The Karisimbi Summit

Following the Leader

2011-10-18T03:47:00.000-07:00

Something special happened today that I’m not quite able to define. I was about fifteen minutes into a forty minute run this morning when a Rwandan man in his late 50s (15 to 20 years my senior) started to pass me by. For some reason unbeknownst to me I started to try to keep up with him. You have to know this is completely counter to my general workout style. I like to train in complete solitude. I’ve gotten to the point where I just run and literally don’t look at people because I want to somehow feel like I’m alone, which is hard in a society where people are always out walking. It’s especially tough to do this when people stare at you and feel free to fall in next to you and try to keep up or pass you. This happens both when running and when biking. The middle-aged man on the single-speed bike carrying a 10 gallon jug of milk might pass me by when I’m climbing a hill; even the young kids walking to school will sometimes sprint ahead of me over short distances. It is not only solitude I hope for while training; it’s also freedom from the stress of even just friendly and unspoken competition with a workout buddy – another reason I train alone.

So it was very out of character for me to start following this man while running today. I think a few different things were going through my mind. I was aware that I wasn’t trying to race with him. I also knew I wanted to show deference to his age so I consciously stayed a couple steps behind him and to the right. But the hardest for me to define was this feeling that I wanted to “follow” him. We made eye contact; he knew I was trying to keep up as we started to ascend a hill; he would glance at me and stay at a pace that I could manage but with a struggle. He wasn’t trying to “best” me. He was trying to train me, to encourage me, to challenge me. And it was playful…as we crested the hill, he quickly pulled away, but then waited and as we came to an intersection, he indicated that he was going one direction while I was going the other. We smiled and gave each other a high five and went on our way.

The significance of this experience may be a function of the role we play here at Karisimbi Partners, as advisors who get paid to provide valuable insight, lead organizations, define strategies, and implement plans. It may just be a function of working in a developing country under the premise of being “here to help.” It may be a function of my own flawed character and lack of respect for “the other.” Regardless of the reason, those five minutes I got to spend this morning following the lead of a Rwandan man clearly my senior, my teacher and my better was incredibly life giving and something I will cherish and look for more opportunities to experience.

-Dano

The Tragedy of the Uncommon Expert*

2011-10-05T02:20:00.000-07:00

We have made the point before: the biggest hurdle standing between the present reality on the ground in Rwanda and the bold ambitions of its leadership is a lack of qualified people. Bold ambitions infuse this place with hope. Better yet, Rwanda’s leadership seems motivated to achieve what is in the best interests of all her people… and that is not often the case in Africa. We continue to remark that this is an exciting time to be here; it is a thrill to work to see even some small part of this nation’s vision being realized. Good vision, good intention… lacking are sufficient people to put it into action.

The most recent illustration of this shortcoming is in what may be called “the tragedy of the uncommon expert”. Earnest is one such expert. His training and skill as a plumber is well above the norm (in a place where it is not uncommon to ‘fix’ the same appliance four or five times until satisfactory). Importantly, Earnest has his own tools, speaks English and is trustworthy (meaning he shows up on time and does not seem to have ‘sticky fingers’ that would require accompanying him at all times on the job). When my friends have the inevitable plumbing emergency, I’m glad to be able to offer them Earnest’s number. Therein begins the tragedy. Earnest does not know how to refuse, balance or delegate work. Soon, his responsiveness and reliability suffers under the weight of too many customers. Finally, his work begins to suffer, he stops returning calls and I stop referring him to others. We have seen the same process play out for mechanics, electricians, realtors and the most capable of Rwanda’s business leaders as well. This is easier to comprehend when you consider statistics such as these: 75% of the workforce has no more than a primary school education (23% have none) and just 6% of those working in the largest companies have university credentials (according to just released Establishment Census). Too few people… doing too much work… leads to ‘burn-out’, bad work and often the need to find a new expert.

One of our clients illustrates the same point. Emmanuel is the founder of a relatively large company (by Rwandan standards). He employs more than a hundred people, yet complains there is only one man (Celestine) whom he trusts to make good decisions and ‘get things done’. Emmanuel regularly laments that progress stalls if he or Celestine are not pushing daily. When Emmanuel travels, or Celestine is sick, business grinds to a halt. Virtually every client reveals a similar pattern in some measure: competence and trustworthiness are in short supply. Part of what is lacking is also a certain mindset for being productive in a work environment. Those Rwandans with advanced education or experience living in a more developed country contribute a unique and valuable mindset, but instilling this perspective in those who have not had such privileges is difficult indeed.

In Rwanda, too few qualified people have too much responsibility. Thankfully, I don’t think I’ll need a plumber again for at least a couple weeks…

Onward and upward,

-Carter

* subtle but intentional reference to "The Tragedy of the Commons" dilemma (popular in socio-economic theory and debate) whereby multiple self-interested individuals deplete a limited community resource.

Our Different Way of Doing Business

2011-09-14T08:05:00.000-07:00

It has been more than two years living and working in Rwanda, yet it is still evident that we will never entirely “blend in” or “go native” here. The fact is, we were all born and learned about management in the United States. We’ve all lived and worked in other countries (e.g. including Scotland, France, South Korea, etc.) but our country of origin has left an indelible mark on who we are today. In Rwanda, the challenge can be to add the best of what American business has to offer while leaving the rest.

There are elements of the American business environment that we would never wish on Rwanda. America’s litigious environment has created bureaucracy, de-humanized policies, and increased costs in ways we are glad to avoid here. As relates to personnel benefits, the relatively high cost of health care and limited vacation time in America are not something we’d encourage Africans to emulate. Unhealthy degrees of independence and competitiveness sometimes found in the US would certainly cause problems in this developing country context.

We have also come to realize there are elements of American business culture that suit Rwanda well, although they do make us somewhat conspicuous. It is difficult for people in a relatively structured, hierarchical culture to see how we could be content in a company with three equal partners sharing the top post. To verify that we were a legitimate business, a government official had to come visit our office(s) and since we predominantly work from home offices, client locations, and conduct many meetings in local cafés and hotels, the inspector left scratching his head. In the end, although our company is a significant taxpaying organization it was not counted in Rwanda’s recent business census since we don’t have a separate and dedicated office space. Given our desire to avoid unnecessary overhead costs, and the fact that our best work is often done on site with clients, we haven’t seen fit to have an office as of yet (and we can charge our clients less as a result). Additionally, we are frequently given funny looks when we come to meetings on motorcycles. We are assured that no Rwandan consultant would be taken seriously if they didn’t have an office and an SUV of their own, but we tend to be less concerned about image and have found we are taken seriously, nonetheless. Besides, at roughly $6.50 USD/gallon, this is another way we can save money, do our part for the environment, enjoy Rwanda’s temperate climate… and it is a lot more fun!

We may never blend in entirely, but we are confident some of the ways we are odd also contribute helpful differences to Rwandan business culture. Our way of doing business brings a dose of informality, suggests our work speaks louder than our look, and suggests it can be good to say ‘no’ to unnecessary overhead costs in order to focus resources where they matter most.

Onward and upward,

-Carter

Investment Considerations for Nations & Businesses

2011-08-18T05:41:00.000-07:00

From rural electrification to food security, the Government of Rwanda regularly considers various investment opportunities. Allow me to suggest the Government of Rwanda may be wise to approach such deliberations from the perspective of a private business.

For a business to be successful over the long-run, it must continuously invest. By definition, an investment seeks a rate of return that is competitive vis-à-vis other investments that entail a similar level of risk. Sources of capital for investment are categorized as either equity or debt. The amount of debt verses the amount of equity required for a business to be successful depends on a number of factors. Ultimately, the business has to generate enough capital to repay its debt holders and it has to generate enough profits to satisfy the return requirements of its equity holders. When a company begins to generate negative profits (i.e. lose money) and continues on that path to the point where it has insufficient funds to pay the interest on its debts, the business goes into default, which is tantamount to bankruptcy.

Reversing this course means a return to profitability which inevitably requires some form of new investment. That may take the form of equipment retrofitting to produce a different line of more profitable products. It may require factory relocation or hiring a more qualified team that will successfully manage expenses. Even reducing employee ranks requires an initial investment in some form of severance benefits to those former employees. The two criteria required to justify any investment are: 1) it generates the required return, and 2) it affords sufficient capital to fulfill ongoing commitments.

These same investment criteria apply to public sector investments. Friedrich August Hayek, renowned 20th Century economist and philosopher, advocated for nations to grow by using internally generated profits to make investments that create appropriate returns. In contrast, John Maynard Keynes, Hayek’s contemporary, argued for nations to grow by using borrowed funds to make investments that generate appropriate returns. There is a great debate continuing today in the developing world about which approach is best. The reality for any nation (or business) is that these are not mutually exclusive; both debt and equity strategies need to be pursued simultaneously to maximize growth.

Nations seeking growth implicitly or explicitly evaluate two criteria: 1) what capital structure will be simultaneously the lowest cost and still afford sufficient capital to fulfill ongoing obligations to creditors; 2) what investments will generate the highest short, medium and long-term returns.

As businesses readily attest, a nation’s best investment is in its people. This includes appropriate levels of health care, education and entitlements; more importantly it involves investing in the creation of an environment where people have the opportunity to exercise their gifts and talents to the maximum extent for the benefit of themselves, their families and their communities. Rwanda is leading the way in the East African Region by striving to maintain a competitive capital structure, while making investments that will generate good socio-economic returns for its citizens.

Other developing countries could learn from the example set by the Government of Rwanda, while simultaneously taking a page from the logic used by business investors: prioritize investments in people, find the right balance of debt and equity, and commit to continuous investment for growth.

-Dano

Building Management As/Where the Market Demands

2011-04-07T23:50:00.000-07:00

A 14 February 2011 article in The East African (a regional business newspaper) titled Low Capacity the Reason Africa is Still Poor highlights the need for business management capacity building. As readers of this blog know, Karisimbi Business Partners is a Kigali-based management consulting firm offering long-term commitment and world-class advice. As a socially-motivated venture, we aim to offer high-impact guidance to high-impact ventures. Every day Karisimbi Partners interacts in very practical ways with a wide range of business operators in Rwanda. Below are some examples of what this looks like.

Consumer Products Sales & Marketing: Daily mentoring of the client’s sales manager for a large (500K USD annual turnover) consumer products company. This includes creating the template for establishing a baseline of existing customers, volumes, and prices – business has been operating for four years and this information isn’t available. It involves one-on-one mentoring including some basic guidance like the following:

Sales Manager: “I’ve spent the day out talking to customers promising them better quality and better service.”

Karisimbi Partner: “Please don’t promise anything unless you know how you are going to deliver on that promise. The first job has to be to listen to the customers’ concerns and let them know that the company is working hard to address those concerns. Secondly, start the conversation by simply asking them what would be required in order for them to be willing to distribute a small additional volume of your product. Let’s meet again in two days to review the list of customers and their responses to your questions.”

Project Management: Working with the client’s Director of Project Management to understand the current status of Project Management Reporting in a large (more than 5M USD annual turnover) construction company. Ultimately concluding that none of the daily, weekly or monthly reports focus on analyzing changes in critical path task schedules. Reporting only focuses on financial indicators. As a result, most of the company’s projects are delivered on budget, but significantly behind schedule. Currently developing and conducting one-on-one training for project managers on an Excel-based reporting process that focuses more heavily on adjustments to critical path task schedules.

Investing: Analyzing the variety of businesses within a holding group and advising the owner of the company where to invest the next 1M USD that he wants to put into his businesses. Realizing that most of the financial reporting is on a cash-basis (as opposed to accrual) and there are significant difficult-to-track transfers between different businesses and therefore limited insight into the true profit and loss individually attributed to any one business unit.

These interactions were not conducted through group “training” sessions. These were not theoretical or generalized approaches to particular aspects of business management. These were relationship-based practical interventions addressing particular challenges for particular people in particular companies. The impacts are clear and measurable and as advisors, Karisimbi Partners is actually held accountable in many ways by the client for the outcomes. In every one of these interactions, Rwandan business managers experienced significant growth in their business management capacity. And that growth will be passed on directly to sales people, project managers and investment analysts in those companies and other companies in those industries.

While our work often begins with asking many questions and delivering some analysis in the form of a report, interactions such as those described above suggest the report merely represents the beginning of the partnership we form with clients in order to ensure implementation. These implementations, while difficult and time-consuming, are where the greatest impact is possible…. and they are perhaps the most rewarding part of what we do.

This approach is not necessarily the only means of building business management capacity in Rwanda but it seems to be a method that is in demand by the marketplace and we believe that ultimately the market is what should drive approaches to business management capacity building.

-Dano

Claiming Karisimbi

2011-02-20T11:45:00.000-08:00

In naming our organization we had a two part objective: first, as a local socially-motivated business, intent on demonstrating our commitment to the needs of Rwandan businesses and entrepreneurs, we wanted a name that was clearly Rwandan – unmistakable in its connection to the country; second, we wanted to communicate our mission and the value we hoped to bring to all organizations, leaders and enterprises with whom we had the privilege to engage.

Our tag line is “Guiding ventures to reach new heights”, and as Mount Karisimbi represents the highest point in Rwanda (14,800 ft), is familiar to all Rwandese, and provides a clear metaphor for growth and challenge, we felt secure in appropriating it for our organization. However….it never felt quite right that in our strategy discussions with clients, our metaphorical descriptions and comparisons of business challenges and successes to Mount Karisimbi, we had no personal experience with the great mountain itself. This changed last month with our team’s two day expedition of our namesake.

Located in northern Rwanda and bordering the Democratic Republic of the Congo, Mt. Karisimbi is an inactive volcano in the Virunga mountain range. Despite Rwanda’s stable equatorial climate, a peak of this height means conditions far different from the rest of the country, with temperatures around 30 degrees Fahrenheit at base camp and deep mud for 90% of the trek. As one would expect, we prepared for the adventure with appropriate clothes, packs, footwear, tents, food, water, etc and secured a national park guide to lead us up. From that point on, our expectations and metaphors differed from those we had discussed “in theory” with clients over the past year and half, revealing some new and unexpected similarities to the challenge of building business and growing management capacity. Allow me to list some highlights and “business” observations from our adventure:

Focus on your strengths (e.g. don’t be afraid to outsource / hire expertise):

Dano and I were both very pleased to learn that porters would be available for hire ($8.50 per day). Neither of us had any ego associated with carrying our own 40+ lb. pack plus water up a muddy trail. Getting ourselves up and down the mountain sounded within our “skill set.” To prove the point, those heavily laden porters handily beat us both up and down the mountain. Carter and a friend decided to take the challenge of carrying their fully loaded packs on day one…arriving at base camp well after us, white faced and wobbly and ready to concede the packs for day two.

Plan for the Unexpected (e.g. allow for contingencies and protect yourself):

To our surprise, not only did we have a guide, we were assigned ten well armed soldiers to provide protection for our expedition. We hesitate to speculate why or if they were necessary, but writing this safely back at home means I have no complaints. Now that’s what I call insurance.

Keep your sense of humor (e.g. laugh at adversity):

There is a reason people refer to business as “serious”, but, despite its inherent challenges (or perhaps because of them), it is important to maintain your sense of humor and perspective. Climbing a mountain for “fun”, resigning yourself to the necessary “trudging” required to keep forward momentum through muddy trails lined by stinging nettles, camping at 12,000 ft in the cold with minimal sleep… all these things can change your attitude for the worse, but only if you let it.

Building relationships (e.g. stronger together than apart)

An obvious expectation of people taking on a challenge together is (hopefully) a strengthening of relationships and teamwork. We certainly found this to be the case on our climb, which included deepening our own partnership, getting to know our new intern, Jon Porter, and crossing cultural lines - huddled around a campfire with soldiers at night trading hymns in our respective languages - relationship building at its simplest.

Dano, Greg & Carter- true Karisimbi Partners at last

View from the top (e.g. may not be all you expect):

Sometimes achieving the goal is quite different from the expectation. We had often talked with clients about the proverbial “incredible views once you’ve achieved the summit of your potential”, but the reality for us was that our last 1000 feet of the climb was completely clouded over, resulting in near zero visibility from the top; the dominant recollection from the summit consists of cold, wind, ice and other debris. Ironically, one of the most rewarding views was at the bottom of the mountain, where the fields of pyrethrum (daisy) stretched across the landscape. This had very special significance for us given our work assisting the client whose factory these well tended fields would supply – bringing employment and security to the local farmers.

Dano, Carter & Greg after the summit

Carter thinks this should be an annual trip with clients invited, but Dano and I aren’t quite there yet. Either way, we are proud to now legitimately lay claim to our name, Karisimbi Partners.

-Greg

Private Sector Development in Developing Countries: What Works?

2011-01-16T07:37:00.000-08:00

Umwaka Mushya Muhire! (Happy New Year!)

After recent travel and varied conversations, I am convinced that there are many good (and controversial) ideas about the best form of private sector development. I would like to take this opportunity to put the question to YOU:

“What seems to work (and what does not) among economic development initiatives in developing countries?”

I will compile your responses (including pitfalls to avoid and best practices to consider) and add some of Karisimbi Partners' own insights in an effort to see if anything resembling a consensus can be found for application in places like Rwanda. Please lend us your ideas and opinions on this important topic!

Onward and Upward,

-Carter

Should you Work in Rwanda?

2010-11-24T03:48:00.000-08:00

Moving to Rwanda to establish a company has certainly challenged our expectations, and the learning curve remains steep; the surprises many. None of us expected, for instance, that there would be so many people from North America and Europe interested in joining Karisimbi Partners. We have been approached by a diverse array of gutsy individuals… undergraduate students and CEO’s, people between the ages of 18 and 60, folks full of great intention, significant questions and interesting backgrounds. We did not fully anticipate the extent to which our unique model for offering socially-motivated business support services might strike a chord with a growing number of people in the West seeking to alleviate poverty, assist developing economies, contribute to Rwanda’s bold vision, or simply do something more meaningful than standard corporate jobs seemed to offer. Many of these people are determined to engage and contribute in more intimate ways than philanthropy and short-term trips can offer.

Because our venture is yet a start-up, it has not truly been in a position to support more than the three people who started it. Still, one Business Analyst intern has joined us for the past nine months, and another, Jon Porter, is joining us in January. We’ve also had countless e-mail, Skype calls, interviews and meetings with candidates of one type or another (most unacquainted with Africa and/or Rwanda). In the course of these discussions, we’ve begun to zero in on some questions that seem to matter in such considerations:

Are you committed enough to work in Rwanda for a significant period of time? Working remotely, visiting occassionally, or working ‘on-the-ground’ for less than two weeks at a time, is clearly not sufficient.
Have you already demonstrated excellence in a particular area? We contend that Africa’s development requires and deserves the ‘best’ the world has to offer. Much can be done with well-intentioned people, but much more can be done if their expertise is as strong as their motivation. This also contributes immensely to the dignity and development of the people served.
Do you bring expertise that precisely fits at least one real and pressing need in Rwanda? Amazing things happen when a specific need at one of our client firms can be connected to world-class expertise among our contacts in other countries. To start by cataloging our contacts and their skills in the West, in the hope they can be matched to a specific need here, is less likely to yield the mutual benefits we all seek.
Are you humble and flexible enough to adapt what you know to accommodate what works here? The most brilliant, experienced person in the world is useless here if they can't translate and bend as conditions require.
Are you willing to work long and hard? Our mission is rarely characterized by quick fixes or instant results. Lectures, seminars, short-term visits and nice reports are never sufficient in fostering deep relationships, understanding, knowledge transfer and sustainable improvement. There remains no substitute for what can be accomplished through hard work alongside partners and clients.

We are grateful for the surprising interest we have received. While many conversations would benefit if every candidate could start by answering the above questions, part of what we continue to learn is how to connect the uninitiated to the type of work we do. A similar set of questions could also help people to evaluate their fit in other developing world organizations or refine what matters most as they set up a company of their own in such a country.

While we can’t hire them all, our sincere hope is that we can encourage more people to move to, and work in, places like Rwanda.

Onward and Upward,

-Carter

Thanks for the Difference a Year Makes

2010-10-30T00:54:00.000-07:00

One year ago we had no real evidence to prove that the idea of Karisimbi Partners was a good one. We didn’t know if we would be accepted by Rwandans. We didn’t know if we would be able to have a positive impact in the way we had hoped. We didn’t know how our families would adapt (or ourselves for that matter). It was a beginning filled with many unknowns.

We had different challenges then than we have now. We didn’t know where to go for good food. We didn’t know what vehicle to buy. We didn’t know if we would have enough money to pay rent after our first three to six months. We didn’t know all the cultural norms for interacting with our clients. We didn’t know the local tax laws. We didn’t know what we didn’t know.

We still have plenty of challenges and many of them aren’t so different from the ones we had originally, but we are somehow more comfortable with the uncertainty of it all. We still don’t know what we don’t know but by definition of having been here for a year, there is at least less that we don’t know now than we didn’t know then.

We give thanks to God for this incredible year and the opportunities we’ve had to experience His love and to share some of that love with others. We’ve seen children adopted and deep friendships forged. We’ve witnessed employees and interns see the world in a different light and client businesses grow and employ more people. We’ve had countless culture-changing interactions on the street corner and within the office of the Prime Minister. Thank you God!

Exhibit A: Over the past week, we attended a meeting with a group of seven leading mid-sized Rwandan companies, led by the Permanent Secretary (number two person) of the Ministry of Trade and Industry, where Karisimbi Partners was featured as the company “doctor” that could help turn around these ailing companies. We led a negotiation with a global software provider in order to develop a solution for Kigali City to manage its finances and serve its people better. We had lunch with an employee to celebrate his experience over the last six months and challenge and mentor him as he thinks about next steps. We advised a client on how to effectively use US Government grant money. We ended the week with a team meeting to discuss how to juggle what seems to be a growing list of opportunities that are in front of us. Compare that discussion to one year ago, where at least I was wondering whether I would need to find a side-job as a teacher or car mechanic in order to stay busy….

Maybe the best blessing in the last year is in our families. For one example, when my kids first arrived, they weren’t so sure about Rwanda in general. This week, my eldest daughter asked me if we could stay in Rwanda forever. I told her it was up to God. Pretty cool.

Dano

Poverty Alleviation via Choice Redistribution?

2010-10-18T06:04:00.000-07:00

We live in one of the poorest countries in the world (Rwanda is #184 out of 194 countries ranked). Poverty could be described as a condition whereby people have insufficient resources. Certainly, resources such as property, employment, food and income are finite and competitively sought after. Ghandi once claimed, “There is enough for the world’s need but not the world’s greed”. This simple sentiment suggests poverty is not only a matter of insufficient supply, but of insufficient distribution of the available supply in the global community.

It is also possible to think about poverty as the simple lack of one particular resource: choice. The poor are depraved by the sheer lack of options they have at their disposal. Whereas I’ve been fortunate enough to choose among many possible foods, medicines, schools, jobs and neighborhoods, my gardener had no such options to choose from. Jean Pierre did not have the option to continue schooling past age 12. He claimed two of the best jobs available for boys in his region, but faced death daily in the mines and on his commute. Thanks to his Aunt, Jean Pierre was able to leave his hometown and experience the possibilities of the big city, Kigali, but he could not afford a place to live or the health care to enable him to be treated for an ulcer and keep his job. Once he married and began a family, he felt he had not choice but to withstand the ill-treatment of his employer. The poor can often feel stuck in a bad place few options for escape. While my family and I chose to make some sacrifices in order to move to Rwanda, we are pleased to report Jean Pierre seems to have a few more choices as a result of our move. We allowed him the opportunity to leave his former employer (and claim better, more regular pay). We gave him the chance to claim his preferred job title and responsibility, that of a gardener. At 42, he is taking coursework in English and learning how to drive (each offer a host of new options). He and his wife are now considering how to use his first paid vacation ever. These are small tokens of how our lives here have added some options to one additional life.

Perhaps one way to alleviate poverty might be to prescribe a sort of “choice transplant”. We might extend Ghandi’s claim to read: the world offers enough options for everyone, but not if some people claim the all best options for themselves. What would happen if more of us with the best options made a concerted effort to give or share them with those born with the least?

Because Karisimbi Partners is committed to private sector development, it is easy for us to point to the expanding options that accrue when a Rwandan is employed in a job that builds a company, sector and this emerging economy. However, I’ve recently been struck by what may be the most profound choice transplant of all: adoption. Post genocide and epidemics, estimates are that 21% of Rwandan children have lost one or both parents, classifying roughly 10% of the population as ‘orphans’. The Jukanovich’s adopted Nathaniel Nyanzima last March, providing an entire lifetime of new options to a boy who had few. The Urquharts are now on adoption journey as well. Such actions effectively transfer upon those with the bleakest prospects all the privileges and opportunities one would expect if born in one of the world’s wealthiest regions. At times, it can seem the problem of poverty is too pervasive and attempts to address it slow and ineffective. Consider, however, the shattered bonds and immense future of a single adopted child and be awe-struck, as I am, with what is possible.

If poverty is defined as a lack of choices, this condition is neither fatal nor permanent. Choice transplant is possible. As we speak, profound sacrifices are being made to create profound opportunities for those with none.

Onward and Upward,

-Carter

CAN Borrow Does Not Imply SHOULD Borrow

2010-09-27T14:26:00.000-07:00

When should you give a personal guarantee? When you are able to and intend to deliver on it and when doing so is aligned with your values, as they relate to yourself and the others involved in the relationship.

In the movie, “The International,” a wealthy business tycoon explains the essence of the banking industry: “The International Bank of Business and Commerce is a bank. Their objective isn’t to control the conflict, it’s to control the debt that the conflict produces. You see, the real value of a conflict, the true value, is in the debt that it creates. You control the debt, you control everything. You find this upsetting, yes? But this is the very essence of the banking industry, to make us all, whether we be nations or individuals, slaves to debt.”

This sounds cynical, and is somewhat so. But the above description should ring true for everyone who has ever taken out a credit card or a mortgage or car or business loan (or has even been offered one, for that matter). The sad part is that except in cases where the customer didn’t understand the terms, the resulting enslavement is of our own choosing.

Credit is becoming more and more available in the developing world and unfortunately we see in our clients where they are becoming more and more willing to take the “risk” and accept credit from financial institutions in return for personal guarantees. Below are some principles by which to determine when or if it is wise to take such a risk.

- My father used to say, “don’t gamble what you can’t afford to lose.” You may very well have to deliver on your personal guarantee. It’s not just a piece of paper. The bank will legally have the right to take everything you own and to even burden your future earnings. And they will absolutely exercise this right. You have to determine if you can afford to lose the amount that is being guaranteed.

- A guarantee has legal and moral meaning. It is called a guarantee for a reason. It’s a promise. It’s a commitment. You have to determine if you are willing and able to put your integrity on the line and actually perform on that commitment.

- Can you guarantee that the assets serving as collateral for the underlying loan are sufficient to fully pay off that loan in the case of default? When cash flow is insufficient to service the debt and it goes into default, the bank will foreclose on the assets and then liquidate them. Will the funds from the sale of those now distressed and discounted assets be sufficient to pay off the loan? If you are confident enough of this, then there is no risk in a personal guarantee because it won’t need to be exercised.

- This following is a technical point, but relevant. A personal guarantee is just another form of collateral for the bank. Banks will strive to acquire as much collateral as they possibly can in order to minimize their risk. The borrower should push as hard as possible to provide as little collateral as possible in order to minimize his risk. This is just another negotiating point. And there should be no “give” without “take” in the negotiation. In other words, save the incredibly valuable and risky personal guarantee for when it really matters or make sure you receive significant concessions from the bank in return for a personal guarantee.

- What is the alternative to not providing a personal guarantee? A business loan is a loan for a business. The bank makes the loan because it believes there is a good risk-return tradeoff. If the bank isn’t willing to loan the money based on the business, then there are more important issues to consider regarding the business. This is an appropriate place to reference another valuable principle: “don’t borrow money if you wouldn’t loan it to yourself,” or “just because a bank is willing to loan you money doesn’t make it a good idea to borrow it.”

Unfortunately bad things do happen and businesses are not always able to pay back loans. Consider whether you are willing to sell your own personal assets or leverage your future earnings and risk your personal integrity before you decide to provide a personal guarantee. Sound principles for dealing with banks are as true where you live as they are in Rwanda.

-Dano

Jean Pierre: Chief Gardener (Part 2)

2010-08-24T00:43:00.003-07:00

(Continued from prior post...)
For nearly two years after the genocide, medical diagnosis was unclear or unavailable and Jean Pierre remained an invalid at his Aunt’s house. Finally, a doctor at one of the government hospitals decided to operate and removed an ulcer. This procedure went a long way to affording Jean Pierre a full recovery.

A naturally hard worker, now with a healthy body, Jean Pierre was able to take a job as a security guard with one of the large private security companies in Kigali. In 1996, Jean Pierre was married and over time became the proud father of 4 children. Although KK Security did not treat employees well (often paying a fraction of what was owed), Jean Pierre did not feel he could leave because he had a family to support and finding another job was unlikely. Jean Pierre was still with KK Security 13 years later when I met him, last summer. Because of the treatment of his previous employers, it was not difficult for me to pay him better and entice him to leave the company that would otherwise claim half the fees I paid for security services. When I asked Jean Pierre what he really wanted to do, he told me he would do anything, but loved gardening. Thus, I was able to give him the title of Chief Gardener and a uniform more to his liking as well. Jean Pierre tells me that this is the only job he’s had that has paid him regularly since he left the Akagera Hotel. You should have seen the look on his face when I got to tell him he would receive a raise after a year of great service to our family!

To share his story certainly takes some vulnerability and risk. As such, I felt I should reciprocate and tell him my own. You can probably imagine how odd that felt! So much of his life has largely been dictated for him…. by others, by circumstance and by poverty. As I began telling my story, I realized how many resources and choices I have had (and often took for granted). I told him that I too scored well in primary school, but I was able to progress to middle school and eventually go to university and choose to study business, and even had the luxury of choosing a field and company I wanted to work in when I graduated. I complained about the one hour commute I had to drive twice a day when living in Los Angeles, but felt silly complaining since I never faced the jaws of a lion as he had on his commute as a boy! I told him I loved working hard and he said he did as well (and it shows!). He was amazed that I would leave a job that had the potential for riches American companies like Microsoft had offered. Although not a believer, he somehow understood that my faith compelled me to chart a different path.

By the time I had finished my story and answered his questions, we both sat with a deep appreciation at the life the other had lived. Although roughly the same age, being born in such different contexts made it quite amazing that two such people could ever find themselves friends.

Onward and Upward,

-Carter

Introducing Chief Gardener: Jean Pierre

2010-08-02T12:44:00.000-07:00

Jean Pierre Barahira is the trusted Chief Gardener (and guard) we have relied upon at our home this past year. His capacity for English is developing faster than my Kinyarwanda, yet there are many conversations we've not yet had. I’ve been anxious to know about Jean Pierre’s life, yet I’ve not wanted to dive too soon into a story so personal. With the help of my language tutor, Silas, I finally found the words and time to get to know this man better. I will attempt to highlight some of Jean Pierre’s fascinating story here.

Jean Pierre estimates he was born around 1965-1966 (birth records are sometimes unreliable here). He is the 7th of 14 children born in the town of Rwamagana, in the Eastern lowlands of Rwanda. He did well in primary school, and earned the right to continue his education but was frustrated when it became known his parents were too poor to support the modest fees required. So, at about age 12, Jean Pierre began working in the local cassiterite mine. Many boys his age were injured or died in this dangerous underground work, but after three years in the job, he left to accept a job he now claims turned out to be even more dangerous. Jean Pierre began working for the only major hotel in his part of the country, the Akagera Hotel. His duties entailed cleaning the rooms, washing and ironing clothes. It was deemed a very good job, but the danger came in the commute. Jean Pierre and the other boys who worked at the hotel lived 30 Km (18.6 miles) away. Some had bicycles and all would speed as fast as possible, but many fell prey to the lions and Cape buffalo that lived near the road. After four years, Jean Pierre had the opportunity to live with his Aunt in the big capital city of Kigali.

The first year Jean Pierre lived in Kigali, he was unsuccessful in finding work. The second year, Jean Pierre found a job as a taxi-bus ‘conductor’, helping to fill and collect fees from passengers on the road to and from Gisenyi. He kept this job for nearly three years, but developed some stomach problems that eventually made it impossible to eat properly or go into work. It was also about then that the disturbances leading up to the genocide reached a fever pitch. Jean Pierre’s friends and relations would travel from place to place trying to get away from the killing and angry mobs. For three months, they never stayed for more than two nights in one place, and every day they faced the possibility it would be their last. By July, the roaming group decided to escape over the Western border to D.R. Congo, choosing instead to face the squalor of a refugee camp, where at least you could be assured nobody would try to kill you. After three months, Jean Pierre prepared to return to Rwanda, and offered to take others with him. Most of the friends and relatives he knew refused to return (although disease and hunger took many lives each day), fearing what they would find if they went back. Jean Pierre has since learned all those that remained have since passed away. Of the 14 brothers and sisters in his family, Jean Pierre is one of only four that survive today.

It was at this point I told Jean Pierre I now realize how fortunate I am to know him. (to be continued…)

Onward & Upward,

-Carter

Rwanda: An Easy Place To Come Home To

2010-07-22T02:09:00.000-07:00

One of the best ways to better understand the culture your in is to leave it. Upon experiencing a new or different culture and re-entering the one you knew, new aspects of each come into view. I have now lived in a few different countries, and traveled to many more, and I am still struck by how much there is to grasp about the distinctive qualities of every place. For instance, on my first visit to the US in almost a year, I was struck by the sheer amount of discretionary time and money Americans have (for hobbies, pets, sports, etc.), the overwhelming number of choices and conveniences available (300+ TV channels and 30+ types of toothpaste!). The Internet and much of life runs at a much faster pace than in Rwanda, yet few seem satisfied they are running fast enough (or have the time or money to support the pace). I suppose this once described what I called ‘normal’, but it strikes me now as ironic so many people have so many resources to chase their dreams yet find them perpetually out of reach.

Such observations remind me of a classic Time magazine article from 1956 that claimed, “not far distant is the time when Americans need spend comparatively little time earning a living…” freeing them to “unleash their considerable powers for cultural, ethical and spiritual accomplishments.” From my vantage point, in the Southern California of 2010, it does not seem such benefits of American conveniences have proven as real or satisfying as suggested.

While in the states, we were able to share and celebrate the Karisimbi Partner’s story with over 200 people at various events and over meals. This video is a wonderful summary of what we are doing (and the work of some extremely talented and generous people!): http://www.youtube.com/watch?v=tcF0U7QQauQ. Wherever we went, people asked for details of the place we now call home, so I am happy to give a few...

Observations of Rwandan culture and life are also easier to see when juxtaposed with North America. While the Kigali airport has very few amenities (effectively a one terminal, one gate airport), disembarking passengers are greeted by a giant billboard for a local telephone company featuring a larger-than-life image of an entrepreneur friend of ours (who also happens to be an advertising model). The customs official has that particularly Rwandan air about him as he takes pride in the execution of his duties to ensure paperwork is in order, but is also quick to offer a smile. On the way to my house from the airport, I was able to see many friends and familiar faces walking the streets. Since the Presidential elections are coming, the major roads are likely to be lined with police and military personnel in order to thwart any would-be disturbances. I am grateful to know that what Kinyarwanda vocabulary and pronunciation I had are still intact. There is a perpetual cloud of dust over the city now that the dry season has descended in earnest. The night air has the familiar smell of distant coal fires, Islamic chants from the nearby mosque, and a chorus of tropical-sounding birds from 4:30AM on. When nearly a mile from my home, the boys that live on my street spot me in my Rav4 and chase me all the way to my house (where I am able to present them a soccer ball I’d purchased in the states). It seems people drop everything to welcome me back, and every greeting involves genuine warmth (and usually a hug).

It is easy to come home to such a place!

Onward and Upward,

-Carter

Human Values- Learning from Each Other

2010-06-25T14:32:00.000-07:00

On a recent visit to the US Embassy, Ambassador to Rwanda, Stuart Symington, challenged us to think differently about the United States and about the future of US influence in the world. No nation remains forever as the global superpower. So if we value what the United States stands for and want the best of those values to outlast its period as a superpower, we need to be taking action toward that end. The Ambassador encouraged us in what Karisimbi Partners is doing, which he called being “pioneers,” and he encouraged us to bring what is good about the US into our relationships with people of other nations.

In the book, Dangerous Nation, author Robert Kagan outlines how up through the late 1800’s, the United States took actions for the purpose of expansion and spreading its values internationally, from the Revolutionary War, Civil War and Spanish American War to a more explicitly ‘capitalist’ expansionism in Latin America. His book only addresses US history up to the late 1800’s, but many have continued the argument with modern day examples.

It seems important that the Ambassador’s admonition does not resemble the US imperialism that people criticize. I think ’imperialism’, in its most negative connotation, comes when either greed or power or at least arrogance are the motivations. And that, given human weakness, unfortunately shows up equally in Generals, CEOs and even Missionaries. I hope, in contrast, that we at Karisimbi Partners are simply living out who we are. Who we are involves being the best we are able to be and at the same time loving our neighbors out of a quite different motivation than greed or power. And our neighbors are Americans, Chinese, Rwandans and anybody else we pass on the road.

We aren’t aiming to spread uniquely American values or hoping that America will somehow live on through our pioneering. In fact, I hope that by our interactions, we are learning more of what are simply human values and that others are learning the same from us. Maybe somebody is learning from me that telling the hard truth, though painful at the time, will help the teller and the hearer. I know I’ve learned that the impact of business on the surrounding community is equally or more important than the profit to shareholders. Maybe someone has learned from me that the proper amount of planning can make for more productive people and organizations. I know I’m still struggling to learn that relationships are as or more important than productivity.

I graduated from the United States Military Academy at West Point and was trained as an Army Ranger. My Father was a Veteran of the Korean War. I took my six-year-old adopted Chinese daughter to Fort Sumter, Arlington National Cemetery and West Point this summer before we moved to Rwanda. I wanted her to feel the same debt of gratitude that I do to those who have sacrificed to build and defend the United States and continue to die every day in countries around the world for people they don’t even know. I can credibly say that I am a patriot.

But I believe there is a fundamental aspect of American culture that has nothing to do with genetics but is a result of a unique confluence of geographic, religious, social, economic and cultural systems. The United States, as a nation, values the individual, possibly above all else, and this is its greatest asset and greatest liability. I hope my Rwandan friends will soak up some of this deep respect for the individual that we have as Americans. And I hope that we will take on some of our Rwandan friends’ deep respect for family and community above the individual.

- Dano Jukanovich

Snapshots of "Workplace Bliss"

2010-05-29T07:43:00.000-07:00

I have said little of the “internal dynamics” of Karisimbi Business Partners. Moving 16 people to Kigali entailed taking on risks to safety, health, reputation, finances, family life and our kid's education. On top of these risks, I didn’t want to acknowledge the strong possibility that the three business partners setting off to start a Rwandan company may not work well together. To be honest, quite a bit of our personal and professional lives together here have depended on a satisfactory answer to this question. As we begin to think about returning to the US to visit family and friends for the summer, one year after we began this adventure together, it seems an appropriate time to reflect and count our blessings.

Dano, Greg and I are three of the most ambitious businessmen I have ever known. Prior to Karisimbi Partners, I had known each for many years, but we had never worked together (even when Greg and I worked at Microsoft at the same time, we never interacted on the big campus). In our late 30's (ok, I'm 40), we have each developed our preferred working styles and standards. We each have different skill levels and preferences in the various aspects of management. Dano and Greg did not know each other well before we began. We are all fairly independent and hard-charging people. Team building experts would never put three such individuals in the same work environment. True, we have many things in common: a social (even Gospel) motivation, a heart for Rwanda, a preference for strategic impact, a practical bent for tangible implementation, and similar tastes in music movies, and humor. Yet none of these aspects guaranteed we would work well together. Here are a few actual “snapshots” of times in our working relationship this past year that represent more “workplace bliss” than we could have anticipated:

Snapshot #1: Over lunch with an investor who doesn’t speak English, Greg carries the conversation in French, Dano translates assumptions into anticipated financial returns on his laptop, and Carter says (through Greg) something of competitive advantages to be had.

Snapshot #2: Carter identifies and nurtures a new business relationship; Greg crafts the contracts that will ensure mutual expectations are fulfilled; and Dano drives the schedule and money to ensure we meet or exceed what we’ve signed up to do.

Snapshot #3: We glance quickly at each other with amusement and terror when the honey production company manager tells us as we approach a bee hive in Nyungwe Forest: “You might see monkeys here… but be careful, African bees can be aggressive.”

Snapshot #4: Dano expresses doubt we can succeed; Carter fails to see how we could possibly fail; Greg talks us all onto a realistic middle ground.

Snapshot #5: Carter begins a business plan speaking of global trends and concepts; Dano makes order of the chaos in the details; Greg creates the PowerPoint presentation to simplify a complex plan for company investors and managers.

Snapshot #6: Dano rides off after a client meeting with Carter perched on the back of his motorcycle. Dano offers the caption for this picture: “Karisimbi Partners does its part to reduce its carbon footprint.” You’ll probably see the picture in a future version of our monthly newsletter (Makuruki) that Greg writes.

I will go on record: these moments have brought an occasional tear to my eye. As expected, we have had challenges as well, working to curb and accommodate the edges and elbows we didn’t know we had. But I feel I can safely say that the fear we would not work well together has been largely put to rest. Recently, a number of our clients have commented on what an “outstanding team” we are, noting the diverse opinions and skills we bring to assist their organizations. Some days I feel anyone could succeed if they were partnered with Dano and Greg—I am that fortunate! I must say it again: doing great work with great friends is certainly one of the highest rewards of our first year here!

Onward and Upward,

-Carter

Launching a New Networking Event in Rwanda

2010-05-17T00:29:00.000-07:00

It seemed an idea whose time had come. From what we can tell, if Rwanda fails to reach its ambitious development goals it will not be for a lack of vision, hard work, international goodwill or even a lack of finances. The chief barrier that public and private organizations here must overcome is a lack of management capacity. While Karisimbi Partners continues to assist a handful of companies in this regard, this pervasive challenge seems to require efforts on an entirely different scale. With the prompting and encouragement of the US Ambassador to Rwanda, Stuart Symington, Thursday marked the day we began to tackle this issue with the creation of a monthly networking event we’ve called the Management Exchange Roundtable.

While the result was uncertain, the recipe was simple: gather a dozen business managers, mix them in the same room with a dozen business support organizations (NGO’s, Government agencies, etc.), place a compelling talk from an insightful person in the middle, and sprinkle food and drink around the edges. While private sector networking events are a common occurrence in other countries we’ve lived, they are still new here. The hope was that creating such a forum could identify management needs, offer management support services and have some success in connecting people and solutions that would not have met otherwise. This initial event was immensely boosted by our adviser and friend Eric Kakou, Managing Director of On the Frontier (OTF), speaking on “The Leadership Gap: The Case of Customer Service”. The research and thought-provoking ideas presented during Eric’s discussion were illustrated by Emmanuel Murekezi, Operations Manager for perhaps the best-known restaurant in Rwanda: Bourbon Coffee. Now our challenge will be to improve on this event with future events!

To leave you with a small taste of what resulted from this recipe, one of the recurring themes expressed by those present was this: Customer service is not only an issue for the person facing the customer. Customer service also involves shaping the expectations of the customer. Importantly, customer service is a mindset, or attitude, that must also permeate the ownership and management of a given organization. An example was given of an owner that trained service personnel extensively, but seemed surprised when their training was not evident following months when the owner failed to pay salaries (an unfortunately common occurrence here). The good news: mindsets can change; the bad news: changing mindsets can be a long and difficult task that must affect everyone from the owner to the customer.

Onward and Upward,
-Carter

Social Entrepreneurship: A Useful Term?

2010-04-29T09:01:00.000-07:00

The term ‘social entrepreneurship’ is increasingly common, although it was virtually unheard of 20 years ago. As an academic, I was one of those that wrote articles and spoke at conferences on the subject. Because there was (and is) little agreement on the definition of the term, I even coined one of the definitions (borrowing heavily from the work of Howard Stevenson): “The pursuit of an opportunity to benefit society beyond the tangible resources currently controlled.” Fast forward to a different time and a different place, I wonder now more than ever if the term is as useful as many of us once thought…

Usefulness over Time
Years ago, I commented that social entrepreneurship, as a concept, is too important and bold to be merely a subset of conventional entrepreneurship or business. My concern then was that the more we did to develop a field that represented a marginal ideal, the more we may prevent the value of the concept from being adopted as part of the mainstream ideology of business. As with the term Corporate Social Responsibility (CSR), as soon as every organization makes the tenants of social responsibility part of their core values and explicit statements, the term losses its value as a differentiator, and it no longer makes sense to demarcate some companies as ‘Socially Responsible Businesses’. Clearly, society benefits more when CSR or social entrepreneurship become part of the assumptions, values and language of the mainstream business paradigm rather than remaining an idealistic notion subscribed to by a few within the larger paradigm.

Usefulness from this Place
Working in Rwanda, it is even less clear that social entrepreneurship is a useful term. In recent weeks, we have asked four CEO’s what had been the driving motivation to found their respective organizations. One said he did it to create jobs for those who had been poaching and killing Mountain Gorillas. Another said he did so because President Kagame asked him to alleviate poverty in the region he was born. Another established his company to improve the technological, social and economic status of his country after the war. The last CEO said his organization was established by the Rwandan Army because the army was expected to dedicate a portion of its resources to improving the development of Rwandans. It seems to me the term ‘social entrepreneur’ is more useful in the West, where identification of some in business that pursue merely selfish ambitions seems plausible. If such a person exists here in Rwanda, I’m not certain I have met them yet...

Onward and Upward,
-Carter

Volleyball Saved His Life

2010-04-13T03:17:00.000-07:00

Robert Bayigamba is certainly one of the best friends Karisimbi Partners could have here in Rwanda. Initially, we were drawn to him because of his warm personality and capacity to appreciate what it is we have moved here to do. Over time, he has become a personal friend to each of us as well as one of our chief advisers, clients and advocates. His biography is truly amazing, spanning key leadership positions in sports, politics and the private sector. Current duties include Chairman of the Private Sector Federation (something like the “chamber of commerce” representing the business community in Rwanda) and Managing Director of Manumetal (one of the oldest furniture manufacturers in the country). It was months into our partnership, however, that we discovered Robert narrowly escaped death during the genocide. Since this week is a national holiday commemorating the genocide that took place 16 years ago, it seems appropriate to share Robert’s story with you.

As Roberts puts it “Volleyball saved my life”. On April 7^th, 1994, Robert’s name was on the list of people the Hutu-led government had disseminated to vigilante mobs for extermination. After a grenade blew a hole into the compound where he lived, Robert found himself face-to-face with the Interahamwe militia, preparing to plead for his life and the lives of his wife and children in the house. Since Robert’s father was a Hutu of some prominence, it was surprising that Robert’s name was on the list at all. Since Robert was once in the zone occupied by the Tutsi-led rebel movement (where he organized a volleyball match with a team from the rebel forces), he was likely tagged a sympathizer and supporter of the Tutsi-led rebel army. Under the circumstances, he had little hope in reasoning with his attackers. Amazingly, one of the mob pointed at Robert and asked, “Aren’t you the captain of the Rwandan national volleyball team?” Indeed, this had been Robert’s initial claim to fame, as he acknowledged in affirmation. Robert told the man “God has sent you here to help me”. His fame as a sportsman, combined with the Hutu lineage printed on his identity card, was enough to convince the mob there must have been some mistake in placing him on the list of targeted individuals, and he and the family were able to stay out of sight for the next few weeks.

As the pace and scope of the killing increased, Robert determined to take his family outside Kigali (the capital city) toward the southern border. As they approached the border, the only way to travel in safety was with military escort. A friend of Robert’s promised to arrange a meeting with a high-ranking officer so that Robert could make the request himself. When the official stepped into the hotel room, he turned out to be one of the most prominent referees in the national volleyball league, and someone Robert knew well. As such, Robert and his family were allowed to proceed into Burundi and safety, on April 19^th, the day before the tragedy entered its darkest period in the southern region. To this day, Robert feels a debt to the sport that gave him so much and contributed to saving his life.

Sixteen years later, every single Rwandan family has a personal story of the tragedy and loss of the genocide…many more devastating than that which the Bayigamba family felt. Some are traumatized as killers, others from ‘survivor’s guilt’, some that fled are only now returning to make a new start… this week attempts to remember, comfort and unify. Please join us in remembering this tragedy and celebrating the enduring spirit of the Rwandan people.

Onward and Upward,

-Carter

Introducing our first "Karisimbi Associate"

2010-03-25T00:18:00.000-07:00

Karisimbi Partners aims to help clients reach the pinnacle of their potential, and this is one of the reasons we have named our company after Rwanda’s highest peak. Given some of the business sectors we have initially engaged, however, it is clear that some of our clients require the guidance of someone with particular technical skills we do not possess. As such, we have invited people we call “Karisimbi Associates” to help us guide our clients toward their full potential. Below is a story about Kiah Jordan, the first Karisimbi Associate we invited from North America to work alongside one of our client companies. Kiah works in commercial property management and financial planning in Santa Barbara. He is also a former student of mine and I recently worked with him on a consulting project in Santa Barbara, California, so I knew he could make a significant contribution at Misteph & Co., a client of our with a residential real estate firm poised to become one of the first “property management” companies in Rwanda. We hoped he could offer industry-specific insights that were critically needed at just now as this initiative was launched. The following brief interview highlights how things progressed over the 10 days Kiah spent in Kigali working with Misteph & Co.:

What did you want to do or expect before arriving in Rwanda to work with Karisimbi Business Partners?
I expected to use my career specific skills in a very focused environment, with a short time to accomplish a lot. I planned on working with Karisimbi Partner’s client on my own for the majority of the time and to be resourceful in quickly adapting to the needs of the client and the culture. I expected there to be very little structure in the client's industry and that I would need to build the process and procedure within the context of the client's needs. Lastly, I expected Rwanda to be much more primitive and more like the barren dry pictures of Africa that we often see in the western hemisphere.

What did you find when you arrived in Rwanda?
I found that Kigali was a relatively developed city and Rwanda was green and had many key resources and a climate that could sustain agricultural development. There was a market already created for real estate, however, it was unregulated, informal, and lacked consistency and efficiency. The specific needs of Misteph & Co. were split between targeting initial clients and building the processes and structures to support them. Misteph & Co. had a great vision and passion for future development, but needed the practical tools that would allow sustainable growth within the company and expansion of the company's role in the forming real estate sector.

What did you do in Rwanda with Karisimbi Business Partners?  
I went to Rwanda to work with Misteph & Co. to provide the specific skills they needed… establishing a new company in a new sector. What a thrill to work with the first real estate company in Rwanda specializing in sales and property management! I spent a significant amount of time learning about the Kigali real estate market, initially meeting and trying to understand the various ‘players’: the builders/developers, sellers, financiers, property owners, and potential clients. I trained the office administrator in Quickbooks and setup the proper accounts for bookkeeping. Since government regulations and industry guidelines have not yet been fully developed for this sector, there are no standard contracts, so I helped create contracts for leasing, listing, and property management. I helped a website developer create the company website. My time in Rwanda was full and there was so much more to do than could be accomplished in the time available, but the contribution to Karisimbi Partners and their client was substantial and the experience to me was priceless.

Indeed, being able to mobilize our contacts and friends like Kiah turns out to be one way we can propel clients toward their potential in a short period of time. Kiah proved particularly valuable, given his deep experience in a particular sector, familiarity with living in a developing country, and possessing the humility and other character traits required to adapt his knowledge in the best way possible. As a way of saying “thank you” our client treated Kiah to a day trekking through the mountains to see gorillas (Rwanda’s #1 tourist attraction). Also, the founder of Misteph & Co. may soon visit a real estate brokerage (another contact of ours) in America to understand how things are done in a more mature market.

We find ourselves uniquely situated to connect real business experts to the real business needs of our client companies. It is difficult to think how our first Karisimbi Associate could have been more effective, and we are convinced this is something we should do more often… so drop us a line if you feel you our clients may benefit from the excellent business competencies YOU have to offer.

Onward and upward,
-Carter

Time Flies Differently Here

2010-03-05T23:29:00.000-08:00

For many years, scholars in the field of international management have highlighted the significant cultural differences one must face in understanding various orientations to the concept of time. In countries known as ‘sequential’ or ‘monochronic’ (e.g. the United States), appointments are kept, one thing leads to another and schedules generally do not deviate from the plan. In ‘synchronous’ or ‘polychronic’ cultures, appointments may be held simultaneously, start late, and end even later. The latter group of cultures tends to place a higher value on relationships than on meeting deadlines or pre-determined schedules. In case it isn’t already clear, Rwanda is a polychronic culture. Perhaps nowhere is this clearer than in surveying the meetings we have (or do not have) on the calendar each day. To give you a glimpse, allow me to share some of my favorite reasons scheduled meetings have been missed in recent weeks…

Ranking (Time Explanation Received) and Rationale for Delay

#12 (30 minutes before scheduled start) “Actually, because of the Umaganda holiday, we are not allowed to meet until after noon”

#11 (During meeting) “I apologize- the medication I am on makes it very difficult to stay awake”

#10 (1 hour after scheduled start) “We could not meet this week because of the death in the family”

#9 (3 hours after scheduled start) “He has a delegation of Americans he is showing the factory… stay there and he may come eventually”

#8 (45 minutes after scheduled start) “The line at the bank was terrible this morning”

#7 (1 hour & 2 hours after scheduled start) “I’m on my way coming”

#6 (2 hours after scheduled start) “His Excellency, the President, urgently asked to see a report today from my (govt.) agency”

#5 (8 hours before scheduled start) “I forgot- I need to drive two hours to see my dentist at that time”

#4 (15 minutes after scheduled start) “I was waiting for the rain to stop so I could catch a moto-taxi”

#3 (1 hour before scheduled start) “He would like to be there, but he must organize his daughter’s wedding today”

#2 (30 minutes after scheduled start) “My house and business burned down last night… could we re-schedule?”

#1 (15 minutes after scheduled start) “I know we confirmed the meeting last night, but I forgot I’m getting married this morning and need to submit some documents”

Thankfully, we have learned to laugh and roll with such delays. On any given day, it seems four scheduled meetings will materialize, two will not and at least one will be added impromptu. Any given in-person meeting may be interrupted by between two to eight mobile phone conversations or texts. For us, patience and flexibility is key. Thankfully, Rwandan businesses are aware of their need to honor schedules better if they are to be deemed serious. In a small country like this, ‘gatekeepers’ are rare, and there is perhaps nobody you could not schedule a meeting with if you tried. But no matter which Rwandans you intend to meet, you should not be surprised to hear excuses such as those we’ve listed here.

Onward and upward,

-Carter

From "Donor Mentality" to "Owner Mentality"

2010-02-26T15:16:00.000-08:00

Perhaps more so than any other part of Africa, there is a popular notion in Rwanda that we must depart from a “donor mentality”. This new mandate has been poignantly communicated in books such as “Dead Aid”, a book which President Kagame handed out to every member of his administration. The thought that local problems can, or should, be solved by benevolent outsiders is perhaps one of the most crippling legacies of Africa’s colonial past. Government, NGO and philanthropic aid continues to pervade countries like Rwanda, and while these people and institutions often have truly noble intentions, Kagame and others are fearful they may stunt the Rwandan mindset required for truly sustainable development. Karisimbi Partners is committed to the market-based sustainability of its client companies, and we feel we can do this best by being profitable and sustainable ourselves. This approach makes us somewhat odd among the many Westerners here representing religious, political or non-profit organizations, but it has also made us popular among the local public and private sector leaders seeking an alternative to traditional aid. I have been struck this week by some of the interactions we have witnessed from this vantage point…

Exhibit A. Too often, Rwandans will wait for aid to come to the rescue rather than working to rescue themselves. For instance, we know of a village that refused to build proper latrines because the village next door had them donated and they thought it would be easier to wait until they received similar help. One of our client companies has recently received a significant investment from a European businessman. As Karisimbi Partners has been asked to evaluate the caliber of the existing management team and supplement where necessary, I have had the opportunity to interview 16 of the top employees in this agricultural processing company. I have asked each, “What changes would you make if you were the owner of the company?”. Almost without fail, the initial response has been a laugh or smile and a comment which indicates they had a) never considered the possibility of their being an ‘owner’, and b) have little reason to think such could be any more than a hypothetical exercise.

Exhibit B. I met with a leading Private Sector Development manager working for a European embassy this week. He has lived here for four years and personally overseen millions of Euros in aid via more than 13 initiatives led from his office. When I told him what Karisimbi Partners was doing, he thought it a refreshing new approach. When I told him mid-sized companies here are paying us such that we are getting closer to profitability every month, he almost fell out of his chair. Like the recipients of donations, those giving donations may also suffer from this mentality. It becomes difficult to believe it could be done differently when you become an expert at giving money to those who are incented to solicit it from you. The donor mentality can be debilitating on both sides of the transaction and fail to recognize the full dignity and equality deserved by each party.

Such experiences reinforce our belief: an “owner mentality” is the best antidote for those suffering from “donor mentality”.

Onward and upward,

-Carter

Out of Control: Four Funerals & a Wedding

2010-02-18T20:03:00.000-08:00

As I was sitting at the funeral service for a dear friend’s father this last weekend, I was very aware that this was one of those distinctive differences between the place I grew up and the place I am now getting to know. Although I could not decipher many of the Kinyarwanda words spoken at the ceremony, it was clear that every word my friend spoke was full of emotion and meaning. In the seven months since we moved here, there have been at least four funerals among our immediate Rwandan friends and neighbors. Initially, I was simply struck by the importance of such events, as demonstrated by the time and priority given to gathering together and mourning for as much as a week after the death. As one Rwandan explained to Dano, “It is not about wallowing in the past, it is about honoring the dead”. It is not uncommon for businesses to close and much of “normal” life to be put on hold while the deceased is honored by hundreds of friends and family members. Today, however, I was struck by the frequency of such events. Indeed, it is one of the more painful indicators that in a country like Rwanda, life seemingly ‘happens to you’ more than life is ‘directed by you’. Unlike any other place I’ve lived, tragedy is expected here as a fact of life and such events are expected to be given their due respect.

On a happier note, weddings are also more visible and frequent events than anything I have ever seen before. One of our business colleagues had to leave the funeral we were at on Saturday in order to join a friend’s wedding party. I received my first wedding invitation last week, and while I could not attend, I look forward to a future opportunity. To deal with the sheer volume of wedding ceremonies here, some churches will ask four or more couples at a time to say their vows together. Wedding parties of extended family and friends gather in public locations for pictures, and some weekends you can compare the formal attire of as many as six wedding parties at one traffic roundabout (This many brides can certainly stop traffic!). I am fairly certain that as we develop more relationships here, it will be fairly easy to spend all weekend at weddings or funerals.

I am continually struck by the way people here share pain and joy en masse. There is a surprising (even refreshing) capacity of local Rwandans to drop whatever they are doing in order to participate in such events. Because it is understood that ‘life happens to you’, there is no presumption that one’s life, work or even today’s schedule is one’s own. I have a theory: Rwandan’s naturally respond to such events by praising or praying to God (Imana) because it is so apparent they could not have orchestrated such things by themselves. It is only when we convince ourselves that we are in control that we fail to acknowledge the existence or possibility of a Creator with a Master Plan.

Onward and upward,
-Carter

Business Ethics: More 'Caught' than 'Taught'...Especially Here

2010-02-11T00:26:00.000-08:00

The Private Sector Federation (PSF) serves as a representative of private sector institutions in Rwanda and liaison to the government ministries that attend to it. As such, PSF is an organization that sits somewhere between the ‘private’ and the ‘public’ spheres involved in the development of this economy. In recent years, Rwanda has earned the reputation as the safest and least corrupt African country, yet there is still much to be done to facilitate business and attract outside investors. PSF decided to champion an initiative to encourage better behavior as relates to key issues: transparency of financials, upholding of contracts, treatment of employees and quality production. The central point in this initiative was a small handbook on business ethics I learned last June was being published. Thinking my PhD in Entrepreneurial Ethics could come in handy here (I’m fairly certain I am the only one with such a credential in East Africa), I met with the organizer of the publication. As seems only possible in Rwanda, I was invited to contribute to the project on the spot. After just two days of work, I was able to contribute a great deal more than I would have thought possible to the final product. A small book called The Code of Business Ethics & Excellence was launched amid much fanfare and lofty speeches. In one of the keynote speeches I was proud to hear the CEO of the PSF quote one of the lines I had authored: “This book is NOT just about deterring the worst, it is also about encouraging and rewarding the best business behavior”. At the launch event, some organizations even signed a document signifying their organization’s commitment to the prescriptions laid out in “the code”. I am now part of a Business Ethics Committee responsible for maintaining some of the momentum generated at this event. The following newspaper article tells more about the event and the initiative: http://www.newtimes.co.rw/index.php?issue=14126&article=24355

After the book was launched, the ethical standard of Rwandan companies was immediately lifted. Ah, if only it were that easy! Like so many documents of this type, this is an important first step in stating ideals worth striving for, and ideas for reaching them. We have become painfully aware, however, that there is a critical shortage of qualified managers to understand and implement things handed to them in documents that describe a better future. This is partially because Rwandan culture is not a “reading” culture. Furthermore, reports are particularly ignored when the subject matter is as seemingly abstract and nebulous as business ethics.

Thankfully, lofty sentiments like integrity, honest and excellence are illustrated vividly in some of the practical business relationships we’ve forged here. Our actions certainly speak louder than any words we could write, so on our best days we and our Rwandan friends do our part to tangibly express our values and beliefs. I’m confident the decisions and interactions featured in our day-to-day relationships are easier for others to understand and emulate than anything we could put to paper. Thankfully, our business model accommodates the transfer of knowledge AND values, since we interact often, deeply, and long-term with many of the clients we serve. As a result, when feasible, we aspire to write fewer documents in order to spend more of our time living and implementing the words that may have died on the page.

Onward and upward,

-Carter

Stakeholders: Ethics & Value for All

2010-01-29T03:24:00.000-08:00

In our “post-capitalist” world, people are concerned with more than the shareholders of a company, they are concerned with all stakeholders. Shareholders are also stakeholders, but they are one of many interests to consider, and not necessarily the most important. And the “purpose” of business is no longer defined as increasing shareholder value, but instead increasing value for all the stakeholders. Economic development discussions often replace the conventional “bottom line” with the “triple bottom line” measuring the impact on people, planet and profits.

For purposes of this discussion, we can call the following stakeholders, because each bears the consequences of the actions of corporations: shareholders, lenders, employees, suppliers, competitors, customers, government institutions and the community. I include the environment or the planet as a subset of many or all of the stakeholders because as the environment goes, so go the rest of the stakeholders.

What if a corporation paid its lenders per the terms of agreements, provided employees with meaningful work at a good wage, encouraged other businesses to grow (be those suppliers or competitors), sold customers a quality product for a fair price, abided by and helped to create laws and regulations that were good for the community and in all of the above improved the general standards of living of the community as a whole? That seems like it would be a company in which one could feel good about being a stakeholder. But you’ll note the shareholders are conspicuously absent from this list of stakeholders above. What if the shareholders of that company took their profits and spent them on frivolous living? What if they used those profits to advance causes that infringed on human rights? What if they used them to fund the sale of arms to those committing genocide? What if they simply used company funds to support a political party with which you disagree? Are any of these reasons to choose not to be a stakeholder in a corporation that otherwise seems to be doing so much good? Does the good being done by the corporation outweigh the consequences of the shareholders’ personal use of the profits? Is that even the right question to ask?

I don’t believe there is a moral or ethical rule to be followed or broken here. But as with many moral or ethical questions, it is to be thoughtfully assessed on a case-by-case basis and decided upon in the specific context of the stakeholders involved.

We are trying to do this on a regular basis in Rwanda. Here, it is possible to see the various extremes in the levels of power and it is easy to see the significant impact businesses have on their stakeholders. But as I write this, I realize our questions are not unique to this place; the same moral questions can be asked of any of the institutions we work for, regardless of geography.

Dano Jukanovich

Karisimbi Partners Makes the Headlines in Rwanda

2010-01-19T11:43:00.000-08:00

Our plan was to avoid any ‘publicity’ or overt ‘marketing’ until we’d gotten settled a bit and earned our stripes working with some real local companies. Per usual in Rwanda, contacts and events took on an organic, unpredictable path of their own….

I had the good fortune to meet Davinah through a mutual friend. Davinah works in the Office of the President, Paul Kagame. As I tried to explain why we moved to Kigali to start Karisimbi Partners, she echoed a sentiment that I have heard a few times now: “Your story is inspiring!” I told Davinah that our story has (in part) been a response to the truly inspiring story that Rwanda is presently writing. This small country is audacious enough to dream of growth and development nobody thought possible… and that kind of vision is contagious; daily we see the diverse array of foreigners and supporters it has attracted to help in the effort.

The day after our meeting, the editor of The New Times, Rwanda’s most prominent daily newspaper, called me to say he also thought our story was inspiring. After a brief interview and a few weeks, there was a 2-page feature story on Karisimbi Business Partners in the business section! The link to the article is here: http://www.newtimes.co.rw/index.php?issue=14125&article=24218. Our little company is no longer flying “under the radar”. Word travels fast.

Onward & Upward,

-Carter

To Know Him is to Know Peace

2009-12-24T10:33:00.000-08:00

We were only there to deliver a gift. What we received in return was nothing like I expected.

All three Karisimbi Partner families have always believed in committing the ‘first fruits’ of our labor, which is why it did not seem strange to want to donate a portion of the first company paycheck. It was not a huge amount, but somehow it just felt right to give a tenth of our earnings to an organization that honors those trying to rebuild after the genocide. In particular, we wanted to support an organization that encourages entrepreneurship. We decided on Amani Ava Hejuru, an organization committed to helping marginalized women in Africa find peace with God and one another. They focus on relationship-building while giving the women sewing and marketing skills. Their products represent excellence.

We wanted to buy three beautiful baskets made from fabric scraps. It seemed symbolic –first fruits are gathered in a basket, and our first fruits would support the business of women making baskets. Our donation could buy three baskets with surplus funds for purchasing a quilting machine that would allow them to produce more products. I communicated with Grace, the Managing Director, and was invited to their workplace. Upon arrival, their workshop appeared to be a small garage converted into a space for eleven sewing machines. Greg and Kristen Urquhart came as well (we have all since decided that the next time we present such a gift, we must all be present). We said some brief remarks and went to leave. Beata, who manages the store, asked if she could sing us a song. The drumbeats started. Her beautiful voice rang out. The others joined in. Hands began to raise and bodies began to sway. Three of the women began to dance the traditional Ingonza dance. Translated from Kinyarwanda, the following words filled that small space with such joy it moved me to tears. “Your husband cannot give you peace, your neighbor cannot give you peace, your friends cannot give you peace, your job cannot give you peace....only Jesus can give you peace.” In a way, this is a Christmas message… one that they sing and feel all year long.

These are words sung by women who lost their husbands during the genocide in horrific ways – often at the hands of their neighbors. They know what can and cannot give you peace. Where we thought our gift was small, to them it was another way Jesus was showing his love to them. And they celebrated that recognition through song and dance, completely uninhibited. I felt I was standing on holy ground. My three-year-old daughter, Anna, was hugging my leg as she listened. I said a silent prayer that she would remember this and someday be able to receive the gifts in her life with the joy and peace these women embodied.

We have the privilege of access – access to education, resources, networks. With this privilege comes responsibility. These women have received the gift of life – a second chance. Rwanda has received the gift of a second chance. We have the privilege to serve with what we hold in our hands. We also have the privilege to receive what this country extends to us.

-Jennifer Jukanovich

Address Common Needs - Hold Things in Common

2009-12-08T04:48:00.000-08:00

As we have begun to find more opportunities to venture further outside Kigali and into rural Rwanda, our appreciation for the beauty of this place and its people has grown immensely. Apart from the heart of Africa, it is hard to imagine where in the world you might see so many tall green hills covered with cultivated crops and smiling people.

Today in Rwanda you can see a collective sense that “we are all in this together”. Despite the tragedies in this country’s past, and the struggles it currently faces, I am continually struck by what I see as simple indications of mutual affection and solidarity toward a brighter future. These indicators are probably poignant to me since the California culture I moved from was rarely characterized by: a) needs that were so commonly shared or desperately practical, b) willingness to share things I can rightfully claim as “mine”.

I regret I never get my camera out in time to show you these pictures, but some of the most colorful illustrations of what I’m talking about include:

- A community soccer ball (pictured here), one of five I brought from the states, that the children in my neighborhood use about 4 hours every day on the dirt road in front of my house. Children collect it from the guard when they wish to use it and return it when they are done.

- A group of seven school children running, laughing and attempting to share one umbrella during a sudden afternoon downpour on the way home from school

- A family of four sharing one moped

- Two boys speeding down a paved road… each with a roller blade on one foot (one right, one left, as they apparently only had one set to share)

The other day, a new Rwandan friend of mine named Shami was driving downtown and called for the attention of what seemed a random passer-by. A short, scruffy-looking man immediately came to the moving car, and Shami smiled, said a few words, and handed him money as we continued on our way. I had to ask what had just happened. Shami told me that the man was a thief he knew… and while he doesn’t condone the man’s occupation (thievery), he pities the man’s condition and makes a habit to pay him now and then so he is able to buy a bit of food. Apparently, on more than one occasion, Shami has been grateful for this man’s friendship. Shami’s car has never been broken into when parked in this part of the city, and when Shami has needed to get information on certain matters (e.g. when friend’s belongings have gone missing), this man has been a valuable informant.

It never before dawned on me that I should make a habit of paying a thief…but then, I’m still new here, and I’m not accustomed to relying so heavily on my neighbors as they do so well in Rwanda.

Onward & Upward,

-Carter

The Search for Customer Satisfaction: Charm vs. Force

2009-11-21T13:57:00.000-08:00

When moving to a place like Rwanda after living in a place like America, one is sure to struggle with the common standards of customer service. There is actually a furniture company here with the motto: “The Customer is a King”. Yet the excitement of seeing such sentiments will quickly wear off when this company fails….

…to build the furniture you requested

…to understand the customer (‘king’) is the one who should dictate which design is best, even when the craftsmen feel it looks better with the alterations they made

…to apologize or inform the customer that the furniture they ordered will be as much as one month later than promised

H.E. President Kagame has made a concerted effort to address the customer service culture in Rwanda. He and others claim that low customer service standards will stunt the desired development of tourism and other key sectors of the economy. Immense amounts of training and funds have been channeled toward addressing this shortcoming, but commonly accepted cultural attitudes do not change overnight.

This common problem presents Westerners like ourselves with a couple viable options: charm or force. I’ve made a mini-study of the effectiveness of each strategy and will attempt to illustrate them in the example below. (Disclosure: The following example is based on an amalgamation of many actual customer experiences)

Let’s assume you visit the nicest coffee shop in town, the one that aspires to be a model of customer service for retail businesses in Kigali. You order a lunch. 45 minutes later, you ask the waitress if it will arrive soon. One hour after arrival, you have seen the people at surrounding tables, who arrived after you did, receive their orders and leave. Your waitress is clearly apologetic, but clearly unable to deliver your lunch. You consider your options and then…

Option A: Force

…you slam you hands on the table and yell at the waitress. While she runs away in tears, you scan the restaurant sure others will affirm your customer service injustice. While bystander reactions vary, some look as though they feel sorry for you… you are someone who simply can’t understand local ways (and perhaps doesn’t belong). You also feel embarrassment and disdain, for you have just exemplified the stereotype that Americans are selfish, loud and individualistic. The ‘net’ result: you still don’t have any food and you’ve perhaps lost current and potential friends as well. In my experience in Rwanda, the harder you attempt to force a quick resolution in your favor, the more resistance and resentment you face from all involved in the interaction.

Option B: Charm

…you smile, tell the waitress you know it is not her fault, and ask to see the manager. When the manager arrives, you step aside and speak quietly so others cannot hear, and explain the problem you’ve experienced. Smiling, you explain you are not trying to blame the waitress, the manager or anyone else for the problem, but you hope the manager has the authority to resolve it in an acceptable fashion as this clearly isn’t the type of customer service a store of this caliber wants to be known for. If this doesn’t work, then the same smiling and charming style may need to be applied to the owner of the restaurant. In my experience, customers who take the time to employ such charm until finding and reasoning with whoever has authority generally get satisfied in the end. Often, they even make friends along the way.

Onward & Upward,

-Carter

One Client's Troubled Story

2009-11-13T13:22:00.000-08:00

There is a wonderful man we have had the privilege to know for the past few months. He is the founder and lead investor in a tomato processing company we have engaged as a client. The more you understand this man’s past, the more inspiring and endearing he becomes. He started the tomato processing company in 1986 because he hoped it would be able to provide stable employment to thousands of farmers at wages above the norm. Given the Rwandan climate and conditions for tomato farming, this seemed a promising concept.

The Rwandan market for processed tomatoes was being satisfied by manufacturers in Italy and other distant countries, so it was hoped a local factory could provide better quality and a better price. He and his wife were both heavily involved in managing and operating the factory in these early years. Prior to 1994, the company made good progress. Then, the tragedy of war and genocide ravaged Rwanda. Employees and their families perished in huge numbers. The buildings, infrastructure and utilities, which the company required to operate, were decimated and looted. For those who managed to survive, they were required to find a way to do so without the work and income on which they had depended. The founder personally lost his wife and four boys. For many years, he lost hope and the will to re-establish his company. The very sight of the factory re-kindled painful memories as his wife was so integral in its operations. For 10 years, the factory remained out of commission.

In 2004, public officials and new investment partners convinced the founder to revive his company. Eventually, the founder re-married and his wife gave birth to three sons. At the processing plant, he remained as Managing Director for over two years, but it soon became clear employees were stealing company funds. He took measures to address the issue and appointed a new Managing Director to take his place. Recently, Karisimbi Partners was engaged to work with this new management team and help the company reach its next stage of growth.

Unfortunately, we learned two weeks ago that the founder’s wife and middle son were both being treated for cancer. Days later, we received the tragic news that, at just 11 years of age, the boy lost his fight with cancer. We were asked to join part of the week-long ceremonies to commemorate the boy’s life. We met the founder at his home to offer condolences and a customary gift. As I have an 11-year-old son, my heart broke for this man.

It is an honor to work with clients such as this… individuals that have experienced tragedies, both past and present, yet still do what they can to help their communities. Our privilege is to partner with such people…indeed, those who need it most.

Onward & Upward,

-Carter

African Guidance Required...

2009-11-06T08:09:00.000-08:00

For almost two months now, I have been taking classes to learn Kinyarwanda, Rwanda’s local language. It was approximately eight months ago that it became clear the long-term impact we were hoping to affect with Karisimbi Partners would require a long-term residence in Rwanda and long-term relationships with clients. Appreciating the cultural and language translation required to truly understand and help these client companies, it seemed one of those on our team should speak the “language of the heart” which Rwandan’s often prefer to use to when Westerners are not around. Besides… Greg Urquhart speaks French very well, Dano Jukanovich speaks Mandarin Chinese and I felt like an under-achiever (and my weak Spanish is of no use here). They say that your capacity for learning a new language quickly diminishes after your formative early years. Since I’m about to turn 40, I thought I’d better get started!

My twice-a-week tutorial sessions have been led by Silas Twagirumukiza, the warmest and most patient guide you could have for such a journey. It has been a huge blessing that Jennifer Jukanovich has also joined us on the path to learning Kinyarwanda, proving that difficult journey’s are made easier with the right traveling companions. Together, the three of us share a cup of tea on weekday afternoons, struggle with the homework, laugh at the “foreignness” of the language and perspectives. We do take time to admire our surroundings, indulging in the occasional tangent to admire afternoon lightning storms, colorful birds, or cultural insights along the way. But one phrase from our study guide continually jumps out at me…

“This (word/phrase) must be learned with the help of an African”

Rwanda is a small country, and Kinyarwanda is not a major language, thus there is nothing like “Rosetta Stone” to show us the way. We have a book written by a Western missionary over twenty years ago and copied so many times that many pages are hardly legible, and most of those have writing in the margin. There are some efforts to facilitate learning Kinyarwanda using more ‘modern’ methods, but Silas is effective even with such materials (and students such as us!). The reason the phrase “must be learned with the help of an African” jumps out at me is because of the humility of the author and the profound relevance of the statement. It really doesn’t matter how long I live here and study the language, it is likely I will never be as good a teacher as a native Rwandan could be. To expand this notion further, there are many things besides language that require translation here: customs, traditions, assumptions, preferences, etc. I’m fairly certain I am learning more each day here than I have learned for weeks or even months in other places. Rarely have I ever felt the need for so much trusted advice and guidance. Since many things can’t be understood without the help of an African… we are grateful many African friends have joined us on the journey.

Onward & Upward,

-Carter

Wanted: More Searchers, Fewer Planners

2009-10-31T14:10:00.000-07:00

William Easterly is an economist by training and practice with a long career at the World Bank and in academia. His book, The White Man’s Burden, has become a ‘bible’ to some of those in the international economic development field. He believes that international aid to the developing world has been characterized by top-down planning in everything from World Bank loans to U.S. Military Intervention, which is why it has predominantly failed. In contrast, those individuals within developing economies themselves or even within international institutions who creatively ‘search’ for solutions to problems based on market demands have and will continue to come up with ways that work to truly alleviate poverty.

Easterly highlights an example of a well-known ‘Searcher’ in Mohammad Yunus of Bangladesh, the founder of the Grameen Bank and the primary individual attributed with the founding of ‘microcredit’ lending (and mentioned in earlier posts). After earning his PhD, Yunus attempted to help the poor by sponsoring tube wells for irrigation during the dry season to increase the growing period. He actually loaned the farmers some of his own money to implement the projects. In his work, he visited as many rural villages as possible to understand the true needs on the ground. He met a woman who ran a small furniture making business but had the majority of her profits eaten up with 120% interest on loans to buy the raw materials for her furniture. His first loan was to this furniture maker. Starting with a PhD dissertation titled, “Optimal Allocation of Multi-Purpose Reservoir Water: A Dynamic Programming Model,” his ‘searching’ led him to establish the microcredit model that has now impacted millions of people.

Easterly’s baseline thesis is worth remembering: Developing country economies need more Searchers and fewer Planners (both in their own countries and in the West). My corollary to his baseline is that humans are innately designed to be creative problem solvers, or Searchers. Karisimbi Business Partners is certainly made up of Searchers. We strive to exercise our own God-given Searcher characteristics while working alongside fellow Rwandan Searchers to solve one business problem at a time.

Dano Jukanovich

Received: The Biggest Check Ever!

2009-10-23T18:41:00.000-07:00

Last Friday, Karisimbi Partners received its first client payment…. A check for over 2.8 million! I should quickly clarify that the check was written for 2.8 million Rwandan Francs (just $5,000 in US Dollars), but that should not depreciate the significance of this particular check. This was not only the first client fee received by Karisimbi Partners, in non-financial terms it may represent more than any check I’ve ever received. When I consider why this seems such a milestone to me and my partners, a number of reasons present themselves…

· We were frequently told that “Rwandan businesses won’t pay our fees”

· It is culturally normal to speak positive, even when there is no plan from prospective clients to follow-through

· Rwandan business leaders do not easily part with their money

· We are Westerners and many Africans expect Westerners to either write a check to them, or at least provide free services as a non-profit

· I had met with this particular client more than nine times since last March (and exchanged countless e-mail and voice communications) to develop our relationship to this point

· At this time, the Crocketts, Urquharts and Jukanovich’s had only been located together in Kigali for two weeks

· A different client asked us to begin work without receiving any payment until the work was completed

· This particular client has committed to engage our services on a significant level for at least the next two years

· The Karisimbi Partners business model calls for client fees in order to be sustainable

· What Karisimbi Partners is offering Rwandan businesses is fairly unique and new, hence frightening to some and hard to commit to for others

· What began as a business concept in December of 2008 was validated by four Rwandan clients this week

There is great need here that fits what we do best….and the fact that clients are willing to pay for it suggests we may be afforded the privilege of doing it in a sustainable way for many ventures in the years to come.

Onward & Upward,

-Carter

When Good Ideas are Bad

2009-10-12T11:56:00.001-07:00

Downtown Kigali, you are likely to be approached by vendors offering the opportunity to buy various printed material. Among the common items on offer: maps of Kigali. As a new visitor and now resident, I paid the $3,000 RWF (roughly $6) to get my copy, even though I could see it wasn’t going to be as useful as I hoped. Although this is a sizeable city of almost 2 million people, I have yet to find a good map. This is largely because the vendors sell the same map…one that is now outdated. This city has seen such change in recent years, entire neighborhoods (such as the one in which our children attend school) and key landmarks are nowhere to be found. The official language in Rwanda has changed from French to English recently, yet none of these maps are printed in English. And perhaps most frustrating, these maps have no way of showing elevation. In a city consisting of many hills, a 2-dimensional map simply fails to help the reader appreciate the terrain to Point B while sitting in the valley of Point A. As an entrepreneur, one’s mind races to possible solutions, and Greg and I struck upon the following idea: A pop-up map of Kigali! Such a map could be topographical in 3-D, include all landmarks and suburbs to scale, be written in English and hopefully printed at a price that still makes it affordable for the growing number of newcomers coming to this city. Among the army of registered vendors, imagine how popular the one with the new map would be!

Every day, walking in a setting with so much untapped potential, one is struck with such ideas (some better and more serious:). If necessity is truly “the mother of invention”, we should not be surprised to find so many opportunities, given the need is so great on so many levels. Good intention can be spread too thin, as many local NGO’s can attest. Since the amount of time and energy we have is finite, we must not try to do so many things that we fail to do one thing well. It is frustrating having to say “no” so often, yet if we can continue to do so, and pick our focus areas carefully, we increase the likelihood that years from now something truly excellent will have been achieved.

Someday, a vendor will offer us a new map of Kigali, and we’ll be thrilled someone else made a good idea happen.

Onward & Upward,

-Carter

Trust: An Illusive Virtue

2009-10-01T04:01:00.001-07:00

Trust is a funny thing. Where trust is present, everything seems easier and better. Where trust is absent, it is difficult to earn or build. Trust is a critical asset that is easily broken and hard to fix. We would all do well to pursue it, but it is possible to have too much of it. It is risky to offer it, but can be very rewarding when returned.

In social settings, from families to nations, there are many benefits attributed to trust. It is often deemed a ‘lubricant’ that makes relationships and transactions run smoother and cheaper. It is also called a ‘glue’ that unites and holds people together. Trust is deteriorated by factions seeking short-term gain, but flourishes where factions subjugate themselves to a unified vision for the long-term.

In post-conflict settings like Rwanda, trust is desperately needed yet hard to build. As foreigners that have just moved here, we can begin to see the want and benefit of trust vis-à-vis settings more familiar to us. Genocide has to be the ultimate destroyer of trust, forgiveness the ultimate healer of what was broken, and a common commitment to a future vision the ultimate road to building something better. In some measure, we can find all these things in Rwanda.

As it relates to Karisimbi Partners, we have already begun to note some of the ways we can build trust and be trusted here in Rwanda:

· Face-to-Face Relationships- very little progress of any substance transpires from a distance, or over phone or e-mail. Getting all relevant parties to meet face-to-face sometimes seems the only way to build trust, albeit business or personal. Less “rich” medium may be valued only insofar as they coordinate in-person meetings. Becoming residents and meeting often has helped immensely.

· Common Motives- most new contacts dedicate some portion our meetings to discerning our deepest motives for being here. Many of those we meet blend social and financial aspirations…. they are clearly interdependent here and now. When they learn we are motivated by faith and social benefit, they smile broadly and say we are “most welcome”. When they learn we seek a practical impact and financially sustainability, they respond as if we’ve said something new or refreshing, and can work with them on what is needed most.

· Commitment- people here want to know you’re “serious”. Good intentions have not been enough in the past. When people hear that we’ve moved here for years and brought our families to empower Rwandans pursuing a better future, they, in turn, take us “seriously”.

On the long road toward building trust, we’ve at least identified some initial steps.

Onward & Upward,

-Carter

Right Place, Right Time (continued)

2009-09-26T07:38:00.000-07:00

We continue to receive daily confirmation that we are in the right place at the right time….so you’ll forgive me if I issue a second installment on the same topic as last week.

Additional indicators that Karisimbi Partners is ideally situated:

A couple months ago, I received a letter from a program director at Harvard Business School. He described to me an MBA ‘immersion’ program that sends some of their top students to Rwanda to work with organizations. He found out about what Karisimbi Partners was up to and contacted me through our website. I’m not sure what I could have done to warrant such interest had I remained an academic in California, yet before we even moved to Rwanda we were known and contacted!

You can imagine what a pleasant surprise it was to be told we may be able to guide ten Harvard MBA students with an interest in Rwanda. They will be broken into two teams in order to serve our clients in a short-term consulting capacity. The program leader had no idea he had reached scholar that had led business students on an immersion program himself.

There is a popular hotel here in Kigali called the Novatel (or Laico, its new name) where many Westerners and well-placed Rwandans mingle by poolside. Today we shared a drink with an Israeli agronomist that introduced us to an English businessman who owns the largest mineral export company in the country. He has lived in Rwanda 12 years, and upon hearing us explain our plan, he said no less than four times “you guys are absolutely in the right place at the right time”…

There are now 16 Americans moving to Rwanda as part of our little venture. All have arrived except those attached to the Jukanovich family. We recently learned that the family across the street needed to move suddenly to Nairobi, Kenya. We contacted the owner (who happens to live in Canada!) and reached an agreement last night that will ensure the Crockett’s and Jukanovich families will be very close neighbors!

Although our move is looking more ‘reasonable’ by the day, I can’t help but remember many of these emerging points of confirmation only became visible once we took what seemed unreasonable first steps.

For anyone else pondering a vision, I hope this is encouragement to make the initial leap… you may find yourself on firmer ground than you thought! Hindsight is a validating factor.

Onward & Upward,

-Carter

The Joy of Being in the Right Place at the Right Time

2009-09-18T14:21:00.000-07:00

I have been a part of organizations that seemed perpetually “behind the times”. I have also worked at organizations that have been so ahead of their time they could not capture a viable market for their products and services. Together, these experiences have instilled in me a great appreciation for being in the right place at the right time.

Karisimbi Partners certainly seems to be ideally situated for the challenges and opportunities facing Rwanda today. Many of the most important validating factors were not visible until we visited and eventually became residents here. The following is a partial list of the indications suggesting we are ideally situated for the present conditions:

· Rwanda has garnered a great deal of international attention, goodwill and resources (partially as a result of the devastating atrocities of 15 years ago; partially due to the subsequent vision and pace of progress since)

· Rwanda is very much “open for business”, as indicated by the following:

o A recent World Bank/IFC report just named Rwanda the developing country that is reforming its business practices and regulations faster than any other in the world (link to report).

o Many consider Rwanda the least corrupt, safest business environment in Africa

o The Rwandan economy is established enough to boast over 70,000 micro-businesses and the services sectors to support them…. yet there are less than 50 ‘large’ companies in the country… offering tremendous untapped potential for small and medium-sized enterprises that hope to grow

· After many group training sessions and short-term management interventions, the Government’s Rwanda Development Board (RDB) has concluded what is needed now are “company-specific interventions” for translating abstract, generalized concepts in ways that offer practical impact for individual companies

· The vast majority of Western business influence in Rwanda has come in the form of investment capital and short-term management interventions… making Karisimbi Partners distinctive for partnering long-term and locally to build up the management capacity of promising Rwandan ventures

…and these are just a sample of the indicators that the timing is right for what we are doing. Other anecdotal signs: I arrived while the national “Code of Business Ethics” was being drafted and was able to co-author the document and receive an appointment to the new “Ethics Committee”at the Private Sector Federation (PSF) managing this initiative…. A new building has been built to support the growth of small and medium-sized enterprises and the owners are now seeking professionals with top credentials to occupy the new offices…. We happened to find a super guard/gardener from a family that happened to be leaving Rwanda the same week the Urquharts arrived…

Indeed, we have daily confirmation we’re in the right place at the right time. Thankfully, a more pressing concern is this: how can I publish a blog regularly when the electricity (and thus internet access at my house) is anything but regular?

Onward & Upward,

-Carter

Custom Solutions for Developing Contexts

2009-09-11T08:18:00.000-07:00

You’ve got to admire the ingenuity of people in developing countries. Last summer, while leading a group of college students through rural China to study the growing phenomenon known as ‘social entrepreneurship’, we saw many ingenious solutions to local problems. One clever example of a “new” application used by rural peasants for boiling hot water is depicted below.

Satellite-enhanced solar kettle

In Rwanda, there are also daily reminders that products created in the Western countries can take on an entirely new meaning when placed in such a context.

New luggage... traditional carrying technique

Such images are a good reminder to us at Karisimbi Partners: we should not expect our experiences and understanding to translate here… at least not directly in the manner we may otherwise assume. In the high-tech U.S. corporations where we’ve worked in the past (e.g. Microsoft, AT&T Wireless) we learned that technology changes much faster than human behavior. Such lessons are only magnified in the context of a developing country where the same modern technologies face traditional behaviors that are significantly less modernized than they are in the West. Cynthia Smith has highlighted this challenge in her book “Design for the Other 90%”, stating that the items many of us take for granted are out of reach for the vast majority and the contexts they live in.

In a developing economy like Rwanda, it seems bringing the best of Western business perspectives will be the easy bit… the real challenge is adapting them to the context in the most meaningful fashion for those we aim to serve.

Onward & Upward,

-Carter

The Power of Cultural Values

2009-09-04T00:41:00.000-07:00

President Kagame and his administration clearly have an agenda that is more than merely about political and economic power… they have a social and moral agenda as well. Some of the explicit messages that are disseminated attempt to encourage people to be “good” in terms that may surprise Westerners (e.g., When was the last time a politician you knew erected billboards discouraging constituents from being ‘Sugar Daddies’ or ‘Sugar Mamas’?).

In the fight for a better Rwanda, and given the social/moral agendas that are a part of that, the current administration has tapped the ideological power of traditional cultural values. Some of these values are encapsulated in simple words; all are uniquely Rwandan and convey powerful cultural meaning. ‘Gacaca’, is a traditional village forum for resolving conflicts and community healing re-invigorated in Gacaca Courts starting in 2001 in an attempt to deal justly with the influx of cases overwhelming conventional judicial processes in the wake of the genocide. ‘Imihigo’ is an important concept referencing a long-standing cultural practice in Rwanda whereby two parties publicly commit to achieving a particular task toward the greater good. Missing the stated targets leads to dishonor as for each party, as well as the community. Among ambitious Rwandan government and other leaders, Imihigo is now being used and employed again. ‘Umaganda’ references a culturally-embedded ideal suggesting progress and beauty are everyone's responsibility. Thus, the 4^th Saturday of every month has been dubbed ‘Umaganda’, and is something of a national clean-up day when everyone (including the President) attempts to dedicate their morning to picking up trash, filling in potholes, and building up their communities together. Given Umaganda was the Saturday after we arrived, it was also a great way to meet people!

After breakfast, my kids and I collected trash along the dirt road in front of our house, trying to do our small part in the beautification of our neighborhood. Afterward, my son Oliver brought out a soccer ball, and a crowd of boys soon formed and was split into two teams. For the next hour, it seemed many of our differences fell away as we played a wonderful game on our street (interrupted briefly by ‘traffic’ in the form of 2 cars and 11 goats). This opportunity to work and play together with our neighbors has become one of the chief highlights of our first week as Kigali residents.

We already appreciate some of the Rwandan cultural values we are learning…although only once a month, Umaganda encourages us to work together better and more often than we might otherwise do on our own.

Onward & Upward,

-Carter

Market/Non-Market Partnership (formerly known as Public-Private Partnerships)

2009-08-29T06:46:00.000-07:00

Economies develop through the creativity and hard work of entrepreneurs who have leveraged Market and Non-Market principles and partnerships. Consider the U.S. economy at its early stages of development. It wasn’t built simply upon government largess nor did it develop only because of the creativity inspired by market dynamics. Rockefeller’s monopolistic Standard Oil, by definition, grew out of what economists consider a “market failure,” but it did presage the development of huge swaths of the U.S. economy. The men who supposedly “risked everything” to build the transcontinental railroad system were able to mitigate their risk due to factors put in place by the federal government.

Let’s define the players in a Market/Non-Market Partnership. Historically, the Market category consists of private companies and public companies that have a purpose to generate financial returns for equity share owners. The Non-Market category consists of government institutions, churches, foundations and any others who do not return any of their profits to equity share owners. In fact, the differentiating factor between the two is that these Non-Market (commonly referred to as Non-Profit) entities do not have equity share owners.

Market/Non-Market Partnerships take some commonly recognized forms but they are a pervasive part of almost any economy. Consider some examples relevant to economic development in East Africa. Churches partner with banking institutions to develop systems whereby poor community members are able to save and invest. A national government builds a hotel with government funds and then sells the hotel to a hotel developer and operator. A railroad builder raises money for his venture through the sale of government-secured debt. Market/Non-Market Partnerships are integral to enterprises from education to transportation to health care; from airplane building to designer clothing merchandising. Increasingly, it’s a fallacy to think we can draw a clear line between Market and Non-Market enterprises.

These partnerships work best when the Market by itself is not able to efficiently provide the products or services, or when there are broader societal benefits that will accrue from said partnerships. The practical micro-economic implication in these scenarios is that a Market-oriented entrepreneur needs Non-Market based incentives to help improve his risk-return ratio to a level sufficient to move forward with certain ventures.

To be blunt, as it relates to East Africa, the strictly Market-driven risk-return ratios don’t justify development of a transcontinental railroad. They don’t justify investing in Small and Medium-sized Enterprises (SME's) in many developing countries. The only way to realign these risk-return ratios is for there to be Market/Non-Market partnerships. It is institutions who agree that “Aid is Dead,” but who are also willing to accept less-than-market returns on their investments who seem to be driving a great deal of economic growth in East Africa. These influential institutions can be led by domestic or foreign governments who have the ability to manipulate markets and therefore endure extended below-market returns. They can be led by “donors” who are willing to relinquish control through true Market/Non-Market Partnerships. Or the institution can be literally a single local entrepreneur who may well have a plan that includes a Market/Non-Market Partnership that will both align the entrepreneur’s risk-return ratio and directly or indirectly benefit the greater public good.

This type of Market/Non-Market Partnership with individual entrepreneurs seems to me the purest and most hopeful way forward for developing country economies.

Dano Jukanovich

Weighing Risk vs. Reward

2009-08-19T17:31:00.000-07:00

I’ve been thinking about this communication for some time now, and while some of you are already aware of our decision, it is good to finally “go public” with the news. From the moment our friends, the Crocketts and Jukanoviches, announced their intention to launch Karisimbi Partners and move to Rwanda, it became difficult NOT to think of what such a move could mean for our family.

From my first trip to Africa several years ago, my heart was captured by the need and difference between our lives and those of that part of the world. And, like many others, I found that once I was aware, it was no longer an option to ‘do nothing’. Furthermore, the restlessness and discomfort with the safe and comfortable life we’ve had in a Seattle suburb has continued to weigh on our hearts. After much thought and prayer, Kristen and I made the exciting (and also scary) decision to join these two families.

Joining Karisimbi Partners was a major decision for my family and I. It involves leaving an established career at a Fortune 100 company with a clear path to ongoing “conventional” success. I have worked for over 14 years with Microsoft, including leadership roles working across the U.S., Europe and Africa. Yet while this is a major decision, it was not actually a difficult one…not when you have that pulling from deep within to do something bold…something focused outside yourself…something that requires faith just to attempt. I love Africa. I love the idea of doing all I can everyday to work towards a mission I fully believe in. I love the idea that we can make a difference – however large or small. I love the people I will be in partnership with and the chance to live in community together. And I love this scenario where a control freak like me steps out into the unknown.

The dictionary describes “Risk Taking” as the willingness to incur injury, damage or loss. Risk is dangerous chance. Hazard. Jeopardy. It is to go out of one’s depth. Reading that definition sounds a bit daunting, but all great accomplishment is also invariably associated with taking risk. To quote Helen Keller, “Life is either a daring adventure or it is nothing at all…life shrinks or expands according to one's courage.” For me, I take comfort in responding to this meaningful opportunity to move out of the comfort zone I’ve lived in for many years now. If anything, I believe there is greater danger in risking nothing, than in attempting to live a life less ordinary. As my new partner, Carter, has blogged in earlier posts, what Karisimbi Partners is working to accomplish is pioneering. The outcome is anything but certain. We are striving to push the boundaries and forge into the unknown. For me, I feel our venture in Rwanda is an opportunity to fulfill our purpose…. to step out, to take a calculated risk using our skills, experience, and passion so that we can serve and develop promising Rwandan businesses. With a reward like that, who wouldn’t accept some risk?

“Two roads diverged in a wood….”

Greg Urquhart

Unlike Microfinance: Depth vs. Breadth

2009-08-13T12:17:00.000-07:00

It is never easy to describe a new business model…. particularly to folks that have little reference for the context in which it is being launched. When we begin explaining what Karisimbi Partners is doing, somebody will inevitably respond…. “Oh, you’re doing microfinance?”

Indeed, we founded Karisimbi Partners to help alleviate poverty and expand sustainable market opportunities. Like many microfinance pioneers, we are motivated by the social impact of our venture (not merely financial returns). We share a belief that the dreams and relationships of poor individuals are the source of tremendous wealth and dignity (which banks have traditionally ignored). But our similarities may end there….

Our focus is on depth, not breadth. Microfinance institutions often make small loans to hundreds or thousands of new ventures. Karisimbi Partners primarily invests relationally (not financially) with just a few high-growth ventures at a time, each of which may someday employ hundreds or even thousands. Microfinance often deals with small business operators that may never grow or create stable jobs for others. Karisimbi Partners identifies and supports true entrepreneurs with proven ideas and great ambitions. Many microfinance institutions begin by lending capital, and then provide related social services. Karisimbi Partners begins by building social capital and management capacity to ensure each venture is ready for financing and future growth. By focusing on a few promising ventures, Karisimbi Partners’ can offer the hands-on assistance to help client companies employ many, export often, contribute taxes, build industry sectors and establish role models which the new generation of business leaders can follow.

Indeed, microfinance is an impressive and crucial model for creating broad market opportunities in developing countries… and will remain a critical factor in the war against poverty. I am proud to be an advisory board member of the best microfinance organization I know, HOPE International, and very much agree with their leader’s recent assertion (on this blog) that Rwanda is ripe for an integrated approach to economic development. Yet our model is certainly different… Karisimbi Partners attempts to pick up where microfinance leaves off, walking alongside select entrepreneurs to significantly impact a few ventures that can make a great difference.

In Rwanda today, it seems calls to build the "missing middle" in this emerging economy also call for a model that has not yet been established…so we’ll have to keep explaining why we are not a microfinance organization.

Onward & Upward,

-Carter