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Madame Zingara: Richard Griffin

The process of continually creating something out of nothing is second nature to Richard Griffin, who has breathed life into Madame Zingara three times.

Juliet Pitman

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Richard-Griffin

Every night that Madame Zingara runs, Richard Griffin and his crew transform the famed Belgian tent of mirrors into a theatre of dreams, complete with spellbinding circus acts and dazzling, dramatic performances. After the guests have departed, the spotlights dimmed and the last traces of glitter are swept from the stage floor, the crew get some rest before staging the entire bewitching performance again the next night.

The scene inside the Madame Zingara tent looks very different by day and Griffin, in jeans and a t-shirt, looks decidedly untheatrical. But I’m not here for the show. I want to get the story behind it, a view into the business that drives the phenomenal and recurring success of Madame Zingara. Because, while smoke, mirrors and a hefty sprinkling of fairy dust are part and parcel of the travelling circus-restaurant’s theatrical performances, the business behind it is real.

“We might be a bunch of hedonistic hippies, but we know our business and we know how to work long and hard,” says Griffin. This combination — a dedicated work ethic and an intimate understanding of what their customers want — is a common thread of success that has run through all the Madame Zingara ventures.

Griffin has a talent for creating unique dining experiences for customers and his focus on delivering personalised service is almost fanatical. “I love what food and hospitality can do for a person’s soul. Whatever we’ve done, we’ve always started by asking ourselves ‘How is this going to make the customer feel?’ We opened the original Madame Zingara restaurant with the vision of going back to the days when dining out was a special occasion. It was all about the individual — it still is. I tell my staff, ‘Never turn a table. Never take a double booking. Get customers into a seat and keep them there. Kill them with love and serve them lots of vodka,” he says.

The original Zingara restaurant gave expression to Griffin’s self-confessed love of “excess upon excess.” Thirteen themed dining rooms of every description paid tribute to the character of Madame Zingara, a “runaway gypsy whore” given life and personality by Griffin’s creative imagination.

The restaurant was a huge hit with local and international Cape Town guests. Started as a 70-seater in Loop Street in what Griffin describes as a “dodgy building with a long lineage of bankrupt restaurant tenants,” it grew to a 350-seater restaurant, eventually taking over the entire building as well as the adjacent ones, and employing 100 staff.

Facing disaster

And then one night it all went up in smoke. “The fire took place at the start of the high season when the restaurant had a reservation book of 15 000 guests and Desmond Tutu’s birthday cake in the kitchen. Of course we’d just spent all our money on renovations getting ready for the season. And while insurance is great it doesn’t help you immediately. I had staff who needed to be paid and no money to pay them,” says Griffin, who describes the fire as one of the best and worst things that has ever happened to him.

It’s the kind of event that would make most people throw in the towel. The strong sense of place that keeps people coming back to a well-loved restaurant is not easy to simply replicate, particularly when it’s the venue itself that has lent the place its unique qualities. (Ask anyone who’s tried unsuccessfully to franchise or open ‘sister stores’ to an existing successful restaurant).

Bouncing back

This makes it all the more remarkable that Griffin was not only willing but able to raise Madame Zingara quite literally from the ashes. While most people would concentrate on getting back what they had lost, he threw himself into the creation of something new that would still hold all the magic of the Madame Zingara brand.

“We had no restaurant and no equipment but we did have two very important things: a strong brand, and loyal employees who knew just how to create magic for our customers. What we needed was a venue and a little bit of time to regroup,” says Griffin.

It was its portable and temporary nature that made Griffin eventually settle on what is known as a mirror tent. “To be honest I was casting around for a temporary venue we could set up quickly – that’s all,” he says. He’d seen a mirror tent in Ireland and, after much to-ing and fro-ing, eventually managed to get one of the few remaining ones from Belgium to South Africa in December, three months after the fire.

Although the creation of the Madame Zingara show was a second thought, it was almost inevitable given Griffin’s indefatigable creative drive. “We had this gorgeous tent – one of only 17 remaining touring mirror tents in the world – with a rich history of travelling shows for the European mink-and-manure audiences. I’d seen shows in Germany previously. Given the fact that we had this venue we almost had to create a show to go in it – but we wanted to do it in our own Zingara way,” he says.

After placing as many of his staff as possible in temporary employment in the restaurants of friends and acquaintances, and moving his reservation book to other Cape Town restaurants, Griffin set about creating the extravaganza that is today so characteristically Madame Zingara.

Golden thread

With a background chiefly in food, creating a live show of this calibre was new territory for Griffin but the first show opened within five months and within a year the business was profitable again. It’s a feat that illustrates a remarkable ability to change a business model – mid-stream, under enormous pressure and with limited financial means – and to do it perfectly, to the same exacting, “ridiculous, revoltingly high standards.”

But while the Madame Zingara Theatre of Dreams was new, its success was based on key elements of an age-old Zingara recipe. The golden thread of the original Madame Zingara magic ran through the new Theatre of Dreams, providing guests with a unique, unforgettable experience, highly personalised service and fine attention to detail. “In a way what we did was entirely new, but in another sense we did what we’d always done: we asked ourselves, ‘How will this make the customer feel?’” Griffin says.

Staying close to the customer remains a key success factor. While Madame Zingara’s ‘spiritual home’ is in Cape Town, the Theatre of Dreams’ largest audience is in Johannesburg. “There’s a bigger market in Johannesburg and it’s not seasonal like the market in Cape Town. It’s also possible that the necessity for escape is higher on people’s agenda.“

Griffin also understands the hospitality industry and, amidst the turmoil, never lost touch with how it was evolving. “The world of food was changing. South African restaurants had moved beyond spaghetti bolognaise. A new thing called hummus was appearing on menus. People were excited. There was a growing appreciation of food and the creative process behind it,” he says. It’s no mistake that Griffin’s marriage between this new interest in food and the creative process of theatre made for a winning combination. It was also, like so many other things he does, unique.

Liquidation

So much so in fact that it caught the eye of a UK-based events company that wanted to take the show to England. “The deal was that they would cover the costs of setting up Madame Zingara in England,” explains Griffin. The company paid the deposit but pulled out of the deal following the global economic crash of 2009. Griffin was left facing a R17 million bill, having transported the entire show to England.

“Looking back I often ask myself what I could have done differently. We had a contract in place but you come to realise that a contract is only helpful if you have the time and financial resources to sue someone over it. I could never have foreseen what was going to happen to the world’s economy, but I do believe that we failed to do our due diligence properly. We didn’t protect ourselves sufficiently from unscrupulous people. And we took decisions that put the company in a position where, overnight, we were suddenly facing ruin.”

Madame Zingara was forced into liquidation. It’s the nightmare of every entrepreneur, and the fear of it is what keeps many people from taking the risks required to start or grow a business. The simple fact remains that the consequences of entrepreneurial failure are deeply personal and long-lasting on every level – from financial and legal to emotional and psychological. And in a country in which failure is a closely-guarded dirty little secret, particularly among thentrepreneurial community, it leaves one out in the cold in every sense.

Knocked off a pedestal and almost literally out on the street, Griffin found himself in a position from which few people have the means or strength to recover.

“It was the first time in business that I felt real shame,” he says. “I couldn’t pay bills, I couldn’t pay staff, family and friends who had invested in me and the business lost huge amounts of money and it was all because of me. It was the first time in my life where I just couldn’t find a way to come up with a second plan. There was this thing that was beyond my control that I couldn’t fix – and it just broke me.”

He sold his car to pay wages and lived on a friend’s couch.

“It was a very dark time. I felt enormous responsibility to people who I’d let down. But when you find yourself with absolutely nothing, you do a lot of thinking and you come to realise that the only thing you have control over is your attitude. My parents, who are amazing people, told me that it’s not your past that defines you. Rather it’s how you approach your future that’s important. Your future gives you the opportunity to take your past – no matter how bad it is – and turn it into the story that you want your life to be,” he says.

It’s a brand of emotional resilience that separates people who give up and go home from those who are able to bounce back. Griffin falls into the latter category, although he’s quick to point out that it was his love of food and the faith of both friends and shareholders that eventually helped get him back on his feet.

Back to basics

“Sweet Lena, who runs my kitchen and with whom I’ve worked and been friends for 27 years, came to me and took my hand and said, ‘Richard, just cook.’” It was sound advice. “I needed to return to the thing that had always given me joy and a drive for life, and that was food,” he says.

Once again it was the inherent strength of the Madame Zingara brand that triumphed. “The brand was all that remained after liquidation,” says Griffin. “It went to two existing shareholders who I owed a great deal of money to, as well as a new third shareholder who had some capital.”

In a rare display of faith (and one that speaks volumes about Griffin’s work ethic and business talent), shareholders wanted to put him back to work immediately. “One shareholder told me that he believed the best and quickest way for him to make his money back was to get me working and building again,” he says.

Their faith was well placed. Griffin was given the opportunity to open a new Cape Town restaurant – the now-famous Bombay Bicycle Club – under the Madame Zingara brand. “We started Bombay with what was left over from an auction site. Nothing matches. Anything goes. It gave me an opportunity to return to the chaos and hedonism of the old days and our old way of doing food,” he says.

Back to work

Getting back to work was a key factor in helping Griffin to recover both his confidence and his will to continue. “What I learnt is that I really do my best work when I have nothing to go on, and I don’t think I’m unique in that respect. It forces you to really think about problems, to come up with creative ways of solving them. In that respect the liquidation, like the fire, was a gift. It took me back to basics, to why I had started all of this in the first place, it reminded me of what was important in the business — of what had helped us to make magic in the first place,” he says.

Once Griffin’s creative drive was kick-started there was no stopping him. He opened a sister restaurant, the Sidewalk Cafe three to four months after opening the Bombay Bicycle Club. Both restaurants remain successful.
It was inevitable that he’d have to face the Theatre of Dreams at some point. “My fantastic shareholders gave me a year to lick my wounds and get back on my feet, doing the Bombay and Sidewalk Cafe projects,” he explains.

Once that year was up, shareholders had him back at work weaving Madame Zingara magic. “Fortunately we had leased the tent so it was not lost in the liquidation. I agreed to a three-year contract as managing director in which time I committed to building the business back up again,” he says.

That three-year period is up and what Griffin has achieved is nothing short of astonishing. Creditors have been repaid and the Theatre of Dreams is currently staged to sell-out audiences. Madame Zingara Entertainment is now worth R30 million, with 14 operations, six restaurants, 350 staff and between 1 500 and 2 000 customers a day.

Leading people

It’s a great deal to be proud of, but what gives Griffin the greatest satisfaction is the fact that 92% of his original staff returned to work with him. “These are people who lost their jobs, their livelihood, because of me. They had every reason to be very angry and resentful. It hurt them personally. The fact that so many of them were willing to come back to work with me is deeply touching,” he says.

It also speaks volumes about Griffin’s ability to lead and mobilise people behind a common vision. “We work very hard here but we’re like a family too. In the same way that we consider how what we do will make customers feel, I try to think about how certain business decisions will make staff feel. When people feel valued and heard, you get the best out of them. When they don’t, they leave or, worse, contribute to a general creeping unhappiness in the business.

So I believe it’s important that I really listen to staff, particularly when we go through periods of growth. It’s at those times that people can get lost in the system. I need to keep going back to the question of whether staff are okay. When they’re not, we stop growing and consolidate again,” he says.

Rooted in history, looking ahead

In the coming months the business is moving into a new growth period and Griffin expects to increase the staff complement from 350 to 500 by the end of the year.

He has one last project to complete before his three-year contract is up. It takes him back to the derelict shell of the original Madame Zingara restaurant in Cape Town. “I think it’s important not to go backwards in life or in business, so while we’re going back to the original site of Madame Zingara we’re not going to try and recreate what was. We’re building a new restaurant there but we’re retaining the history of the fire,” he explains.

The new venue will give expression to Griffin’s recent love affair with India. “Shake Your Honey Mumbai will have seven different dining experiences, one of which will be in the slums, which we’ll locate in the old burned out parts of the building,” he explains.

Working with some of the country’s top creatives, Griffin is back on form and remains as committed as ever to customer service. “It’s become something of an obsession. I went to India originally to learn about their culture of service and how we can bring it back here. There is still so much we can improve upon, so much still to create and build,” he says.

It was Winston Churchill who said, “Success consists of going from failure to failure without loss of enthusiasm.” He also said, “Success is not final, failure is not fatal: it is the courage to continue that counts.” In both instances he could have been describing Griffin’s journey and the incredible resilience that is largely responsible for Madame Zingara’s success.

As he leaves the interview to change for the photoshoot, I notice for the first time the words that are printed on Griffin’s t-shirt: Live.Work.Create. It is, perhaps, the most fitting epithet.

Lessons in overcoming failure

  1. Accept that there are things outside your control and don’t let this stand in the way of allowing you to take the risks needed to build greatness.
  2. How you deal with failure is what really matters. It can be an opportunity to define a new future for yourself.
  3. Take care of your people – you can’t buy loyalty and sometimes it’s the one thing that will get you through business disaster.
  4. When you fail, go back to basics. Identify the thing that made your business successful in the first place and try to build back from there.
  5. Get back to work as soon as possible, even if it’s doing something different.
  6. Sometimes you need to accept that you can’t recover what was lost. What you can do is adapt, change strategy, shift the business model, do things differently. Look for new opportunities instead of trying to recreate what was.
  7. Always stay in touch with your customers and the changes in your industry. This is where the opportunities lie.
  8. Growth can cause destruction. If your business is growing, keep a close eye on how it’s affecting your people. Take care not to lose the essence of what made you successful in the first place
  9. We all fall on our heads at some point – some of us just do it more publicly.
  10. It is possible to overcome.

Juliet Pitman is a features writer at Entrepreneur Magazine.

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1 Comment

1 Comment

  1. The Executive Coach

    Aug 24, 2012 at 18:04

    Thanks for this great article. Many Entrepreneurs should read that!

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Entrepreneur Profiles

7 Foundational Values Of Brand Cartel And How They Grew an Iconic Business From The Ground Up

Marco Ferreira, Renate Albrecht and Dillon Warren built Brand Cartel, a through-the-line agency, that delivers exactly what they wanted — and has grown exponentially as a result.

Nadine Todd

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Vital Stats

  • Players: Marco Ferreira, Renate Albrecht and Dillon Warren
  • Company: Brand Cartel
  • Launched: 2013
  • Visit: brandcartel.co.za

“We’d never worked at agencies, which meant we had no idea how much you need to run an agency. We grew into it. It’s made us really good at what we do.”

When Dillon Warren, Renate Albrecht and Marco Ferreira launched Brand Cartel in 2013 they were in their early 20s with zero agency experience between them. The idea had started when Marco recognised that social media was taking off, but no agencies were playing in that space yet. It was a clear opportunity.

Printing flyers that said ‘Your social media is so last season’, Marco and Renate went from store to store in Sandton City, pitching their services. When Dillon joined them a few months later because they needed someone to handle the company’s finances, they had two laptops between them, R6 000, which Dillon had earned from a Ricoffy advert, and sheer will and tenacity.

“We shared a house to save on rent and split everything three ways,” says Renate. “At one point we hadn’t eaten in two days. My mom lent me R500 so I could buy Futurelife and a bag of apples for the three of us.”

The trio hired their first employee soon after launching Brand Cartel, and after prioritising salaries and bills, there wasn’t much leftover. “Dillon actually paid us R67 each one month,” laughs Marco. “That’s what was left — although I still can’t believe he actually sent it to us.” It was at this point that the young business owners realised they needed credit cards if they were going to make it through their start-up phase — not an easy feat when your bank balance is under R100.

Related: What Comfort Zones? Get Comfortable With Being Uncomfortable Says Co-Founder Of Curlec: Zac Liew

“Looking back, those days really taught us the value of money,” says Dillon

We spent a lot of time with very little, and we’re still careful with money today.” Through it all though, the partners kept their focus on building their business. “It almost didn’t work for a long time. We were young and naïve, but in a way, that was our strength. We didn’t have any responsibilities, and we’d never worked at agencies, which meant we had no idea how much you need to run an agency. We grew into it. It’s made us really good at what we do. All of our business has been referral business. It takes time, but we focused on being the best we could be and giving everything we had to our clients. Our differentiator was that we really cared, and were willing to offer any solutions as long as they aligned with our values.”

This is how Brand Cartel has grown from a social media agency into PR and Media Buying, SEO and PPC Strategy, Digital and Print Design, Web Development, Campaign Strategy and now an Influencer division. “It’s an incredibly competitive space with low barriers to entry, which meant it was easy to launch, but tougher to build a client base,” says Renate. “I’d sometimes cry in my car between sales pitches, and then walk in smiling. We had no idea if we’d make it.”

The perseverance has paid off though. Strong foundations have laid the groundwork for exponential growth over the past year, with turnover growing almost ten-fold in 2017 thanks to relationship-building, strong referrals and fostering an internal culture and set of values that has driven the business to new heights as a team.

Like many start-ups, Renate, Dillon and Marco have made their fair share of hiring mistakes, but as the business grew and matured, the young entrepreneurs began to realise that the success of their business lay in the quality of their team and the values they stood for.

This meant two things: Those values needed to be formalised so that they could permeate everything Brand Cartel does, and they needed a team that lived, breathed and believed in them.

“We’ve had some nasty experiences,” admits Dillon. “You should always hire slowly and fire fast, and for five years we did the opposite. We’ve hired incredible people, but we’ve also ended up with individuals who didn’t align with our values at all, and that can destroy your culture.

Dillon, Marco and Renate realised they needed to put their values on paper. “We did an exercise and actually plotted people based on a score grading them against our values, so we knew where our issues were. We knew what we wanted to stand for, and who was aligned with those values. We were right; within a few weeks resignations came in and we mutually parted ways.”

The team that stayed was different. They embraced Brand Cartel’s values, and more importantly, it gave the partners a hiring blueprint going forward.

“Values are intangibles that you somehow need to make real, so it’s important to think about the language you use, and how they can be used in a real-world work context,” says Marco.

The team has done this in a number of ways. First, they chose ‘value phrases’ that can be used in conversation, for example, ‘check it, don’t wreck it’, and ‘are you wagging your tail?’ Team members can gently remind each other of the value system and focus everyone on a task at hand simply by referring to the company’s values. “In addition, when someone is not behaving according to those values, you can call them out on the value, which is an external thing, rather than calling them out personally,” explains Dillon.

Related: How Matthew Piper And Karidas Tshintsholo Launched Their First Business From Their UCT Dorm Rooms

Second, all performance reviews are based on the values first. This means everyone in the organisation begins any interaction from a place of trust, knowing they are operating according to the same value system.

“When you’re in a production environment with jobs moving through a pipeline, there can be problems and delays,” explains Marco. “Instead of pointing fingers when something is over deadline or a mistake is made, our team can give each other the benefit of the doubt and work together. They trust each other, which creates cohesion. We all work as a team, which impacts the quality of our work and the service we offer our clients.”

The system is simple. Coaches will step in first if there is an issue before it escalates to the Head of Team Experience, Nicole Lambrou. If Nicole is called in, she will address the problem head on. “Inevitably it’s something fixable,” says Marco. “By addressing it immediately and in the context of our values it can be sorted out quickly. Ultimately, the overall quality of our team improves, and we are a more cohesive unit.”

The founders have seen this in action. “I recently arrived at a client event and three different people came up to me and complimented my team on the same things — all of which aligned with our values. Everyone at Brand Cartel lives them, internally and externally,” says Renate.

The value system has also shaped how the team hires new employees. “We used to meet people and hire for the position if they could do the job,” says Renate. “But then we started realising that anyone can hold up for an hour or two in an interview. You only learn who they really are three months and one day later.

“We need people who walk the talk, and we really only had a proper measurement of that once we articulated our values. Our interview style has changed, but so has what we look for.”

brand-cartel-south-african-agency

Here are the seven values that Dillon, Marco and Renate developed based on what they want their business to look like, how they want it to operate, and what they want to achieve, both internally, and in the market place.

1. Play with your work

Our goal is for everyone on our team to become so good at what they do that it’s no longer work. Once that happens you love your job because you’re killing it. It’s why sportsmen are called players, not workers, and it starts with the right mindset.

2. Wag your tail

The idea behind this value stems from Dale Carnegie, who said ‘have you ever met a Labrador you don’t like?’ In other words, we all respond well to people who are friendly. It needs to be genuine though, so again, it’s a mindset that you need to embrace.

We live these values whether we’re at the office or meeting clients. If you go into each and every situation with joy and excitement, from meeting someone new to a new brief coming in, you’ll be motivated and excited — and so will everyone around you.

3. Check it, don’t wreck it

The little things can make big differences. Previously it was too easy to pass the buck, which meant mistakes could — and did — happen. Once you instil a sense of ownership and create a space where people are comfortable admitting to a mistake however, two things happen. First, things get checked and caught before there’s a problem. Second, people will own up if something goes wrong. This can help avoid disasters, but it also leads to learnings, and the same thing not happening again.

4. What’s Plan B (aka make it happen)

We don’t want to hear about the problem; come to us with solutions, or better yet, already have solved the problem and made it happen. We reached a point where we had too many people coming to us with every small problem they encountered, or telling us that something wasn’t working so they just didn’t do it.

That wasn’t the way we operated, and it definitely wasn’t the way we wanted our company to operate. We also didn’t want to be spoon feeding our team. It’s normal for things to go wrong and problems to creep in — success lies in how those problems are handled.

Ignoring problems doesn’t make them go away, so we embrace them instead, encouraging everyone on our team to continuously look for solutions. For example, the PR department holds a ‘keep the paw-paw at Fruit & Veg City’ meeting every morning, where we deliberately look for where problems might arise so that we can handle them before they do. We start with what’s going wrong and then move to what’s going right. You need to give your team a safe and transparent space to air problems though. We don’t escalate. We need to know issues so that we can collectively fix them, not to find fault.

Related: The 5-Hour Rule Used By Bill Gates, Jack Ma And Elon Musk

5. Put your name to it

It’s about pride in work and making it your own. When someone has pride in what they’re doing, they’ll not only put in extra time and effort, but they’ll pull out all the stops to make their creative pop, or go the extra mile for a client.

We need to find the balance between great quality work and fast output though. One way we’ve achieved this is by everyone reviewing the client brief and then committing to how long their portion will take.

When someone gives an upfront commitment, they immediately take ownership of the job. It took time for us to find our groove with this, but today we can really see the difference. Our creative coaches also keep a close eye on time sheets and where everyone is in relation to the job as a whole to keep the entire brief on track. If someone is heading towards overtime we can immediately ask if something is wrong and if they need assistance.

We also celebrate everything that leaves our studio. Every morning we have a mandatory 15-minute catch up session where we check in on four core things: How am I feeling (which allows us to pick up on the mood in the room and the pressure levels of our teams); What’s the most important thing I did yesterday; What’s the most important thing I’m going to do today (both of which give intention and accountability); and ‘stucks’, issues that team members need help with. We then end off with our achievements so that we can celebrate them together.

6. Keep it real (aka check your ego at the door)

We believe in transparency. At the end of the day we’re all people trying to achieve the same thing, but it’s easy for ego to creep in — especially when things go wrong. You can’t be ego-driven and solutions-orientated. If clients or team members are having a bad day, you need to be able to focus on the solution. Take ego away and you can do just that. It’s how we deal with stucks as well. We can call each other out and say, ‘I’m waiting for you and can’t do my job until I receive what you owe me,’ and instead of getting a negative, ego-driven reaction, a colleague will say, ‘sorry, I’m on it.’

7. Walk the talk

For us, ‘walk the talk’ really pulls all our other values together. It’s about being realistic and communicating with each other. If you’ve made a mistake or run into a problem, tell your client. Don’t go silent while you try and fix it. Let them know what’s happening and fill them in on your plan of action.

Walk the talk also deals with the industry you’re in. For example, if you’re a publicist, you need to dress like a publicist, talk like a publicist, and live your craft. In everything we do, we keep this top of mind.

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Entrepreneur Profiles

John Holdsworth Founder Of Tautona AI Shares 4 Disruptive Strategies That Are Changing The Insurance Industry

What can we do now that we couldn’t do before, thanks to changes in technology?

Monique Verduyn

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“Disruption isn’t just doing things in a different way which doesn’t resonate or go any further — it’s about changing the game. Being disruptive means taking a look at an industry and finding a way to do it differently, giving you an advantage over the incumbents.”

Vital Stats

  • Player: John Holdsworth
  • Company: Tautona AI
  • Est: 2016
  • Visit: www.tautona.ai

Disruptive innovation is the catchphrase that defines the last 20 years. New technologies, business models and media have disrupted the way we do just about everything. Conventional wisdom has it that the new kids on the block are the ones who are going to own the market at the expense of industry stalwarts, but this innovative South African disruptor is showing them how it’s done.

1. It’s the experience economy, stupid

Regardless of how the world changes, organisations that consider their customers’ emotions and experience first, win. That’s exactly what Tautona did. They put themselves in the customers’ shoes and asked one key question: ‘What’s wrong?’ Few industries are as ripe for disruption as insurance. When John Holdsworth co-founded cognitive automation business Tautona AI in 2016, he knew that there had to be a better way for insurers to handle client claims.

Tautona AI emerged out of a consulting engagement John had with a large insurance company. With a background in IT, he is a highly experienced technology executive and entrepreneur who has started a number of successful companies. He says he loves the energy and adrenalin associated with start-ups. He pioneered the use of digital signatures in South Africa, founded mobile payments company PAYM8, and converged voice and data provider ECN, which he sold to Reunert for R172 million in 2011. The experience acquired over this time meant he was ready to take on a massive challenge.

Related: 5 Key Areas Pratley Are Using For Current And Future Growth

“When a policyholder submits an insurance claim, that action should trigger an instant decision, with the outcome immediately communicated back to the policyholder,” John says.

“Customers want swift claims handling, communication, and compensation. They want the same instant gratification that they get from online banking. So that’s what we set out do — to revolutionise the entire claims process. We have made traditional claims processing a thing of the past by pioneering a cognitive solution that is making the claims process faster, smarter and more efficient.”

2. Automating judgment tasks once reserved for humans

Tautona’s claims automation solution uses artificial intelligence to instantly approve or refer claims for further investigation. By using machine learning algorithms to identify patterns in the data, Tautona’s solution identifies fraudulent claims, enabling insurers to halve fraudulent claim losses.

Tautona also uses Robotic Process Automation to integrate to legacy systems, removing the need for traditional programming techniques. This means that Tautona’s claims automation solution can be implemented with minimal disruption to a business. By automating decision-making, communication, and compensation, Tautona enables insurance companies to take a major step towards becoming true digital insurers.

3. Ditch the legacy systems, start from scratch

Disruptive innovators invest in digital strategies so that they can find new ways of responding to their customers’ evolving needs. The founders of Tautona AI agree on several principles, but one that stands out specifically because it goes entirely against traditional thinking, is the importance of starting from scratch.

“You cannot take a non-digital business model and expect it to work online,” says John. “Instead of using old methods, you need to start from the beginning. Ditch the legacy systems, take a leader mentality and imagine the art of the possible.”

This iterative, modular approach typically begins with defining the strategy and programme plan upfront, delivering a core capability fast so it can provide benefits immediately, and then continuously improving with regular, incremental capability improvements to achieve the objectives of the strategy. It’s an approach that fosters closer collaboration between stakeholders, improved transparency, earlier delivery, greater allowance for change and more focus on the business outcomes.

Related: 8 Codes Of Success That Helped Priven Reddy of Kagiso Interactive Media Achieve A Networth Of Over R4 Billion

4. Shaking up an industry

How do you launch new solutions and educate customers who are used to doing things the way they have always been done? John says resistance to change is inevitable. That’s why you need more than good technology.

“When you introduce something ground-breaking to the market, you encounter many different types of personalities asking diverse questions. That demands an approach that is client-centric and entirely customer focused. It also means you have to spend time developing a sound business case to present to decision makers.”

A solid business case documents the justification for the undertaking of a project. It’s the way you prove to your client and other stakeholders that the product you’re pitching is a sound investment. You need to justify the project expenditure by identifying the business benefits the innovation will deliver and that your stakeholders will be most interested in reaping from the technology.

“Essentially, it’s about proving you can deliver,” says John. “When you have an entirely new proposition, the only way you can hope to get your foot in the door is with a value proposition so profound that clients are forced to take a look at it.”

Tautona has convinced a number of South Africa’s top insurers to implement their AI-powered claims automation solution. The results to date have been ground-breaking, with insurers dramatically reducing turnaround times and processing fees. As a result, Tautona’s sales pipeline is full to the end of the first quarter of 2019.

“But there’s no rest for disruptors. Nokia and BlackBerry crumbled because they were slow to react to market changes, and they underestimated the challenge from Apple and Samsung. The only way to retain leadership is with relentless innovation, that is, a constant flow of new versions and features. That applies in any industry today.”

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Entrepreneur Profiles

Tim Hogins Started Out As A Security Guard, Today His Has A Turnover Of R150 Million And Has Self-Funded Three Huge Lifestyle Parks

As a poor township kid, Tim Hogins watched kids pile into buses heading to Sun City every weekend, knowing he couldn’t afford to join them. He was a youngster, but he made a promise to himself. One day he would build parks that anyone could visit — especially underprivileged kids like himself.

Nadine Todd

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tim-hogins

Vital Stats

  • Player: Tim Hogins
  • Company: GOG, formerly Green Outdoor Gyms
  • Est: 2012
  • Turnover: R110 million
  • Projected Turnover: R150 million (2018)
  • Visit: gog.co.za

“I’m a visionary, and I’m not scared to invest in my vision. I’ve lost millions, but I’ve made more because of that. Business is about making money, but I’ve grown beyond that – I want to employ people, develop them, push boundaries and see where we can take this.”

“Poverty can be a good thing, because growing up poor makes you creative, and that’s an incredible power if you know how to use it.”

Seven years ago, Tim Hogins drove out of an office park and pulled onto the side of the road because he was having a panic attack. His car was closing in on him, he couldn’t see and he couldn’t breathe. After months of hard work, it was all over. His dreams were shattered.

Tim isn’t the first entrepreneur to find himself here, and he won’t be the last. What separates him from countless other aspiring business owners is that despite a massive setback, he didn’t back down. He sat in his car, phoned his wife, and told her what had happened. Instead of telling him it was time to move on and find a job, she asked him how they were going to cobble together the money he needed to start again.

And that was the beginning of Green Outdoor Gyms, a vision Tim had been nurturing for almost two years. A business idea that had led to his retrenchment and was almost ripped away from him by his business partners and investors.

But he didn’t quit. He pushed on. And today his business has a projected turnover of R150 million and has self-funded three huge lifestyle parks that Tim hopes will impact the lives of thousands of underprivileged children while providing jobs for hundreds more.

Related: 8 Codes Of Success That Helped Priven Reddy of Kagiso Interactive Media Achieve A Networth Of Over R4 Billion

The in-built art of tenacity

green-outdoor-gyms

To understand Tim, you need to understand where he came from. As a township kid growing up in Randfontein on the West Rand of Johannesburg, Tim always helped his parents to sell stuff. They were traders. His dad had a small café selling burgers and chips, and his mom baked. While other kids in the area piled into buses for Sun City on the weekends, or visited a local bird park, Tim had to work or the family didn’t eat.

“I matriculated in 1996, and even though I had an exemption, tertiary education wasn’t on the cards for me,” he says. “We just couldn’t afford it.” But Tim had a plan. His cousin told him about a free four-week course to become a security guard, and Tim aced it, securing a position at one of the firm’s top industrial sites.

Here’s the first secret to Tim’s success. Instead of seeing a dead-end job, Tim saw an opportunity. If he did his job well, he would progress to a driver, and then a cash-in-transit guard. From there the plan was management. Becoming a security guard wasn’t his fate because he couldn’t get a degree — it was step one to the rest of his life.

“I was raised to be the best version of myself. Everything is what you make of it. In primary school I was head boy, and in high school the head of the SRC. There’s always a way to grow and improve yourself.”

Two years into his career as a security guard, Tim heard about another opportunity  — a free programming course teaching COBOL, a back-end system used by the financial services industry.

“I grew up 500 metres from Stafford Masie, who would go on to become the first head of Google South Africa and is one of our country’s greatest tech entrepreneurs,” says Tim. “I had zero programming experience — I’d never touched a computer — but I knew how valuable these skills were, and here was an opportunity being handed to me.”

It wasn’t quite as easy as Tim imagined. He failed the aptitude test and had to take it again. Once he was on the course, he failed that too — it was a programming course after all, and Tim needed a far more basic introduction to IT. He didn’t give up though. He’d quit his job and needed to make this work while he was still living with his father and didn’t have financial responsibilities, so he begged the course administrator to let him retake the programme. This time he passed, and found a job at a small IT firm.

Once there, Tim built up his IT acumen. Over the course of his IT career Tim worked for Dimension Data, EOH and SITA. In his final three years he applied for an account management position and moved into sales. His goal was to become a business owner, and so he diversified and learnt what he could about business.

He also paid attention to the world around him, looking for a business opportunity or problem he could solve. He dabbled with some ideas, but the one he kept coming back to was outdoor gyms.

“I saw kids in parks doing sit-ups, push-ups, pull-ups on trees, and kept thinking there must be a better way than this for them. I knew that a proper solution would be good for the whole community — giving kids and parents a safe and free environment to play in and focus on their health. I focused on poorer communities, where gym fees weren’t an option, and kids needed safe places to play and keep out of trouble.”

The more Tim unpacked the idea, the more he began to believe in it. And then his employers found out, and made it clear that they did not like Tim’s attention divided between his job and his business idea. Despite this, Tim continued to focus on his entrepreneurial play, and within a few months he’d been retrenched, ostensibly due to a restructuring of the business, yet Tim was the only person let go.

It was October 2010 and Tim had no job, two-months’ salary and he was about to get married. But it was the best thing that could have happened to him. “That retrenchment catapulted me into business. From then on, my full focus became outdoor gyms.”

Winning and losing

gog-water-park

Tim had approached Joburg City Parks who where interested in the idea. He had also met with an engineer and they had begun to design the equipment. There was just one small problem: Money.

“I knocked on doors, approaching anyone who would listen. One investor laughed at me. He said I’d gone from IT to playing with steel — what was wrong with me? A contact at SITA said flat out that she wouldn’t help me. Looking for funding can be incredibly demoralising. I had an idea and a letter of intent from Joburg City Parks, and it still wasn’t enough.”

And then Tim was introduced to a group of investors who wanted to instal kids play areas in municipal parks. Tim had the City Parks connection; they had the funding. They entered into a business partnership and built a prototype together. This was when Tim’s wheels fell off.

“I was invited to a meeting by my three business partners, and when I arrived there were five people in the room — my partners and their two lawyers. We’d entered into the agreement as 50/50 partners, and they wanted us to all be 25% shareholders. I couldn’t agree to that. This was my idea, my connection, my baby.”

By the time Tim left the meeting, he had no funding, no partners and no prototype and he knew City Parks was getting impatient. All he’d done was create competitors — and they had a demo model.

Tim had spent most of 2011 looking for funding and then building the prototype once he found his partners. He wasn’t just back to square one, he was behind where he’d started months ago. Hence the panic attack.

It was a pivotal moment. Give up or push on? Tim chose to push on. That night, Tim and his wife, Rona Hogins, sat down and came up with a plan. They would sell one car and Rona would apply for a bank loan. Together, they managed to come up with R200 000. Tim approached a friend who was interested in a side business and they launched LXI, an importer of screens for media companies. LXI brought in enough to pay the bills while Tim concentrated on getting Green Outdoor Gyms off the ground.

Then luck stepped in. “I drove past a warehouse and saw some play equipment. Instead of driving on, I pulled in and pitched my business idea to the owner.” The owner, Neta Indig, agreed to build Tim’s prototype at cost, in exchange for a long-term partnership. Tim agreed. His R200 000 would be enough to get the business back off the ground. Green Outdoor Gyms was officially launched in February 2012.

Here’s the thing about luck though. Unless you’re open to opportunities, paying attention and willing to step out of your comfort zone, luck alone will get you nowhere. By the time Tim drove into Neta’s parking lot, he’d spoken to countless investors, had doors shut in his face, lost a partnership and his prototype, and was still willing to look for any opportunity that might present itself. Through sheer will and tenacity, he found it.

Related: The 5-Hour Rule Used By Bill Gates, Jack Ma And Elon Musk

Seizing opportunities

gog-exercise

After the first outdoor gym was installed, two things happened. The competition Tim had feared from his old partners didn’t materialise. It was Tim’s first real lesson in the power of passion. He’d doggedly pursued his idea for over two years. His partners, who didn’t share that passion, did nothing with the prototype they’d acquired. Tim was still — at that stage — in blue ocean territory.

The second was how quickly an idea can take off once the foundations are in place. GOG’s turnover was R3 million in its first year, and orders were flooding in from municipalities throughout South Africa.

Tim was invited to present his solution in parliament, and it was included in the National Development Plan. “Everything escalated faster than I could have imagined,” he says.

“The reality is that we’re an obese nation. It’s a real problem. On top of that, 90% of the country can’t afford commercial gym fees. Under the National Development Plan, every community was earmarked for an outdoor gym. Government saw my vision and they bought into it.”

Tim had to tender for each new site, but he had a first-mover advantage. By the time other players entered his space he’d already built up a track record. His team’s turnover times are impressive and the business doesn’t only design and instal the equipment, but can also overhaul a derelict park. The quality of his products ensures that equipment lasts at least eight years with no maintenance, although once an outdoor park is installed, the community takes ownership of it, cleaning it regularly and maintaining the area.

In six short years, GOG has installed over 1 000 outdoor gyms for local municipalities around the country, and there’s still room for growth. There are currently between 5 000 and 10 000 sites available, and while Tim doesn’t believe they will get all of them, the business will continue to expand. “I believe we still have a ten-year run with government-funded outdoor gyms, but this is no longer our core business.”

In fact, GOG has grown and changed considerably since that first outdoor gym was installed in February 2012.

“I’m an opportunist. I pay attention to developments around me and am always on the lookout for where we can add value,” says Tim. As a result, GOG is now developing its own sites and supplying equipment to the industry — across private and public sectors.

“You need to know that competitors are coming,” says Tim. “When we started out we had a niche with outdoor gyms and government, but someone will always want to eat your lunch. If you know that someone’s paying attention to what you’re doing and that everyone needs to diversify, you can stay ahead of your competitors.

“Our business is centred around health, fitness and family, and  this understanding has allowed us to grow into lifestyle spaces that support our core focus.”

As a result, GOG has expanded to the installation of play areas and outdoor gyms for hotels, private and public schools, beach parks and lifestyle estates, including Steyn City.

“We also have a registered landscape company,” says Tim. “We can take vacant land and transform it into a park with grass, trees, water and pathways. We have a Geotech division that does soil testing and environmental studies.”

None of this happened overnight. It takes time to build a reputation, but if you’re focused on four key things, you can build a sustainable business. “You need to diversify your product range, diversify your customer base, nurture relationships and push outbound sales,” says Tim.

Tim has geared the business for scale, which is critical in a production and manufacturing context. “We have always outsourced our manufacturing, first with Neta, and later to a Chinese manufacturer who has become integral to our success.”

Tim’s relationship with Neta was critical in the start-up phase, but after two years the manufacturer decided to focus on his core. “We were too big — it wasn’t a side project anymore, and Neta wanted to remain in construction,” says Tim. “I needed to either find another manufacturing partner, or move into that space myself.”

Tim visited manufacturing facilities in China and sourced samples until he found a plant that could handle GOG’s volumes and quality. “Chinese manufacturers value loyalty and they’ll do whatever you want at the price point you ask. If you want a cheap product, you’ll get it — and the quality to match. Good quality costs more. I have an excellent relationship with our supplier — so good that he flew out to South Africa to see our operations, because he was impressed with the volumes he produces for us.”

It’s this relationship and the capacity available to Tim that has allowed him to take the next step towards his ultimate vision for GOG: Lifestyle parks.

Living the dream

gog-exercise-park

GOG’s first lifestyle park stemmed from Tim’s need for a showroom and his life-long dream to give underprivileged children access to entertainment parks that he couldn’t afford when he was a child.

“We were manufacturing outdoor parks and I started thinking about other ideas in this space that aligned with our vision and niche. I needed a showroom that could showcase everything we can do, from ziplines to climbing walls, swimming pools to spray pools and outdoor gyms. A lifestyle park was the natural answer to everything I wanted to achieve.”

GOG Lifestyle was opened in November 2016 and is situated off the N14 near Lanseria Airport. It’s close to a number of townships, including Diepsloot and Cosmo City. “The revenue model is corporate team building events, family days and launches, which allows us to run specials for kids, the elderly, and CSI projects for schools and churches.”

The next lifestyle park, GOG Gardens, was opened in Soweto in December 2017. Bigger than the first lifestyle park, GOG Gardens caters for picnics, outdoor events and concerts. It’s a multi-purpose venue with seven venues in one, and also focuses on corporates, the general public and events, with CSI projects that support children.

“We have launched some smaller projects, such as GOG Kids at Chameleon Village in Hartbeespoort and a play area in Vilakazi Street, but our next big project is Happy Island, a 36 hectare water park off Beyers Naude Drive in Muldersdrift.”

Happy Island is GOG’s first joint venture with an investment partner, Tim’s Chinese supplier. Unlike the other lifestyle parks, which GOG self-funded from cash reserves, Happy Island is a multi-hundred million rand project with large capex needs. “The idea came to life when the chairman of our manufacturing supplier visited our operations in South Africa. There are no water parks in South Africa similar to those I visited in China. We are doing something completely new and exciting, and we broke ground in April 2017.”

All of GOG’s lifestyle parks have required high capex investments and have not yet reached break-even, unlike the smaller projects that will reach break-even within a few months. “Our projection for the lifestyle parks is three years, and five years for Happy Island,” says Tim.

“My long-term goal is to have ten lifestyle parks across South Africa, one in each region, and that’s what I’m investing in. We want to make a difference, give kids access to these parks and employ people.

“I’m here today because of my childhood experiences, but before I could invest in this dream, I needed to start small and build up my reputation and cash reserves. To achieve my ultimate dream will take a lot of investment, so that’s the focus.

“I’m a visionary, and I’m not scared to invest in my vision. I’ve lost millions, but I’ve made more because of that. Business is about making money, but I’ve grown beyond that — I want to employ people, develop them, push boundaries and see where we can take this. When someone says something is impossible, I want to know why, and then try anyway. That’s how you achieve great things. That’s how you realise your dreams.”

Related: 6 Lesson Gems From Appanna Ganapathy That Helped Him Launch A High-Growth Start-Up

Next level

In 2016, GOG launched its first lifestyle park, GOG Lifestyle. Since then, two more lifestyle parks have been added, GOG Gardens in Soweto, and GOG  Kids in Chameleon Village in Hartbeespoort. The company’s biggest venture, Happy Island will soon be open to the public as well.

Healthy Living

GOG’s genesis was outdoor gyms, and the company continues to grow from these original roots: Catering to a growing focus on healthier lifestyles, from public parks to beaches, corporates and residential estates.

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