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Netsurit: Orrin Klopper

In true dotcom style, Klopper and Van der Walt started their venture from a bedroom.

Monique Verduyn

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Orrin Klopper of Netsurit

They sold PCs and calculators to students and did a few odd jobs in-between. They were just chasing the money, but then Y2K came along and they spotted a massive opportunity: SMEs were being ripped off by IT companies and paying a fortune for technology they did not need.

By targeting this sorely neglected market, Klopper and Van Der Walt grew Netsurit into what is today – South Africa’s largest managed outsourced IT provider for SMEs. There were some big red flags on the way – like R9 million debt to the IDC – but Klopper, MD of the company, says believing in what you do and in what you are selling, providing great value to clients, and helping your people to live their dreams has paid off big time.

It was while I was still at school that I realised I was not the type of guy who respected people just because of their position or status. If I had a teacher I admired, I was a great student. If I didn’t like him, I battled to take instruction. I didn’t really grow up in an entrepreneurial environment, but my drive to work for myself came from that inability to take orders from other people.

After I matriculated in 1992 I took a year out and went to the UK to work for my brother who had set up a fast-food business. I learnt a lot from him about how to treat employees. He worked hard and demanded the same from his team, but he was also fair and he created an environment that was fun for everyone.

Student life

I came back in 1994 and enrolled for a Bachelor of Commerce degree at what was then the Rand Afrikaans University (RAU). When I got my student loan I realised I could put it to good use. I threw open house parties for students which were really a blast. I remember one in a huge house on Oxford Road which was a great success.

All the time I was thinking about what I wanted to do. I even considered starting a gardening services business – anything that meant I could work for myself – that was my sole driving force at the time.

In the meantime, I used the money I was making from the parties to sell books and magazines at the Rosebank market, and I also sold clothing and shoes at building suites, basically doing whatever it took to make some money. In 1995, when I started my information systems major I met Rian. He was doing an engineering degree and he and his brother were selling PCs and engineering calculators on campus.

They had a great business going and I wanted in on the opportunity. I convinced him I was a great salesman and I joined them. One day my mother came home and walked into my room when I was counting a big wad of cash. I’d also just applied for an additional two phone lines for the business. She took one look at me and told me it was probably time for me to get my own place.

From part-time job to full-time business

I was 21 years old when I moved into a flat in Randburg and we started running the operation from there. Because the business was so successful, we knew it was time to start formalising it. At the end of 1996 we registered for VAT. This was a turning point – it was obvious by this stage that we were onto something really promising and that there was no way we were going to work for anyone else given how well we were doing.

I was extremely encouraged by the simple fact that we were selling and people were buying from us. By 1997 I had finished my degree, but Rian was still studying so I ended up running the business full-time, now selling PCs and laptops to small businesses too.

In 1998 it became obvious that we needed offices and we moved into our headquarters in Marlboro. That formalised things. Something happens when you get your own premises. The bills also get bigger so you have to start putting systems in place. Rian had finished varsity and joined the business full-time. I think the main reason for our success then was that we were in it together as a team from the beginning.

My talents lay in sales, while Rian was the technology expert. Whatever I sold, he delivered. Also, we went straight from university into the business so we had none of the expectations that come from being in the corporate world.

The Y2K factor

It was the tail end of the 90s and mass hysteria about Y2K was reaching its peak. The threat of this so-called technology Armageddon was widely publicised and technology providers used it to exploit the SME market. We had one client who paid R20 000 more for a solution than the R60 000 it should have cost.

That’s when we saw the opportunity – we could provide managed outsourced services for the SME sector and differentiate ourselves by being honest, ethical and fair. That was how we came up with the name for the business – network support insurance products, Netsurit. By this stage we were supplying hardware and software as well as maintenance services.

We were still billing on an ad hoc basis and one of our clients pointed out to us that we were being short-sighted? He advised us to charge clients a monthly fee and set up service level agreements (SLAs). I thought that was a crazy idea. But then Discovery Health was launched and the business model was amazing.

Adrian Gore developed a system of consumer-centred health plans and people jumped at the chance of having more choice and more control over their healthcare spending. I was really taken with what Discovery was doing and I sent a cheeky letter to the CIO, outlining what a great service we could provide for the company.

He agreed to meet me and we ended up signing a R50 000 per month SLA. It was our biggest deal to date. We also started to apply the Discovery model to our own business. Clients were encouraged to take our advice; we would manage their IT and take all the risk. By this stage our business model was starting to change because we had introduced contracts and SLAs, which meant more annuity revenue.

The big question was how do you develop a business model that convinces people in the entrepreneurial space, who like to maintain control over everything, to hand their IT over to you. We placed a huge focus on fairness: if the SLA was R10 000 per month, and actual servicing of the account came in at R9 000, a total of R12 000 would be accrued in a year. We would keep R4 000 and refund the client R8 000. The SLA became a major differentiator for Netsurit.

Our response and resolution times were soon the best in the industry.

One step forward, ten steps back

By 2000 the business was solid and we had built a great team. Some of the guys we knew from varsity had heard what we were doing and they wanted in on the business. We had created a great vibe and people who work in this sector were talking about it. One friend who had been a real hooligan at varsity was so determined to become part of the team that he used to come to work during the day and then waiter at night to supplement his meagre income.

We had a fair sized team by this stage, around 20 people, as well as a steady amount of annuity income. We had also started an Internet service provider (ISP) to leverage the growing demand for ADSL. But then something really terrible happened which almost destroyed the business.

We needed money to fund further growth so we applied to the Industrial Development Corporation (IDC) and got R3 million. We were lucky to get finance from different sources, R600 000 from The World Bank, as well as some additional funding from the Umsobomvu Youth Fund — almost unheard of for entrepreneurs.

We had the most comprehensive business plan imaginable, and although we were so young, the business had been trading for several years and had a strong track record.

When the IDC loaned us the money, the interest rate was 18% and that was the amount reflected on the invoices. But we got it wrong. They wanted an internal rate of return (IRR) of 20%. IRR is the rate of growth a project is expected to generate. We did not realise that with the IRR on top of the interest rate, we had to pay almost 30% interest, or three times the loan amount, making it R9 million.

The IDC gave us a one year payment holiday, but when that came to an end we had to start paying back R140 000 a month. It hit us like a ton of bricks. We had to retrench staff and with all the turmoil, we were not hitting the targets we had set. The business was saved for two reasons: the IDC accepted annuity revenue from our ISP; secondly, the market changed, interest rates started dropping from 2003 to 2006, and the demand for ADSL was booming. We sold the ISP to MWeb and used the money to settle our debt.

It was a harrowing experience. At the height of the crisis we had to negotiate salaries because the cash flow was hit so badly. Employees always got their money, but they often had to wait for it. It says a lot about their loyalty that we managed to get through the whole debacle.

This episode taught me a huge lesson about paying attention to detail and ensuring that you check contracts and agreements extremely carefully. No-one had done anything wrong or questionable; we just hadn’t been thorough enough in our understanding of the deal

Turning the focus inwards

By this stage, I felt like I’d been in a war. A reality check was called for. We had survived, but it was time to look at our business model and to find ways to increase our efficiencies, bring down costs and prepare the business for expansion.

I decided to apply ITIL (Information Technology Infrastructure Library) which is the most widely accepted approach to IT service management in the world. Unfortunately, we chose the wrong ticketing systems, the wrong monitoring and alert systems, and a managed server application that would see 30 PCs on a network when there were 50.

So there we were adopting best practices, while profitability, client care and efficiencies all dropped. But I was determined to implement the best practices approach no matter what. I could see the mathematics of the model even though we were not getting it to work properly.

The problem was that we were using generic applications for a specific line of business. We had to change our systems. I had also employed some very senior people from the corporate IT world and they just did not fit in, so we got rid of them too.

The shift from large enterprises to the mid-market space requires a certain level of resilience they simply did not have. So we basically got rid of the wrong apps and the wrong people and refocused the business internally.

In hindsight, I realise that you need to be cautious about the types of systems you implement – you have to ensure that they are absolutely in line with your strategy and your business imperatives. At the time, we were paving the way for many of the values we live by today: constant growth through leaning, ethics, integrity and prudence, quality drive service, client obsession, innovation, having fun, open communication, and client and staff loyalty.

With a group of 20, we rolled out the balanced scorecard. This gave us a new approach to strategic management, allowing us to align business activities to our vision and strategy, improve internal and external communications, and monitor Netsurit’s performance against strategic goals.

What appealed to me is that it added strategic non-financial performance measures to traditional financial metrics to give us a balanced view of our performance.  It gave us the marching orders for the business.  By that stage I had read enough to know that a solid foundation would have a huge impact on future growth.

Putting people at the heart of the business pays off

In 2006 and 2007 we expanded aggressively through acquisitive growth and also by diversifying our services offerings. The next year we merged with a company in the Western Cape and established an office there. To do this properly, we made sure we had the right people in place.

When it comes to people and hiring, skills are only part of the requirements. Netsurit is not for everyone – it’s an unusual environment that requires people who are resilient and robust. I look for people who have had five to ten years tenure in a position. I am not interested in job-hoppers. Our company culture also reflects an adherence to some old-fashioned values. We all wear ties and suits to work.

Something that distinguishes the company is the Dreams of the Doers programme. It provides a platform for our employees to nurture and realise their dreams. It’s something that makes working at Netsurit truly special. I was inspired to do this after reading about psychiatrist and holocaust survivor Viktor Frankl’s theory that people are driven by their dreams and their search for meaning.

Added to that, I did a course at MIT, a programme based on Matthew Kelly’s book The Dream Manager: Achieve Results Beyond Your Dreams by Helping Your Employees Fulfil Theirs. Since 2008, each employee who wants to take part creates a dream book which includes all the things they want to achieve. These are narrowed down to ten for each person, and then we put them on our dream wall.

In 2009 we had 70 participants and 700 dreams depicted on our dream wall. This year, 115 people took part. It’s something that I’ve learnt over the years – the power of writing down your goals. This enables you to visualise what you want and to work towards achieving that. We also created a dream management fellowship to help people do something that is really important to them.

We’ve got one employee whose dream was to go on Hajj. We made it happen.

There have been others who wanted to go bungee jumping, and some who wanted to learn more about managing their finances. Health and fitness is important to many of our staff so we built a gym and a canteen that serves really healthy food at a low cost. It has been a truly amazing strategy that has had a huge impact on the business.

In 2008 our turnover was R83 million. It went up to R86 million the following year, in the midst of the recession, and in 2010 we did more than R100 million. I am confident that our quality of service (QOS) is one of the highest in the country. Calls are answered in ten seconds or less. We no longer say to clients “we think we can” – now we know we can. Our efficiencies are running at 100%, up from 50% in 2007. Of the 8 000 tickets we do every month, 200 are audited for quality.

Our people feel autonomous and empowered. We also brought in a consultant to help us work on our unique selling proposition (USP). From closing one out of every six qualified leads, we now close one in three. We don’t spend much on PR and marketing because we get leads from our client base. We also channel our marketing spend into partnerships because that’s what delivers value for us.

Reflections and long-term goals

It’s interesting for me to see how my own work ethics have changed over the years. From being absolutely consumed by the business, I am now able to take leave and know that everything will continue to function without me. That depth of management is one of the most important elements of our success.

Last year Netsurit was ranked as one of the world’s top 100 Managed Service Providers (MSP) by leading blogsite MSPmentor. We received a ranking of 53rd which is the first time ever a South African-based MSP was ranked this high. We’ve achieved things that I honestly never thought were possible.

My wife and I have been together for ten years, married for five. She never saw as many sunrises in her life as when she met me. I would be at the office at 5.00am every day. Now, I lead a more balanced life thanks to a team of eight executives.

I have a strict no meetings policy for Monday mornings so that I can work undisturbed. I apply the principles of David Allen’s Getting Things Done to my life – I think that is the single best productivity management approach.

As a co-founder of the local chapter of Entrepreneurs’ Organisation (EO), I also get the opportunity to network with people, to share what I have learnt and to learn from those I meet from all over the world. My advice to young entrepreneurs is to keep the start-up costs as lean as possible, even if you have money.

Check the cash every day and know that cash flow management will always be your biggest challenge in the early years. I insist on getting a daily email with all the bank balances, and we meet once a week to talk finances, regardless of how well the business is doing. And of course, always read your contracts very, very carefully.

I’m putting all my energy now into acquiring new business, which is where my skills lie.

There is the opportunity locally to create a billion-rand SME technology services company. Globally, there is further opportunity to turn that into a billion-dollar business. We have made many acquisitions and growth will continue to happen. What we need to ensure now is that we grow at the right margins while maintaining quality.

Monique Verduyn is a freelance writer. She has more than 12 years’ experience in writing for the corporate, SME, IT and entertainment sectors, and has interviewed many of South Africa’s most prominent business leaders and thinkers. Find her on Google+.

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1 Comment

1 Comment

  1. legal decisions

    Aug 31, 2011 at 07:37

    Thanks for sharing your experiences. Just wondering that I thought you are single and you are planning to get married?

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Going The Extra Mile With Neil Robinson Of Relate Bracelets

In business, your offering is only as good as your relationships. Neil Robinson from Relate Bracelets explains how FedEx Express has helped the business grow into Africa and beyond.

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  • Who? Neil Robinson
  • Company: Relate Bracelets
  • Position: Managing Director
  • Visit: relate.org.za

Neil Robinson, MD of Relate Bracelets understands the importance of business relationships. While Relate is a non-profit organisation, it is run like a business. It does not rely on donors, but instead produces and sells a product.

For each bracelet sold, one third of the income goes towards the materials and operating costs, one third supports the people who produce the bracelets, and one third goes to the charity for which that particular bracelet is branded.

In order for the business model to work and be sustainable, Relate’s partners are incredibly important. These include the retail chains that stock the product and who provide prime point-of-sale positioning, the charities who Relate works with, and most importantly, Relate’s logistics service provider, FedEx Express.

“Retail is all about visibility and availability,” explains Neil. “A brand is a living, breathing thing. People can see it, use it, and comment on it, but if they can’t access it, it’s all for naught. And so, at the point of purchase, it’s both visible and available, or it’s not.

“Logistics is key. You need to get your product to the retailer on time, 100% of the time. The expertise and focus that FedEx displays in supply chain and logistics encompasses far more than just retail, they understand our specific needs, making them a strategic partner, rather than merely a supplier.”

Related: Zenzele Fitness’s Clever Tactics To Grow In Next To No Time

Building a relationship

The FedEx/Relate Bracelets relationship stretches back to 2009, when Relate Bracelets launched its first campaign with ‘Unite Against Malaria’ leading up to the 2010 FIFA World Cup.

“We did the first campaign in partnership with Nando’s,” says Neil. “Robbie Brozin was passionate about the cause, and he pulled in strategic partners to launch the campaign. Within two years we’d shipped hundreds of thousands of bracelets. FedEx was an incredible partner, ensuring the integrity of our product and time-sensitive deliveries, and we’ve worked with them ever since.”

As with all good B2B relationships, the FedEx and Relate Bracelets teams understand that regular strategy sessions and updates are important.

“FedEx understands the inner workings of our business,” says Neil.

“A successful campaign has multiple elements, from planning and strategy, to marketing support, pricing and distribution planning. Of these, distribution planning is the most critical. For us, the bridge between our brand and the consumer is logistics. FedEx have delivered beyond expectations. They literally and figuratively go the extra mile for us.”

Protecting a brand

FedEx has customers across different industries and each of their needs are different. In the case of Relate, who operate in the retail sector, buying patterns are important. “Retailers run a tight ship,” explains Neil.

“They have planning cycles and seasons. Besides the fact that penalty clauses are built into contracts, you can’t miss a deadline by two days, or you’re in the next cycle, and that might be two weeks later. Not only are you missing out on valuable shelf time, but this can affect an entire campaign. Lost sales can also influence the retailers’ buying decision the following season. FedEx has made it their business to understand our business, so they know what’s at stake and what’s important to us.”

Supporting growth

FedEx has also played an integral role in the overall expansion of Relate Bracelets, particularly into new markets. “As a global organisation, FedEx has been absolutely critical in supporting us to grow our business into Africa, the US, Australia, the UK, Western Europe, and now New Zealand. They play an enormous role in the delivery of our products, with sophisticated tracking systems ensuring that the quality and integrity of our products are maintained.”

Through the relationship with FedEx, Relate experiences the benefits of working with a globally recognised and credible brand. “When you work with quality, you get quality.”

Related: Entrepreneur BB Moloi’s Inspiring Story of Rise To Success Through Grit And Hard Work

The business

If you’ve ever bought a beaded bracelet that supports a cause (for example: United Against Malaria, Operation Smile SA or PinkDrive), chances are it was a Relate Bracelet. If you bought it at Woolworths, Clicks, Sorbet or Foschini, it most definitely was.

To date, Relate Bracelets has raised more than R40 million, which supports various charities and ‘gogos’, women living on government grants and supporting their grandchildren, and who desperately need the additional income Relate Bracelets provides.

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Entrepreneur Profiles

Slikour’s Moto: If You Dream It, You Can Be It

Rapper and entrepreneur Slikour believes his success is the result of one key element: The aspiration to make something of himself, and create a platform for his voice to be heard. Now he’s bringing that mindset to South Africa’s black urban youth.

Nadine Todd

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Before you can achieve great success, you have to believe in the possibility of success. This is the single greatest secret to changing your circumstances — you have to believe it’s possible.

Did music or entrepreneurship come first? Siya Metane, aka rapper Slikour, isn’t sure himself. The two have worked hand in hand for him since he started selling cassette tapes of his own music when he was 12 years old.

What has developed over time however, is an innate and deep understanding that with his success comes a responsibility to pay it forward, and help his community and kids like him see that they can be anything they put their minds to.

Related: 10 SA Entrepreneurs Who Built Their Businesses From Nothing

If they can dream it, they can be it — provided they realise they can dream it in the first place. This is his challenge, and greatest driving force.

Start small, but dream big

I bought cassette tapes on Smal Street in the CBD for R5. My best friend, Lebo and I recorded our own rap music onto them and sold them in our neighbourhood for R15. We needed the mark-up — it meant we could buy more tapes, and also that we were making a profit.

Related: Zuko Tisani Learnt These 7 Invaluable Lessons On His Path To Success

I’m not sure if we were trying to start a business or launch our rap careers, but if you’re living in a hood like Leondale you don’t always recognise that there are opportunities open to you. No one is going to do it for you — you have to have your own aspirations, and find a way to make them happen.

Keep dreaming big, no matter what

That was one of the biggest and earliest lessons I recall growing up: The ability to dream big can be stifled out of you. I lived in a hood where there were no aspirations past our neighbourhood — the neighbourhood and its opportunities were everything. If 90% of the people you know are suffering, who are you to not suffer?

It’s a very limiting mindset, and one that does a lot of damage to our youth. I knew kids who had incredible potential, but could only look at their immediate environments for opportunities. So a budding young scientist doesn’t find a way to change the world — he finds a new way to make drugs.

Those are the limiting aspirations I was surrounded by. I call it the Trap, and it’s the driving force behind everything I do today. I want South Africa’s urban youth to recognise the Trap, and understand that they should have aspirations beyond it, because they have the abilities and potential necessary to break free.

Work hard, be determined and believe in yourself

I was lucky, I wasn’t a victim of the Trap. What so many people don’t understand is that I could have been. Hard work, drive and discipline aren’t enough to break free of the Trap. You need to believe you can break free — to look beyond your current circumstances. In my experience, that seemingly simple mindset shift is the biggest hurdle to overcome. It’s more complicated and pervasive than you can imagine.

Two things showed me a different way. First, my mom got me bursaries at Holy Rosary Convent and then St Benedict’s College. I was surrounded by rich white kids, full of privilege, and it struck me that here were the same talents and opportunities, but with a wealth of aspiration in the mix.

Related: Self-Made Millionaire At 24 Marnus Broodryk On How To Build A R1 Billion Business

That was the real difference — not ability, but recognising that ability and having the aspiration to do something with it. It was eye-opening. The second was meeting my best friend, Lebo Mothibe. Lebo, or Shugasmakx, as he’d later be known in the music world, had one foot in the privileged world, and one foot in our world.

His mom lived in the hood, his dad was a wealthy entrepreneur who lived in Illovo. And Lebo straddled both worlds effortlessly, and with humility. But he looked beyond the limiting beliefs held by many of his neighbourhood peers.

Find people to inspire you to reach success

His dad was also the first self-made, wealthy black man I met. But when I heard his story, I realised that it wasn’t overnight success. He’d slept on Lebo’s mom’s couch while he slowly but steadily built his business. It gave me an understanding that success is earned. You need to work at it, and push on against adversity. This had a huge impact on me.

Lebo was the ying to my yang. Even though we didn’t think of each other as business partners, that’s what we were, from the age of 12. We formed Skwatta Kamp, we hustled and shook up the music industry together, and changed the face of rap music in South Africa.

I was the dreamer, the visionary, and Lebo was the executor. He found a way to make my crazy schemes and ideas come to life. This is exactly what a partnership should be — helping each other grow, and complementing diverse skill sets.

Build your success, one step at a time

We built our success, brick by brick. I entered a TV show competition, Jam Alley, and won. I used the cash and Dions vouchers to buy recording equipment. Lebo’s dad helped with speakers and a keyboard. My brother, who was studying IT, downloaded software and helped us with our recording quality. Everyone pitched in with what they could. 

Be your own biggest cheerleader

We tried the recording contract route for a while, but realised that the only people who cared about our success were us. And so we hit the streets — hard. We had street crews, we sold our own CDs and negotiated with music stores to carry our albums.

Recording studios kept saying they’d sign us, but they never had a studio available. They just didn’t see the value in rap and hip hop. They didn’t believe there was money in it in South Africa. We needed to prove there was.

Gallo finally approached us and signed us after we won at the South African Music Awards (SAMAs) as an independent act. We used real guerrilla tactics to get our name out there — on stage, with that platform, we told our fans that if a music store didn’t carry our album, to burn it down. We wanted the attention — that’s how you build a name.

Related: Entrepreneurial Powerhouse TBO Touch On How Success Is Built From Small Acts

Our first album went gold, and we used that to push the idea of rap into mainstream media. If 20 000 people bought the album, another 200 000 had bootlegged it. There was money here; and slowly brands and advertisers started realising we were right.

Drive a movement with your business

We were musicians, but first and foremost we were driving a movement, and that meant we needed to be businessmen as well. We hosted end of year parties, and got brands on board, realising we had a captive audience that aligned with their target market demographics. We started our own label, Buttabing Entertainment.

Our goal was to find and nurture young musicians from the hood to get them established in the industry, and show other kids in the Trap that it could be done: Anyone can create their own destiny. One of the things I’m proudest of is discovering a kid in Katlehong, Senzo Mfundo Vilakazi, who would develop into Kwesta.

He’s doing phenomenally well, and recently appeared on Sway in the Morning, one of the biggest hip hop shows in the US. Our success spilt over into Kwesta, and now his meteoric rise will hopefully inspire a whole new generation to dream bigger than they ever thought possible.

Pivoting to further growth

All success has its pinnacle. By 2010 we had achieved so much as Skwatta Kamp. We’d brought rap music into the mainstream and opened opportunities for countless kids, as music labels actively sought rap and hip hop acts. I realised that I’d hit a ceiling. I needed to step back, regroup and figure out what to do next.

What I did was something I’ve only ever associated with privilege. I moved home, spent a lot of time lying on the couch, and wrote. I wrote my life, my lessons, my dreams, my ideas. I don’t know how I reached a point where I was able to do that, but I’m grateful. I started collecting my thoughts and understanding my purpose.

During that time I was approached to join a few marketing agencies. I had no formal marketing training, but we’d worked with big brands at our parties and activations.

Sprite was the first to recognise that they had an opportunity to authentically connect with the black urban youth through us, and so we partnered up. I learnt above-the-line marketing in a Coca-Cola boardroom, and built onto what we’d learnt on the streets about below-the-line marketing.

Take a step back, and rediscover your purpose

That experience had drawn attention, and so for a while I joined an agency. But its mandate was sponsorships, and my heart was with the black urban youth. I’d discovered my purpose, even if I’d subconsciously been living that purpose for almost 20 years.

I wanted to create a platform that gives young black artists a voice; established artists a way to reach out to the youth that other platforms don’t offer; and brands a way to authentically connect with that audience — not just to sell products, but to show black urban youth that their culture is important, that it holds value, and that they, in turn, hold value.

Related: Shark Tank’s Romeo Kumalo Weighs In On High-Impact Entrepreneurial Businesses

Adidas’s support of Run DMC in the US showed that kids from the ghetto had a message worth listening to. Big brands have the power to connect the unheard and voiceless to the mainstream, if it’s done correctly. I had the marketing experience to understand the ROI that brands need, as well as what I could do with that to support black urban youth.

All I had were dreams and a URL, but that was enough. I quit my job and launched my website, Slikouronlife.

Reveal opportunities and create aspirations with your message

This is my politics and CSI. If we can get marketing to marry culture, and change the positioning and perception of young black South Africans, we can show there are opportunities out there, and create aspirations.

But we need to put culture first and tap into the authenticity of who we are as South Africans. We need to recognise and acknowledge the mental traps that exist in our neighbourhoods, and that we are victims of limiting beliefs, and then show that there is another way.

Everyone told me I was nuts. That black people don’t go online. I did it anyway. With Skwatta Kamp we had created a market for our music. Kids supported us; my name added value — and then brands came on board. We now average between 200 000 and 250 000 unique visitors a month, which is impressive for a mainstream website, let alone a niche music site.

Ten months ago we were a team of three operating from my house with one desk. Today we’re a team of ten with one focus: To make a real difference on the ground. To give the voiceless a voice. To prove that if we can drive the aspirations of South Africa’s urban youth, the sky will be the limit.


Related: Watch List: 50 Top SA Small Businesses To Watch

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Entrepreneur Profiles

How Mark Sham Earned His Suits & Sneakers

For many businesses, the biggest challenge is getting their message heard. Through Suits & Sneakers, Mark Sham is not only building a huge microphone to create awareness around his business and his vision to change education and training in South Africa, but he’s forging a network of entrepreneurs and corporate businesses to champion the cause. Here’s how he’s doing it.

Nadine Todd

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Mark Sham hasn’t just created a microphone. He’s creating a movement. In July 2015 he hosted his first event. It was called Suits & Sneakers, and 1 000 people attended. Mark was looking to see if his idea resonated with anyone else. It was clear it did.

Related: Persistence Can Beat Any Odds Says The Founder Of Rebosis Property Fund

The second event, a few months later, drew 1 500 people. Two events held in 2016 had 3 000 people respectively, and it would have been more if Mark hadn’t realised they needed to limit attendees to ensure the event was still personal.

Keep up the momentum

To keep the Suits & Sneakers momentum going, a weekly event, Suits & Sneakers Fixed was added. While the main events each year have four speakers focusing on completely different content, Suits & Sneakers Fixed is held every Wednesday and has only one speaker, discussing one topic. Between 100 and 120 people can attend, and you can book online. It’s a free event, first come, first served.

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But here’s the secret behind Suits & Sneakers. It’s not an eventing company. It’s a business promoting the benefits of informal training, and focuses on a new method of corporate training, that with enough traction will hopefully turn the current education system on its head — something Mark believes South Africa desperately needs.

The 3 goals of Suits & Sneakers

The Suits & Sneakers events were created with three goals in mind: One, to test whether Mark’s theory of informal education held weight.

Two, to bring corporates on board to his way of thinking, and to be willing to test this new training methodology in their own organisations, and ultimately support a new education system for South Africans who cannot access the current system.

And three, to build a really, really big microphone letting the country know who Suits & Sneakers is, and what the brand stands for. In a nutshell, it’s marketing on steroids. And it’s having a massive impact.

Here’s how the idea took shape, and how it’s developed within the market place.

How did a love\hate relationship with learning lead to Suits & Sneakers?

suits-and-sneakers

I’m an avid learner who is addicted to learning new things and educating myself, but I hate the formal education system. I didn’t matriculate despite having good marks; I didn’t quite fit in. I questioned everything and the traditional schooling system isn’t built for that.

I ended up spending a few years travelling around the US. When I came back to South Africa I tried to enrol at IMM to study marketing but soon realised that nothing had changed. The traditional education model still wasn’t for me. So I started my own business.

I’d been exposed to social media overseas, I was born in an era of full access, thanks to the Internet, and I upskilled myself while learning the ins and outs of business. I also knew I had a natural talent for advertising, and just needed to pull all the threads together.

R1 million in debt at 25

The problem is that I’m high-energy, and tend to have a lot of different ideas and projects on the go. I was building up my marketing agency, but I also launched an online fragrance store. My suppliers convinced me to open a physical store as well, and that was a big mistake. I ended up losing the store, and being R1 million in debt at 25.

I knew I would never be able to pay that back through traditional employment, and nothing had changed — I still had no qualifications. What I did have was a young marketing agency. I needed to find a way to really make an impact on my clients and start building that up.

In sales and marketing, you’re always looking for an in: How do you give your clients real value, in such a way that they want to do business with you, because they know you can positively impact their business. That’s the code you need to crack with every prospective company you do business with.

Share your insights with your clients

Because I was an avid learner and I’d already spent a few years working in the social media space, which was still in its infancy in South Africa, I knew I had some real insights to share with my clients. I designed and marketed a social media course.

There was a lot of interest, but I couldn’t find anyone to present it for me. I ended up doing it myself and it worked. I’d never thought of myself as a public speaker, but my passion for the topic came through.

It triggered something in me. I read a book, Inside Coca-Cola, by David Beasley and E. Neville Isdell, that’s filled with lessons I wanted to share with the marketing community. I created a breakfast event to share this with marketers, and which I could use to build relationships with them, and was invited to do the talk for corporates.

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It made me realise that while the education system in South Africa is broken, there is a solution. Informal training really worked well for me. I’ve created ‘Ted Talk’ syllabuses for people. There is a real need, and maybe I have a solution. 

How did you take a wild idea that could change the world and turn it into a reality?

My talks started out well. I travelled around the country, speaking on different topics, and making a decent living.

Then I realised it was futile. I was giving one day workshops that people loved, but they weren’t putting what they’d learnt into practice. I needed to switch people on to learning and to make them hungry for knowledge and, through ‘drip’ learning, change their approach to business and life through consistent and habitual changes that together make a powerful whole.

At first it was a side project. I had my business and this was a pet project. I had four aims:

  1. Put together an incredible event as a proof of concept
  2. Find a way to get corporates excited by the structure and vision
  3. Get entrepreneurs and corporate execs to attend
  4. Use this whole thing to build a really big microphone for the brand, to let people know what our vision was, and how training and education can be transformed.

Get people excited about your offering

Step one was easy — I had so many incredible contacts to draw from. My goal was to pull four very different speakers together. Suits & Sneakers isn’t about one particular topic. It’s about getting people excited by the idea of learning something new. If you can trigger that, you can create a life-long learner. That’s our aim.

Securing a corporate sponsor took a bit longer. First, I needed to be able to articulate what I understood because I was feeling misaligned. Previously, you qualified with a degree and you were relevant for 20 or 30 years. Now, in two years you’re irrelevant. That’s the pace of today’s world.

The same is true of the workspace — annual training that isn’t revisited isn’t benefitting anyone. It’s like going to gym once a month for 12 hours — you’ll never be fit and in shape. It takes regular practice.

Related: 4 TED Talks To Help You Deal With Stress And Anxiety

And yet this isn’t how we treat training. It’s a bigger problem and more costly than it needs to be. Smaller, more regular doses of training that teach employees to become learners who embrace their own development is a solution to this training crisis — for employers and employees.

We needed a change of style. Podcasts and Ted Talks work for me because they’re personal, informal and entertaining — even though the content is exceptional. How could we bring this into a traditional training environment? I didn’t want presentations and slides. I wanted a visceral, immersive experience.

I didn’t have everything perfectly laid out, but I knew we needed to get started and develop it as we want along. My vision and goals were clear, even if the final product wasn’t, and I approached Sage.

There was alignment: They have a great product that is valuable to SMEs, and I could gather SMEs into one venue, and create a database. Sage could pitch their services to a captive audience, and I would have a platform to start refining my training ideas, and I would also be creating my giant microphone and brand.

Big risk, big reward

I invited Sage to the first event. They didn’t think I could get 1 000 people there. Not only did I hit my target, but 300 of those tickets were paid — the balance were free. I lost R600 000 putting the event together, but it was my marketing for the year — my giant microphone. After the second event Sage was on board.

I still run the main event at a loss, but each year the gap is smaller, and it’s our most valuable marketing tool, attracting a number of different corporates. We’ve launched the Real Life MBA, which is a charged-for event with six simultaneous speakers.

You choose who you want to listen to in person, and have exclusive online access to the videos of the other talks post the event. The conference is really the start to a 12-week learning programme.

Related: Edward Moshole Founder Of Chem-Fresh Started With R68 And Turned It Into A R25 Million Business

We’re also creating informal learning curriculums for corporates. We collaborate with them to develop manuals, events, self-learning assignments and so on. Eventually we want to digitise and gamify the entire experience.

How is the current Suits & sneakers model feeding into a bigger vision of change?

Ultimately, we want to disrupt education. Real quality education can be free. There is so much out there; so many experts to learn from — we just need to reimagine how to learn. Our aim is to create a free education system for 18 to 24 year olds.

In 2016 I decided to sell my other businesses and focus full time on Suits & Sneakers. I’m a start-up again, but I’m finally living my vision.

Our offices are a co-working space called Impello, operating in Greenside. It’s a space for start-ups, freelancers and entrepreneurs to collaborate and work with like-minded individuals. By paying the bills with one revenue model, we can fund a training and education space that incubates small business and works as a campus for our informal university.

Tech advances are revolutionising learning possibilities, but you need a mix of classroom and online learning. Face to face is social and emotional but classroom learning doesn’t scale without adjacent costs.

So what’s the solution? Co-functional, co-working spaces. We have six funders who share the vision and understand what we’re trying to do here. That’s been the power of our giant microphone.


Related: Self-Made Millionaire At 24 Marnus Broodryk On How To Build A R1 Billion Business

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