Experience Sharing Session with Mr. Suman Rayamajhi, Co-Founder and Managing Director of Upaya City Cargo

Experience Sharing Session with Mr. Suman Rayamajhi, Co-Founder and Managing Director of Upaya City Cargo

On February 29th, 2024, USAID Clean Air hosted an insightful experience-sharing session titled “Seed to Scale: Entrepreneurial Insights Unveiled”, featuring Mr. Suman Rayamajhi, Co-founder and Managing Director of Upaya City Cargo. The session aimed to provide valuable insights and guidance to the cohort companies of USAID Business Accelerator for Clean Air, enabling them to structure and manage their businesses while navigating fundraising from investors and other stakeholders.

Drawing from his extensive two decades long experience  in prominent roles across public and private sector companies in Nepal, including the Soaltee Group, Rastriya Banijya Bank, Smart Cell and Business Oxygen, Mr. Rayamajhi shared his valuable insights on crucial aspects, such as navigating investments and fundraising, leveraging blended finance, effective stakeholder communication, and broadening business vision to enhance appeal to investors and other stakeholders with the cohort companies.

Key Insights from the Session

  • Advice on Fundraising: Mr. Suman Rayamajhi presented a "3x3 formula" for entrepreneurs looking to raise funds for their businesses to streamline their fundraising efforts, focusing on considerations crucial for investors and what entrepreneurs should bring to the table.
Investor ConsiderationsPersonal Commitments
Entrepreneurs: Investors look at the entrepreneur's integrity, experience, and ability to execute. They invest in entrepreneur as much as the business idea.

Business Plan: A clear and detailed business plan is essential as it outlines the business objectives, revenue generation strategy, and factors contributing to success.

Path to Profitability: Even if the business is not profitable yet, it's important to show investors how it will become profitable. This could involve strategies such as increasing sales or reducing costs.
Entrepreneur's Capability: Investors assess the entrepreneur‘s capabilities including skills, experience, and passion for the business to determine if the business will succeed.

Entrepreneur's Commitment: Investors prefer entrepreneurs who are fully committed to their venture and willing to overcome challenges.

Personal Investment and Risk: Investing personal funds shows that you believe in your business and helps to build trust with the investors.

  • Leveraging Blended Finance: Mr. Rayamajhi advised entrepreneurs on leveraging grants and subsidies, while cautioning against relying on them as a long-term solution for sustainability. He emphasized aligning grants and subsidies with the company's operational objectives. Specifically, he stressed the need for grant-supported activities to be internally profitable and that it contributes positively to the core business.
  • Effective Communication with Stakeholder: Mr. Rayamajhi emphasized the importance of clear and straightforward communication, tailored to the language of the stakeholders. Additionally, he suggested allocating resources or establishing a dedicated department to manage relationships with supporting organizations.
  • Strategic Business Planning: Comprehensive planning beyond narrow strategies is crucial, advised Mr. Rayamajhi. This involves expanding plans to cover various areas, making them more appealing to potential investors. He emphasized the importance of research-based planning, suggesting the use of credible sources to enhance credibility and leveraging Blue Ocean Strategy for companies facing competition from large players. By identifying underserved market segments and leveraging their unique strengths, businesses can carve their own space, creating a value advantage and fostering long-term growth alongside large competitors.
  • Accounting, Financial Management and Compliance: Mr. Suman Rayamajhi emphasized the significance of proper accounting, financial management and compliance, as they often go overlooked. He highlighted the importance of skill development within the team and suggested incentivizing team members through Employee Stock Ownership Plans (ESOPs) and similar methods, to foster skill development and better performance.
  • Balancing Macro and Micro Management: Knowing when to delve into the intricacies of daily operations and when to prioritize big-picture strategies is crucial for successful leadership and business growth, according to Mr. Rayamajhi. Entrepreneurs and managers must adeptly switch between micro and macro management approaches depending on the situation.
  • Equity Dilutions during Fundraising: During fundraising, Mr. Rayamajhi stressed the importance of prioritizing overall company growth over fixating on ownership percentages. Entrepreneurs should focus on increasing the company’s value as a whole, and strategically manage the terms of investment to retain control. He advised on the strategic use of funds to fuel growth and potentially facilitate a buyout of investors’ shares in the future.