The Founder Files is a series sharing the life stories of founders of emerging startups in Kenya and across Africa. This is the first in a five part series on Afrinnovator. For the opportunity to sponsor such a series, email [email protected]

I’m welcomed into the Uhasibu office by the lingering scent of pastry and a box that shows what was once a beautifully baked cake. Just a regular day at the office in the m:Lab at Bishop Magua Centre.

“I started really using computers at the age of 12,” Michael Pedersen, founder of Uhasibu quips. “In Copenhagen at that time, the tech scene was referred to as the Demo scene where most of it involved cracking popular PC games and software. People would then brag about it and put their logos as part of the “cracked” games as they showed off their development skills.” Michael is pleasant and placid in demeanour and leans back on a chair beside his two-screen setup with a functioning double-split keyboard. As a teenager, he experimented in the demo scene before going into consulting during the .com boom in Copenhagen. 10 years after putting in his time, together with a friend he decided things could be done much better than what everyone was settling for.

Having been at PlusPeople, he looked towards Africa as he’d heard and read of the advent of the undersea fiber cables. In a joint venture with a local Kenyan agency and an investment in local ISP Access Kenya, Michael came over to Nairobi in 2007 and spent 6 months working in the city. “We were looking to outsource development work to Kenya at the time,” he added. By 2009, the challenges facing him became more stated. There were few companies with the kind of experience they needed to execute larger projects and Michael wondered how they could leverage both the imminent arrival of fiber and the business opportunity. He tested ideas out. From a web school to a web agency or another joint venture. Models and ideas were aplenty and execution became the challenge. Would they import talent to Nairobi to make the most of it. Michael recalls his getting the feeling that Kenya was the “last gold rush of the internet.”

“It’s a question of execution and adaptation”

Taking a leap of faith, he chose to close down his business and move to Kenya in 2010. All Michael knew at the time was that he would do a start-up in Nairobi. “The thing about the internet here is that everything is new, meaning everything (from a developed internet market or country) is missing.” Michael’s confidence came from the fact that he did not have to reinvent the wheel when it came to ideas for the local market. “It’s a question of execution and adaptation, you pick proven ideas over new ones.” Michael says. And so he did just that, taking the leap to come over to Nairobi, he made the iHub his base after reaching out to Erik Hersman who had just founded the space at the time. Describing the next few months he says they were a combination of drinking, thinking and working on what would soon become cloud-based accounting service Uhasibu.

When it came to spotting the opportunity, Michael found that within the accounting phase there were some gaps in the market. Everybody was buying or pirating software. “The challenge was that you had to pay the full cost of the whole system up-front,” Michael says and for businesses he noted that cashflow was already an issue and this is what made pirating or operating without any structure better in the short term. He figured if a reasonable amount of businesses were paying from Ksh. 40,000-60,000 a month for accounting packages, then a Ksh. 1,000 a month model would be a sure shot.

Differentiating by offering a cloud-based solution over the stand-alone options in the market meant he had one added advantage of minimising maintenance, backup and I.T. costs both for the customers and the accountants and finance professionals who would recommend the service to their customers. “It took me 1 year to build the system from the ground up. I first had to get a clear vision of the what the minimum viable product would be, sketched it out and worked with a handful of accountants as I put it together.” Michael says. He worked on the alpha version of the product for 6 months. Within his network he found approximately 5 friends and contacts who would serve as his first clients. “There were times I would go, here, and show them the demo and then as they used it I’d go – don’t click that button.” Michael confessed. A work in progress it was, and though he underestimated the total product development time, he had Pivot East as his launch date and was gearing up towards launching there.

The hard work paid off, he won his category at Pivot East as well as being one of the inaugural companies to be incubated at the m:Lab East Africa, just one floor beneath the iHub.

Next we will we find out the next steps Michael took from working from a trip to Nairobi on a reconnaissance for a digital agency partner to winning East Africa’s mobile app developer competition in the Finance category and bagging $5,000.