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African Billionaire: Proud Of Poor Background, Successful From Bank’s Rejection

Making effort to rise from poverty, although the African billionaire Mike Mlombwa does not have a college degree, thousands of bachelors and masters are working for him.
Malawi is one of the poorest countries in Africa, but the will to overcome difficulties towards getting rich and start from scratch here is not inferior to any other economy.

A life of servant

Source: The New York Times

The name Mike Mlombwa is not strange to the people of Malawi at all. He is a billionaire in this country, owning the brand Countrywide Car Hire, together with several hotels. The interesting fact about this entrepreneur is that he used to live in sheer poverty, even begged for a living.
Born in the Mwanza region, which borders Mozambique, Mlombwa had to lived with several families at a very young age. Because his family was poor, that was the only way for him to earn money for his tuition fees.
“My mom was very poor… So, in the village, I grew up with several people who paid my school fees. In the afternoon I would come back from school to work in gardens or look after cattle or whatever.” Mlombwa says.
However, when Mlombwa reached high school, no family could adopt him anymore because the cost of this his over expensive tuition fees. So he had to walk 60km to the city of Blantyre, becoming a true beggar having no money in his pocket or a place to live.
Desperate, he decided to seek help from the Catholic community there and was luckily helped. Finally, Mlombwa was also hired by a benefactor to work as a servant, thereby making enough money to cover living expenses and go back to school.
"One family took me in as a servant. I was working… but I was going to school where I did my Form 1-4.," Mlombwa recalls.

The first businesses

Source: BBC

After graduation, the young Mlombwa started selling stationary, using his earnings to buy a used car, then driving it across the borders of Mozambique, Zambia and South Africa to do business. The job developed so quickly that he was able to buy his 2nd and 3rd car.
However, difficulties soon arise. Cross-border trade struggled against competitors from Indian immigrants. Ultimately, Mlombwa had to reconsider his new direction as he acknowledged the incoming market saturation.
With 3 cars obtained from his business, Mlombwa came up with the idea of ​​​​car rental which was quite new in Malawi. So in 1997, this 28-year-old guy started a car rental company.
“And little by little I started increasing my fleet. In 2005 I had about seven vehicles. Then in 2007 I had 15, but three quarters were second-hand vehicles. This is when I asked my friend to assist me with making my company a limited company,” Mlombwa remembers.

Succeeded by... being rejected by the bank

Source: Countrywide Car Hire

At the time, Mlombwa aimed for an infant car rental service at the airport, but he needed capital to expand further and the bank would never accept a fledgling, unconnected, nameless car company like Mlombwa’s.
“I didn’t have a very good education like a degree, so it wasn’t easy,” he explained. “I struggled… The banks were not giving me an opportunity.”
Mlombwa refused to give up, trying to figure out other ways to fulfill his dream. The fact that the bank denied his loan prompted him to negotiate with other car rental companies. His company would sublease their fleet and pay a commission instead of expanding the fleet on its own.
Surprisingly, it was this difficult decision that accelerated Mlombwa's business explosive growth. The large profits from car rentals at the airport enabled him to afford for more cars, continuing to expand. By the time the business was big enough, Mlombwa was eligible for a bank loan.
“When they saw I was doing fine, banks came to me and said: ‘Okay, we can assist you now’,” highlighted Mlombwa.
Currently, anyone visiting Malawi can see Mlombwa's fleet of rental cars covering airports and hotels. Realizing the development potential of the country, Mlombwa intends to double his fleet of vehicles, together with investment in real estate and hotel construction to create a sustainable ecosystem for his business model.

Proud of his own background

Source: USA Today

Contrary to many people in Malawi, billionaire Mlombwa is quite proud of his poor background when compared to the old-established wealthy elites..
“I came from a very poor family. When I say poor, I mean the poorest family. That is where I came from. Today sometimes I have to ask if I am dead in heaven or still alive, because I can’t believe that God has sent me here – that I have got a name in the world, in Africa,” Mlombwa shared.
Although he still wants to get a university degree, the billionaire said he has no regrets about what he went through.
“I am happy to face challenges and I am happy I became an entrepreneur. And to be honest, I don’t see it as a regret that I did not finish my schooling, because now I can employ people with master’s degrees or whatever. They are assisting me here and there,” said Mr. Mlombwa with a smile.

Valuable advice

Source: Nyasa Times

The young billionaire shared that starting a business here was no easy at all when it comes to small businesses, as they had to compete with large corporations, especially multinationals. Most of the bank's capital is prioritized for state-owned enterprises, and the sky-high interest rates can cause many fledgling firms to back down.
Recognizing this problem, Mlombwa established the Indigenous Business Association of Malawi (IBAM) to support the local startup community as well as call for investment capital for new businesses.
According to Mlombwa, a huge reason why young people in Malawi as well as across Africa often fail when starting a business is that they are impatient, and want to get rich and enjoy too quickly.
“They rush. When they see their business is doing fine in the first year, they want to start living a luxury life. They want to drive a Porsche; they want a certain life,” Mlombwa said.
This billionaire advises young people to start small and develop long-term, sustainable businesses, instead of being in a hurry just to collapse quickly.
“Younger people are always in a hurry to do things. They want to become billionaires in two years, but in another two years, they collapse,” he continued. “That is why I always advise business people that only time allows you to [get there]… Time is going to allow you.”
H/T: www.bbc.com
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