into a Sacco was initially borrowing into debt collectors; desperately invading
through group guarantee from a micro- homes to confiscate households. There
finance company.
is only so much you can recover from a
house.
During this period, I had firsthand The African social setting in particular
experience in managing a group. To begin our comfort in groups and our fear of
with, our businesses were at different taking individual risks could partially
stages of growth. There were those explain our affinity for Sacco’s, Chama’s
who were just starting out, others were and self-help groups and the now famous
established, some on the growth path table banking. As much as we yearn to
while others were on the decline. Even grow as groups, the challenges are most
funding, our common need was in varied times even bigger for groups than for
in amounts.
individuals. Groups can be dens of high
class mediocrity, bringing together people
Although we were aware that some of us of diverse characters, habits, energy, and
blew up their loans on drinking sprees risk profiles.
and other extravaganzas unrelated to
their businesses while others diverted Their liberal membership and democratic
the business loans to family needs, principle usually ushers in the loudest
there was nothing we could do about it. and not necessarily the best to leadership
Unfortunately, it’s the diligent members positions further denting their ability
who picked up the tabs when it came to to navigate and exploit business
defaults.
opportunities. Their committee approach
to everything is laborious, expensive
The weekly repayment schedule was a and time consuming; a handbrake on
big challenge. Actually, it was due to this decision making process, dragging simple
repayment nightmare that I cobbled up a decisions over inordinately long period
fund that could stem defaults by paying of time. This is a luxury that start-ups
for those who could not pay up to keep cannot afford as time and opportunity
our credit clean with the lender. It was waits for no man, not even a group.
the only way to keep the loans tap flowing
and also keep the group together.
Suffice it to say that most earthshaking
ideas or achievements were not group
Eventually, our group transitioned into efforts but solo acts. Meetings do not
a Sacco and members loan sizes grew. generate new ideas. They only shape
This heralded a new challenge; bigger them. Henry Ford was not a group. Same
loan defaults. Suddenly, unlike with the to Steve Jobs, Bill Gates and Zuckerberg.
small loans, we could not absorb the large Show me a Chama in the list of Forbes
defaults. Overwhelmed, members turned top companies!
To be fair to Chama’s, there are groups
that have had their successes. Many of
these successful Chamas have a rigorous
membership criterion that ensures only
individually strong members with a
common vision join the group. Chamas
such as TransCentury and Home Afrika
brought together successful professionals
and businessmen who were willing to pool
funds and hire competent management
besides themselves to run their affairs.
A group is a strong as its weakest link, in this
case, member. There is nothing like a strong
team with weak members. The assumption
that you become stronger by simply coming
together is a lie. Strength is not in the
numbers but quality of the membership.
A group of ten weaklings is the same as
multiplying the weakness by ten. A disaster.
Next time you’re invited to a Chama or a
group, please check out the membership.
Forget the sentiments. When most Chamas
fail, it’s the strong members who take the
spoils. Think twice before taking your
donation to a Chama. What’s your Chama
experience?
Evans Majeni is a businessman selling
Apple Products in Nairobi and a director at
Tahidi Homes Limited. He enjoys stepping
on big toes and paying the price. You can
reach him via mail on this or related issues
at: [email protected].