and those loans are very expensive only that they don't internalize they don't don't borrow to buy food if it's about buying food you're going to sleep hungry I totally understand but you borrowing to keep up with a certain lifestyle to be seen in Dubai you post photos on Instagram you know to buy um maybe even cars we sell cars and we love selling them but you find someone just Bing to keep up with the journeys you know

you borrow to pay another loan very very dangerous especially personal debt you see a nice shoe I love shoes and you don't have money and you have to borrow you nowadays we have the mobile loans very fast you borrow and tomorrow or after a week that money is needed you borrow again too very very dangerous it can put you in a very very deep hole which is not worth it and that is where many Kenyans are and it's very very unfortunate and we need to get out of that culture as soon as only borrow if

like I you employed your employer has an agreement and that money must help you and I want to go back to what Jam said about building your own home people like saying is it an asset is it a liability what I ask you people is you eat every day is food a liability or an asset MH I mean from the mus hierarchy food if those things are basic a house you know food clothes they're basic the clothes we wear what are they okay they don't have a definition you can't say it's you can't walk naked

because you don't want to spend money on clothes you can't go without eating and you have money because you don't want to spend on a liability so this liability as a thing that discussion is sometimes really put off of the the main topic okay build your own house buy whatever you have to say just know this like food you have to eat breakfast lunch or whatever and that money it will never come back assume when you spend money on your house that is that kind of an expense that you have a lot of Peace only

that this one now will save you from paying red for example so yeah so the amount of money you're willing to put on a house is the amount of money you're willing to pay for peace that's how much peace will and for us who are in business J will tell you like personally when I wanted to leave employment what I told Jesse is the day we enter our house I'll quit I'll be able to quit because you know you have somewhere to sleep yeah you know it's such a big it may look small for people

was saying it's a liability it's easy to talk like that but when you have you have the comfort of going home to your house and now you're trying to hustle here trying to make it in business remember business like we said very few survive yes you can actually burn all your money you can go for 3 years without making anything but remember you have somewhere to sleep and maybe your husband or your wife or someone that alone gives you so much peace you're able now to go out there and hustle properly okay yes ah maybe

theza culture I can just mention my previous employment was in lending yes Financial Services the the highest balling would happen on which holiday not Christmas not Easter not a holiday actually on Valentine yes we had aone we used to call okoa yes SOA was on phone so you just needed to get to your phone and go the highest borrowing on a single day would be on Valen Valentine so is that for business yes so you see people are borrowing and what happens the next month the cycle continues on the 14th the 13th the 15th borrowing

goes up are they borrowing to spend I mean are they borrowing to use on something they borrowing so that they can continue maintaining that lifestyle yes yes yes yes yes that's something my take would be people need to get out of because the interest you pay is so high yet you do not make anything with that money okay for sparing your time to come share your knowledge with us on behalf of our audience that is but then before we let you go cash is King and cash is King and this is in a different context

purity during we sold it after 11 months and I was faced with a decision M uh we were selling that car for half a million was it half a million 600,000 less than we had bought it 11 months before right we had someone who had committed to buying the car at 200,000 more than someone who walked in on Sunday WHo later turned out to be my friend Dr Stanley araru Stanley came the car but the offer at that time under those circumstances was 600,000 less but then there was someone financing 200,000 more and at that

time D you need to choose 600,000 less than what we bought the car 6 months before very wisely anything can happen with financing right yes you faced with the decisions PRI you know if somebody came to the showroom and my salesman maybe calls me and says this guy is coming to the office this is the offer the question I ask is it cash so if it's cash then I will not leave the money I I'm willing to go down I'm willing to go down because money today is not the same as money tomorrow that will

be processed by a bank that possibly says Ah this guy is on clb so he has to clear but you see if you get the cash today you do a lot with it and you redeem possibly you paying an interest expense you redeem it today you have saved so the best value of money is in the present yes it's less a million tomorrow yes yes because you're able to invest it when it is still very liquid liquidity and maybe can tell you there are people we have you know you run over time there are cars

you have kept for somebody and maybe they don't even have a deposit because they going through bank finance so a cash guy comes and you say no because this offer is maybe 100,000 more it's taking more time yes but then you learn over time that you would rather take the rest 100,000 cash today than wait for that process that has no deposit wow certain process you cannot learn and in our last conversation one of our show my first M I got book very very good work on this ones by the way this one is an

easy read liquid ways to invest your money in Kenya easy quick one hours for the good work 70 realities 70 realities and rules of running a successful business very very proper tips these ones you can get from N N Shop I can highly recommends personal experiences we brought Purity on the show ideally we through Jess youth one of my favorite topics how money works yeah you are a trainer Finance so Facebook look way way more value than what you'll pay for it n all local authors the best plug were in Kya Hospital towards kambu on

your left aband a very big showroom I think one of these days s for sticking with us up to this point I hope you enjoyed our content I trust it was time well wasted please consider joining us by subscribing to our Channel by hitting the Subscribe but subscribe and turning on the notifications Bell we have a lot of good vibes uploaded on the channel we have so much more coming through I'm Dr kingori see you on the next one