The Quintessential Entrepreneur: Pakwo Shum

Pakwo Shum is an enigma in Ghanaian business. The shy looking bespectacled Managing Director of Aviation Alliance Ltd, dedicated General Sales Agent of Delta Air Lines in Ghana and eight other West African countries is perhaps one of the most successful serial entrepreneurs in Ghanaian business.

Having engaged in businesses spanning a number of industries, including retail, air transportation, corporate travel management, real estate, commodities and mineral exploration, Shum, as everyone calls him, best describes himself as an entrepreneur who looks for problems that exist in his environment and finds solutions to them.

“… I’ve founded a lot of businesses. Many of them never saw the light of day but the ones that have done well have simply been the ones that looked to solve problems,” he states.

Pakwo Shum illustrates his point further.  “We’re in a very intriguing era in Africa, and more particularly in Ghana; many of us can only see the other side of the coin; the bad side. You’ve got to wonder why so many foreigners have found interest here: Ghana, and many parts of Africa are now viewed as destinations of opportunity. Unfortunately, focusing on the bad side of the coin means we most often will fail to see the good. The truth is, in the inefficiencies, the very things we love to complain about, lie the opportunities.” He adds.

“There are many business ideas that get floated around, but knowing what I know now, I’ve become very selective of what business to get into. I will only start a business if it seeks to solve a problem, because that is the easiest way to make money: the path of least resistance. When you are able to identify a problem someone has and you are able to provide a solution to that problem, then they are happy to part with money for that solution,” Shum explains.To understand what drives this archetypal entrepreneur, who attributes his success as much to God’s grace as to his upbringing, the story is best told where it all began.

For Shum, the steely character required to withstand the pressures of business life were acquired in his formative years. Born to Ghanaian and Chinese parents, he says, “My quest to be an entrepreneur began at home; both of my parents were business people. At an early age it was the thing to do — it came naturally to me. Every day after school, I spent time in the family business. I really had no choice”.

Shum describes how after school, when friends expected him to go out and play, he had to first contend with other duties; “…in our home it was mandatory that at the end of the school day, I turned up at my dad’s restaurant, not just for lunch, but also to work in the kitchen. I worked in the kitchen two or three hours until the restaurant closed at 3.00pm, that’s when I could go home, do my homework and then I could play basketball with my friends.

“So this thing of being a business man, it was part of me, it was part of my growing up and I guess that largely accounts for who I am today,” he explained.

“I know a lot of people cannot contemplate the walking away from the assurance of steady employment and its benefits to face the unknown world of business. In my case, that was never a challenge. It was different because business was part of my family’s life. I was fortunate never to have had such challenges; it was just part of what I did as a part of being a member of the family. And so it wasn’t much of a big deal that I decided to go straight into my own business as soon as I completed secondary school and long before I went to university, especially as by that time the economic conditions in Ghana were at their harshest, and had taken a severe toll on our family finances.”

Shum is a firm believer in starting out early in business because of important lessons that must be learnt early. “Starting my own business came with its unique sets of challenges. With hindsight I can see how that helped begin the series of experiences that have molded me into who I am today,” Shum narrated, disclosing that it was at that time that his parents’ business had gone belly up owing to the turbulent economic conditions in the 1980s in Ghana.His first business venture, at age 17, was in distributing cooking utensils to retailers in the markets. “At the time, Ghana didn’t import many goods; the country depended on factories to manufacture a lot of the everyday things we needed, and it was pretty much a seller’s market. I figured I could secure allocations of supplies from factories from my savings. I started out distributing pots and pans to petty traders in the marketplace. I learnt my first crucial business lesson in the importance of cash flow when my customers failed to pay me on time repeatedly. That led to my first business failure. Now out of cash, I decided to get a job, and secured one at a Chinese restaurant that belonged to friends of my family. That started out very well because I was excited at the novelty of it, but it soon wore off, and the mundaneness of it turned into one of my worst experiences. After nine long months my employers got fed up with me and fired me,” Shum revealed with a laugh.

The experience made him realise, very early on, that he would have to be his own man and venture back into business for himself, since by nature he wasn’t the kind of person to conform to certain rigid ways of doing things. “And to a large extent, that’s what it’s turned out to be,” Shum says.

He learnt important lessons as some of his businesses failed and others did extremely well. “My early failures were a blessing in two major ways. Not only did they happen at a time in my life when the consequences weren’t dire, but they also provided crucial lessons to be learned that prepared me for the bigger opportunities that lay ahead. I doubt that I could have succeeded in doing what I do today if I hadn’t had the chance to fail growing up. That is the reason I tell parents, whenever I have the opportunity to speak, to look for entrepreneurial traits very early in their children and guide them towards business. Most people capable of building businesses only begin to pursue their dreams way into their 30s or later. People aren’t encouraged to start in their teens”.

“The other good reason is that business thrives on relationships. After my brief adventure with working for someone else, I found considerable success in being a middle-man between importers of construction supplies and small retailers. At the time I attributed my success to how good a businessman I was, but I now know both my suppliers and customers only gave me a chance because they saw a young man trying to make a buck. They liked me because I was a just a boy. People tend to cut a break for younger people in business and it helped me.” Shum smiles.

Not surprisingly, the most important lesson learned by Shum came from yet another business failure, this time much later in life. “After a decade of building a number of successful businesses, most notably a clothing company known as Adeva, the Ghanaian economy took another downturn and my businesses went down with it. I needed a new strategy, and took time out to go to university when I was turning 30. By the time I was graduating from the University of Ghana, I was ready with a new plan. A plan that took into consideration the reasons my previous business had failed.”

“I decided I wasn’t going to get into an inventory-heavy business, weighed down further by a fast depreciating Ghanaian currency as my Adeva did. Having built my clothing brand, which became very famous in Ghana, I had learnt the ropes on consumer behavior and needs and felt I was ready to venture into a service-based business. The only catch was that it had to be a business that would solve problems that existed in our market. That’s why I set up Travel King, a travel agency. By this time my experience as a frequent business traveler meant that I knew what the market wanted and needed to see in a travel agency, but which weren’t being met by existing agencies.” Shum recalls.

When he started out, the plan was to make the agency different, to make it meet the requirements of his clients. And within a very short time Shum had carved out a niche for his agency – by taking care of companies only.

“Travel King set out to do exactly what companies wanted, but couldn’t find in a traditional agency. Companies basically look at two things; they want to save money and they want efficient, hassle-free service. Travel King essentially leveraged the value of huge company travel budgets against special considerations from airlines that weren’t available to the everyday customer. By doing so airlines and their high value customers were happy, and Travel King grew.” Shum disclosed.

“We depended very heavily on technology, which was something other travel agencies weren’t doing at the time. And so we communicated very frequently with our customers by email, newsletters and many other means and we provided a lot of market information customers didn’t realize they needed, which built trust and confidence in our brand.”

And it worked perfectly for him. Within nine months of setting up that company it won KLM’s most innovative agency award, went on to win several other awards, and became Ghana partner to BCD Travel, a global travel management company, by 2004. Two years later the Delta Air Lines opportunity came up and Shum was more than ready for it.

“It was the travel agency business that set me up for the Delta opportunity,” he said. “But, although I had learnt how to build a hugely successful business I was yet to transition that from a business that revolved around me to one that had become an organization that thrived on its own without me. I discovered this when I left Travel King abruptly and went on to set up Aviation Alliance to meet Delta’s deadline of a December 2006 flight launch. “

Shum learnt that up until now, he had built most of his businesses around himself, without any succession plan and by nature, being more of a start-up person than a manager, he ran out of steam whenever he had nurtured the business up to a steady state where it required a different set of management skills, and the businesses suffered as a result of that. Travel King without another “Shum” collapsed a little over a year after he left to set up Aviation Alliance.

“That was why I lost the travel agency business; it simply collapsed. I set it up, it did very well, gained immense recognition and goodwill, but it revolved around me. So, the Delta opportunity came up and I had to build a new business out of that to represent the airline, and in doing that I walked away from the travel agency without providing proper succession and a structure. I’ve learnt from that costly experience. It cost me a lot of money indeed. A very expensive education on succession and structure.”

Talking about education, Shum has his own views. He admits it was important for him because it enhanced his potential in doing and understanding business. On several occasions, classroom concepts would echo what he had learned the hard way and that put many things into perspective and created a certain structure in his mind as to how things worked. It brought clarity and structure within his mind about business.

However, at the risk of sounding controversial, Shum insists; “I don’t think a formal education is absolutely crucial for anybody to succeed in business.”

He acknowledges though that, “..a formal business education sharpens people who are already going to be good business people; it sort of maximizes your potential and it enriches and enhances what you either already know by experience or have by character.”

The entrepreneur, who doesn’t see himself as a manager, but more as a start-up business person, reveals “So these days, what I do is, I rely on my strength to start businesses and I am learning to recruit and lead good managers who can carry on and grow my businesses beyond what I alone am able to bring to the table, and that’s finally working very well” Shum said.

An out and out entrepreneur, Shum remarks; “I love the challenge of starting a business; it places me in a very unique position because that is also the challenge of several start-ups; ‘how do we start? How do we get something from scratch to steady state?’ That is the unique skill God has blessed me with; I’m able to do these things, and I’ve fine-tuned them over the years.

“I’ve learnt that in growing a business to the next level, you look for talent who are the right fit for the needs of the company. People who are smarter, faster and sharper than you, to take it from where you leave off.”

But while Shum is overly critical of his failed businesses and what he did wrong, he is modest about his sterling successes.

“Maybe I need also to explain that I’m a spiritual person. And so for me, my philosophy is no matter how hard you try at business, no matter how smart you are, no matter how well positioned you are, whether by education, family connection or whatever other reason, if God is not in it, it never works out in the long run; at best success is only temporary. And so I believe strongly that it is God who has granted me success.”

“However, having said that let me also add that God gives grace to everybody, but not everybody chooses to use it. You will find that people who tap into the grace of God are persistent, positive thinkers, they endure, and certainly they’re marked by faith and hope — all characteristics of God’s benevolence.”

Obviously, Shum’s can-do spirit and high optimism will not be deserting him anytime soon. He sees the outlook for Delta Air Lines in West Africa as absolutely positive, presenting win-win situations for both West African countries and the airline.

On Ghana and air transportation, he has this to say; “Ghana is very well positioned to be a thriving hub, not only in the sub-region but in Africa. Geographically we’re blessed, politically we’re stable and there is a lot of confidence right now in this country as a solid business place.

“I know a lot of people wish we had a national carrier; it’s great to have one – but it must be one that makes money, and not one that’s losing it because of circumstances that are neither necessarily within our control nor peculiar to just our region. The airline business is very capital intensive and requires major scale to stay relevant. So, we must be grateful for international carriers because they open up routes to the country making us easily accessible; the growth in foreign investment we see in Ghana is happening largely because it is easy to get here from all parts of the world — plain and simple. Today we have direct flights from many African countries, Asia, Europe, and now North America. It will be interesting to calculate exactly how much business is generated in this country today as a result of the free movement of people and goods between Ghana and the rest of the world. “

But despite all the excitement with which Shum is building the Delta Air Lines business in West Africa, it is not lost on him that he will be getting bored sooner or later and would have to move on.

“That’s my nature. It should happen, but not quite as you describe it. Instead, I’ll concentrate my effort on building the new territories and growing the skills of my people, and leave my managers to focus on the day-to-day business. I’m blessed with fantastic and very young managers, most of them under 30, who handle our business in the countries we handle Delta sales in.  They have learned so much within a short time and they are more suited towards managing the business than I am. I am continually engaged in looking at other new businesses. I want to do what I do best and love, starting up new business.”

Shum may sound like one fixated on spotting and snapping up every business opportunity ahead, but he says he is also very concerned about what he portrays and his legacy.

“One day, I’d like people; family, friends, or whoever I was ever associated with, to remember me with pride. With pride because they knew this man who lived well, was successful in an ethical way marked by integrity, who was one of the many Africans that founded world class businesses in a legitimate way, who lived his life passionately for the right things. I want to be remembered as someone who loved family dearly and lived his faith and spoke his mind. Lastly I’d like to be remembered as one who was a good custodian of God’s grace by giving back to Africa in diverse ways.

Obviously, for Shum, being the quintessential entrepreneur is the fulfillment of his destiny.