How to Start a Business in Kenya

You have made the decision to start a business but you don’t have an idea where to start (pun intended).

Don’t worry.

This article lists all the steps required to materialize your business idea and having a successful business. It’s time to stop telling people that you’re going to start a business and actually put in the work to make it happen.

1. Are You Mentally Ready?

Let’s get this over with and the earlier the better.

Starting a business is hard work, requires a lot of determination and learning, and only pays off in the long term. Take an honest look at yourself before leaping.

About 20% of small businesses fail in their first year, and 50% of small businesses fail in their fifth year. Let that sink in and stop for a minute and look outside the spectrum of the Flipkarts and Ubers of the world. There are plenty of documented start-up failures — and many, many more undocumented ones.

Why is it that so many ground-breaking ideas by brilliant minds crash and burn so quickly? Here are some of the main reasons why start-ups fail.

  • Lack of a business plan
  • Premature Scaling – The first order of business is to figure out the product/market fit and until then, expenses need to be limited to necessities and essentials.
  • Lack of marketing knowledge
  • Lack of funding or revenue
  • Inefficient founders – this are mainly the wantrepreneurs who WANT to run a business but don’t know HOW to run a business.

If you are employed, the transition to the business world requires a complete shift in mindset. As an employee, you are accustomed to getting a salary at predefined intervals, you know what you will make, you can plan and budget. However, being your own boss, you pay yourself, your employees (if you have any), your suppliers etc and you can pay only if you make something, and if you don’t make……. The bills still needed to pay, it can be struggle.

Don’t forget that as an employee you work for a set number of hours but business never sleeps. As a business owner you may be working 14 hours a day instead of the usual 8 hours……..and minimal holidays (if you are lucky even to have one).

Hoping that you have thought through the above and you feel that you have it to venture into the business world, lets proceed to the other steps of starting a business.

2. Determine What Type of Business to Start

The next step of starting a business is to figure out what type of business to start. 

Is there a niche that you’re particular passionate about? You have to like it – that’s the only way to succeed- because sometimes it will be difficult , very difficult and if you don’t love what you do you will give up. Are you looking for a business that you actively work on or just own? Are you looking for a business to start by yourself or with a partner? These are just a few of the questions you need to ask yourself before starting a business.

To figure out what type of business you want to start, create a list of things you’re passionate about. For example, yoga, personal finance, dogs, movies, food, and clothing. And answer this question, “In five years from now, which business would not only get me out of bed in the morning but would also excite me enough to continue creating content/products/tools for it?”

Refine Your Idea

Once you have your business idea do a quick search for existing companies in your chosen industry. Learn what current brand leaders are doing and figure out how you can do it better. If you think your business can deliver something other companies don’t (or deliver the same thing, but faster and cheaper), you’ve got a solid idea and are ready to create a business plan.

It is good to know why you are launching your business. In this process, it may be wise to differentiate between [whether] the business serves a personal why or a marketplace why. When your why is focused on meeting a need in the marketplace, the scope of your business will always be larger than a business that is designed to serve a personal need.

3. Write a Business Plan

At its heart, a business plan is just a plan for how your business is going to work, and how you’re going to make it succeed.

It answers questions such as:

  • What is my business about?
  • How will the business be financed?
  • Who are the target customers and how do you reach them?
  • How will the business be managed?
  • Who are your competitors?

A business plan helps you figure out where your company is going, how it will overcome any potential difficulties and what you need to sustain it. Learn how to write a business plan and when you’re ready to put pen to paper, these free templates can help.

4. Access your Finances

Starting any business requires that you pay for various services. Do you have the means to fund your startup, or will you need to borrow money? If you’re planning to leave your current job to focus on your business, do you have money put away to support yourself until you start making a profit?

Experts generally agree that startup businesses often fail because they run out of money too quickly before turning a profit. It’s never a bad idea to overestimate the amount of startup capital you need, as it can be a while before the business begins to bring in sustainable revenue. Additionally, don’t overspend when starting a business. Understand the types of purchases that make sense for your business and avoid overspending on fancy new equipment that won’t help you reach your business goals.

If you need financial assistance, a commercial loan through a bank is a good starting point, although these are often difficult to secure. If you are unable to take out a bank loan, you can get assistance from friends and relatives. After all, they are easier to talk to to and tell them about your dream business.

If you’re employed and saved some money to start your business, don’t quite your job until:

  • You have enough money flowing from your business to cover 2X your average monthly expenses.
  • You trust that you’ll put in the work to make your dreams happen and expect no get rich quick results.
  • You have an emergency fund to cover at least 12 months of expenses
  • You realize when you quit, you’ll be working 14 hours per day instead of 8

The type of business structure that you have around your business can make or break your business. There are many different business entities to choose from based on how you want to start your business. Here are some of the business structures you can setup:

a) Sole Proprietorship

This is the easiest to setup and has the least number of requirements. If you are just starting, you can setup your business as a sole proprietor then upgrade to a company later.

This legal business structure gives more control to the entrepreneur over decision making in all different parts of the business.

Characteristics of a Sole Proprietorship

  • Easy and cheap to setup
  • Few Legal Requirements
  • Minimal Legal Protection – In a sole proprietorship, the business and the owners are one and the same. If someone sues the business, then the personal assets of the owner(s) – car, home etc – can be seized in any judgement against the business.

b) Partnership

A partnership legal structure is best for a group of people thinking of starting a business. You need to have a minimum of 2 people and a maximum of 20 people. While setting up this kind of business you will be required to sign a Partnership Deed.

c) Limited Company

This is by far the best business legal structure to operate with when running a business. The reason is that the liabilities are limited to the business assets and you can enjoy some tax benefits that a sole proprietor business cannot.

You need to have a minimum of 1 director and up to a maximum of 7 directors, however you can add more shareholders in the business.

Once you have chosen the best legal structure for your business, you can go ahead and register it on Kenya’s eCitizen Portal.

6. Create your First Product or Service

There are a number of products or services you can create to sell to your audience when starting a business.  The products you create for your business will depend heavily on your skillset and business type. However, there are countless products that can be ordered or created that you can sell to an audience. 

7. Promote your Business

Before you start selling your product or service, you need to build up your brand and get a following of people ready to jump when you open your literal or figurative doors for business.

Create a logo that can help people easily identify your brand, and be consistent in using it across all of your platforms.

There are two main ways of promoting your business: offline and online business promotion.

a) Offline Business Promotion

Promoting your business offline is all about marketing to customers using a range of options they can touch, feel and experience. This includes everything from your business card and letterhead through to brochures and flyers, posters and banners

Here are some offline marketing strategies you can use easily and affordably to promote your business.

  • Business Cards – Business cards are cheap and effective, but many business owners are stingy about using them. They also make you look professional and are easy to share at any time.
  • Networking Networking not only gives you direct engagement with a potential client, but referral opportunities, as well. Both have higher rates of conversion because people prefer to do business with professionals they’ve met or who have been referred to them.
  • Press Releases/Media Pitches Press releases offer a great deal bang for your promotional buck. Not only are they free, but they boost your authority as well.
  • Flyers Flyers might seem old school, but they still work because they can keep your name and brand in people’s minds as they go around town and see your posting.
  • Seminars/Speaking Like publicity and articles, seminars and public speaking present you as an expert, thereby increasing your credibility. They also give you a chance to show off your stuff, and entice people to hire or buy from you.
  • Trade Shows/Events Trade shows and events give you a chance to sell your goods and services, but also offer networking opportunities. Even if people don’t buy at that time, it’s a place to showcase what you’ve got and get information into potential customers’ hands through business cards, flyers, brochures, videos and other marketing materials.

b) Online Business Promotion

Online business promotion / advertising, also called online marketing or Internet advertising or web advertising, is a form of marketing and advertising which uses the Internet to deliver promotional marketing messages to consumers.

The first step of promoting your business online is having a website. According to Ruthann Bowen, client relations specialist at EastCamp Creative, too many startups have the wrong mindset about their websites. “The issue is they see their website as a cost, not an investment,” Bowen said. “In today’s digital age that’s a huge mistake. The small business owners who understand how critical it is to have a great online presence will have a leg up on starting out strong.” 

If you need to create a professional business website, HostFiti Website Builder can help you achieve this at affordable rates. See our website templates designed for any type of business and pricing for more details.

Once you have your website, create social media pages for your business.

 Here are a few other ways you can promote your business online:

  • Facebook: You can run Facebook Ads by going after “broad” interests and including relevant brands as an interest to capture their audience. You can also post in Facebook groups as your fan page which is great for businesses with niche audiences. 
  • Instagram: Grow your Instagram followers so you can make sales with each Instagram post. You can also add direct links in Instagram Stories to capture more sales.
  • Pinterest: Group boards are a great way to get visibility on your posts when you’re starting out. You can also create your own boards to promote your content on. Be sure to promote other brand’s content to avoid triggering your account as spam.
  • LinkedIn: Build your personal brand by creating posts and sharing thoughts on articles on LinkedIn. Invite relevant users to follow you to increase your reach. 
  • SEO: By optimizing your website for search and creating blog content you can generate more leads, email subscribers, and website traffic. 
  • Quora: Answer niche questions on Quora to promote your website. You can use SEO tools to find high-ranked Quora keywords to help increase your visibility on the platform. 

8. Grow your business

Your launch and first sales are only the beginning of your task as an entrepreneur. In order to make a profit and stay afloat, you always need to be growing your business. It’s going to take time and effort, but you’ll get out of your business what you put into it.

Collaborating with more established brands in your industry is a great way to achieve growth. Reach out to other companies or even influential bloggers and ask for some promotion in exchange for a free product sample or service. Partner with a charity organization and volunteer some of your time or products to get your name out there.


While these tips help launch your business and get you set to grow, there’s never a perfect plan. You want to make sure you prepare thoroughly for starting a business, but things will almost certainly go awry. To run a successful business, you have to adapt to changing situations.

“Be prepared to adjust,” said Stephanie Murray, CEO and founder of Fiddlestix Candy Co. “There’s a saying in the military that ‘no plan survives the first contact’ meaning that you can have the best plan in the world but as soon as it’s in action, things change, and you have to be ready and willing to adapt and problem solve quickly. As an entrepreneur, your value lies in solving problems whether that is your product or service solving problems for other people or you solving problems within your organization.” 

Do you think this article will help someone? Don’t forget to share.

Subscribe to be notified about new marketing, entrepreneurship & web development posts.

Make a Professional Website using HostFiti Website Builder

Having a professional business website helps you establish credibility as a business. Make your professional website using our drag and drop website builder in minutes and make it convenient for your customers to contact you.

Starting from inclusive of bulk SMS, hosting & unlimited email accounts.