American entrepreneur establishes furniture brand in Kenya
Eric Kouskalis came to Africa in 2004 as a volunteer teaching assistant in Namibia during the summer of his freshman year at Harvard. Originally from New York City, he enjoyed it enough to postpone a semester of his studies and returned later for another six months, taking part in educational development programmes. By the time he completed his undergraduate studies, he was sure he wanted to work in Africa.
He had always been interested in social business, so Kouskalis applied for positions in English-speaking countries on the continent and moved to Kenya in 2008. He spent six years in the development sector before venturing into entrepreneurship. His four-year stint at Innovations for Poverty Action and Evidence Action (IPA) helped him develop skills to start his own venture. While IPA is essentially a research organisation, Kouskalis was involved in implementing a programme that was scaling the use of water treatment technology.
“I joined at the pilot stage and left when the project had reached one million people. I learnt a lot about an early-stage team, creating a good concept and finding the most effective ways to scale up. That inspired me to strike out on my own. I did extensive research on several ideas and industries and saw promise in the furniture market,” he says.
Kouskalis identified a gap in the Kenyan furniture industry and co-founded Moko with Fiorenzo Conte in January 2014, hoping to provide a trustworthy service and a high quality, but affordable, solution for young urban families wanting to invest in the interior of their homes.
“Our mission is to help our customers live a better quality of life in their homes. Unfortunately, the average Kenyan family is not well served by the mass-market furniture industry. There is a fundamental breakdown of trust from the customer side. It’s common to hear stories of customers who bought something that didn’t last with no recourse,” says Kouskalis.
Moko set out to make the process of furnishing a home hassle-free and fun. The company delivers affordable products that offer value in terms of quality and functionality; it delivers on time and provides refunds if the customer is not happy.
Financing was the greatest challenge in the early days and the duo had to cultivate financial discipline to remain afloat. “During the initial part of the company’s development – the first three or four years – Fiorenzo and I used all our savings. We received support from our friends and family and I, quite irresponsibly, convinced my parents to mortgage their house to invest in the business. When I meet people considering going into business and who want to be independent and not rely on others, I explain that if I didn’t have help from friends and family, the company would not exist. You are only as good as the support and team around you.”
Today, Moko supplies material to other manufacturing businesses and makes its own furniture for sale directly to the public. Finding the correct sequence to grow the business proved tricky and Kouskalis admits this took some time to get right. As there was a quicker uptake on the B2B raw material supply, the team initially focused on this.
“Through trial and error, we sourced the right suppliers, figured out good quality control and found ways to differentiate the raw materials we were offering from what was already available in the market. Once this was working, we concentrated on the customer-facing retail furniture business which is the Moko brand.”
Moko has grown from a team of six to around 350 employees and has almost 7,500 m2 of facility floor space that includes manufacturing, warehousing and showroom premises. In addition to its headquarters situated in Mlolongo on the outskirts of Nairobi, it has three permanent retail locations in the capital. At any given time, a handful of pop-up shops are open where customers can view products such as sofas and accessory pieces like multi-function tables, ottomans and pouffes. The Moko mattress has also become quite a popular product for the brand.
As the business grew, building a team with the technical expertise and experience has been tough, especially at the leadership level.
Moko secured its first external funding, a GroFin loan, towards the end of 2017. Once it was able to prove there was growing market demand for its products, other investors followed. “We attracted professional investment from debt and equity investors like Novastar Ventures, DEG, Grofin, IDB Capital and they helped us professionalise and scale up the business.”
While Kouskalis acknowledges the furniture industry is competitive, he believes Moko has maintained its edge over competitors by offering good quality products and value-added extension services, such as warranties.
Today, Moko makes thousands of home deliveries a month, with plans to roll out additional retail stores in Nairobi and other urban centres in Kenya. In Kouskalis’ view, Kenya’s younger demographic presents an untapped market. “Kenya has a young population and we are seeing a lot of growth in young professionals in urban areas continuously investing in their homes.”
He highlights two other consumer trends playing to Moko’s strengths: jaded customers who lost trust in mass-market retailers and want quality, even if it comes at a slightly higher price; and, secondly, this young, urban market segment is keen on fresh, modern design.
Plans are underway to expand the current product range. Kouskalis explains they have received enquiries for a Moko bed, for example. The company has always had an e-commerce offering and after Covid-19 struck, it channelled resources in that direction.
The journey has not been smooth sailing. Kouskalis recalls one of his lowest moments when a focus group gave scathing feedback on the company’s very first sofa design. “We were starting out and very naive. We designed a sofa and could make it quite inexpensively. We had a focus group of some customers in Kibera and they tore the product to pieces. They said it felt like they were sitting in a matatu (Kenyan minibus taxi). It was a massive learning experience and we adapted based on their feedback.”
Moko’s attempts to execute all parts of its vision at the same time taught the team vital lessons on decision-making and the importance of prioritisation.
“Entrepreneurs must carefully consider the ideal sequence to grow a company: the best time to introduce a new product line, invest in a new manufacturing facility or adopt a new business model,” advises Kouskalis.
News Author : Çetin KAYA
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