Publisher of Ovation magazine and media entrepreneur, Dele Momodu, has disclosed that he lost more than $500,000 after venturing into the restaurant business in Accra, Ghana, in what he described as a painful lesson about the risks of diversification.
Momodu made the revelation during an appearance on a podcast titled Building Wealth with Femi, where he reflected on the financial setbacks he encountered while attempting to expand his business interests beyond media and publishing.
According to him, the loss occurred during a period when he decided to diversify his investments, a strategy many entrepreneurs believe guarantees additional income streams. However, he cautioned that diversification does not always produce the expected results and, in some cases, can lead to significant financial losses.
“The time I lost money was when I tried to diversify,” Momodu said during the interview. “People always think that diversification means you will make more money. No, unless you are very lucky, you can lose all your money while trying that.”
The veteran journalist explained that the business venture involved launching a restaurant called House of Ovation in Accra, Ghana’s capital city. The project, he said, was designed to be a high-end establishment that would reflect the prestige and global reputation associated with the Ovation brand.
Momodu noted that the restaurant was built around a strong concept, combining quality dining with a sophisticated ambience that he believed would appeal to both local patrons and international visitors.
“I tried to do a restaurant business in Accra, Ghana, and I lost over half a million dollars,” he said.
The former presidential candidate said the idea behind the restaurant was carefully thought out and executed with attention to detail. According to him, the establishment featured modern facilities, quality interior design and an emphasis on premium dining experiences.
“It was called the House of Ovation in Ghana. Very beautiful, great ideas, good food. I employed the best chefs,” he said.
Despite the careful planning and investment, Momodu revealed that the project encountered numerous operational and logistical difficulties that eventually led to its collapse.
Asked during the podcast interview what exactly went wrong with the venture, Momodu responded that the business suffered from a series of setbacks that compounded over time.
“Everything that could go wrong went wrong,” he said.
One of the major challenges he highlighted involved delays in the delivery and release of specialised kitchen equipment required to run the restaurant effectively.
Momodu explained that he had ordered customised industrial catering equipment from a company in South Africa to ensure the restaurant met international standards.
The equipment, he said, included a wide range of essential kitchen tools and appliances such as refrigerators, cutlery and other catering materials designed specifically for professional restaurant operations.
“I paid $60,000 to a company in South Africa to customise my industrial catering equipment. My plates, my spoons, my forks, my knives, of course, refrigerators, everything,” he explained.
According to him, the equipment shipment arrived in Ghana in January 2007 after being dispatched in late 2006. However, what was expected to be a routine delivery process turned into a prolonged logistical nightmare.
Momodu said the container carrying the equipment remained stuck at the port for several years due to administrative and bureaucratic delays, severely affecting the restaurant’s operations and financial stability.
“In October 2006, the goods were shipped and arrived in a container in Ghana in January 2007,” he recalled.
But the equipment was not released promptly as expected.
“Do you know when they released it to me? I got it out in 2010,” he said.
The prolonged delay meant that the restaurant could not operate as originally planned, leading to mounting expenses and financial strain. By the time the equipment was eventually released, the business had already suffered substantial losses.
Momodu said the experience taught him important lessons about the risks associated with expanding into unfamiliar industries and the importance of understanding the operational challenges that come with new ventures.
Although the setback resulted in a significant financial loss, the media entrepreneur noted that such experiences form part of the journey of entrepreneurship.
He advised aspiring investors and business owners to conduct thorough research, understand the markets they intend to enter and prepare for unforeseen challenges before committing large amounts of capital to new ventures.
Momodu’s revelation offers a rare glimpse into the risks faced by even seasoned entrepreneurs, highlighting how complex logistical and operational issues can derail well-funded business plans.
