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TEDx Talks
Published: 2015-12-31
Source: https://www.youtube.com/watch?v=hhBDfJY-xZw
males who question how much longer will you and I'd be happy with the status quo that exists a status quo that over the past hundred years continues to put you in I. S. African people at the recipients of all forces shaping the global world so foster question what's happened in the world over the past few years that we've done that shape to the rest of it
how many of us he would answer in the affirmative and give an example and the truth is this because of the narrative in conversations that we've had we've had a conversation that makes it okay for Africans to just be OK and a part of the conversation we sit in my environment we finance businesses it was a huge thing about small businesses but to start a business
and just get in and it's okay if it's a small business well I'm here to tell you something new and that is it's not okay so in my own country South Africa we have these things called god does but what good does an institution in his artwork you take a loaf of bread you cut it in how often did you cuts what's left in off and
you're left with a quarter of the brit hence what would you then does your move the centerpiece of it which is the soft bread and inside to put in whatever you like with the units could be French fries a could be sausages with a bit of catch up and you overlay it with a soft point and you eat it and please understand it does something to
the soul that a McDonald's burger will never to it is perhaps our greatest export except here's the thing we're not exporting it so here to businesses tables got as a person Alexander run by an interesting entrepreneur he started his business in your two thousand and five you turned over fifty three thousand rand for the year last year interestingly there is a list of some African company
which started a franchise called got the job and they pumped in a bit of capital they started in twenty thirteen eight years off the tables doing the same thing he does I lost your they did twenty million random Terranova my point we all big business so maybe this is an anomaly right the question what's a bank bank ladies and gentlemen is nothing more than a collective
investment scheme we all come together we put our money in the central plots we put it they usually a savings with the idea that when you unlock that money and you needed future you can get what the bank doesn't take that money and assist people if your credit worthy will lend you the money and will price is at a premium hence our ability to buy a
car or house yeah so after we have these advance of things cool stuff fails to usually a group of black women who come together may put money in a pot and at the end of the year they have money and they go to the surprised and then they buy stuff and then the next day the cycle starts again right so here's an interesting stop focal ceremony
operate in the Eastern Cape started a year off to we achieved our democracy ninety five last year they collective investment three hundred thousand but you bundle together three hundred thousand for the past twenty years you can do the math about the kind of numbers were talking that they cumulatively over the past twenty years have put in the same place in nineteen ninety one four years before
them a bank was formed to serve African onus absa which does in essence the same thing stock fell last year three hundred thousand absa is a four point six billion Randy eternal the business my point are models of doing business all big business you and I need to unlock or thinking it's not okay for us to start small businesses it's not okay for us to be
happy to be vendors on the side of the road anymore setting fruits and vegetables what we need to do is own the place to produce the fruit own the road infrastructure that moves the fruit on the retail infrastructure the cells the fruit and on the banking system that's on sex the whole platform and by the way what we just take the taxes as well so the
idea here is we need a radically new form of thinking no we clear on this let me explain to you why we're not doing it because we could blame colonialism in my country up out of date as long as we want but there is a deeper problem and the deeper problem is our inability to understand the ecosystem and lifecycle of entrepreneurship all entrepreneurs start off to
start ups well you're Bill Gates to Steve Jobs you start out as a one man show with an idea what makes the Americans and now more recently the Asians really good is they've created a huge pool of venture capital money easy to access cheap and you can have is patient money you can have it forever and never have to pay back that's why they building large
institutions so it's not a mistake that Xiaomi a Chinese mobile company started five years ago is now the third largest smartphone company in the world where they sell the phones eighty seven percent of their sales comes from China remainder from this continent we are big business we'll start to start ups I know you're sort of it's easier one guy you go to the customer you did
with him you go back you may make the cookies then you come back in a given that the cookies and then mother diplomacy can I please have my money and then he pays and if he doesn't go to and say please I'm going to tie up until I get my money and usually given what I like to call in a HA an attitude adjustment clock but
how do you know your start up it's easy if you on the value of the business your startup if the customer wouldn't trade with your business unless you are in it your start up more little above that you become when I see a lot of happening now in the rest of the continent so for a bit of context are on a VC fund it obviously fun
we own adviser business we advise on to present a start businesses in a surprise development business is what we help them get into the supply chains of large when I was a sin and in a fund where we actually finance them so the entire ecosystem we're in six countries on the continent of southern Africa eastern Africa and West Africa I like to call us what we
are the best kept secret in this continent nobody knows about us and I like it that way because then the concierge coming so we see a lot of them start up to start a soon to become the survivalist entrepreneurs the problem is a lot of them die at the instance of which they become survivalists but also by lists I really need money months and to pay
my bills and how do you know you are one it's usually one person with three maybe four people in his team is operating in a small office in is just barely making it it every month he must make money to pay for that month's bills little above that isn't income success right it a success you one guy of a core group of people who manage people
and medical group of people who do the work and then we we should be that growth level is the question how do we move from startup to growth it is false is time possible minimize the risk and develop our own industries my semester change perhaps the deepest thing about this is this so complex entrepreneurs need six things to succeed just six just six even infrastructure what's
the challenge we have in our continent if I manufacture something in job or South Africa how do I get it to Michael Cole in Nigeria how do I get to Luanda Angola it's still persists in our own continent icon put on a single Railtrack and move it to that part of the world so we need an infrastructure that opens up our markets we need capital money
funding and your governments here's the point money doesn't have to be cheap but it does have to be patient it's not okay anymore when Ochsner's failed in our continent we bank we bank them and after that we can put them on these things called blacklist silicon excreted animal because what you've done is you've taken some of whose failed and learn from failing any momentum that he
called operate economically for the next five years so they need assets we need access to markets strong administration and then people but here's the thing about the people challenge what is the first thing top talent does in Africa it leaves think about it do you think about the top African shaping the rest the world today they're not lightly doing it in our own continent there somewhere
else doing it and a part of the narrative we need to reshape is how do we bring them back here to build what is jointly house there is a huge mass of knowledge in the African diaspora we need to bring them back in here and this is how we reshape it so three four reasons people start businesses full to live well to leave something for your
kids to sum it all to change the world that's it it was good will say you will see as we exist to do no harm apple says with because the people who are brave enough to think they can change the world are the ones who do today a little philosophy space where it's really is about changing the world and the reward is much much higher yeah
we live life styles we get access to public sector opportunities we called them ten deaths and here's the thing about attend a once you get it people must know so the first paycheck goes to getting you that Ferrari and because because we don't have for adidas is what we do we import them in and not only that some of the B. C. B. seem to live
in a certain suburb so what we do is we in kumbha our ability and opportunity surely by wanting to live a fancy lifestyle the Asian people are different specifically Indians you see a lot of this in my country they build legacy businesses my great grandfather gets a corner shop and he opens up a dry cleaner his son the father opens up a false food joint his
son you open up a hardware store and your son what an open of something else but here's the thing generation on generational generation they don't close the shop down they keep them running in the family as legacy businesses the environment I work in is what we sell businesses we build on purely for the purpose of setting them why because if you build to sell you build
for value it means you're gonna live scrappy you gonna keep costs low you gonna take a long term view because you're building this thing generally to create enough push pet pressure in the market that you can sell it thousand dragons Dennis South Africa so invested in my self in the other dragons actually invested in a business that is fundamentally shaping the entire floral market in the
world not just here but in the world they've created and Booba bustle flowers so imagine a situation where you would go on your phone and you want to get flowers for your loved one when you pull up the application on your screen it would show you the local florist and what that local forces available right now and the price you wouldn't buy from the local florist
you would receive the order and deliver the goods in a split second of a time why because he's closer to you does work because it does a local florist wants access to the market you want to get the grocer customer and here's a business that's reshaping it why do we do it because we know it'll disrupt not only here but globally and a huge opportunity to
sell so the question really for us is why are we building our businesses I would argue that we don't build and for the right reasons if this is true and I would argue that it is how do we fix it we need to do four things one we need to change the conversation a conversation needs to be how do you build a business with a philosophy
in mind it's gonna be greater than you it's gonna be about changing the very way of you own continent works twenty a bettering other people's lives and making sure that in the innovations that we bring to market we have something that nobody else has in the rest of the world and they can only get it here it must be based on a philosophy anything else two
week second we need a strong system of mentorship we take a moment to pause here so here's the thing about the mental shifting right in my family in South Africa specifically we come from the deep cost of subjugation of the majority of the population black people my people and because of that black people were never allowed to own businesses so in my family and I imagine
it's the case most of us in the room when I started my business everybody thought I was crazy because you were raised in a system where you grew up went to school got good grades went to varsity got good grades got a job and got married and when you want to disrupt the system society doesn't understand it what did they meant was when I did start
my business I had nobody to whom I could go and seek mentorship why because they themselves didn't know what they didn't know SO incumbent upon us to create a system in our social spaces well we can access mental ship to think differently this I would imagine is our deepest challenge socially third we need to start creating a culture of delayed gratification plus money most Faustin but
it's also really fast out and here's the other problem with lost money and this culture of delayed gratification let's be honest here and this is not political we also live in a continent where in truth we have two economies the connected economy and everything else anything else is what most of us here live the connected economies with the over release on the politically connected lives so
it's not by mistake for instance that the wealthiest woman in the continent also happens to be the daughter of the president of Angola I'm not by any means trying to arm put any splurges on her qualifications are her abilities but I would argue differently which you have the same opportunities if she were not the daughter of the president in my country South Africa we've seen a
huge accumulation of wealth of family members links to our own president why because we created that narrative and we've made it okay I connected economy where if you're in you're in and if you're not well that's just tough so it's about creating a culture of delayed gratification this is build it build it for the next ten years next fifteen years same generations send young people through
the varsity's great innovation structures and platforms and proceeds but we allow ourselves build a different continent whatever you do delay you own Greta and finally this is the trick right how do you know somebody is a good entrepreneur dot simple every bad writing business plans Stroup which you lot of it in our environment if someone has an MBA what's often a socket on spinners if they
can write a really well written business plan odds are they gonna be report this entrepreneurship fake and in the context of this conversation about the lie of small business is a particle position we need to have which is how do we take people one naturally not inclined to writing sixty page business plans and attach an addendum of a twenty page excel spreadsheets of projections and by