Ntuthuko Shezi's journey as an entrepreneur started when, as a schoolboy in rural Ndwedwe in KwaZulu-Natal, he sold vetkoek and fried fish. After that he mowed lawns in Bedfordview. He now runs a multimillion-rand vehicle repair business out of two of the country's busiest airports.
It is not any old vehicle repair business -- Scratch Mobile is one of a kind in Africa, if not the world. Shezi's company will fix the dents, scratches and chipped windscreens on your vehicle while you fly. On your return to the airport parking bay, your vehicle looks as good as new.
"Fix a scratch, collect the cash," Shezi said with a broad smile. It sounds simple, but his journey shows that great entrepreneurial ideas often take considerable time in the business school of hard knocks.
But behind Shezi (30) stands a global entrepreneurship incubator, Endeavor, which has two mentorship programmes to help emerging entrepreneurs to develop their innovations and to build them up regionally -- or even globally.
Endeavor was founded in South America in 1999 -- its roots are firmly embedded in the developing world -- and has offices in 11 countries in South America, the Middle East and Africa.
It opened an office in South Africa in 2004 and since then has incubated 43 start-up businesses that between them have generated more than R1-billion in turnover, created more than 12 000 jobs and grown at a combined average of 30% a year. In the 2009-2010 financial year alone, amid a global economic recession, these companies generated R300-million in turnover, up 67% on the previous year, and created 588 new jobs.
Difficulties
Entrepreneurs in developing economies face unique difficulties, according to Malik Fal, Endeavor South Africa's managing director and a former head of Microsoft's operations division in Africa.
A relaxed Fal, shirtsleeves rolled up to his elbows, said that entrepreneurs like Shezi were "the missing middle" of the economic pyramid in developing countries who had "traditionally been given the short end of the stick".
Sandwiched between the large, self-sufficient corporations operating worldwide and the "poorest of the poor", who were the focus of most government attention, entrepreneurs were often left to muddle along on their own.
Endeavor's South Africa office has a network of more than 120 business leaders who mentor entrepreneurs on a voluntary basis. Partnerships with local and international business schools allow entrepreneurs to study locally and abroad.
Their businesses provide case studies for MBA students who in turn provide feedback. Other partner organisations such as Deloitte and Ernst & Young donate free accounting and consultancy services to entrepreneurs that they could not otherwise afford.
"We do almost everything a private equity fund would do, but without providing capital," Fal said.
He said that, although access to funding was a hurdle for entrepreneurs in developing economies, that was easier to overcome than a lack of access to networks and knowledge. "The natural networks of friends and relatives in business, which exist everywhere in developed economies, do not exist in economies where business in its current form has been conducted only between people for two or three generations," Fal said.
'Accentuating the positive'
An entrepreneur has to raise his or her own capital, which eliminates many chancers, even before the arduous 12-month Endeavor selection process begins. Endeavor's philosophy is to replace the idea of poverty reduction with that of wealth creation.
"We aim to accentuate the positive, not the negative, and to undo the deep psychological impact implicit in such negativity," Fal said.
What support does Endeavor get from government? Fal's relaxed demeanour slips: "None, man! Don't get me started! In Brazil, the government contributes 30% of Endeavor's budget and has created its own agency to incubate entrepreneurs on a massive scale. In South Africa? Nothing!"
That was despite South Africa being awash with entrepreneurs whose skills could be developed, with a huge impact on job and wealth creation.
Shezi spoke fondly of his mother, a teacher, and his maternal grandparents in Ndwedwe, whose business acumen had seen them prosper beyond the limitations of their paltry government salaries and grants. Shezi said he learned how to "grow money" from their example.
When he bought a new car, which acquired scratches and dents over several months, it cost him thousands of rands in repairs. He sensed his opportunity. He bought a van and the registration number 083 SCRATCH, which he daubed on the side, and set out to undercut the competition.
Although working full-time at Accenture, Shezi would receive phone calls requesting his services during the week. He would rustle the pages of a magazine near the phone speaker and say, "We're fully booked this week, ma'am … let me see … oh, wait, someone's cancelled on Saturday morning".
Shezi, with no panel beating or painting experience, would collect another company's off-duty panel beater, give him a pair of Scratch Mobile overalls and get the job done.
In the first month -- November 2006 -- he turned over R30 000. Shezi quit his job, sold his flat and was soon living the life of an entrepreneur -- quarter the salary, four times the excitement.
"If I could make 30 gees sitting in the office working for the boss, I knew I could triple my revenue working full-time," he said.
"When you work at a company, you get a performance assessment once a year. Here, I do one every morning in the shower … what's the bank balance? … when are wages due? … oh no!" he said, rubbing the back of his head in mock anguish.
The airport idea came to Shezi while he was using the valet parking service during an Accenture business trip. "I noticed that customers spent a few minutes filling out paperwork to park there and, in that time, a Scratch Mobile agent on site could assess a vehicle's condition and provide that customer with a quotation for repairs on the vehicle that was being left behind."
But Scratch Mobile only grew into the medium-size business it is today -- with a turnover of R6-million, a staff of 26 and branches at OR Tambo International Airport in Jo'burg and King Shaka International Airport in Durban -- thanks to the input provided by Endeavor.
Shezi has received free financial audits by Ernst & Young, which have enabled him to approach other companies for loans, and a marketing strategy created by Draftfcb, which has helped put Scratch Mobile on the map.
His advice to other entrepreneurs is to "find the one thing that's unique about your business -- a selling point -- and exploit it as much as you can". He calls it "the magnet pulling customers your way", which, in the case of Scratch Mobile, is that "anyone can panel beat, but we can do it while you fly".
Shezi's location -- at airports -- is symbolic. It is unlikely that anything short of the sky will stop his rise as an entrepreneur.
Source: http://mg.co.za/article/2011-01-07-starting-a-business-from-scratch
It is not any old vehicle repair business -- Scratch Mobile is one of a kind in Africa, if not the world. Shezi's company will fix the dents, scratches and chipped windscreens on your vehicle while you fly. On your return to the airport parking bay, your vehicle looks as good as new.
"Fix a scratch, collect the cash," Shezi said with a broad smile. It sounds simple, but his journey shows that great entrepreneurial ideas often take considerable time in the business school of hard knocks.
But behind Shezi (30) stands a global entrepreneurship incubator, Endeavor, which has two mentorship programmes to help emerging entrepreneurs to develop their innovations and to build them up regionally -- or even globally.
Endeavor was founded in South America in 1999 -- its roots are firmly embedded in the developing world -- and has offices in 11 countries in South America, the Middle East and Africa.
It opened an office in South Africa in 2004 and since then has incubated 43 start-up businesses that between them have generated more than R1-billion in turnover, created more than 12 000 jobs and grown at a combined average of 30% a year. In the 2009-2010 financial year alone, amid a global economic recession, these companies generated R300-million in turnover, up 67% on the previous year, and created 588 new jobs.
Difficulties
Entrepreneurs in developing economies face unique difficulties, according to Malik Fal, Endeavor South Africa's managing director and a former head of Microsoft's operations division in Africa.
A relaxed Fal, shirtsleeves rolled up to his elbows, said that entrepreneurs like Shezi were "the missing middle" of the economic pyramid in developing countries who had "traditionally been given the short end of the stick".
Sandwiched between the large, self-sufficient corporations operating worldwide and the "poorest of the poor", who were the focus of most government attention, entrepreneurs were often left to muddle along on their own.
Endeavor's South Africa office has a network of more than 120 business leaders who mentor entrepreneurs on a voluntary basis. Partnerships with local and international business schools allow entrepreneurs to study locally and abroad.
Their businesses provide case studies for MBA students who in turn provide feedback. Other partner organisations such as Deloitte and Ernst & Young donate free accounting and consultancy services to entrepreneurs that they could not otherwise afford.
"We do almost everything a private equity fund would do, but without providing capital," Fal said.
He said that, although access to funding was a hurdle for entrepreneurs in developing economies, that was easier to overcome than a lack of access to networks and knowledge. "The natural networks of friends and relatives in business, which exist everywhere in developed economies, do not exist in economies where business in its current form has been conducted only between people for two or three generations," Fal said.
'Accentuating the positive'
An entrepreneur has to raise his or her own capital, which eliminates many chancers, even before the arduous 12-month Endeavor selection process begins. Endeavor's philosophy is to replace the idea of poverty reduction with that of wealth creation.
"We aim to accentuate the positive, not the negative, and to undo the deep psychological impact implicit in such negativity," Fal said.
What support does Endeavor get from government? Fal's relaxed demeanour slips: "None, man! Don't get me started! In Brazil, the government contributes 30% of Endeavor's budget and has created its own agency to incubate entrepreneurs on a massive scale. In South Africa? Nothing!"
That was despite South Africa being awash with entrepreneurs whose skills could be developed, with a huge impact on job and wealth creation.
Shezi spoke fondly of his mother, a teacher, and his maternal grandparents in Ndwedwe, whose business acumen had seen them prosper beyond the limitations of their paltry government salaries and grants. Shezi said he learned how to "grow money" from their example.
When he bought a new car, which acquired scratches and dents over several months, it cost him thousands of rands in repairs. He sensed his opportunity. He bought a van and the registration number 083 SCRATCH, which he daubed on the side, and set out to undercut the competition.
Although working full-time at Accenture, Shezi would receive phone calls requesting his services during the week. He would rustle the pages of a magazine near the phone speaker and say, "We're fully booked this week, ma'am … let me see … oh, wait, someone's cancelled on Saturday morning".
Shezi, with no panel beating or painting experience, would collect another company's off-duty panel beater, give him a pair of Scratch Mobile overalls and get the job done.
In the first month -- November 2006 -- he turned over R30 000. Shezi quit his job, sold his flat and was soon living the life of an entrepreneur -- quarter the salary, four times the excitement.
"If I could make 30 gees sitting in the office working for the boss, I knew I could triple my revenue working full-time," he said.
"When you work at a company, you get a performance assessment once a year. Here, I do one every morning in the shower … what's the bank balance? … when are wages due? … oh no!" he said, rubbing the back of his head in mock anguish.
The airport idea came to Shezi while he was using the valet parking service during an Accenture business trip. "I noticed that customers spent a few minutes filling out paperwork to park there and, in that time, a Scratch Mobile agent on site could assess a vehicle's condition and provide that customer with a quotation for repairs on the vehicle that was being left behind."
But Scratch Mobile only grew into the medium-size business it is today -- with a turnover of R6-million, a staff of 26 and branches at OR Tambo International Airport in Jo'burg and King Shaka International Airport in Durban -- thanks to the input provided by Endeavor.
Shezi has received free financial audits by Ernst & Young, which have enabled him to approach other companies for loans, and a marketing strategy created by Draftfcb, which has helped put Scratch Mobile on the map.
His advice to other entrepreneurs is to "find the one thing that's unique about your business -- a selling point -- and exploit it as much as you can". He calls it "the magnet pulling customers your way", which, in the case of Scratch Mobile, is that "anyone can panel beat, but we can do it while you fly".
Shezi's location -- at airports -- is symbolic. It is unlikely that anything short of the sky will stop his rise as an entrepreneur.
Source: http://mg.co.za/article/2011-01-07-starting-a-business-from-scratch
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