TLDR;
This YouTube video features a conversation with a guest who shares insights on entrepreneurship, marketing, and growth in the African context. The discussion covers strategies for acquiring first customers, the importance of understanding customer behavior, talent acquisition, and the need to focus on metrics that drive business growth. The guest also shares personal experiences and lessons learned from building successful businesses in Nigeria, emphasizing the unique opportunities and challenges in the region.
- Understanding customer behavior is crucial for effective marketing and sales.
- Talent is the most important thing in building any business.
- Nigeria has a competitive advantage in people and talent.
Intro [0:00]
The host introduces the guest and mentions that Sellar is the new presenting sponsor of the podcast. Sellar is an e-commerce platform that helps creators turn their ideas into products and services. The host also promotes a sales and marketing bundle available for purchase.
Acquiring First Customers [3:43]
Flutterwave initially focused on enterprise payments and leveraged partnerships to acquire its first 10,000 customers. They partnered with Access Bank, providing a superior payment solution for the bank's merchants compared to the existing option of Interswitch. This involved integrating with Pay with Capture (later acquired by Access Bank) and offering services to other bank customers. They also used this approach to onboard Uber.
What Didn't Work [5:18]
The guest emphasizes the importance of automating services and focusing on key customers. He notes that a small number of customers (around 50) were responsible for a significant portion of the traffic and profits (70% and 50-60%, respectively). Focusing on these key customers earlier could have reduced workload and increased efficiency.
Key Takeaways for Entrepreneurs [6:16]
Talent is the most important thing in building any business. It's crucial to find people who not only have the skills but also share the same motivation and values. Understanding and predicting customer behavior is also essential for effective marketing and sales. It's important to understand customers' mental models and how they think about things to craft effective marketing messages.
Entrepreneurship as a Service [8:11]
The guest discusses the concept of "entrepreneurship as a service," where entrepreneurs receive funding but lack a genuine connection to their customer base. This can lead to a disconnect between the business and the needs and habits of its customers, ultimately hindering growth and success.
Changing Beliefs About Growth in Africa [9:09]
The guest used to believe that growth in Africa was primarily driven by consumer spending. Now, he believes that growth is more closely tied to what people are paid for producing. He highlights the limited number of people employed in key sectors like oil and emphasizes the need to focus on creating employment opportunities for the large population, particularly through exporting labor and talent.
Nigeria's Competitive Advantage: Exporting Labor [10:56]
Nigeria's primary competitive advantage lies in its large population and talent pool. With a significant number of graduates produced each year, the focus should be on exporting this talent and creating opportunities for them to earn income. Even a modest income of $5 an hour can significantly impact the economy and improve the financial well-being of individuals.
Understanding Consumer Behavior [15:11]
The guest emphasizes the importance of understanding consumer behavior to drive business success. He stresses that businesses should focus on what they know about the consumer that drives their behavior. Research is essential, but it doesn't have to be formal or academic. Simple observation and asking questions can provide valuable insights into customer needs and preferences.
The Power of Research and Understanding Your Customer [16:49]
It is important to understand your customer and avoid making assumptions about them. Research doesn't need to be a licensed activity; it can be as simple as talking to customers and observing their behavior. The guest shares a personal anecdote about selling a book to young people by understanding their affordability and targeting institutions that could purchase the book in bulk.
Experimentation and Doubling Down on What Works [18:07]
The guest advises making small bets and experiments to discover what works for your business. He uses the example of an entrepreneur who found success advertising skincare products on Instagram but struggled with Facebook. The advice was to focus on Instagram, where the customer behavior and purchasing patterns were more favorable.
Key Metrics for Business Growth in Africa [20:14]
The top five metrics businesses should focus on daily are: revenue, leads, conversion rate, cost to serve, operational costs, and free cash flow. It's crucial to understand the customer journey, from initial interest to purchase, and to identify why potential customers didn't convert. Businesses should also analyze their cost structure to ensure prices are appropriate and costs are minimized.
The Importance of Exposure and New Experiences [23:17]
Exposure to new experiences, whether through travel or reading, is crucial for entrepreneurs. These experiences can broaden perspectives, spark new ideas, and provide motivation. The guest shares a personal story about witnessing a startup being acquired for $40 million, which inspired him and showed him what was possible.
Favorite Entrepreneurship Books [26:56]
The guest shares his favorite entrepreneurship books, including "Founders at Work" by Jessica Livingston and "Zero to One." He also expresses a preference for reading biographies, as they provide insights into the experiences and thought processes of successful individuals.
Lessons from Parents [28:37]
The guest shares how his parents' journey from humble beginnings to success taught him about social mobility in Nigeria. He emphasizes that Nigeria offers opportunities for advancement if one is determined and works hard. He cautions against making irreversible decisions like selling assets when seeking opportunities abroad, as Nigeria still offers the best chance for social mobility.
Why Be Bullish on Nigeria [31:30]
Nigeria represents the idea that black people can self-govern. It is one of the few majority-black countries without significant white representation in elected offices or business leadership. This makes Nigeria a unique and important experiment in self-governance and economic empowerment.
Advice for Startups [32:56]
The guest emphasizes the importance of providing early-stage startups with initial funding, mentorship, and introductions to customers. He advises startups on how to articulate their unique customer insights, build the right team, and find customers at scale. He also stresses the need to develop products that are affordable and solve real problems for customers.
Hiring the Right People [34:16]
The first role a startup should hire depends on the founder's strengths and weaknesses. Hire for what you don't have. It could be finance, business development, operations, or design. The key is to identify the capabilities needed on the team and find the best talent to fill those gaps.
Product Development and Financial Advice [35:43]
Startups need advice on product development to ensure they are building solutions that solve customer problems and are affordable. They also need financial advice to accurately calculate costs and ensure the business is profitable. This includes accounting for the founder's salary and all expenses.
Outro [37:36]
The host thanks the guest for the conversation and encourages viewers to subscribe to the podcast on YouTube, Spotify, and Apple Podcasts. He also promotes the sales and marketing bundle available for purchase and thanks Sellar for sponsoring the podcast.