Mhasibu; Small Business Accounting App

The Problem

Accurate and updated business records are essential for tracking
progress and health checks as well as accessing credit from financial
institutions. Without accountants, owners of small businesses keep
these records manually which is inefficient, unreliable and prone to
errors, or worse still, to getting lost.

Our Solution
Mhasibu is a desktop and mobile app that enables small business
owners to keep and manage business records. They are also able to add users with limited rights and can monitor business records in real-time.

Scalability
Small and medium sized businesses contribute a third of Kenya’s GDP and employ 80% of the total workforce. Increasing connectivity and the decreasing prices of smartphones presents an opportunity to help small businesses digitise their record keeping. 75% of Kenya's SMEs do not see their 5th anniversary and only 10% stay afloat 10 years after their inception. This solution is able to help more small businesses succeed and access capital through their sales records.

Mhasibu aims to digitise records of small businesses who are unable to do that as existing solutions target businesses with higher turn-over. Business owners find it harder to manage their businesses especially when they are not physically present on site. In addition, those running small retail businesses have to deal with a lot of inventory and when manual, it is very time-consuming, inefficient, unreliable and prone to errors.

Findings from KNBS indicate that the most useful data for
small businesses is the balance sheet, the profit and loss
statement and the cash flow statement. Furthermore, 62% of
businesses regularly keep records while about half of the small
businesses do not have a bank account. Without an account and
proper records, these business are unable to access loans or end
up acquiring unconventional loans which are expensive, thereby
slowing down business growth.

What

Mhasibu is a desktop and mobile app built to enable
business owners manage their expenses, record their
stock and track their revenue in real-time and even
remotely . Through daily record keeping, the system is
able aggregate monthly and annual profit and loss,
revenue, and business records thus helping business
owners make informed decisions on the go.

How
The app is built for small business owners who have
an account and allows to them to assign different
employees rights to perform certain tasks on the app.
They are able to see all the business metrics live.

Who

Small and medium sized business owners in retail businesses. The app is optimized for small businesses with 2-9 employees and the desktop version allows the same functionality now on a computer. Some of the businesses currently using the app include; 

• Motorbike spare parts business making close to USD1000/- daily. Uses it to monitor sales, record stock, transparency and process control.
• A supplier selling eggs in wholesale in Nairobi who had to improvise on how he uses the app to fit his product. 
• A hotelier selling food in Nairobi has been using it to monitor business performance.

Based on what is discussed above, small businesses owners either have one person doing everything or have a small team without a dedicated accounts person. They use manual methods of record keeping if they do at all and this is difficult to continually update.

This solution is meant to allow small business to always have an updated record of their business performance to access credit and make informed decisions. Small businesses do not make enough margins to access the softwares and point of sale products in the market. A subscription model charging USD1.5 monthly for the most basic service.

Mhasibu’s development followed a design approach of research, development, testing and reiteration. Having completed the research, development, testing and reiterating phases, the next part is the growth phase which will entail customer acquisition and financial training. All this was done in Nairobi with different businesses ranging from shop owners to small hotels and roadside sellers.

PHASE 1- Research & Development

After talking to consumers and identifying a problem in the market, we developed a minimum viable product for testing product for the market. This took three months and we engaged 30 small business owners.

PHASE 2- Prototyping & Reiterating
The product testing phase involved identifying  small businesses across different categories and  allowing them to test the product. The  businesses include hotels, a sausage seller,  hardware shop and an egg-selling venture One of the key design lessons was how to enable  the businesses to easily adapt the app to how  they work. It also provided a lot of product  feedback that came in handy in improving the  product for the market. 394 people installed the beta version of the  app and we talked to 100 of them.

PHASE 3- Application Roll-out 

The next phase is one of consumer acquisition  and pushing the product in the market. It was  clear that the product provides value to the  users as through organic growth, we so far  have 600 downloads and 200 active users.
Till now, 584 people have installed the app  and there are 200 people actively using it. We are in the process of converting it payment by subscription model (monthly) and we have 5 paying users so far.

With the world increasingly going digital, Mhasibu is ensuring small businesses are not left behind. Manual record keeping is slow and prone to errors and allowing businesses to automate their record and financial systems saves them from losses. It also gives them time for more strategic activities such as research and development, looking for partnerships and business growth.

Record keeping also ensures businesses are able to access credit when
they need it as they act as proof that the business is healthy and positjve in
terms of cashflow. The value of Mhasibu is not so much in the now but in the
future. And that is our driving force. Small businesses are
mainly untracked and this is because there is no aggregate of all
their records.

By digitising a largely informal sector, we are able to access
real time data on the trends in retail market and provide
insights from the contributors of a third of our country’s GDP.
This data also provides an opportunity for collaboration with
financial institutions to reduce business closure and accelerate
growth by availing a line of credit to small businesses.

The application currently has 500 downloads.

With a digital conversion of 2% for mobile applications in Kenya it will be possible to get to 5000 users in 12 months and a target of 200,000 in 5 years.

The immediate indicator is the number of downloads.

The second indicator is performance of small businesses on the platform. Increasing revenues means they are growing and this provides an opportunity to further train this groups to keep growing.

2 people fulltime

2 people part time

Joel Muriuki is the lead developer is has worked on a number of mobile and web applications for different clients. His background is mathematics.

Bedan Mwathi is a strategist and design researcher with a background in Anthropology and a masters in international development

James Ndung'u is the project manager and has a degree in Industrial chemistry and a masters in Environment studies from Yale

Veronica Kanuthu has 2 years working as a sales representative with different companies targeting both individuals and businesses. She is currently a student doing computer engineering

We are currently a small team but as we grow, the team intends to ensure we are fair in representation. Since the business currently does not have a revenue, we rely on people donating their knowledge and time.

We are currently fundraising to