Leading SA entrepreneurs offer diverse advice to attendees at the Discovery Leadership Summit

Leading South African entrepreneurs offered diverse views and advice for start-ups and established businesses on Wednesday at the 2014 Discovery Leadership Summit in Sandton, Johannesburg.

“I never got the memo during apartheid that if you’re black and a woman, you’re not supposed to do certain things,” said Nonkululeko Nyembezi-Heita, CEO of Ichor Coal and chairperson-designate of the JSE Stock Exchange. “I just did what interested me and what I was good at. I never thought about not doing it.”

Nyembezi-Heita added that many successful entrepreneurs in other countries were not particularly young when they started their businesses, and thus had considerable expertise. Sam Walton founded Wal-Mart at the age of 44. This is a challenge for South Africa, where unemployment is particularly acute among younger people.

At the same time, education and training institutions could help to change the mindset of South Africans so that start-ups and entrepreneurial ventures gained the same respect as large corporates, she said. For start-ups, their relationships with large corporates could be game-changers, and corporates should recognise that changes to their own processes – such as shorter payment cycles – could support entrepreneurship.

Fellow panellist Laurie Dippenaar founded FirstRand Group with two close friends. He shared, “It’s quite unusual because it’s three of us and it’s a true partnership. We have complementary skills (and) our value system is identical.”

Throughout their business dealings they sought to entrench an entrepreneurial culture. Employees were encouraged to contribute to a graffiti wall and to dress down, while executives lost their reserved parking bays. “Once you’ve done the makeover, you can then work on innovation,” he said, citing First National Bank as an example of a company that runs regular competitions for employee ideas, with prize money of up to R5 million at stake.

Dippenaar acknowledged that access to start-up capital was almost impossible to access, particularly with no track record. Around 80% of entrepreneurs were funded by personal savings, family and friends, and only 20% received bank financing.

“Don’t be the start-up,” said Bidvest founder and CEO Brian Joffe, half-jokingly. “Be the guy who buys the business from the start-up guy. It is extremely difficult to start unless you have access to savings and some reputation. Most inventors don’t make money from their inventions.”

He said empowerment was Bidvest’s central philosophy. Without that, the business could not be sustained. When evaluating potential acquisitions, Joffe looked for people potential and a decentralised structure. As a group, Bidvest now has 3 500 business units.

Nyembezi-Heita advised entrepreneurs to trust their gut feel. “Don’t allow people to tell you your gut feel is wrong. But remember your gut feel can be wrong. Crunch the numbers and do your homework,” she said.

Dippenaar advised entrepreneurs to have a clearly differentiating idea for their market.

Joffe observed that there had never been a shortage of money for a good idea. But given the dramatic rate of social change, entrepreneurs need to have a forecast and an idea of what their plans would be in the future.