In honour of Global Entrepreneur Week (14-20 November), we spoke to some of South Africa’s most successful entrepreneurs from a range of sectors to find out more about what it takes to succeed, and the challenges involved in going it alone.
Shafin Anwarsha is the Founder and Head of Product at Giraffe, an innovative mobile recruitment platform, whilst Andrew Smith is Co-Founder and CEO at ecommerce homeware company Yuppiechef, South Africa’s most loved online store. Both are Xero customers.
Payspace, cloud-based HR and Payroll software, was founded by the Van Wyk brothers – Bruce, Warren and Clyde – and their close friend George Karageorgiades, and integrated with Xero earlier this year. Finally, Marnus Broodryk is the CEO of accountancy firm The Beancounter, a Xero Gold Partner. He is also appearing as an investor on M-Net’s TV show Shark Tank.
Why did you start your business?
Shafin (Giraffe): I’ve always had a passion for technology and its ability to impact people’s lives. When we came up with the idea for Giraffe, we knew immediately that it had the ability to do exactly that, and at the same time be a part of the solution to solving one of South Africa’s biggest issues: unemployment. We immediately knew then that this is what we wanted to do!
What was the most challenging part of the first year?
Andrew (Yuppiechef): The challenge was trying to start an ecommerce business at a time when South Africans were even less inclined to shop online than they are now. Not only were we trying to get customers to trust us as a brand-new retailer, but also to trust the entire process of transacting with a computer screen.
Warren (PaySpace): The practicality of planning and building a software solution without having the funding to support us. We had to think out of the box and eventually had to keep our “day” jobs to fund our “night” job which was building a software solution.
Did you always know you wanted to run your own businesses or did you get into it by chance?
George (Payspace): There was never a doubt in my mind, it was a matter of “when” not “if”.
Marnus (The Beancounter): As you get older you forget the mindset you had when you were younger. However, I discovered a note the other day that I’d made as a 20-year-old, with goals I wanted to achieve by the time I turned 30 – one of those was to run my own business.
Andrew (Yuppiechef): I have always been anti-establishment, as evidenced by only surviving three months at university. I don’t think I would be very good in a corporate setting, but I thrive on the uncertainty and opportunity that being an entrepreneur offers.
How did you get your business off the ground financially – did you have investors etc.?
Shafin (Giraffe): For the first 12 months when we sought to prove the concept, we bootstrapped the company. We figured it was important to demonstrate traction before taking on any investment
Bruce (PaySpace): We used a bootstrapping model as well, which means we required no capital funding from investors. We started PaySpace after hours, while we kept our day jobs. Working part time was draining and slow but we could not afford to all resign and suddenly start working on our dream, we needed to be realistic. As the business grew, one by one we started working for PaySpace full time.
Marnus (The Beancounter): I’ve never had any investors involved in any of my businesses. My solution is to be very lean: bootstrapping until the business scales and you have more cash to scale operations. It’s an approach that should be followed by more entrepreneurs, as nowadays with online shops and pre-orders you don’t necessarily need investment. Entrepreneurs shouldn’t get stuck in the mindset that they need investors: start lean and get off the ground without them.
What systems did you use to maintain their financial records when you started?
Shafin (Giraffe): It was extremely rudimentary – a combination of Google Docs and our internal database. As we began to grow though, this system quickly started to become insufficient. Lucky for us, Xero had just launched in South Africa at around the same time so we made the transition and haven’t looked back since.The system has vastly improved our accounting and invoicing process allowing us to handle the scale we require from current demand.
Marnus (The Beancounter): I’m a financial guy, but despite this our own financials weren’t always managed that smoothly. In the past we tried other accounting software products, though it was very reactive, and we mostly used them for compliance work. Now we look after our own numbers and have used Xero for our own accounts for the last three years.
Is it possible to have a good work-life balance and be a successful entrepreneur? Has your attitude towards this changed since you’ve been running your own business?
Warren (Payspace): Yes, but you need to decide how much balance you wish to dedicate to the various aspects of your life to achieve a balance. For example, we could work 18 hour days to achieve success in a shorter timeframe but in doing so totally neglect our family. We place a big emphasis on family and therefore we work 8 hour days in order to see our family. The downside of this is that it takes longer to realize a goal, but we are ok with that as the reward of owning and running a successful business and seeing gradual and consistent growth is good enough an achievement for us, plus we have a healthy family environment – bonus!
Andrew (Giraffe): We started working on Yuppiechef in 2006, which is also the year my first son was born. Both are incredibly demanding, which generally means sleep becomes non-existent. However, I am actually grateful that I had a reason to leave the office at a respectable hour every day. I am sure I would have been even more of a workaholic if I didn’t have other fixed commitments in my life.
That being said, I don’t feel the need to “balance” work and the rest of my life. The lines are a lot more blurry, because I work with some of my best friends, I read business books in my leisure time, and technology feels like more of a hobby than a work tool. I feel that it’s more important to try and listen to my emotional, relational and physical state, and take the breaks that feel necessary at the time.
Marnus (The Beancounter): I’ve given up trying to get a solid split. On a Monday morning, I might go get a haircut at 10am, but on Saturday at 10am I’ll also take a business call. Everyone needs time to relax and over the weekend I do try to take 24 hours off and switch off all devices. But people make too big of an issue of juggling separate work and personal lives. Ultimately you will get that phone call on the weekend and, rather than risk losing clients and causing an even bigger headache on Monday, it’s better just to take the call and get on with it.
Xero’s State of SA Small Business research identified the top three biggest challenges to launching a business, how did you overcome these?
Competition
Andrew (Yuppiechef): We picked the “frontier” world of online retail, which had a lot of challenges, but also the advantage of not being full of competitors. As ecommerce has grown more competitors have come online, but we had a head-start over most of them.
Access to funding
Shafin (Giraffe): Demonstrate strong traction and build a product that solves a real problem. If you do this, investors will come to you.
Marketing your business
Bruce (Payspace): In the beginning, we tried billboards, street pole ads and various other above the line marketing channels. Online digital channels however always proved to be a better return on investment. Word-of-mouth is still equally important and grew as the client base grew. Differentiating features in the system were delivered which provided a powerful message in all our marketing efforts.
Marnus (The Beancounter): Marketing is one the biggest challenges to launching a business. Everyone is so inundated with different marketing messages, it’s difficult to get your name out there. Digital marketing is the place to be – and where we get to our core customers. It might be expensive but depending on what business you’re in, it could well be essential.
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