Financier to the Poor: A Ugandan Entrepreneur

by Doug Seebeck and Timothy Stoner

Timothy grew up in a small village in the province of Gulu, which is near Uganda’s border with Sudan. His father was a polygamist with three wives. In 1979 Timothy was preparing to go to university when Idi Amin’s removal thrust the country into bloody political and social upheaval. Timothy was not able to pursue his education. At the age of 20 he found work at a Shell gas station in Gulu. He rented a room in a garage and worked at the station for the next six years.

When the rebel coalition that regrouped under the Lord’s Resistance Army (LRA) became a growing threat, the new government of President Museveni made a natural assumption. Given the country’s history of civil strife between north and south, they assumed that the rebels were receiving sympathy and support from the communities in the north – especially from the people of means and influence. During this period of suspicion and confusion, the army arrested 5,000 people in towns across the north, from Timothy’s tribe – the Acholis – and the neighboring Langi tribe to the east. Many were killed, including one of Timothy’s brothers who was murdered in front of him. In 1988 Timothy was put in a maximum-security prison.

When he was finally released, Timothy learned that marauders on both sides of the conflict had stolen all 1,000 head of his family’s prized cattle. Timothy had lost everything, including four of his uncles, who had been killed. He had no income, no assets, and the ongoing tribal conflicts made it impossible to return home. He went to Kampala, the capital city, and found work as a day laborer, off-loading freight trucks for poverty wages.

Taking Opportunities

In 1989 Timothy heard that the CalTex-Chevron gas station across the street from the Shell station where he had worked as a young man had been abandoned.

Recognizing a unique opportunity, he approached a Chevron officer in Kampala and offered to purchase the station. Negotiations took several months, but Timothy never lost hope.

“Each time they asked me whether I had the money to buy the station, I would tell them, ‘Do not worry, it will be no problem,’” Timothy says, adding that at the time he had only $50 in the bank. But there was more than mere bravado at work. “I knew that God owns all the money and that somehow he would help me to get it. So each time they asked me about my resources, God gave me the grace to reply confidently.”

Eventually, Timothy and Chevron worked out a purchase agreement and Timothy returned to Gulu to ask the town’s only bank for a loan. Years earlier, the banker had taken note of Timothy’s honesty in handling the Shell station’s money. He trusted Timothy and wanted to lend him the money, yet regulations required him to demand collateral. The problem was that Timothy had only $50 to his name.

The banker decided to bend the rules to provide the initial capital. The loan was just enough to buy 2,500 liters of diesel fuel, 2,500 liters of kerosene, and 2,500 liters of gasoline. Timothy now had product to sell, but no money to pay employees. So he found three unemployed men, including his younger brother, who agreed to work for him for three months without pay. Timothy spent his cash on stationery, a ruler, a pen, and a rubber stamp to make his business documents look official.

The day Timothy opened the station there was a regional fuel shortage that left his competitors with no gas to sell.

Timothy’s station sold out in 48 hours. The banker had expected repayment within two weeks, but Timothy paid him back in two days. The banker was amazed. “From now on, Timothy,” he told him, “if you need money you come to me, but do not come at the end of the month when it will have to go on the books. Come earlier so you can repay the loan before the books close.” Timothy was able to keep his station open and to buy fuel for a year without any collateral.

With this type of favor on his start-up business initiative, Timothy leveraged that first gas station into a series of Gulu-based business ventures.

Timothy’s next business endeavor was to open a small shop selling consumer goods. After that he purchased additional gas stations. By 2008 he had six stations scattered throughout the nearby districts, and two in Kampala. He also owns a soft drink distribution company. When he bought the business, sales hovered around 500 cases per month. He increased that to 20,000 cases per month.

Multiplication

Running these businesses has enabled Timothy to help transform the lives of thousands. He views his own story as a testament to what is possible for individuals like Aloysius Kongoli, an orphan with AIDS from Kampala.

When Aloysius was 14 years old he lost both his father and mother to AIDS, leaving him to care for three younger siblings. Timothy was moved to help Aloysius. He told Aloysius that he could not promise to pay his school fees, but if Aloysius was willing to learn a trade he could help him do that. Aloysius decided to become a tailor. When he completed the course, Timothy gave Aloysius a sewing machine as a graduation gift. He also paid rent on a small space for six months and continued to mentor the young tailor for the next six years. In 2008, Aloysius was 25 years old, had a thriving business with eight sewing machines and ten employees, and was able to send his three siblings to school.

In Africa they say that one job feeds five people. If that’s true, then more than 50 people receive their daily bread from Timothy’s investment in Aloysius.

In addition to helping orphans, Timothy was using his own savings to provide start-up capital for small businesses. At the outset, he had no organization, no plan and no method. His strategy was to find hardworking people he felt he could trust and lend them money at no interest to get them started. Although this practice helped many budding entrepreneurs, it almost swamped Timothy. All the records were kept in longhand in receipt books without the help of Excel or Office Pro. Since he was already running several large enterprises of his own it soon became overwhelming.

Finding His Place

Timothy recognized that if he did not establish some kind of loan institution he would be forced to stop. He decided to attend a Partners Worldwide conference after hearing about the organization from a field missionary. There, he says, “my whole thinking changed.” He realized that for the Christian entrepreneur, business and mission are one and the same. “I had found my right place,” he says, “because as much as I wanted to do business as a mission, it had never occurred to me that a businessman can actually minister in his own business by using it as a calling to minister to God.”

Timothy also learned how to make his loan program sustainable. Up to that point he had been treating the microloans more like charity. Through conversations and lectures he learned about efficient systems to track the loans and came to understand that charging interest was the only way to ensure his loan program’s continuance and expansion.

This new perspective freed Timothy to launch the microenterprise company he calls Talanta Finance – Microfinance Trust. The name was carefully chosen; it refers to the story Jesus told of those who invested their talents wisely and those who did not. A simple sign outside the unassuming, two-story facility summarizes its purpose: “Promoting your talent in business.”

One of his more recent enterprises ensures that Timothy does not carry alone the vision of business as mission in his country. In 2005 Timothy helped start a business affiliate of Partners Worldwide called Ugandan Christian Business Partners (UCBP). UBCP has more than 80 members – all business owners – from the north and south of Uganda. Among this group of Christian business owners, there is more than business going on – ancient tribal divisions are also being healed.

Doug Seebeck is the founder and President of Partners Worldwide and co-author of My Business, My Mission.

Excerpted from My Business, My Mission: Fighting Poverty Through Partnerships by Doug Seebeck and Timothy Stoner (Faith Alive). All photographs owned by Partners Worldwide.