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The Midas Touch: Hina Kassam & Irfan Pardesi

ACM Gold’s story spans three continents, and almost a decade of highs and lows. This is the story of how one sibling who paid his way through school, and another who didn’t go to varsity, have built a business with a turnover of R400 million that’s worth more than R3 billion.

Nadine Todd

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Hina-Kassam-&-Irfan-Pardesi_Entrepreneur-Profiles_Success-Stories

Vital Stats

  • Players: Hina Kassam and Irfan Pardesi
  • Company: ACM Gold
  • Launched: 2005
  • Turnover: More than R400 million
  • Profit: R350 million
  • Company Value: R3 billion
  • Awards: World Finance Best Broker Africa 2013
  • ARABCom Best Broker 2012 (Middle East and Africa)
  • Contact: www.acmgold.com

Irfan Pardesi has never seen his father have money. His brothers and sisters have, but as the youngest child, his experiences were of his father losing everything – twice.

It’s not typically the kind of household that an entrepreneur would emerge from, where entrepreneurship meant tough times and a family struggling to make ends meet.

Related: 7 Essentials for Making R10 Million From Scratch

But for the youngest Pardesi, it meant something else: Survival. Growing up in Pakistan and nearing the end of high school, the young Irfan could have dropped out. His family could no longer afford to pay school fees, and by working he could help to pay the bills.

Instead, pushed by his sister Hina Kassam, who was married and living in the UK, he decided stay in school – whatever it took. He was good at his studies, and he wanted to get his A levels. “I started selling mobile phones to pay for my school fees,” he says, and his path to entrepreneurship began.

Wanted: Resourceful spirit

The-Midas-Touch--Hina-Kassam-&-Irfan-Pardesi_Entrepreneur-Profiles_Success-Stories

Today, Pardesi and Kassam run ACM Gold, a forex trading platform that spans international markets, and has a group turnover of R400 million, with very impressive profit margins. Launched in Pakistan, the business’s head office then moved to Dubai, before settling in South Africa.

“South Africa has everything we’ve been looking for. It’s a beautiful country, the climate is ideal, its banking sector is well regulated and trusted, and it offers all the skills we need,” says Pardesi. “We’ve found our home, and we have big growth plans.”

Having lived on three continents, the brother and sister duo have a good understanding of what they’re looking for. Kassam grew up in Pakistan, spent time living in Uganda and Kenya, and settled in London before moving to Dubai to head up ACM in the bustling UAE capital. While Kassam was in Uganda, Pardesi finished his A levels and was looking for a way to study in London.

“I had negotiated with my school to let me finish my A levels in one year instead of two. I needed to save costs. We were broke, there was a lot of unrest in Pakistan, and loans were piling up. I wanted to get on with my future.”

Getting his A levels didn’t solve any of Pardesi’s problems though.

“I would be the first person in my family to get a university degree, and they weren’t having any of it. My father had borrowed a lot of money, and my extended family expected me to start working as soon as I was out of school to help pay off those loans. I didn’t have permission to leave Pakistan to study abroad.”

But this was a kid who had paid his own school fees and finished his A levels in one year. He was going to get to London. The problem was that global events didn’t agree.

“I finished school in June, and started getting ready to leave for the UK. I’d told my family that I was going to Uganda for business. And then September 11 happened, and the British embassy in Pakistan closed.” There was no way Pardesi was getting a visa. The London School of Economics had accepted him, but he couldn’t get to the UK in time for his first semester.

Entrepreneurs are nothing if not resourceful. Their greatest strength is seeing an opportunity in every challenge, and finding solutions where others would give up. If he couldn’t get a visa in Pakistan, Pardesi would fly to Uganda. “Hina was living there and she had a friend in the UK embassy. I arrived in Uganda and they had arranged a British visa so that I could continue on to London.” Kassam had taken a loan and was able to give her brother £730 over and above the £1 500 he’d already saved up for his first term’s fees and living expenses while he found a job.

Becoming a specialist

Entrepreneurship is all about making it happen. Pardesi wanted to get his degree, and he needed to pay his way while also sending money home. In his first week, he secured a job at Starbucks, working 40 hours a week. But this didn’t leave much time for studies.

“I changed my schedule so that I went to university for two days, and worked five days a week. This meant skipping lectures that didn’t fit my schedule. I’d tried convincing the school board to change it for me, but they refused.”

Pardesi’s grades were good enough to qualify him for a scholarship in his second and third years though, and so when he graduated in 2004 he’d managed to not only save some money, but was living comfortably and still sending money home.

By this time, Kassam had moved back to London and was working in bank finance, and Pardesi secured a position at a boutique investment house that negotiated operational leases for aircraft.

“Our role was to find an investor, bank and carrier simultaneously, and then structure a deal. It wasn’t very complicated, but it was a highly specialised field that to outsiders looked scary and difficult. We were a boutique house, and yet institutions like Deutshe Bank and Goldman Sachs were asking us to value deals – and we could charge a premium price for our services.

Related: 9 Things Successful People Won’t Do

It was Pardesi’s first big lesson in business: Focus on what you know best. You don’t need to be a master of everything, you just need to know a lot about one thing. “We knew who we were, and we didn’t try to be anything else. It made us extremely good at what we did, and highly sought after in the market.”

It was also during this time that Pardesi was first introduced to currency. “We were advising our clients on currency derivatives and hedging of currencies, and an idea started percolating. I’d already learnt that as a specialised expert you garnered respect, and now I started thinking that as a ‘newbie’ if I wanted to launch something of my own, it needed to be in an area where my skills and knowledge were scarce, and I could make a difference.

“The obvious answer was an emerging economy.” Pardesi had saved $120 000 in bonuses and grown a seed fund as his idea continued to percolate, and then he suddenly found himself back at square one.

Reality check

“My father had a liability of $160 000 and my parents needed me to come home. The money I’d been sending helped with living expenses, but hadn’t solved their debt.” The seed funds went towards servicing that debt, and by early 2005 Pardesi found himself back in Pakistan looking for something to do.

“My sole goal was to accumulate as much money as quickly as possible to launch the business I really wanted,” he explains. “I did this in a number of ways. My father had started a small property valuations company that I got involved in. I understood valuations, and we were soon on a panel assisting Pakistani banks with property valuations.”

He also started importing mobile phones, and partnered with a local teacher to open an HR consultancy. “I was scrambling. None of these businesses had the scope I was looking for. They did well, and we made a profit on two of them when we sold them, but I knew they had limited growth potential. I was looking for something where the sky wasn’t even the limit.”

These businesses were fairly simple to set up and run, with low barriers to entry, but in the background Pardesi and Kassam were busy on a different project. “While I was still in the UK, Hina and I had developed a habit of visiting brokers and CEOs of trading houses to see what they were doing,” says Pardesi.

Kassam, in particular, was looking for an additional income stream. “I wanted to start trading forex so that I could leave the bank, but first I needed to learn as much as I could.” They made contact with a South African company, Global Trader, that was operating in the UK, and became introductory brokers (IBs), earning a commission if they introduced traders to the online platform.

By the end of 2005 both siblings were in a position to launch a forex trading company. Kassam was trading and doing well, and had made good connections in London. Pardesi had saved $22 000 in seed funding, and had sold the businesses he was involved in. His plan was to move back to London and launch the business. The plan lasted exactly as long as it took to book a ticket, move back to London, and turn right back around and return to Pakistan.

“I had no business plan; I just wanted to hit the ground running. And then I realised that the money I had saved wouldn’t even last two months in London. I immediately turned around and went back to Pakistan,” he laughs, recalling the shock of realising the miscalculation.

Kassam stayed in London with her husband and family. She would negotiate the platform deals in the UK and Pardesi would set up the business in Pakistan.

Lessons learnt, and improvements made

ACM-Gold_Success-stories

The launch of Accentuate Capital Markets (ACM) in 2005 taught Pardesi his second big lesson in business: You can launch a highly successful business with limited funds.

“After saving and losing my start-up capital, and then saving up again only to realise it wasn’t enough, we needed to find a way to bootstrap the business. My aim was still to reach for the stars, but first we needed to start building a brand, earning a good reputation and securing a client base. We needed to start small to become big.”

The partners worked out a way to launch with limited investment capital. “Hina approached Global Traders and negotiated a deal with them. She was already a client of theirs, plus we’d been IBs for their brand for over a year. They knew us, and we were always aware of how important relationships are in business, so we’d fostered the relationship we had with them.

“We told them we’d be trading in Pakistan and getting them new clients in an emerging market, but we needed their platform for free. Their model was to charge monthly minimums to businesses that used their platform, but we couldn’t afford those fees, so this negotiation was essential to the success of our start-up.

“All trades would still go through their offices in London, and they’d make the commission, of which we took a small percentage. We were working off low margins, but we needed the platform to get started, and eventually they agreed. We were in business.”

Once the deal was signed, Pardesi focused on securing great office space. “Our fees were small, so we needed to focus on volumes. This meant having a good office that people could visit, meet me and the dealers, and feel secure depositing their money with us. Our primary investment went into that first office and securing a few dealers.”

Pardesi had promised Global Trader 400 to 500 new clients each month, which was one of the reasons they had agreed to give them the platform without charging fees, and they now had to deliver. “We’d convinced ourselves (and them) that Pakistan was a new market with endless opportunities and no real
competition.”

The reality turned out quite different. Growth was extremely slow. Pardesi kept the business lean, and they achieved break-even in the first month, thanks to existing clients and contacts, but they were nowhere near their target of 500 clients.

Related: How to Never Give Up On Becoming an Entrepreneur

“I think one of the single biggest lessons I’ve learnt in business, and one we’ve carried through to every decision we’ve made since, is the importance and power of localisation,” says Pardesi. “Entrepreneurs are problem solvers. That’s what we do. But that doesn’t mean much if you’re trying to solve a problem that’s not your target market’s main concern.”

ACM was following the model of a broker based in the UK who does business online. It worked very well in the established UK, US and European markets, but not in Pakistan’s emerging market. “Online trading wasn’t embraced. Even though we had dealers that our clients could call, and white papers we distributed to educate our market, the model just wasn’t taking off.”And then Global Trader went bankrupt. It was completely unexpected as the business had been growing.

“We needed to regroup and re-evaluate what we were doing. It’s never nice to see a business go under, especially one you have a relationship with, but it did force us to change our model, this time with a much better understanding of our market guiding us.”

The secret of localisation

First, Kassam started negotiations with online platform providers that centred on a more holistic partnership. The reason was two-fold.

“Previously, we only hosted the platform and provided on-the-ground support. All accounts had to be set up through our UK partner, and approvals took up to a week and a half. This time delay meant people couldn’t start trading immediately. It also meant that they were essentially doing business with two companies – us and Global Trader, which could become confusing, and all trades were done in foreign currency.”

Kassam’s negotiations with a new online trading platform resulted in a very different business model. The platform was white labelled, so all trades were conducted through an ACM-branded site, which meant the client had only one point of contact. ACM also had power of approval, which meant they could approve new clients and get them trading immediately.

Their next big change was to localise trades. For the first time in the global trading environment, ACM offered a local trading denomination for gold.

“The subcontinent’s gold measurement is the tola. Around the world, gold is traded in US dollars per ounce. We allowed trades in rupees per tola, and did the conversions ourselves. It was a small change that Hina negotiated, with huge ramifications. No one had thought of localising trades. It wasn’t rocket science, or even difficult to do, but it meant our clients could trade in a denomination they were familiar with, and it made a huge difference to their confidence in their own trades, and our platform.”

The third big shift in the business model was focused specifically on how their clients traded. “Our dealers were extremely busy as clients would rather call them and have them make the trades than do it themselves online. They also liked dropping in to the office, and those who did so traded more frequently and for bigger amounts. They loved our environment.”

Armed with this knowledge, Pardesi made a decision that would never have worked in London. He cancelled his sales and marketing budget and redirected everything towards creating a physical trading environment that people wanted to be a part of.

“We had no sales consultants, but we did have three cooks, for example,” he says. “Clients could walk in day or night and order a drink, food – we even had staff who could run errands for them – all for free. We wanted them to feel at home. We were no longer trying to change the social behaviour of our clients; we were adjusting our model to suit their behaviour.”

Soon, clients started bringing friends. It was a lively, social atmosphere where everyone was pampered. “There was something about the energy of the trading floor that they loved. You walked in and you were immediately a part of something special.” Pardesi’s brother, who is a real people’s person, also joined the business, and the company finally started seeing the volumes it had hoped for in its first year, with turnover growing tenfold.

Spreading too thin

By 2007 Pardesi once again started feeling the itch for growth. Their office was doing well, so what was next? “We opened an office in Cyprus as our foothold into the European market, but we soon realised that while we understood the Pakistani market, the European market was very different. We just weren’t making any headway.”

In early 2008, a third office was opened in Dubai, which had a similar environment and structures to those in Pakistan, but real growth still evaded the brother and sister partnership. “We had lost sight of that key lesson: Localisation,” says Pardesi. “We were trying to branch out when we had a model suited to the market we were already in, based in a city of 21 million people! What about opening more offices in the area where we already operated, and had proven our model?”

Pardesi and Kassam now started actively concentrating on a model that had originally brought them into the industry – that of paying commission to local IBs who introduced new clients to the platform. “Each IB could open their own local office based on our model, work off our platform and use our systems. It meant owner-managers across the region were promoting and growing our brand, while building sustainable and profitable businesses themselves.”

It was the start of Pardesi’s realisation that their business model didn’t only help people trade, but also created wealth for local business owners.

“We’ve created many dollar millionaires over the past few years, and we’re proud of that. We don’t charge a minimum, because we got our start that way, and we share a percentage of the commission.” By late 2009 there were 277 offices spread across Pakistan all based on Pardesi’s model and using the company’s own system, which they built between 2008 and 2009.

“Building our own platform was the next logical move. We’d saved up the business’s profits and wanted to create a platform that had the capacity for thousands of simultaneous trades, was highly secure, looked good and was easy to use – and we could hire top international talent to help us do it.”

It was also a business that benefited from the recession. “This helped our growth in two ways. First, people wanted to be in control of their money, which made online trading desirable. Second, in a volatile market, gold prices go up. It’s seen as a long-term, stable commodity. We re-branded as ACM Gold, and focused on this market. Our trade in local currencies and denominations enhanced our success.”

By 2010 expansion was back on the cards. Dubai’s office was doing nicely, and ACM Gold now started eyeing India, which had a similar environment to Pakistan. Pardesi had also opened offices in Malaysia, Macedonia and Slovenia, and began the process of disinvesting from these markets.

“We wanted to grow, but recognised that these markets didn’t want the model that we were so good at. While we realised that we might have to change the model to reach our next level of growth because business is about adapting with the times, it wouldn’t be in those areas.” So where was the next opportunity? The answer was easy – Africa.

The move to South Africa

Pardesi and his wife had honeymooned in South Africa in 2008, and at the time she made him promise that they would return to the rainbow nation. Two years later, that time had come.

“We recognised the huge potential Africa had to offer. We’re suited to emerging markets, and we’d already learnt that localisation works. If we wanted to expand in Africa, we needed to operate locally. South Africa was the perfect fit.

“It has a well-respected Financial Services Board, is one of 11 countries that understands forex, and has a highly trusted banking environment thanks to strong regulations. We knew that people would be comfortable sending their money here, and trading through a local platform.”

Pardesi had also opened offices in Madagascar, Uganda and Kenya which readily accepted ACM’s tried and tested model – but South Africa didn’t.

“It was a big reminder that you can’t make assumptions about a market until you’re physically operating in it,” says Pardesi.

“We had country managers in our satellite offices around the world, and Hina was splitting her time between Johannesburg and Dubai. We had closed most of the Pakistan offices and had handed them over to local brokers. We had a big deal pending with the Pakistan Exchange, and we wanted to concentrate on our growth in Africa — but we just weren’t getting it right.” Then Pardesi realised their error. South Africa may be classified as an emerging economy, but it also resembles Europe. It needed a different kind of localisation.

“South Africans understand forex in a way that many other nations don’t. Everyone has grown up watching how the rand is faring. We quickly realised that South Africans don’t want to be involved in anything they don’t understand. They won’t trade unless they know how the system works and what they’re doing. If we wanted to do well in this country, we needed to cater to this specific need – we needed to educate our market.”

Where Pakistan and India were happy to trade with the advice of their dealers and wanted a social trading floor, South Africans are comfortable trading online, but want to be educated before they do so. As a result, ACM Gold invested in UFG (University of Forex and Gold), a training platform designed with the assistance of Adriano Tabasso, through which they could begin training people.

While this is steadily growing into a comfortable secondary revenue stream, its original mandate holds true: To create a market for ACM Gold by educating the public. “In many ways, South Africans are like Europeans. They don’t want to trade as a hobby, they want to trade full-time, and this takes a keen understanding of the market.”

The fact that ACM’s platform can be localised is a plus point, as all trades are done in rands and dealers can assist their clients in their own language. “We added Kruger Rands to our offering because South Africans understand and are comfortable with them,” adds Kassam.

Pardesi returned to his IB model. “I made a point of attending franchise expos and approaching local brokers. We needed to bring re-sellers on board, and we had a model that made sense. We’re based in South Africa – when you deal with us there isn’t a boss or platform that is operating overseas, everything is here, in local currency. Decisions can be made quickly, and all support is easily available.”

Consolidation for growth

By 2013, the market had grown and changed enough to warrant a relook at the original online model. “The Internet and consumer comfort with online models and trading has come a long way in the last seven years,” says Pardesi.

“We were buying back offices in Pakistan that we hadn’t already closed, and consolidating the business out of South Africa. We can have clients around the world trading through our online platforms now, so the local office model is no longer relevant.”

Today, there is only one small office in each of ACM’s regions with trusted local partners supporting the online trading platform. “If the market isn’t yet comfortable with online, we don’t look at it. We’ll wait two years and they’ll come to us via our online platforms, based in South Africa.”

Top tips

  • Focus on what you know best. The best businesses aren’t masters of everything — they’re specialists in one key area, and invaluable to their clients as a result.
  • Even big brands start small. You don’t need millions to launch a company. Make some strategic partnerships that everyone benefits from, start small and be patient.
  • Localisation is everything. You can be a big, multi-national company, but always take the current, on-the-ground clients into account. Design your business offering with their needs in mind. What works in one market won’t necessarily work in another.
  • Shift the business when the market changes. Don’t hold onto something because it worked well in the past — times change, move with them.
  • Don’t make assumptions. You’ll only understand a market once you’re actually operating in it. Launch your business or local office, but be prepared to shift your model as you learn about the market and what it wants.
  • If your business allows, build a network of re-sellers that believe in you and your products, and help them achieve their goals — you will automatically achieve yours.
  • If you want to get the best out of people, appreciate their efforts lavishly and give them a path to grow and prove themselves.  The bigger the dream, the more important the team.
  • If everything seems to be under control, you’re not going fast enough.

Trading + Gaming = Traming

Pardesi’s latest project is traming.com, an android app that merges trading with gaming.

“Traming.com has been created to give everyone easy access to the financial markets,” explains Pardesi.

“The concept emerged from the understanding that in this age of simplification, people are constantly looking for quicker, simpler ways of doing things, and in that vein, even online trading was still too time consuming. I wanted to develop an app that made trading fun, quick and easy.”

With Traming.com, users can decide what direction the market will take in an allotted time frame. Will it be up or down in the next 60 seconds? Get it right, and you’ll see up to 85% return on your investment — within 60 seconds.

“These trades are available on most global asset’s including currencies, commodities and shares,” concludes Pardesi. 

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

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1 Comment

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  1. Dane A. Mesane

    Sep 16, 2015 at 06:44

    Inspired.

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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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brand-cartel

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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john

“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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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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