Kenya’s A-list is all wearing one set of headphones: PACE. Even the president, Uhuru Kenyatta, jumped on the trend and ordered half a dozen pairs last year.
PACE was founded just two years ago by Larry Liu, a former aerospace marketing manager from China, and Jibril (or J) Blessing, a Kenyan celebrity music video producer and artist. This unique Chinese-Kenyan partnership is one of the first startups to create a wholly Kenyan-designed product, manufactured in China, that meets international standards.
“We don’t have a reputation that Africa creates this and that, so we wanted to be the first company that can be able to create cool stuff that can compete in international markets,” says Blessing.
Liu emphasizes that PACE is “designed in Africa for Africa,” and the company uses Kenyan sound engineers and designers, along with Blessing’s music expertise, to create a product that is uniquely Kenyan and has a market primarily in East Africa. But PACE also relies on Liu’s connections in China to manufacture their products.
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In many ways, PACE bucks the trend of Chinese business presence in the region, which has a reputation for shipping in Chinese employees and being out-of-touch with the local population. According to the Johns Hopkins School of Advanced International Studies’ China-Africa Research Initiative, there were around 8,700 Chinese workers in Kenya in 2017, a 545 percent increase from 2009.
“Integration is the future in Africa; you can’t be successful without integrating,” argues Liu. “It won’t work in the long run to have a Chinese company full of Chinese people move to Africa.”
Kenyan president Uhuru Kenyatta visiting PACE
Chinese investment in the country, both public and private, has increased rapidly in recent years. The Chinese government (largely through the Belt and Road Initiative) and private companies have been instrumental in the construction of a major railroad, highway, and port in the country, and loans from China account for 70 percent of national debt.
The links are not without their critics, but Blessing sees potential in the growing interest in Kenya from the Chinese. “As a businessman [I] need to have investment and this is a good opportunity,” he says. “Africans and Kenyans can benefit from Chinese. Africans are loyal people so I believe in more partnership and also growth of both countries or continent.”
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This partnership is embodied in PACE. The company is aiming to match the quality of well-recognized brands like Beats and Bose, but with more accessible price points. PACE Focus headphones sell for 55USD, while the PACE Mate bluetooth earphones go for 38USD. This is made possible in part by access to Chinese manufacturing.
The founders met when a company Blessing had invested in was looking for materials from China. They began sharing their ideas, and PACE was born.
“I wanted to make something concrete,” says Liu, who previously worked in ecommerce in Kenya.
Blessing expresses a similar sentiment: “I felt like I needed to create something that, even if I’m not around, it will still leave a mark in our society.”
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This mark goes beyond a pair of headphones. Liu and Blessing channel part of the revenue from every sale into the PACE Link foundation to empower people in the arts or related industries to take the first step on their career. Last year they awarded a full scholarship to a talented soccer player and the third-highest scoring middle schooler in Kenya who was on the verge of dropping out because he was unable to pay his school fees.
Blessing knows from experience what kind of difference this support can make in a young person’s career. “I was a street boy. My parents died when I was only nine years old so I didn’t have anywhere to live. I went to the street for five good years until a well-wisher decided to help me, to welcome me into his house and also take care of my education.”
He has since used his own success as a music producer to help other aspiring artists in Kenya. In turn, PACE is taking advantage of these connections to expand their business to become a multi-channel network (MCN) company.
“One of the marketing strategies we used [for PACE] was to involve celebrities and influencers to be able to help us market our product,” says Blessing. “And through that we’ve become very popular in terms of when someone sees a celebrity rocking our product they feel like it is authentic.”
Liu is hoping to use Chinese capital to help other African companies reach similar success and address real problems on the ground. In November 2018, he founded Shaka Ventures with a group of Chinese and African partners. The fund secures private financing from China to invest in African startups, and Liu’s focus is on tailoring their support to conditions on the ground.
President Uhuru Kenyatta rocking some PACE headphones with the team
The fund currently invests an average of 1 million USD in each venture, and since its founding has invested in six ventures, mostly in the tech industry, such as the Nigerian mobile payment system GONA.
“We use Chinese capital but we have a local team that understands local needs,” says Liu. “People in China have never been to the slums and they don’t understand what 1USD means to people there.”
Liu sees public perception as a major problem for Chinese investment overseas. In Kenya, for example, Chinese companies have been accused of racism against locals and there have been major protests over the proposed China-backed Lamu Coal Plant.
“The people coming are good people, but they don’t know how to communicate with the local people so there are a lot of misunderstandings,” he says.
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In particular, Liu sees Kenyans as more direct communicators, whereas he says the Chinese favor a more indirect style.
“Kenya is more like the British way. What is input, what is output, what is target for today? It is more linear,” says Liu. “China is more diversified, multi-tasking at the same time. And also when you speak to Chinese you won’t speak to ‘this is the result I want, this is the process.’ It’s a bit more unclear. With Kenyans you have to be very straightforward and say ‘this is the result I expect at this time.’”
Religion also plays a significant role in Kenyan business culture, something that is not widely present in China and took some adjusting to on both ends.
“For us sometimes we hope” Blessing says. “We do business and pray that we will be able to see the outcome. But you see a Chinese person is very accurate. They have to see before it happens. So that’s been a challenge for us. But day by day we’ve been able to improve in that and understand that this a business and the vision is to have cool stuff from Africa to the world and also create a world-class brand. So we have to be able to accept each other and also embrace what we have and make good out of it.”
All images courtesy PACE.
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