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Innovation

Profit, Planet, People

Ask 10 people to describe a sustainable business, and you’ll get a variety of answers.

Grant Davis

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Sustainable Businesses

A banker or shareholder would call it an established business with regular, uninterrupted profits. A college student may point to a company’s commitment to zero out its environmental impact.

According to Karen Martinsen Fleming, director of Green Mountain College’s sustainable business MBA programme in Vermont, both are correct. She would also add “people” to the definition to create what’s known as running a business with a triple bottom line (TBL).

Specifically, TBL refers to “profit, planet, people,” and it’s a term often connected to companies that are actively engaged in eco-friendly policies or community outreach (think Toms shoes). And it usually gets a bad rap from the business community.

“A banker or investor might feel that a start-up’s good intentions are incompatible with success or [are] going to hurt profitability,” Fleming says. “But there’s enough evidence now that operating a company with an altruistic bent offers considerable strategic advantages, the kind that don’t always show up instantly on the books.”

When a start-up inserts TBL principles into its mission – and makes that mission widely known -Fleming says what it’s doing will matter to a niche in the market, whether it’s eco-friendly practices or a commitment to support and give back to the community. Ideally, that niche could sustain a new business through those lean first years until it reaches a bigger audience and scale.

To illustrate the people side of TBL, Fleming points to Ted Castle’s Burlington, Vt.-based Rhino Foods, maker of the cookie dough for Ben & Jerry’s ice cream. “Rhino makes a point of hiring recent legal immigrants to work in the plant to help get them established in their new country,” she says.

“But these people were having trouble getting to work on time, or at all, and it was affecting the company’s bottom line. Their cars would break down, or they didn’t have a reliable ride to the plant. After looking into the issue, Castle discovered that his employees had no credit – they couldn’t take out a loan or get a credit card to help pay for a car or repairs or sign a lease on a home closer to the plant. So he went to his bank and guaranteed a $1 000 line of credit for every employee.”

With that, Castle established Rhino’s Income Advance Program, designed to help staff deal with financial hardships or emergencies that arise – no questions asked. “Two hundred employees took him up on it, and no one’s ever defaulted. Now he has an incredibly loyal work force that shows up on time,” Fleming says.

And the best part, she adds: “It didn’t cost him a penny.”

Successful case studies aside, effectively implementing TBL into a start-up’s mission is not easy. “It’s so complex,” Fleming says. “Unfortunately there’s no cookie-cutter approach to making it work, not even within the same industry or product market. Each company has to figure out what works for them on a trial-and-error basis.”

However, there is a silver lining to this unknown, and that’s the quality of the employees inside many TBL companies; they are resources an owner can tap to determine what the company’s mission should be.

“Generation Y and X, in particular, are very motivated to work for a bigger mission than simple profits,” Fleming says, adding that companies that follow sustainable business practices “tend to attract the highest-quality candidates, who then turn into passionate employees who share the business owner’s drive to see the company grow.”

For the members of 1% for the Planet, an organisation of TBL-minded companies that turn over 1%  of their sales to environmental organisations, the practice pays off. From 2009 to 2011, member companies’ revenue grew by more than 20%, beating the less than 2% growth of the U.S. GDP.

Or put it this way: The good guys are winning.

Grant Davis is the Tech and Money Editor for Entrepreneur Magazine and is always on the lookout for new ways that technology allows an entrepreneur to do more with less and the creative ways that startups find funding today.

Innovation

Why Smart Business Growth Means Smart IT Budgeting

(…And how to do it)

Colin Thornton

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information-technology-budgeting

For any business today, no matter its size or sector, getting the IT budget right has become a critical part of success and sustainability.  The difference between a three-device network and a fifty-device network has significant ramifications for your IT spend and your overall budget outlook.

Let’s take a closer look at several potential costs and how to plan for them…

Network: The driving force

Essentially, the network is the backbone/core of your IT infrastructure. It needs to be reliable, fast and efficient. Often, a young and growing business will have a piecemeal network in place, bolting on new sections over time. This can lead to the network becoming inefficient and slow.

The important thing to note is that when you have reached capacity on your current network, is it’s sometimes better to start from scratch and also leave room for expansion down the line (rather than adding to the existing network as a quick fix).

While it may appear more costly (and scary), the end result is a reliable network that you won’t have to worry about revamping for many years.

Related: How Dial A Nerd Managed To Dial Up Profits

Licensing: Pricey but critical

Software licensing often comes as an unexpected (and unpleasant) cost to many business owners and their financial teams. Indeed, purchasing legal software can be pricey if you aren’t prepared for it (and don’t understand how it all works!). However, if you buy software licenses in bulk, or commit to a longer term, they can cost far less…so again, budgeting intelligently for your business growth can save you money in the long term. Also remember that many software licenses nowadays can be rented on a per user per month basis so its flexible and always up-to-date.

Maintenance: Be realistic

As the business grows and expands, so too will your IT maintenance needs. The key factor to note is to carefully consider the potential costs of IT failures and hardware issues. You need to take into account that you will undoubtedly have to spend money on maintaining your computers and overall network – and breakdowns can be extremely costly in downtime and lost productivity.

Some businesses find that it makes good financial sense to employ someone to be an IT technician in addition to taking on other responsibilities – but this person may not have the right expertise and experience to manage everything. The other increasingly popular option is to outsource your IT management.  With flexible pricing options now available to businesses, this is becoming a viable and often much more flexible route to take.

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Company Posts

Think Beyond The Box

With a holistic view of your business finances and admin in place, Sasfin’s new digital banking platform is engineered to help you grow your business.

Sasfin

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business-banking

Welcome to the banking platform designed to support your banking needs. In response to more than 50 years of financing and supporting SMEs, Sasfin has launched a digital banking platform, B\\YOND, to help address the pain points and pressures that business owners face in South Africa.

“We’ve spent decades understanding what makes SMEs succeed or fail, and a lot of it begins with how well a business owner understands their finances,” says Sasfin CEO, Michael Sassoon.

“Failed SMEs often tend to either neglect or become completely consumed by their finances and admin. We wanted to create a platform that could help them take control of these factors, and give them a full 360-degree view of their businesses.”

B\\YOND was built to enable businesses to attend to their finances and admin seamlessly, thereby ensuring that entrepreneurs can focus on their clients — driving revenue and enhancing their products and services in the process.

Related: What To Consider When Investing Your (Hard-Earned) Money

Everything you need on one platform

According to Sassoon, entrepreneurs on the B\\YOND platform will never need to set foot in a branch again. The sophisticated technology incorporates many value-added services at no additional cost, including:

  • B\\YOND online applications: Businesses with multiple shareholders and directors can apply online, by uploading documents and signing the application digitally.
  • B\\YOND payroll: A simple-to-use and SARS-compliant payroll function enables business owners to perform their own payroll management.
  • B\\YOND invoicing: Businesses can create and send personalised quotes and invoices directly from the platform.
  • B\\YOND insights: Smart dashboards generated through clever account and transaction classification and tagging helps manage revenue and expenses, and keep track of projects.
  • B\\YOND integrations: Direct-feed integration into Xero ensures that small businesses and their accountants can safely and seamlessly connect their Sasfin Bank transactional data with Xero, the fastest growing cloud-based accounting software provider in the world.

Serving the entrepreneur

While there is much in store for the next versions of B\\YOND, the platform currently offers business leaders the basic tools they need to run their businesses smoothly in one place at no additional cost, with the ability to bank at their convenience.

“Sasfin has always existed to serve the entrepreneur and investor, the two key drivers of the South African economy and it bothers us that there is such a high failure rate of entrepreneurs in our country. We have spent the last three years building B\\YOND — a future-fit digital banking platform to help these entrepreneurs,” says Sassoon.


Engineered for success

Sasfin has gone above and B\\YOND to bring you a new digital banking platform that gives you the tools to make managing your business simple and profitable.

B//YOND is a value-add to all Sasfin Transctional Banking clients

Bank outside the box

The Sasfin Transactional Banking Business Account is designed for SMEs who want to focus on what they’re most passionate about — their business — while their banking platform not only sweats the small stuff for them, but helps manage and grow their business.

  1. Do you spend unnecessary time on banking?
  2. Does your bank pay you market-leading annual interest rates?
  3. Does your bank give you easy cash management in real-time?
  4. Would you like to manage your payroll and invoicing from your bank account?
  5. Does your bank help you keep track of your cash flow, manage your admin, and provide you with the set of tools you need to help run your business successfully?

Sign up today and have access to a whole new world of banking better for your business.

Visit: www.sasfin.com/bank/byond/

Call 0861 SASFIN for more information.

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Innovation

A Short Cut For Corporates To Digital Innovation: Start-ups

Charlie Stewart, co-founder and CEO of Rogerwilco shares his advice for turning to start-ups for solutions.

Charlie Stewart

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digital-innovation

If there is one anathema in corporate culture, it is failure. With profit to be made and share prices to increase, failure is simply not an option. And yet, when listening to stories about success in the digital space, failure is there to put one on the right path to success. The phrase ‘Fail fast, Fail often’ is often bandied about, and innovation can be seen as a constant process of iteration, test and failure, repeating this until a well refined service or product is on the table.

Many corporates are waking up to the uncomfortable fact that at a structural level, the type of innovation required to grow in today’s digital landscape, is out of their reach, at least when trying to come up with it internally. So what to do? Charlie Stewart, co-founder and CEO of Rogerwilco shares his advice for turning to start-ups for solutions.

1. The start-up solution

Corporates comfortable in the digital space – Apple, Alphabet, Facebook and Amazon – have been buying startups for years, and now companies are realising that when it comes to Blockchain, artificial intelligence and machine learning, they need to turn elsewhere. And they are. Matt Garratt, Vice President of Salesforce Ventures noted that of the roughly 1500 tech acquisitions Stateside in 2016, half of them were bought by non-tech companies, showing that buying a start-up is a quick way to acquire new technologies, skills or patents.

Related: Why Optimism Isn’t Enough – You Need To Also Accept The Brutal Facts

But purchasing a company with a fully developed product can be an expensive and often risky play. Instead we are beginning to see a trend where corporates are framing agile startups as solution providers, offering them seed funding to come up with answers to digital headaches.

In the US, defence contractor Lockheed Martin has turned its investment strategy around, focusing on young startups instead of more mature companies. In the region of $20 million was ploughed into startups in 2017, helping Lockheed Martin to get a slice of the pie in fast moving spaces such as cybersecurity, autonomous vehicles and nanotechnology.

2. Outsourcing the problem

For corporates turning to start-ups, there are two benefits. Firstly, by doing so companies are casting their net a bit wider, with not only more eyeballs on the problems but, importantly, without the restraints of the corporate boardroom. There is more out-of-the-box thinking involved, no internal politics to worry about and far less of a threat of somebody’s career being jeopardised.

Secondly, if a start-up comes up with a solution, investing in the fledgling company can be cheaper than purchasing one with an established solution. If a buy-out is on the cards, it is less risky too since the due diligence process has been worked through and cultural challenges have been ironed out.

But not all start-ups actually want a buy-out. Some rather prefer access to market and skills transfer, especially around the commercial side of business. Yes, they do need investment, so companies can provide them with a proof of concept to take their idea forward, or potentially a more structured form of investment in their business. 

3. Cape Town: the start-up hub of Africa

Locally, Cape Town can be seen as the tech start-up hub of Africa, and is certainly a good place for corporates to start sniffing around for that digital innovation golden ticket. Events such as last year’s AfricArena conference proved that Cape Town can be a fruitful hunting ground. 80 start-ups from across Africa attended the inaugural event, and were tasked to find solutions to problems provided by corporates beforehand. Air France, for example, was looking for innovative mobile solutions, the City of Cape Town wanted to see how technology can be used to improve the tourism industry, while RCS asked for a loyalty programme to match a new credit programme.

Related: 7 Ingredients Of Small Business Success Online

By all accounts the event was a major success, connecting start-ups with corporates and investors, both attending the event and dialing in. The winner of Air France’s challenge, mobile payment solution provider WeCashUp, received multiple offers of investment and the project has moved on to the proof-of-concept phase.

4. The start-up lifeboat

Many companies need to face up to the fact that the current corporate structure they are working within does not allow for the type of innovation required to adapt to, never mind thrive, in a digital world. South African companies were perhaps sheltered from the digital tsunami that has eviscerated the analogue business world, but the wave has hit our shores. If it is innovation that is needed, it is time to turn to agile startups, far better adapted to a sink-or-swim digital environment, to come up with the solutions.

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