Lost a job unexpectedly? Side income to supplement the family income? What about that elusive job? Stay-home mom being urged to do something with her time beyond looking after babies?
Well, if they were in Uganda, they would mostly 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 8am. 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 chicks chirping. Stoves are being lit, and more loads of feed are arriving at the “farm,” this time by 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. 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 center, 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 chickens are sold. She doesn’t think that would be the case, but she doesn’t want to be accused of being unsupportive of the family business. She already feels that poultry is the source of her unhappiness.
The business is not turning any profit, but entrepreneurs whose businesses are 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 three 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 feed guy in the trading center some money. He can only show up if he has the money. The guys at the farm, meanwhile, are now the supplier 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 advertisement over the car radio that if you invest money in some company in an office suburb of Kampala, you will earn a 40% return within five months. If you invest a lot, you are guaranteed a 15 percent 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 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 documents 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 the police, you find another 50 people, some with complaints of having spent hundreds of millions of shillings. You realize you were scammed.
But you’re happy you weren’t 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 Shs 2 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 Shs 1 million in chicken and get Shs 400,000 in five months? It is too good to be true.
How would you invest Shs 100m and get a return of Shs 15m every month? Would those chickens be laying the proverbial golden eggs?
But the story of Capital Chicken is ironic because it comes at a time when there is an initial public offer from 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 telecom to literally beg 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 and 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.
Although pyramid schemes like Capital Chickens cannot be fully eliminated, if people learned more about other genuine options where they could invest without hustling, they would put their money there.
The writer, Dennis Jjuuko ([email protected]) is a communication and visibility consultant.
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