In 2004 Luvuyo Rani opened Silulo Ulutho Technologies, a company that provided local teachers with refurbished computers. It didn’t take long to realise that his target market did not understand the technology, and so he opened an Internet café to create a space where he could place the refurbished PCs, and provide the residents of Khayelitsha with a place to access the Internet and learn about computers. And no one came. The café was losing money hand over foot, and Luvuyo and his partners were simply hoping people would come.
“We realised we had recognised a market — but that the market hadn’t recognised itself,” he says. “People need technology, but we were pitching to a market that simply didn’t know how to use what we were offering.”
And so Silulo added training courses to its business model. At first the courses were ad hoc — an hour or two each day at the Internet café. It soon became clear that in trying to create a market for their products, Silulo had actually struck on a business offering the marketplace was desperate for. Today Silulo operates 18 training centres across the Western Cape. Courses run for six months at a time, 8am to 5pm. MWeb has taken notice of the business and refurbished five centres as part of its ED programme. This second revenue stream has lower costs than the Internet café, and is more profitable.
“You can’t be too precious about your business model,” Luvuyo says. “Sometimes you need to adjust your offering to suit the market. You can’t expect the market to adjust to you, simply because you are offering something. Find what they want or need, and then give them a solution.”