Many businesses in Zimbabwe and across Africa start with passion and determination, but sustainable growth requires more than hard work—it requires structure. With Zimbabwe having the second highest rate of informality, there is work to be done to ensure that formality (structured business systems and records) becomes a central tenet.
In the First-World countries, it is very common for an entrepreneur to start a business and sell off a stake to other investors and become an “overnight millionaire”. In this evolving AI-edge, many businesses have been started and sold off within a very short space of time for millions, and some for billions of dollars.
Many funds actually have a problem known as "dry powder"—committed money from investors that has not yet been invested. Globally, private equity and venture capital firms have hundreds of billions of dollars of dry powder waiting for suitable businesses. In summary, there are more investors and money than quality opportunities. (Investors/Money > Quality Opportunities). What constitutes a quality business opportunity one might wonder? The answers lies in this acronym (SPDTS)
Scalability Profitability (including ability to generate positive cashflows) Defensibility TRUSTABILITY Sustainability
In this short article, we want to zoom in on Trustability.
Formal business systems and accurate accounting records give business owners a clear picture of their financial performance, enabling better decisions on pricing, cash flow, expansion and profitability. They also simplify tax compliance, reduce the risk of fraud and errors, and improve operational efficiency through clear processes and accountability. In the event of raising capital, accurate records ensures that the Trustability is ticked. Most importantly, the regulator of any nation will trust your business if the financial records are accurate and complete. Well-maintained financial records build confidence with banks, investors and business partners, making it easier to access funding and secure new opportunities. As a business grows, strong systems ensure operations remain organised, scalable and less dependent on one individual. Most local businesses fail once the founder passes on due to a lack of a structured way of running a business.
Simply put, businesses that know their numbers make better decisions. Investing in proper systems and up-to-date accounting records is not just about compliance—it's about building a stronger, more resilient business for long-term success.
The recent launch of the Zimbabwe Entrepreneurship Exchange (ZEEX) by the Zimbabwe Stock Exchange (ZSE) represents a significant shift in how Zimbabwean SMEs can access growth capital. ZEEX is intended to provide smaller businesses with a structured pathway to raise private capital and, over time, potentially graduate to public markets. This places trust at the centre of every investment decision because investors are committing their money based largely on the quality of information provided by the business.
Investors need evidence and not promises. That evidence is supported by historical financial and non-financial records, solid internal controls and governance processes, customer information, financial projections, bank reconciliations e.t.c. What is key for entrepreneurs: Culture for maintaining a solid, accurate and complete financial records should be inculcated right from the business start-up. Y our business has the potential to scale up from the “Museyamwa phase” (local version of sole trader with little to no financial records) to an African giant! Do you have your ducks in a row when it comes to your business financial records? Are you ready for a time when an investor or Regulator knocks on your door? Do you need help? Please kindly get in touch.
DeTori & Associates helps businesses implement practical financial systems, maintain accurate accounting records and automate internal processes that support sustainable growth.
Need tailored advice?
Request a consultation