Café Deli owner’s dream of building a coffee chain

When Obado Obadoh was hired by Norfolk Hotel as an apprentice chef in 1990, he had no idea that the job would plant in him an entrepreneurship bug that would sprout into a multi-million shilling business two decades later. 

“I had just turned 18 and I needed a job to take care of my struggling family. I started off as an apprentice chef since I had no formal training and by the time I left (employment) in 2004, I was the pastry chef,” Mr Obadoh, the founder of Nairobi-based coffee house Café Deli, said in an interview on Friday.

Mr Obadoh’s plan was not to stay on the job for long.

He wanted to gain exposure to the hospitality industry, get to know how it works, and then decide what to do with his life. His stay in the hotel industry however lasted nearly 15 years, before he finally gained the courage to plunge into the entrepreneurial world.

After working at Norfolk for five years, he left for his second job with Safari Park Hotel, where he worked for four years before leaving for Nyali Beach.

Two-and-a-half years later he joined Sarova Panafric as a Pastry Chef until 2004 when he resigned from formal employment.

In the same year, he set up a pastry shop in Westlands, Nairobi, and incorporated two of his business partners to fund the young business.

“When the business started doing well, disagreements emerged and I opted to leave,’’ says Mr Obadoh, reflecting on an experience that almost pushed him into depression.

He was bought off from the business.

In 2006 he opened a pastry kitchen that focused on delivering to homes and supplying restaurants.

He registered Nanjala Limited, a start-up that took nearly six months to break-even, surviving mainly on a few trader-clients who would buy from him and re-sell at a small profit.

He later employed sales people to sell some of his merchandise at bus terminuses, paying them on commission.

As the business grew steadily, Mr Obadoh learned that a coffee shop by the name Coffee World located along Nairobi’s Moi Avenue was being sold off. He put in a bid for the business but lost since he did not have Sh18 million needed to acquire the firm.

The banks told him that his asset value of Sh2 million at the time was too little to cover the financing that he required to buy out the firm.

Unbowed, he approached a venture fund that loaned him the cash to expand his business, which he re-named Coffee Deli. He renovated the premises that had a capacity for 60 people and expanded it to accommodate 80. This was in 2011.

By 2013, the business had gained momentum and he had accumulated some cash, which he used to buy out the iconic Green Corner Restaurant also on Moi Avenue, opposite Kencom House, from Home Park Caterers.

The coffee house has a capacity for 200 people.

Both Cafe Deli outlets has 110 employees. Mr Obadoh has co-opted Veronica Aluoch at Café Deli as a business partner.

He said his entry into the coffee shop business was informed by the shortage of African dishes in Nairobi’s restaurants that are targeting the middle class

Cafe Deli plans to open two more outlets in Nairobi, one along Kenyatta Avenue that will have capacity to hold 250 people, and another early next year.

Café Deli is also targeting space in shopping malls, where other established coffee shops like Java have already made inroads.

Mr Obadoh says his business acumen has been shaped by failures which sharpened his decision- making.

An example of such failure is a cereals business he started while working at Norfolk Hotel, with a Sh100,000 loan. The business never lived to see its second month.

He says the biggest challenge for him now is getting the right space to set up outlets, and the high set up costs.

But Mr Obadoh advises that lack of capital should not be a hindrance to activating a business idea.

“Just have a good idea and people will invest in it,” he says.

In July this year, Café Deli received a Sh100 million funding from a South African venture firm to finance its expansion plans.

Mr Obadoh, 43, says for now he would be hesitant to buy an existing business but would rather start from scratch. He says experience has taught him that people don’t sell businesses that are doing well.

His motivation comes from reading books among them Rich Dad, Poor Dad by Robert Kiyosaki. On investing, Mr Obadoh says the best investment is in an area you understand best, and hiring a workforce that appreciates your idea and not just the payslip.

“Do what you love and what you know best,” he says as a parting shot.