AccessKenya’s journey from tiny firm to corporate giant

AccessKenya managing director Jonathan Somen is set to relinquish his position after leading the technology company for 15 years. Mr Somen is a founding member of the IT company, which briefly listed at the Nairobi Securities Exchange (NSE) before going private after it was bought by a South African group.

AccessKenya stayed as a family-owned business for most of its lifespan before it floated shares to the public through an initial public offering (IPO) at the NSE and ultimately found an international suitor.

Mr Somen spoke to the Business Daily on the firm’s long journey from a tiny family-owned enterprise to a foreign-owned corporate giant.

It is difficult to imagine how the IT landscape looked like when AccessKenya was born. What inspired the family to go into the Internet business at the time when Kenya had virtually no infrastructure to support such an enterprise?

We were already in the ICT business till late 2000 when my brother David and I sat down to explore “what the next big thing” in ICT in Kenya would be. We agreed it was going to be the Internet and that’s how AccessKenya was born.

It is true that the sector was very closed at the time and we had to buy both local loop connections and the international bandwidth from the Kenya Post and Telecommunication Corporation, the State-owned monopoly at the time.

Costs were very high and service wasn’t great in the market at the time and we felt we could do it better than everyone else. Luckily, the sector started to deregulate a few years later and it happened so fast.

We had the advantage that by this time we had built a great name as a first-class service provider.

At what point did AccessKenya founders realise that it was time to list the firm at NSE and what was the motivation?

Listing on the NSE is not an overnight process so it was quite a long time before we felt it was an option. We believed the IT revolution was just building up and that an explosion of services across the country was looming in the wake of deregulation.

It was during this time that Kenya was getting connected to high speed Internet through an undersea fiber optic cable.

We felt it was time to “step change” the business to gain the financial muscle we needed to invest in infrastructure and maintain our position as market leader. We felt that the business needed more funding to go to the next level.

We looked at options such as taking in strategic partners as well as listing on the NSE, but in the end we felt going public was the best route.

It created a massive amount of support for our brand and it also made many people realise that AccessKenya was the market leader in corporate connectivity. 

Many entrepreneurs prefer to hold on to their businesses yet you let AccessKenya become a public company, later a subsidiary of Dimension Data. What made you different?

Business is not a static process but rather a very fluid situation that is constantly changing. My brother and I were never hung up about control and wanting to always own 100 per cent of the business. We had a long term view and when we had a plan we adapted to what suited the plan for the business.

When the business was sold to South Africans, we weren’t actively out in the market looking for buyers but we were approached. The offer turned out to be not only in the interest of the shareholders but also good for the future of the business.

We felt Dimension Data was and is an excellent company, very professionally run, culturally very similar to us and they had (and have) a great vision for this business. 

What are some of the key lessons learned during your tenure at the helm of AccessKenya ?

There are just too many to list them all. One of the most important ones is that it is people who make the business.

We happen to be a technology company and we are very good at technology but without the right people, you will never succeed.

Another key lesson is focus. We have always focused on our core business and this has really helped us to stay atop the corporate market.

As we got bigger, we had to delegate more and we started doing different things and that really tied back into the people point I just made — without the right people you are going to struggle to succeed.

Finally, I would also say that we aren’t going to get everything right and we made mistakes along the way. Fortunately, we didn’t make any major mistakes but those lessons from mistakes are probably more important than the lessons you learn from your successes.

What should we expect of the Somens’ in relation to IT and your impending role as a non-executive director at Internet Solutions?

I have run this business for 15 years and so I have a lot of knowledge about the business. My knowledge will obviously still be there for the business to tap into and to be available for the incoming MD if and when required.

As I transition into a non-executive director’s role, I envisage helping at a more strategic level.

I am really delighted to be taking up this role as I believe I still have value to add to the business. David remains in the business and is now the executive deputy chairman of the Kenya business so we both remain involved.

Any insights for African entrepreneurs on building sustainable business?

Focus. If an entrepreneur starts a business and it does really well, don’t lose that focus. Many people do really well then think they can conquer anything and start shifting their focus to other things and end up losing advantage in their original businesses.

The other thing I’ve seen and read a lot about is that the number one killer of startups is cash flow. If you start a business, be absolutely sure that your customers pay you and pay you on time.

If you do a great job and are better than your competition, your customers will want to pay you so that you come back but don’t allow customers to sign up and get services then get away with not paying.

A customer who doesn’t pay you is worse than someone who never becomes a customer.

When you want customers to build your business, it’s easy to take them on and not ensure that you get paid, or not ensure that you get paid enough upfront to keep you afloat. Finally, you need a big dose of luck and we’ve been lucky!