May 2021 –
My name is Johanna, I’m the CEO of Sandberg ltd. Sandberg limited is an HR consultancy which has been operating in Kigali since 2017/18.
We do HR recruitment, training (team development etc.), and HR management. We hope to do outsourcing too.
International. I mainly do recruitment for embassies, the private sector, and NGOs. So, I cover all sectors and all types of recruitment.
Most of them are European but they may come from all parts of the world.
I decided to come because I wanted to do my thesis here. Also for family reasons.
When starting a company like mine, the competition in Rwanda is not so high compared to Denmark. So, to put it simply, in Denmark I would have never started a recruitment company.
But here it was still possible because there was still space in the market and the other HR companies here had a greater focus on the local market or Government. Whereas I was the first one really focus on an international clientele. Also, being from Denmark, meant I understood the culture of international organisations to my benefit.
In essence, being here meant having a niche and having a space in a market which I would have never had in Denmark.
I didn’t have a local partner. What I had was 3 years of experience in Rwanda. So, in three years I had a strong local network by working with Government institutions and local partners and that was beneficial.
So, I learned the hard way. Maybe it would have been easier if I had a local partner from the beginning. But I didn’t have that; I took my time to learn.
There are opportunities through some of these more established networks like EBCR to try and find the right people to work with.
I think it is beneficial to do your recruitment through an HR company here. Because they can do the background checks, they know the market, they know the players, they know the reputation of the people you’re recruiting.
Sometimes people can look good on paper, but their history here makes it difficult for them to operate in the market. So, getting local companies to help you find your business partner here I think can be really beneficial and can help you avoid mistakes from the beginning.
I’ve done this through my networks. I also used BAG Innovation at some point because I was in need of some consultant to help me operate on the HR side of things and they helped me find people.
I hired mid-level. Kenyans mostly. Then I have also hired some Rwandan HR managers as well. But today I’ve switched to working with consultants.
For now, I don’t like to have any employees. I have tried to have staff and I have tried to see if I could find a business partner too. I’ve tried many scenarios and my conclusion, after Covid, is that I don’t want to be responsible for other people. But if they want to come in and benefit from a company that’s been here for the last 3 – 4 years and has a portfolio of clients etc. they can come in and work with me as independent consultants. That’s the model I’m running right now.
Having employees is a responsibility and in a consultancy house, finances go up and down all the time. So, unless you have a good cash flow every month – in HR there are only a few types of projects that sustain a regular monthly turnover like staff outsourcing – you have these consultancy contracts that come and go, and they can’t sustain permanent staff.
It’s much easier with consultants because you don’t carry the financial responsibility of paying their maternity leave, pensions, etc. so the tax looks different.
While with consultants (on short term contracts) you can just calculate 15% [Withholding Tax] and that’s your all you have to pay in taxes. So, it helps me as a company to work that way and not have staff to be responsible for. It makes my personal setup a little lighter.
Yes, I have a “consultant-accountant” who helps me file my taxes. I don’t want to do that myself. I really need somebody who knows the system and who knows the Rwanda Revenue Authority (RRA) and can do the communication and can also fix invoices and EBM (Electronic Billing Machine) receipts.
I’ve tried a few. I took a well-renowned company at the beginning, but they were very expensive. Today, I have a consultant that comes in from time to time and so it’s really a few things that he needs to do. I don’t have a high volume of transactions, so I just need somebody on a monthly basis, not on a weekly basis. So that’s a cheaper model.
The first ones I found through recommendations from my network. The latest one was by chance while sitting in a café. I needed help with the Electronic Billing Machine, and they called the accountant of the company to come to help me. We started chatting and like that randomly…
But I trusted the company I was sitting in, so I thought: ‘If he can do their accounting then he can do mine.’
RDB – that’s it.
It has been smooth.
I think the best thing is that it’s quite easy to earn some money. Because it’s a small network, so we all more or less know each other and if you’ve done a good job for one company it’s fairly easy to get work for another one. This means you can easily build your portfolio and that helps a lot.
The worst thing is that you’re not paid a lot. So, I’m making maybe 25% of what I’d earn in Denmark for the same job. Then of course the taxes there are a bit different as well. (Though the taxes here can also be quite high.)
For me being here is not about earning a lot of money. It mostly gives me a good lifestyle. There is some kind of balance between work and time off, everybody is flexible so it’s quite okay to do business here and it’s not so bureaucratic.
#advice What was interesting from that experience was that I really had high hopes that I could have a couple of consultants in Kigali running the business, earning the money, and that I would have something that could look like a passive income.
That would have been really great, but as soon as I left one of my clients stole my consultants because they were really good.
I soon discovered that this was the truth. And also, how disconnected you are from the market and from your clients when you’re so far away. Trying to be close to the process and close to the people while having another job in Denmark was really hard. I could see that my company was suffering from me not being there.
Everybody warned me that you cannot have a business in Africa without being there yourself.
Then you have to keep in mind that this is also a very “relationship-based society”. You have your clients because you have a relationship with them. It’s not just about the work that you’re doing, it’s also about who you are.
In principle, I was back in Denmark for 1,5 years, but in practice half of that year, I was back here in Rwanda doing projects.
Transposing your business back to Europe from here is not evident at all. You have to have some sort of niche experience that will help you compete with other European businesses. In my case, the only interesting option in the Danish context for HR in Africa would have been Doctors without Borders, but I chose not to do that.
When I arrived back from Denmark and had to re-apply for a work permit (before COVID) in order to apply for a visa, I needed to “have an office with a door that closes”. And I also needed to have my “logo showing up on the street”, so people know that I have my office there.
These were the two requirements that immigration imposed on me when I had to renew my work permit last time. There are the things that are stated on theofficial website and then there are also the unofficial requirements. These couple of things were not very clear from the onset.
Before that, I had my address at the Westerwelle. But the authorities didn’t really want foreign companies to be in co-working spaces, they really wanted us to find and rent our own offices. (Probably because they are building a lot of buildings and I guess they are empty). They were really pushing for foreign companies to have their offices.
For now, with Covid, these practices have changed, but they might come back.
It’s very easy – especially if you have a little bit of money. There are a lot of buildings and co-working spaces. Norrsken is also opening up soon. They are going to have space for around 1,500 entrepreneurs, I think. Then you have Westerwelle which also has a lot of space and there’s also Waka Fitness which also has co-working spaces.
Otherwise, you have Kigali Heights where there are office spaces too.