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Heshan de Silva Venture Capitalist

Heshan de Silva Venture Capitalist

Poverty and profits
Today Heshan’s company, which has a 400-strong workforce, all of whom are under 23 years of age, has developed a reputation for being one of the region’s most enterprising entities, with holdings in commodities, technology, renewable energy, insurance and agribusiness including companies such as Moran Apparel, AFRClothing, Limelight Media and SASACabs.

One of the businesses DSGVenCap has invested in – Uniq Technology – has developed a GPS-enabled gadget that controls the music and advertising that commuters listen to. The innovation has been globally patented and will be rolled out among the ubiquitous yellow cabs of New York City. A second local success is Gourmet Nomads, which makes and delivers lunches in Nairobi for KSh150-KSh200 ($1.70-$2.30) per meal.

DSGVenCap also has greenhouses across the country designed to leverage on Kenya’s vast tracts of agricultural land, and ease food insecurity. “If you put up a 10×8 greenhouse and start growing tomatoes, then switch over to peppers and cucumbers, these make a lot of money. It’s KSh130,000 ($1,500) to set up a greenhouse and you can net KSh1m ($11,000) every season. The numbers make sense,” said Heshan.

The company also has two clothes lines – one in Miami and another in Kenya, with the former championed by US rapper 2 Chainz; interests in robotics and tech hardware; and three television shows under production including a cookery competition on K24, The Billion Bob Question on NTV, and one on Citizen TV that will either be titled Shark Tank or Dragons’ Den.

Road travelled
DSGVenCap’s business identity has been intimately influenced by Heshan’s own experiences in the business world.

“We go after the field of ideas purely because when I was starting out I had no capital whatsoever. I had to go after the one sector that I could afford, which was ideas. Couple that with always taking a minority stake in the business irrespective of how much funding you are putting in, and you’ve created the most valuable commodity: trust,” he said.

When he was working at his father’s small tea export company in Mombasa, Heshan had his first experience of the cut-throat nature of business competition.

“We were selling a few containers to Egypt, and these guys would plant seeds of doubt into buyers’ minds for no other gain other than to see you squashed. We were taking a tiny piece of the market out of 40 exporters – we were number 38 – and that was my first experience of this really ugly side of business where people will do anything to squash or beat you down.”

Shortly after the political unrest in Egypt, his family opted to slow down their tea export business.

Another defining moment was the number of rejections he received in his early career after being turned down from 15 restaurants for a menial KSh12,000 ($137) a month job as a kitchen assistant.

The scorn that his youth and naïveté received in the early days stayed with him, and when he and his New York business partners talked of how to address the vast income disparity in Kenya, they agreed they should work with the poorest in the country.

“These are people who are ignored. They have ideas, small business dreams but no one cares because they have no assets, no security,” said Heshan.

And so DSGVenCap adopts a strategy that is all about the numbers, and plans to reduce poverty in Kenya from 60% to 40% in the next decade.

“We believe that if we have a lot of deals, not just five or six a year, but hundreds of small businesses with a 70% success rate, we’ll be doing well,” he said. “Many VC funds think two out of 10 is great but we average seven to eight out of 10 [in a year]. If you’re only going to do three or four deals in our world – four greenhouses or three kiosks – your net impact will not be large.”

And four years down the line, the verdict is good for DSGVenCap. Heshan leans back in his chair; his arms hang loosely by his side and his right eyebrow is unfurrowed.

“It turned out okay,” he said. “Life is all right. I can’t really complain.” 

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Written by Aamera Jiwaji

Aamera Jiwaji is a Nairobi-based business journalist who writes for the East African and MENA markets. A graduate of South Africa's Rhodes University, she returned to the media in 2011 after working in Kenya's publishing and public relations scene. Tweet her on @amijiwaji.

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