Kyangombe Cyber Cafe

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Contact: Genesis Ngari, [email protected]

Business ProposalBusiness Proposal

Kyangombe Cyber CafeKyangombe Cyber Cafe

January 2011January 2011



Business Proposal – Kyangombe Cyber Cafe

Contents

• Executive summary

• Kyangombe opportunity

• Business proposal

• Capital requirements

• Contact information




Executive SummaryUnique Opportunity to be First-to-Market Cyber Services Provider in a New Nairobi Slum

• Demand for pay-per-usage access to the Internet is very high in developing

countries where mobile and high capacity bandwidth networks are still being built• Cyber cafes that offer other business services are a thriving business in the Nairobi area• Kyangombe is a newly developing slum settlement a few miles east of Nairobi

– Recent voting results revealed approximately 50,000 people live in the slum – Relative to other slums in Nairobi, Kyangombe is more secure and contains a

higher mix of temporary and permanent structures – There is one main road into Kyangombe that connects to various side roads

• There is a great opportunity to launch the first cyber café in Kyangombe – Numerous other businesses exist on the main arterial roads but no internetproviders

– Nearest cyber café is at the Mombasa Road junction near a supermarket (~2kmfrom Kyangombe) and charges 2-4x the average market rate

• Services to be offered: – Terminal access to Internet or Office suite at 1 ksh per minute (market average) – Scanning and Photocopying services – Lamination services

– Binding services• Numerous permanent structures are available for reasonable rental rates on the main

road into Kyangombe

• Month 1: acquire computers, tables/chairs, scanners / printers, and other equipment andset up 3-5 stations

• Month 2: finalize location and sign contract• Month 3: negotiate Internet service providers, etc.• Month 4: set up location and open business

Market

Business

Plan




Kyangombe Opportunity (I)A Captive Audience in a Newly Developed Slum

• Nairobi is a city well-known for its proliferation of slum settlements

– Estimated that ~2M of the city’s 4Mpopulation lives in a slum – Slums are typically dense housing areas with

high population density, few if any publicservices, and numerous informal businesses

• Kyangombe is a newly developing slum located onMombasa Road outside Nairobi – Major highway to major airport (JKIA) – Significant matatu and foot traffic in the

broader area – Land owned either by the city or Kenya

Airways (unclear)

• Kyangombe is relatively more secure than other Nairobi slums – Higher standard of living – Structures are more durable (built from tin

sheets rather than mud)

– Numerous permanent structures frame thearea

• Kyangombe has one major road leading fromMombasa Road to the slum, which in turn connectsto other side roads at various junctions – Numerous small businesses have already

been started in the slum… – …However, to date no cyber café or computer

center has been developed




Kyangombe Opportunity (II)Excellent Location in a Dense Area

Main road leading into Kyangombe

Side road in Kyangombe Side road in Kyangombe

Target location




Business Plan: Kyangombe Cyber Cafe (I)Overview of Business

• Services: full-service cyber café and business center

– Internet access and computer usage (e.g., Microsoft Word) priced per minute with aminimum

• Target: 1 ksh per minute with minimum of 10 ksh per usage (current market average)

– Business services such as printing, binding, lamination, photocopying, and scanning

– Personal services such as printing, CD burning, etc.

• Location: main road into Kyangombe, where majority of foot and motorbike traffic occurs

– Rent a permanent (cinder block, metal roof, owned by a landlord) structure that will providesecurity for equipment and patrons

– Located near an intersection with a residential side-path

– Prominent signage

– Evaluating multiple options: second floor concrete building near a school, first floor concretebuilding near other businesses, etc.

– Rent estimated to be 4,000-5,000 ksh per month including utilities

• Financial model

– Startup costs ranging from 40,000 ksh to 150,000 ksh ($500-2,000 USD) based on approach

– Monthly revenue potential of 35,000 ksh

– Monthly operating expenses of 8,000 ksh

– Net monthly profit of 27,000 ksh


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Business Plan: Kyangombe Cyber Cafe (II)Example Locations

Option 1

Second floor room with toilet

access on a balconyoverlooking main road.Secure door, tile floors, solidwalls, ample space.

Option 2

First floor shopwith solid door and windownear other shops.Numerousoptions available

for rent.



Business Plan: Kyangombe Cyber Cafe (III)Revenue and Expense Model

Assumptions Pro forma Profit & Loss

Operating hours per day 8

Days per month 22 Monthly

Revenue

Internet usage Internet usage 26,400

Internet patrons per hour 6 Copying 880

Average usage (minutes) 25 Scanning 1,100

Cost per minute (Ksh) 1 Laminations 2,200

Bindings 660

Business services Total revenue 31,240 Copies per day 20

Cost per copy (Ksh) 2 Expenses

Scans per day 5 Rent 5,000

Cost per scan (Ksh) 10 Internet 3,000

Laminations per day 5 Supplies 1,800

Cost per lamination (Ksh) 20 Wages -

Bindings per day 1 Other miscellaneous 1,000

Cost per binding 30 Total expenses 10,800

Expenses Pre-tax profit 20,440

Monthly rent / utilities 5,000

Monthly internet access 3,000

Ink / toner per month 600

Other supplies 1,200

Salaries None



Capital Requirements: Three ScenariosInitial Estimates

All dollar figures in Ksh

Description Quantity Unit cost Total Unit cost Total Unit cost Total

Computers 3 15,000 45,000 15,000 45,000 - -

Printers 2 10,000 20,000 5,000 10,000 - -

Seats 5 5,000 25,000 1,500 7,500 5,000 25,000

Shelving 2 5,000 10,000 3,000 6,000 5,000 10,000

Power extension 3 1,500 4,500 667 2,000 1,500 4,500

Lamination machine 1 6,000 6,000 6,000 6,000 6,000 6,000

Binding machine 1 5,000 5,000 5,000 5,000 5,000 5,000 Bulbs 2 500 1,000 150 300 500 1,000

Card reader 2 500 1,000 250 500 500 1,000

Webcam 2 1,000 2,000 500 1,000 - -

Head phone 2 500 1,000 500 1,000 - -

UPS 3 3,000 9,000 2,000 6,000 - -

Network modem 1 5,500 5,500 5,500 5,500 - -

Receiver 1 6,000 6,000 6,000 6,000 6,000 6,000

Network pins 10 25 250 25 250 25 250 Network cables 50 20 1,000 20 1,000 20 1,000

Counter books 2 100 200 100 200 100 200

Miscellaneous 10,000 5,000 5,000

Shipping of donations 5,000

Grand total 152,450 108,250 69,950

Scenario B: Cheaper

equip.

Scenario A: Higher-

end equipment

Scenario C: Some

donated equipment


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Contact Information

• Genesis Njeru Ngari – [email protected]

– Cell: 254 – 0720 – 993509

• Background

– Author, Slum: The People of Kibera (2009)

• Non-fiction book documenting the lives of people living in Kibera,the largest slum in sub-Saharan Africa

• www.peopleofkibera.com

– Co-founder, Blessed Hands Beauty Salon

• Salon and business center located in Laini Saba, Kibera, founded

using funds from book sales of Slum – Translator, Katekisimo (2010)

• Developed a Swahili version of the Children’s Catechism fromEnglish to use in churches in East Africa

Kyangombe Cyber Cafe

Documents

Transcript of Kyangombe Cyber Cafe