In 2007 NXT\ (pronounced next) was a mobile company called NXT Mobile. By 2009 it was a tech development company that developed specific platforms and solutions for its clients.
Today NXT\ Digital Innovation is a multi-specialist full service digital agency that believes the only constant is change.
“Instead of being swept away by change, we’ve become its agents,” says Wayne Levine, founder and MD of the digital innovator.
“Success in this industry lies in being able to forecast how digital progression will impact traditional business and then develop solutions accordingly. It means we’ve needed to be flexible ourselves – we’re a very different company today to what we were five years ago – but as long as we hold true to our vision that doesn’t matter; we’re adjusting to a changing landscape.”
The company’s accolades include the Best Innovation Award at the Vodacom Annual WASP Awards in 2008, runner up in 2009 and three IAC awards in 2011 for excellence in online advertising. And they’re only just getting warmed up.
Never say ‘no’ to learning
Levine and his founding partners, Dave Oosthuizen and Eunene Sucevic, have been at the coalface of digital development for well over a decade.
In 1997 Levine was running his own web design company when he joined Metropolis, an Internet company owned by Primedia. “They spoke the same language as me, but with huge funding behind them. It was a great opportunity for me to learn and pioneer digital development, so I took it.”
Levine would spend three years with Primedia (staying on at iAfrica.com after Metropolis became another dot.com casualty) before joining iTouch in 2000. “Again, this was a learning move.
The Internet had failed to present a sustainable business model (at that time) and mobile was rising from the ashes with a clear way to generate revenue.
We were creating digital services and finding new paths every day. The industry was full of pioneers looking at this new digital tech and asking ‘What can we do with this?’ It was incredibly exciting.”
By 2007, Levine was ready for something new. Oosthuizen, his counterpart at competitor Exact Mobile, was in the same boat. “We had both learnt what was possible in digital, and what consumers responded to.
The success of the mobile number 35050 brand had shown us what a mainstream digital product that consumers responded to could achieve. The behaviour and power of consumers was changing, and because we were at the forefront of this evolution, we understood what it meant.”
It was time to create something new from their shared vision. “Some of the ideas we had were not even possible until recently. In some cases technology has actually needed to catch up with our vision. But we knew it was time to get started.”
Levine is a strong advocate of the power of belief. He likes to say that Martin Luther King didn’t stand in front of his supporters and say “I have a plan.” He had a dream, and he was able to share his vision with thousands of people – long before social media was even a vague possibility.
“Too many entrepreneurs get hung up on funding. Finance is a huge challenge, but how you approach that challenge can make or break a business. Don’t look for a money guy, whether it’s a private investor or a bank. Don’t approach a business. Look for someone who shares your vision and believes in your dream.”
For Levine and Oosthuizen, those people were Reg Lescaris and John Hunt. “Mutual friends put us in contact with each other. Reg and John were looking for consultants who could develop a digital arm for their company.
The more we discussed our vision with them however, the clearer it became that a better idea was for us to set up a digital business with them as silent shareholders.”
At this point Sucevic joined the team, and the three new partners set up NXT on a shoestring budget. “The five of us believed in the future of digital media and the role we could play in shaping that future.
We had no funding from Reg and John. They gave us business and valuable contacts. We were going to grow the business slowly and organically.”
Levine is also a firm believer that cash strapped businesses focus more on cash flow and asset management. “I wanted us to be driven and hungry.” For two years the team stuck to this approach until 2009 when Levine decided to gear up to accelerate growth. “I approached Reg and John, who brought in a trusted outside investor to take a large equity stake in the business.”
A focus on growth
Equity is traditionally a touchy topic for entrepreneurs. Some welcome equity investors, others distrust shareholders. Levine believes it all goes back to that shared vision. In terms of equity the three partners only hold 10% of the business.
“That’s not important. Our profit share agreement is very different from our revenue share agreement. When the business is eventually sold – and we’ve received and rejected a number of offers already – we will receive a large share of the profits. We don’t want a bigger piece of this pie.
We want to grow the pie. Our agreement actively motivates us to do this and makes us very revenue-centric.”
These values filter down. “As NXT gets rich, so our employees get rich. We have strong incentive schemes designed to encourage dynamic expansion, creativity and low staff turnover. It’s all about trust.”
That same trust is two-fold. Levine trusts his employees, but he has also shown his shareholders that they can trust him. “You need to be able to have open and honest discussions with your shareholders. Don’t hide anything from them, good or bad.
“We’re following a vision in a constantly evolving space, which makes execution important to our ultimate success. That’s a scary space for shareholders, and we understand and respect that.
But at the same time I need the freedom to make quick decisions without constantly asking my board for permission. It’s a delicate balance, and it’s built on trust. It’s the ultimate secret to success.”