Lost a job unexpectedly? Side income to supplement the family income? What about that elusive job? Stay home mum being urged to do something with her time beyond looking after babies?
Well, if they are in Uganda, they would most likely turn to poultry. A business heralded as one with quick returns — two months or so in and you are on the market either with broilers or supplying eggs to rolex makers.
Poultry is one of those businesses Ugandans love but also the one they least learn from. Drive or take a walk in your neighborhood and if you are a keen observer, you will come across a few gigantic buildings, some storied with wire mesh on either side.
At first, it will be a beehive of activity. A guy who arrives at dawn every morning wearing a necktie and in a rush to beat Kampala traffic to be at his desk by 8.00am. If you eavesdrop, he would be urging workers to offload the chicken feeds.
Many times, “Madam” will be visiting as well on some days in her Toyota Wish which would be loaded with trays of eggs.
A few months in, the chicken house will be expanded and you will hear chics chirping. Stoves being lit and more loads of feeds arriving at the “farm” this time by a truck.
Soon after, ”Madam” will stop showing up alone, only appearing whenever “Mr” is around especially over the weekend. As an outsider watching this business from the sidelines, you realize there is some tension. Sometimes “Madam” doesn’t even get out of the vehicle to check on the chicken and bellow out instructions. She remains in the car on her phone, perhaps whatsapping her buddies or enjoying reels of TikTok and Instagram videos.
At the bar in the trading centre, the story is that “Madam’s” Toyota Wish was sold, which explains the feeds being delivered by a truck. She is unhappy about the project but has been promised a Subaru in a few months time when the eggs or chicken are sold. She doesn’t think that would be the case but she doesn’t want to be accused of being unsupportive to the family business. She already feels poultry is the source of her unhappiness.
The business is not turning any profit but entrepreneurs whose business is speaking at conferences have told her that when you decide to do something, you shouldn’t give up. Success is for those who are patient. Those who are in it for the long haul.
With an unhappy “Madam” at home, “Mr” is starting to realize that she was actually right. The business is not making any money and has only been surviving because of his salary loan and the benevolence of “Madam” who agreed to sell her Wish.
To cut costs, he decides to only visit two times a week. The workers simply call and he sends mobile money. But there is another reason for his lack of visits too. He owes the feeds guy in the trading centre some money. He can only show up if he has the money. The guys at the farm meanwhile are now the suppliers of chicken to all the Mchomo guys in the town. But “Mr” is not aware of this.
Then as “Mr” navigates heavy traffic in Kampala, he hears an advert over the car radio that if you invest money in some company in an office suburb of Kampala, you would earn a 40% return within five months. If you invest a lot, you are guaranteed 15% profit every month.
The beauty of this is that you won’t have to run to the farm every morning, quarreling with workers and having an unhappy spouse at home because her car was sold to support the family business. You will be monitoring the business on mobile app on your phone.
You are a man of your word, so getting her a Subaru is high on your mind. It will rekindle your love. The family will be happy again.
So you approach the bank again or sell off some family assets. With the money, you visit a well branded, well advertised company with an office in the most expensive parts of Kampala and hand over the cash.
They give you some document printed on paper with marked margins to append your signature. And then you go back home and wait for a few months to get paid so you are happy again. Only to hear that the guys have closed office and have run to the hills.
On reporting to police, you find another 50 people some with complaints of having spent hundreds of millions of money. You realize you were scammed. But you’re happy you were not the biggest loser.
Sounds like fiction? Yet it happened with Capital Chicken. The founders ever so careful not to have public profiles understood the frustrations of a Ugandan poultry farmer and devised a strategy on how to scam them. By the end of the day, some 50 people according to reports had lost Shs2 billion. Many won’t come out. They don’t want you to know that they aren’t that sophisticated to be conned like that.
Of course when a deal sounds too good to be true, you need to run. And the first sign of such a business is the promise of high returns when doing nothing. How would somebody invest Shs1m in chicken and get Shs400,000 in five months? It is too good to be true. How would you invest Shs100m and get a return of Shs15m every month. Would those chickens being laying the proverbial golden eggs?
But the story of Capital Chicken is ironical because it comes at the time when there is an initial public offer (IPO) of a telecom company, where you would think people should be investing. Instead, we go into a business with people who are faceless and a model likely to scam most people while leaving a regulated telcom to literally beg (they have extended the period of the IPO, a sign of low subscription) people to buy its shares.
This calls for more education regarding investments in capital markets (not chickens) and ensuring that we provide an environment that enables these businesses to grow to provide regular returns to their shareholders.
The stock exchange needs to be vibrant so people can trade in shares as often as they wish without losing a lot of value. Thereby increasing the shareholders liquidity options.
Although pyramid schemes like Capital Chickens cannot be fully eliminated, if people learnt more of other genuine options where they can invest without hustling, they would put their money there.
The writer is a communication and visibility consultant. firstname.lastname@example.org