How Majozi Bros Construction Built Their Business, One Brick At A Time

How Majozi Bros Construction Built Their Business, One Brick At A Time

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The only thing that falls from the sky is rain, say the founders of construction and property development company, Majozi Bros. For everything else, you’ve got to work hard, never take no for an answer, and create your own opportunities.
Simphiwe-Majozi-and-Sihle-Ndlela

Vital Stats

  • Players: Simphiwe Majozi and Sihle Ndlela
  • Company: Majozi Bros Construction
  • Est: 2012
  • Visit: majozibros.co.za

Simphiwe Majozi and Sihle Ndlela have one aim: To be the biggest property group in Africa. They’re dead serious about this big, hairy, audacious goal, but they’re willing to do it slowly and sustainably. “We understand the importance of the right foundations,” they say. “We have eight failed businesses between us, so we’ve learnt a lot of lessons, particularly around the dangers of trying to grow too quickly.”

They’ve put those lessons to good use while building Majozi Bros, and their patience is already paying off. Here are their top seven lessons for start-ups with big dreams and the perseverance to make them happen.

1. Turn challenges into opportunities

One of Sihle Ndlela’s favourite sayings is ‘the only thing that falls from the sky is rain’, which neatly encapsulates the entrepreneurial pair’s response to challenges. Nothing is going to fall in your lap. Success is what you make it.

“Sihle and I started working together because we realised we had a lot in common, particularly the fact that we were the same age, felt the same way about business and shared the same values,” says Majozi. Their youth drew them together, but it also worked against them.

“It was tough to convince potential clients — especially established, older generation clients — that we can deliver. We realised that we could allow this problem to hinder our growth, or we could find a way to use it as
an advantage.”

And so the pair made it rain. They created a brand around their youth. “We highlighted the fact that we’re two young guys in construction. In every interaction we had, particularly with media, we painted a positive picture of our youth and aspirations. We didn’t hide from it, we shouted it. We’re proud of it,” says Sihle.

“We just needed to get a foot in the door so that our record could start speaking for itself, and the hype we created did that for us.”

Related: Funding And Resources For Young SA Entrepreneurs

2. A brand is much more than a logo

Long lasting brands stand for something. They consistently provide the same experience. It’s not about a logo; it’s about the ability to deliver on promises. A recognisable and sustainable brand can’t be built overnight because you need a track record to back up your claims.

This means two things. One, aim high, but be realistic about what you can do. Rather under-promise and over-deliver than over-promise and under-deliver. As you grow your ability to deliver more, it will scale accordingly, but get your foundations right first.

3. You’re your own best client

Majozi-Bros-Construction

“We launched in the middle of a boom market,” says Majozi. “And then suddenly the housing and construction market started taking strain. The jobs dried up. We realised we could wait around and hope things would get better, or we could go out there and create our own opportunities.”

This is exactly what they did. They did some research, and selected an up-and-coming semi-township area where property prices were cheaper than in the suburbs, but there was real buyers’ interest.

“Buy a plot, develop it, sell it. That was our plan. We wouldn’t just be the builders. We’d be the developers. We’d give ourselves work,” says Sihle. It was a small scale experiment that paid off, and they were able to use the profits to buy their next property.

4. Keep things lean

“Our approach to business was the reason we had the cash to buy our first plot,” says Sihle. “From day one we’d paid ourselves a minimum salary. All the money we made went back into the business. Our investment mentality is that if you take care of the business, your business will take care of you.”

“Successful businesses are all about positive cash flow,” agrees Majozi. “Once we chose this path of expansion, we were careful to only ever buy one property at a time and to never exhaust our cash flow. Each time we used the profits from one sale to build the next property. Slowly we built up our base, our profits and our reputation.

“Over-extending yourself leads to really bad business practices. Before you know it, you’re using one client’s cash to fund another client’s project. Soon you’re in debt and cutting corners. This is how businesses in our industry go under and ruin their reputations, not to mention the irreparable harm to their clients’ finances,” he adds.

Related: Making a Profit in Construction

5. Get creative to finance your growth

Once Majozi and Sihle had proven they had a successful prototype, they started looking for outside funders to scale their projects. Traditional finance options weren’t available, and so once again they looked to themselves to find a solution.

“We decided to tap into our community for investors,” says Majozi. “We kept things small. We’re working with five civil servants, amongst them a teacher, a policeman and a nurse, and together we’re growing their savings. Because we didn’t need huge amounts of capital, and we’ve spread the risk, we were able to find interested parties. We’re sticking to our project-by-project model, with profits reinvested into the next property.”

“We’ve learnt that a little can go a long way,” adds Sihle. “A group of people can split the costs as well as share the rewards, which has been much more attainable for us than one big loan from a bank.”

Of course, they’ve had to put trust and integrity at the forefront of every decision they’ve made, given that they’re working with their investors’ life savings.

6. Don’t take no for an answer

Once they’d proven their model, the partners set their sights on gated communities. “Gated estates use accredited builders. We were young and new, and they just said no to us,” says Sihle.

“We would physically stand outside the estates trying to get someone’s attention. When a site manager approached us, we would ask the same question: How can we build here? The response was that we needed to be accredited, and that clearly wasn’t happening. We needed a plan.”

They returned to what had worked for them, buying a plot and appointing themselves the construction company. “There were still a few hurdles getting the developer to say yes, but eventually they did. I think we wore them down. Plus now we were also technically a client.”

“Once we had our foot in the door, we could start building a track record,” says Majozi, and this is exactly what they’ve done. Today Majozi Bros has properties in Hillcrest, Cotswold Downs and Izinga Ridge in Kwa-Zulu Natal, and they’ve set their sights on the prestigious Waterfall Estates in Gauteng.

7. Never stop learning

“We believe that information and industry experience is power,” says Sihle. “We make a point of learning as much as we can from other industry players, clients, suppliers — anyone who is willing to share advice or who we can observe. You can never know too much.”

Related: Construction a Good Investment?

The business has also been accepted into WBHO’s enterprise development programme, which ensures the entrepreneurs will be fine-tuning their business and industry skills. “We’re excited to be exposed to the systems that an industry giant uses, and apply them in our own business,” says Majozi.

“We want to compete with the best, and that means continuous learning.”

Remember this

Successful start-ups create their own opportunities. Don’t wait for something great to happen to you. Go out and make it happen.

Aug 15, 2016
Nadine Todd is the Managing Editor of Entrepreneur Magazine, the How-To guide for growing businesses. Find her on Google+.