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Bank denied me loan because of collateral –Ojo, Elizade boss

Bank denied me loan because of collateral –Ojo, Elizade boss

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Omodele Adigun

Raising seed capital as a start up may not be a tea party. Ask Chief Ade Ojo, the Chairman of Elizade Group of companies, he might narrate how a bank denied him loan to start the business that  has become a conglomerate today just because of collateral .

Hear him : “I had to approach a bank to give me loan which they refused because they said I had no collateral. The collateral which I had to offer was my brain. And they rejected my brain as collateral.”

At an interview session recently, he shared his thoughts on sundry issues, including how to build successful business.Excerpts.


How I was able to make the savings that I later used to start my business?

I was at Inland Revenue only for six months. From there, I joined the BP (British Petroleum). But something happened at Inland Revenue which I will share because I believe it may be useful to some of you.

At the Inland Revenue, even though I was just there for five and a half months. I was not used to laziness. When I joined government work I discovered that it was house of laziness. Within the first two hours, I would have finished the job assigned to me for the whole day.

I then thought ‘how do I make use of the hours left?’. I then decided to be going to our registry and collect the names of those people who were not insured. I learnt about insurance in CFAO. So I would collect the names and go after them since there was no work for me to do in the office. I would talk to them and introduce life insurance to them.

And I was very successful in this; even more successful than those who were doing it full time. Why? It was because I was hitting target. I was going to people who I knew were not insured. And this experience was only going for me because those insurance people were only going about it like blind people by going to everybody. But for me, I was going to only those who were not insured. So that amounted to one of the reasons for my success. So I was able to sell insurance to many people.

So that was how I was able to make the savings that I later used to start my business.

Car business

When I joined the BP, there was no time because my time was fully engaged by the company. So for about one year, I could not sell insurance because I was fully facing my job. And I was doing very well at my sales because I’m a very good sales person. And that is where my success lies. If you are not careful, I can sell shit to you, thinkingthat you are buying moinmoin. So I was doing very well in sales.

Within the four years that I spent in BP, I was their highest sales person. So I took the business from Shell. The next year, I took also the engine oil and all that from them. In 1970, I was transferred to Benin (Edo State) for three months to relieve somebody. And I did very well within the three months of my being there. I increased the sales by 25 per cent. So I came back to Lagos after that. But to my surprise, the man I relieved in Benin was brought to be my direct boss. And this really annoyed me. That was how I made up my mind to leave. So I then asked for my annual leave. Within that four-week leave, I was able to sell 40 cars. And with that 40cars, that was howmy business started. After selling the cars, I calculated what I was going to earn. And to my greatest surprise, I discovered that it was more than one year salary in BP. So this led to my decision to leave and do my own business. So you can see how I came about my wealth.


When I started this business, I was asked to pay £600. You know it was RT Briscoe Motors that started Toyota business in Nigeria. And it was the company that gave me the opportunity to be selling for them on commission. I had earned money but I’d not received the money because we were selling forward. The vehicles were not available, you had to deposit for them. It is only when the vehicle was delivered that you could earn your commission. Although I had that money but it was not cash. I had to approach bank to give me loan which they refused. When they refused this, because they said I had no collateral. The collateral which I had to offer was my brain.

And they rejected my brain as collateral. So I left and I went to a cousin. And the cousin gave me the £600. And I paid that to start the sales of their motorcycle at that time. I became an agent after payingthe money. And they promised to pay me two and a half percentcommission. Then they were paying their dealers 10 per centcommission I took it and started the selling. Since the bank hadrefused my head as a collateral, so when I got that money, it waswork, work and work. Working is my second nature. I don’t know how toget lazy at all. When I don’t get things to do I feel like I’museless. So I must always engage myself in something. That’s theresult of the lesson that my mother gave me.

Again,not that the money I got was sufficient because I had to get a house,I had to buy some other things to equip our office and home at 71, Awolowo Way. So, I still needed some money. I was using a Volkswagen when I started the business. And I continued to use it until I was able to buy a fairly used Cressida car. And I used it for some time.

Luckily I sold two heavy-duty vehicles and I was able to get some money. So I decided to buy Corolla Panel Van , what you call Shalaake. I want to make it clear to you that at that time, I could buy new car.

But I needed the money to promote my business. So I did not buy new vehicle. Instead, I opted for that fairly used vehicle. When I sold those two heavy-duty vehicles I realised £720 from it. And I put the money back into the business. When I was leaving BP, I had ordered for a car and I had taken advance from BP. The car came, I sold it because I knew I could not afford to ride it with my own business. If I was working with BP, I could use it. But I decided to sell it. And I sold it and I used the money for six months before I returned it to BP. That was it. From there on, through cutting my coat according to the size of my cloth, I was able to build the company up very quickly. And what I got from it, I made sure I didn’t waste them on luxury. I didn’t attempt to do things that I knew could kill my capital. And I’m still like that till today, which I want you to really learn from. Knowing the son or daughter of whom you are. If you are trying to build a business, always be careful not to waste this thing they call capital because it can bring many good things to you.

Elizade University

Education is not a business as far as I’m concerned. And anybody who is going into establishing a university for the purpose of making money, that person has missed the road. So, I didn’t go into the university education for money making. It is for charity, for the development of my native place. Since 1988, I’ve promised myself that I’m going to build a secondary school in my home town. But I put it to them that you must give me the land free. I was not prepared to buy land. It was like a donation to the town, But they could not find land. That was what they told me. The land was there, but they could not get for me. As years rolled by, my intention was to build a school of international standard for that town. But they said there was no land. Yet, this thing was burning in me. Maybe it was God saying you must do it. So in 1998 , I raised the standard and said if the town could give me land, I would not just build school, but a polytechnic. Still, they didn’t do anything.  It was until some boys, Ilara Youth Association, rose up and went to meet the Oba and made a request. I got only two plots of land from them.

But that was two small for what we are talking about. I then found out who were the owners of the adjourning land. And bye and bye we were able to buy about 10 acres and so on until we bought 100 acres of land. Look ! I’ve spent roughly N25 billion on that university, and not a kobo has come from there. There are people who have done some things. But in terms of money, I’ve spent everything. Chief Afe Babalola said recently that if you are planning to make money from university, you had better forget it because the fees we are collecting don’t cover anything. You know if you send somebody to the U.K. or America for university education, it is not a joke. We have five faculties at the university. And we are doing well.

National Auto Policy

Well, the auto policy, as I have always said, my problem had been the fact that before success can be achieved in that business we must be able to produce the parts in reasonable quantities. We must have steady electricity because if you are running it on generator it is hard.

The biggest challenge we have, I told Obasanjo in 2007 at a breakfast he called some of us to. I said: “Sir, God has made you the President of this country. You are talking of 2020. Let’s forget about 2020.

Just give us electricity, the GDP of this country would grow between 10 per cent and 15 per cent.  If we can solve our problem of electricity alone,I don’t need this generator and nobody needs the generator. All we need is just to press the switch on the wall and the light is on. That’s all. So, I pressed on the need for infrastructure development. If our infrastructural development problem is addressed, we have gotten so many sharp and clever people in this country.   Give us electricity, give us roads, don’t worry about schools. Nigerians will raise schools by themselves for their profits, for business. And they will do well. Don’t think I’m contradicting myself. I don’t mean university. University is very tough. But elementary and secondary schools, people will do those two and make it. Apart from these. I was telling Obasanjo to his face. I said do that and you would have addressed all our problems. That was in February 2007 in Abuja. Later people were saying you are bold o. How can you be speaking to him like this. And I said well I was saying the truth. How do we address the auto policy problem?

They (FG) are addressing it the wrong way. What is the point? I mean, you don’t put the cart before the horse. My own trouble with this is that, because I’ve witnessed two which did not succeed. And I can tell you, do you think it will succeed? Answer it yourself. South Africa has a lot of big motor manufacturing companies in their country, what are you doing to ensure that the auto companies bring their plant here?

I have told you that there is no business man who sees a very good opportunity to make money that will be afraid of investment.

So the thing is that if these basic infrastructures are not in place, it will be disincentive to investment. We are here because this is our country. If the country is like this and you want me to go and start an auto business there I won’t.  I’ve fulfilled all righteousness. I have an assembly plant here in Lagos. Nobody can say I don’t have an assembly plant. But it is not a matter of just having an assembly plant, sustainability is the key. You know, how many have had assemblies and they have failed.

Didn’t you hear of the one in Anambra? Did you not hear of the one in Kano? Didn’t you hear of Leyland? Do you know how much was put into Leyland in Ibadan? What have we gotten out of it?

I was even mentioning Ibadan, what of Volkswagen in Lagos here? Look, I don’t lie. That is my policy. If it is what I can do, I will say I can do it. That is why I put my assembly in place. It was to fulfill all righteousness. My assembly is here in Lagos.

What would you say is the most real thing that keep you going till this time by what you said you were doing during childhood, selling kerosine at that early life? I know the son of whom I am. I am a very truthful person. I will not lie. If I’m selling

my car N2million and that car cost me N1.9million and you want to buy it N1.8million. You see, in business you have to use your head. You must allow some profit margin, otherwise you will not last in business. But whatever you are able to get from the business, know what to do with it, make sure you don’t waste it. You must ensure continuity for the business. You must make sure that you know what can hurtt the business and always avoid that. You must know what you need. I do all I do with God in mind. I must know that, even though, some people may not see me, but God is seeing me, whether I’m naked, whether I’m sleeping or whatever. And, therefore, that man sitting up there, I want to please him because, by the grace of God, I want to make heaven. I try as much as possible, I do not waste money because it is not easy to come by. So you must know what you are doing and face it squarely, provided it is a clean business.

What will be your advice to young people looking at the fact that you wanted to be a doctor and you ended up being a successful business person; and considering that state of Nigeria economy is it still possible for the children of the poor to make it?

It is very possible. One: you must differentiate between your capital and spending. You must make sure that you don’t spend the money meant for your business whatever the case may be unless you put yourself in a situation where you may have

to lose everything. In doing this business, I made up my mind after an experience that I had.

I think it was in 1978. We were importing by ourselves. What happened was that the government increased the import duty in December. Those vehicles were to come out of the port in January. And in January the new tariff came. And it came very high.

And we were not able to clear the vehicles from the port because of the high tariffs. And what should we do? We had borrowed money to do this business. The bank didn’t know about your problem, you had to pay. And it must be at the time that is due. So I did what I had never done before because of the tariff. They introduced me to one of the Custom Officer. And I had to dance to their tunes. The money that was involved was N250,000 when a new Toyota Corolla was just about

N750. At that time the N750 was not a small money. So I brought the money. The import duty I was to pay was so high. So they introduced me to somebody. Before I used to pay everything. But this time I had to do it the Nigerian way. I had to withdraw the money from the bank.

N250,000. Taking the money from the bank was a problem because I had never handled such a big amount. I put it inside my car and nothing happened. But I was looking at the front, back, centre to see whether somebody was watching me or had seen me and pursuing me. Luckily I got to the port without any problem. They then went to call the concerned officer and he came. He asked us to park the car next to his car but there was no road. So we parked at one car space to his. This money

that almost kill me with anxiety, the man came and asked where is the money and I said this is it. I told my man to take it and give him.

He just took the money and threw it carelessly into the booth of his car and slammed it. I said “Eeeeeh!!!” Is this magic or what? I expected him to carry the money carefully with some respect. But he just threw it as if it was N10. E-e-e-h!!!  He said that is all that we could go. I got the thing done. But between that place and my house I was still looking to know whether police would be trailing me. That night, I could not sleep, thinking that something could go wrong there and they would bring police to my house. It took almost a year after before I could get my mind free. There and then, I preferred to do clean business. I don’t give myself that problem. If I go to a party and I saw a uniform person I would be afraid that something could have informed it. So I decided I can not live that kind of life. That is me. Maybe if it were to be any of you, there would have been a different reactions. I discovered that some people succeeded in doing such things but me I didn’t do it. And I thank God for what I’ve been able to achieve. So my mind is at rest. I don’t fear that somebody may be coming to my house. And of course, I don’t play with Him. I mean I don’t play with God. Meaning that I respect Him as my Saviour and I believe the one directing me in what I’m doing.

The post Bank denied me loan because of collateral –Ojo, Elizade boss appeared first on The Sun Nigeria.

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