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How wiGroup Keeps Doubling their Turnover

Here’s how a business that was started from Bevan Ducasse’s apartment is dominating the point of sale integrated mobile transacting market.

Nadine Todd

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 Vital stats

The growth stats

  • 2008: wiGroup makes no money. It’s living off investment finance while developing and tweaking the platform.
  • 2011: Breakeven
  • 2012: R7 million
  • 2013: R20 million
  • 2014: Projecting R40 million
  • 2015: Goal is R65 million
  • 2016: Goal is R100 million

 

What strategic decisions did you make in your start-up phase that are still paying dividends today?

The first and biggest has been taking great care to get the right people onboard from day one. Businesses are essentially their people. If you get the people part right you set the foundation and the environment for success.

The second was to find the right funding partner. I was 24 years old and I’d left my job to start something on my own. I’d been working for another start-up and realised that I wanted to be in that environment – I wanted to be an entrepreneur, taking risks and creating new things.

The problem was that I had only a few months of rent in hand, and I needed a few million rands to get my idea, which centred on point-of-sale transactions from a mobile device, off the ground. I needed an investor, but I also didn’t want to just take money from anyone.

I wanted an investor who would add strategic value to my business, specifically a company with retail and point of sale (POS) relationships in place. When I met Capital Eye Investments (which was UCS Group at the time) I knew it was a good match.

They were looking for innovative software companies to invest in, and I was looking for a company to add strategic value to my business. That relationship still holds today, and it’s been a strong contributing factor in our growth.

Did your start-up strategy align with today’s growth figures?

Absolutely… not. The initial incarnation of the business was wiWallet, a solution that enabled you to load your credit card details onto your mobile phone and pay in participating stores using your mobile phone.

Initially, we had partnered with some small innovative coffee shops, and launched on 8 August 2008: I remember walking into Café Neo and buying coffee using my phone linked to my credit card. It was an incredible feeling.

However, wiWallet was a consumer play and one that was probably seven years ahead of its time. We learnt a lot of very quick lessons in launching the business, the key one being that big retailers were not going to integrate a point solution to their POS for every new application that launched.

It was too risky for them; they were wary of backing the wrong horse knowing that there would, in the near future, be a slew of mobile applications all wanting to integrate to them. Equally, the banks were very hesitant about the idea.

We realised that what the market really needed was a platform that would sit between the retailers’ POS and the growing number of applications that would begin entering the space, so we pivoted our business from a consumer play to a business to business play.

This is when we changed the name to wiGroup, and built our new platform, an open and interoperable solution that enabled retailers to integrate once to their POS to then be able to accept any mobile transaction application, including vouchers, coupons, payments, loyalty and money transfer applications.

From the outset we knew that we needed to attract the big retail players for our business to be successful. Once you’ve got two or three major clients on board, the rest will follow. But it’s a chicken and egg situation. We’re a platform for mobile applications aimed at the retail market. We needed apps on our platform to attract retailers and we needed retailers to attract applications.

How did you get your foot in the door?

Step one was proving we had the technology. Step two was making sure that we were able to articulate the value proposition delivered by the wiPlatform clearly and at the right level within the big retailers.

In any software business, real growth comes when you can scale the product. Your development costs are high upfront, but at a certain point your sales exceed your investment, and because you aren’t manufacturing a product, this results in great margins. But it’s dependent on uptake.

It’s also a slow process – you can spend up to a year going through the motions with a retail group before an agreement is reached.

Our value proposition resonated with the retailers. They don’t want to spend months vetting and negotiating with each app developer that presents them with an idea. Similarly, for app developers, getting an integration to a large retail chain is extremely difficult.

Our platform solved both those problems. It works on a similar principle to Apple’s iOS or Google’s Android in that it enables app developers to build on to it and get reach and scale. In our case this reach and scale is through the retailers that have integrated to our platform.

Read Next: How to Get Clients to Buy More Stuff

How did you sign your first big deal?

Bevan-Ducasse_WiGroup

With a lot of hard work, patience, persistence and timing. We’d proven the technology through our pilot with Vida e Caffé, which is a brand people want to associate with, so we had something innovative to show Shoprite and Pick n Pay, the retail groups we were targeting. We also understood that landing such big clients takes time, but they were vital to our growth plans. You need to be prepared for a lot of meetings, and reiterations of the concept. That’s how big corporates work, and you have to play by their rules. You won’t sign the deal if you can’t put in the time.

We also had a number of things going for us. First, we were speaking to them at a time when they were beginning to be approached by app developers on a weekly basis. The need for our platform was clear. Second, both retailers knew that enabling mobile transactions at their POS was strategically important.

What is interesting is that Pick n Pay and Shoprite went live on our platform within a matter of weeks of each other, but they each launched with very different use cases. Shoprite launched with their mobile coupon offering, Eezicoupons, and Pick n Pay launched with MTN Mobile Money.

Through the Pick n Pay integration to wiPlatform, MTN Mobile Money users are able to deposit, withdraw and pay from their mobile bank account at any Pick n Pay till point across South Africa. The success of the MTN Mobile Money integration opened doors for discussions with other tier one networks such as Vodacom.

Having the two biggest FMCG retailers and two biggest networks on our platform was the cornerstone of our growth strategy, and once we had them, the momentum really shifted.

What was your most strategic decision when it came to laying the foundations for your growth?

Our integrations are essential. Who we’ve targeted was, and is, crucial to our goals. So important, in fact, that having them as clients is almost priceless. Getting them on board was therefore essential, and we were willing to lower our revenue to ensure the integration and strategic positioning we needed happened.

We didn’t want to set our price point too low though – once you do that, it’s very difficult to raise your prices – so we offered them a good discount instead. They know they’re getting a discounted rate, but we won’t need to change our price point later.

Always work out what your most important strategic goal is. Ours wasn’t getting as much money in the bank as quickly as possible. I’d rather invest heavily in the business this year to see our goal of R100 million realised in 2016, and to do that, the platform needs to grow quickly and sustainably.

Our whole growth model has followed this same path. From 2008 to 2010 we were living off investment capital as we had projected. In 2011 we broke even. By 2012 our turnover was R7 million, which grew to R20 million in 2013. We’re projecting turnover of R40 million this year, and R100 million by 2016.

Our investors have seen a good return on their investment, and all growth for the last two and a half years has been organically funded through our own cash flow.

At this stage in the business, I’d rather invest a few million into new product ideas that add value to our platform and our clients than keep that money on our bottom line. We spend a lot on developing new opportunities and solutions to support and stimulate the market and on enhancing our platform.

How is your current growth stimulated?

Bevan-Ducasse

MTN Mobile Money alone has over one million users in South Africa, generating huge transaction volume through our platform. Our business model supports exponential growth as we leverage the marketing and expanse of the applications that integrate into us.

Being POS integrated, our mobile coupon capability enables our clients to close the marketing loop with any campaigns they run.  We’ve found that mobile money transfer, digital coupons, vouchers and loyalty have driven the growth, and our belief is that payments will follow once mobile transacting has become more widely accepted.

Start-up app developers are increasingly finding wiGroup when they carry out their research ahead of launching their businesses. The capability our platform offers them is clear. They’re approaching us to get onto our platform, and some of them are developing amazing, leading edge apps. It means we’re not doing it alone – we’re all growing together, and benefiting from joint exposure to the market.

Similarly, when app developers approach our clients, the retailers are sending them our way. So for example, if a developer approaches KFC with a loyalty programme, they direct them towards us, since KFC tills are already integrated with our system. We currently have R1,9 billion in transactions that have gone through our system, and it’s growing each day.

Read Next: 4 Ways to Find More Work

What additional value do you offer your clients?

Over and above the fact that they just need to integrate with one platform, we give our clients unprecedented access to track and engage with their customers.

We have built tools and products that can link to basket information and deliver deep analytics and reporting. The reporting is real time and invaluable to retailers and restaurants.

We also work hard at finding applications that will suit our retailer partners and assist in both pairing the application with the retailer and allowing them to leverage from the benefits.

How much focus is placed on development at this point?

It’s still our major focus. Of the 50 employees we have, 20 work on development, while the remaining 30 are in admin, sales, business analysis, account management and project management.

All new product sign off and direction resides with myself, but everyone in the company provides input and ideas, ensuring the product and value is always prioritised.

We also have a team that deals exclusively with agencies. So for example if Unilever and Quirk develop a campaign that rewards customers for buying Nivea products, we’ll build the app that supports the campaign.

In addition, mainstream apps will be hitting soon and we look forward to seeing the innovative and exciting ways that these applications make use of our platform. At this point the market is in its infancy in South Africa.

This is an easy and convenient platform, and we’re ready for even greater growth, particularly because we pay a lot of attention to what consumers want, and to what our clients need.

Global expansion

  • wiGroup is currently in discussions with one of the biggest switching companies in Nigeria. With an agreement already in place to integrate the company’s tech into one of Africa’s fastest growing economies, wiGroup’s reach into Africa is poised for explosive growth.
  • wiGroup is currently launching with partners through the SADC region.
  • Talks with large retail groups in the UK have already begun. 

Dealing with competition

wiGroup-competition

wiGroup might be a first mover, but success breeds competition. Ducasse’s strategy to deal with competition is threefold.

Continue to expand wiGroup’s platform as fast as possible.

By definition the strongest competitive advantage a platform can have is reach — Facebook, Google and Apple have all proven this model.

Add Value

Continue to add valuable products to the platform,always striving to be innovative and leading with creative ideas. Every new product wiGroup bolts onto its platform puts it another step ahead of anyone else wanting to enter the space.

Ensuring excellent service and relationships.

“We strive to be the most reliable partner to our clients, always providing them with excellent service,” says Ducasse. It’s easy to pay lip service to the importance of focusing on the customer, but in wiGroup’s case, there is a strong understanding that through these relationships the company ensures clients trust them, and more importantly, like working with them.

“We believe this is critical to keeping their business and assisting us in gaining further market share through their positive word of mouth.”

Taking advice

“I read a lot of business books and biographies of top entrepreneurs. I’m inspired by the drive for perfection, out-the-box thinking and passion of people like Steve Jobs, the genius of Larry Page and Sergey Brin, and the energy and passion of Richard Branson.

“There are also so many excellent business lessons in top business books. We’ve built the entire company around Jim Collins’ advice in Good to Great on finding the right people and getting them on the bus. One person doesn’t run a business, especially as we grow. A business is only as good as the team you have, so make sure that you’re hiring well — and giving your employees a great environment within which they may excel.”

 

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

Increase Profitability

Leon Meyer GM At Westin Cape Town Shares 4 Experience-Driven Tips On How To Keep Your Team Productive

Productivity is a fundamental requirement for an organisation – it’s the seed that builds a business and contributes to higher profit margins.

Leon Meyer

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Productivity is a fundamental requirement for an organisation – it’s the seed that builds a business and contributes to higher profit margins. But what’s the best way to ensure employees remain productive, and happy in their day job?

The answer is simple and highly effective and I choose to sum it up with three short phrases – respect, trust and teamwork.

In partnership with my management team, which consists of about eight staffers across various disciplines, we strive to tick these boxes.

Related: 5 Surprising Elements That Boost Your Productivity (One of Them Is Colour)

In total we’re ultimately responsible for managing roughly 500 employees.

Five hundred employees across several departments is a mighty job. But with teamwork, good listening skills and the right attitude from the top to filter down, any business can run like a well-oiled machine.

I’d like share with you the essentials for building and maintaining a productive workforce, and these apply to all industries, not just the hospitality sector:

1. What’s your definition of a productive team and how do you achieve that?

We need to keep in mind that productivity is a result, one that CEOs and managing directors strive for with their teams. But what happens beforehand in order to achieve that result determines whether it will be achieved at all, and is equally important. I suggest the following to ensure a productive team:

Define roles and responsibilitiesDirection is incredibly important; everyone needs to know exactly where they’re going and how they need to get there, so KPIs are essential.

Often when roles and responsibilities are unclear, things go pear-shaped. I am an advocate for setting clear KPIs, it’s a good way to steer us in the right direction, and in turn helps to grow the business and the individual in his/her role.

Be flexible: Rigid environments are the worst kind, allow your employees some flexibility and the opportunity to be themselves in the workplace. We spend so much of our time at work, we need to be ourselves there.

Celebrate the team: When there are achievements, celebrate them, single out individuals who are excelling and living the company values. This builds morale and is indicative of appreciation, which is fundamental when running and building a business.

2. What has and continues to be your philosophy since managing a large team?

Know your strengths and weaknesses, as well as your team’s and leverage off that. Be prepared to learn from others, no one can operate in isolation, regardless of the level on which you operate. Accept criticism and don’t bulldoze someone’s ideas, that’s how you build trust.

3. What in your view are the top characteristics the team look for in a leader?

  • Be consistent – inconsistency screams bad leader
  • Provide guidance – this is key, don’t turn a blind eye, give input and council
  • Listen – always listen intently
  • Be impartial – always be fair
  • Give credit – it builds morale and shows you recognise good work
  • Be patient – Rome wasn’t built in a day, and remember not everyone thinks the same as you do

4. What’s your view on an open door policy and how does it assist with managing a team and ensuring everyone remains productive?

I believe in an open door policy. It’s essential to build and develop trust. I’m the first to admit that it takes a while to build that trust, but once the team (on all levels in all departments) know your door is always open, and that they can trust you implicitly, half the battle has been won.

I host a GM’s roundtable every two months, just to establish how everyone is feeling and where everyone is at. It gives staff the opportunity to bring their challenges to the table, and I deal with them the best I can.

It’s 100 percent confidential and line managers are not allowed to attend. During this meeting we try reach common ground, and I commit to addressing and ultimately solving the problem(s).

Related: 10 Ways To Make Your Employees 10x More Productive

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Why Purpose Drives Profits

If you want to succeed, it’s time to start engaging where it matters.

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Over the past two years, many clients have been extending brand positioning exercises into purpose-driven expressions.

When we look at it, it makes sense given the country’s demographics. With many of our fellow countrymen struggling to make ends meet, brands have stepped in to provide them with a picture of a future worth striving for.

Global customer-centricity study, Insights 2020, led by research firm Kantar Millward Brown, has attempted to understand how brands could drive customer-centric growth as well as the factors that really make a difference. The research surveyed 10 495 individuals in 60 countries, and there are some significant efforts worth investing in if brands want to engage where it matters most, in consumers’ hearts.

The research uncovered that for market-leading companies and brands, traditional value drivers such as quality, packaging, or distribution are necessary, but no longer provide a competitive advantage; most brands are capable of providing these drivers. What is important, are a few critical approaches.

1. Purpose-led brands

The study found that when companies or brands linked to a purpose, 80% of them outperformed the market. Only 32% of non-purpose led brands managed to perform better than the market. 

Related: How To Calculate Gross Profit

2. On the ground

It’s important to engage with consumers in their space and on their terms. Through the use of memorable campaigns, experiential events and activations it is critical to engage with consumers on their turf.

3. Be truthful and authentic

Consumers can smell something inauthentic a mile away, especially when it’s coming from a brand. This forces brands to strive for authenticity in everything they do, especially when it comes to marketing. Building values and principle-based attributes into your brand as a guiding tool is essential.

4. Helping consumers commit

By allowing individuals to attach themselves to a brand with a purpose, it helps consumers personally commit to a cause that they consider important. When a consumer is personally invested, the link between the brand and product or service deepens.

Related: Profit Share for Increased Performance

5. Balancing heritage and modern relevance

There is a continuous tussle in balancing the traditional market, transitional market and the new consumers brands are trying to attract. Keeping the heritage and roots of the brand true to itself, while creating relevance for the new market, is a battle marketers are still fighting.

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Need To Trim The Fat To Boost Profitability? Listen To Your Clients First

Jeff Bezos believed that once you win the client over by doing this, everything else will follow – not least profitability.

Marc Wachsberger

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Finding the balance between offering the extras that set you apart from your competitors and keeping things ‘lean and mean’ to minimise wastage and maximise return on investment is a tricky balancing act.

I’ve noticed that many businesses try to attract or retain customers by offering what they think their customers want, rather than finding out what they really need, and then delivering that. That’s an expensive mistake to make – and it’s not going to achieve the business results you need.

I’ve also observed that now is the age of the new entrepreneur – the game changers who disrupt the status quo long set by big bureaucratic competitors who think that their customers will just accept an inflationary (or slightly larger) increase every year, just because they always have.

While Amazon has been around for a while now, there’s also an important lesson to be learned from its launch goal, which was to bring the price to the client. Jeff Bezos believed that once you win the client over by doing this, everything else will follow – not least profitability.

How have I applied these lessons in my business?

Firstly, we design our hotels backwards – we focus on the needs of our clients, very aware that what hotel guests wanted years ago is not what they want now. That’s why we don’t offer thing like a turn-down service with chocolates on the pillow. Nobody eats the chocolates, and nobody uses the toiletries – so why should we include the costs of these unwanted extras (and the cost of the staff required to implement them) in the final bill to our clients?

Related: 7 Steps To Optimise Your Cycle Of Customer Service

We do, however, offer free WiFi internet connectivity, free parking in our buildings, free laundry services and either bed-and-breakfast options or self-catering rooms.

Simply put, we’ve cut the fat that nobody wants anyway, and added the value that our guests have said they expect.

Our clients have said that they expect the whole hotel to be a workstation, and not just the business centre in a dark, unwanted corner. So, we’ve put a workstation in every room, with always-on access to the internet. Our hotels are designed with beautiful work spaces that cater for nomadic entrepreneurs and double up as comfortable meeting spaces, again – gone are days of boardroom only meetings, our spaces are primed for work and play in one integrated space.

Our clients have pointed out that they’re already paying for their room – so why should they pay for parking?

Many of our clients stay with us for days or weeks at a time, and have said it would be helpful if we did their laundry. So, we do that for them – and we don’t charge them for it.

Related: Good Customer Service Is About Relating At The Same Level

It’s true that many of our old-school competitors offer a broader range of products and services than we do, but we’ve built a successful business on adding the value that our clients need, removing the costs and extras that annoy them, and keeping costs (theirs as well as ours) under control by cutting out unnecessary frills.

It’s an approach that’s worked for The Capital Hotels and Apartments as a disruptor in the hotel and long-stay accommodation industry, and I’m confident that its principles would apply to any other industry that’s ripe for disruption.

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