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Turnover Doubling Every 10 Months – Honeybee Has Set Its Sights To Scale Speedily

Honeybee is doubling its turnover every ten months, but it will need to be eight times its current size before the business model starts to pay real dividends. Sam Clarke has his sights set on a highly scalable, profitable business that delivers real value to his clients. Here’s how he’s getting there.

Nadine Todd

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Vital Stats

Businesses go through phases, and while it doesn’t matter what you call those phases, it’s important to know which phase you’re in. This directly impacts the decisions you make, particularly if you’re targeting specific growth goals.

Sam Clarke, founder of Honeybee, a mobile sales enablement platform for sales reps in the field, calls these phases 0 to 1, 1 to 10, 10 to 100, and 1 000+. Each phase has its own challenges, and each must be conquered before the business can enter its next chapter of growth.

Phase 1: 0 to 1

“This phase is from start-up to when you’ve landed your first client, and you have something that at least one company will pay for,” explains Clarke.

“This phase is all about development and perfecting your offering for at least one client. You’re keeping things lean while focusing all your energy on delivering client satisfaction.”

Phase 2: 1 to 10

This phase is all about learning what different clients need from the same product. “You’re not profitable,” says Clarke.

“You’ve got a decent number of clients now, and there are a lot of overlaps between their various needs, but you’re still customising. You don’t yet have enough features for new clients to choose from existing menu options.”

However, each iteration or client change is addressing a client need, which just adds to the overall complexity and comprehensiveness of the product, moving the business closer to its goals. “Our whole idea was to build a modular product that clients could configure based on an extensive menu of options.

“As our core base grew, we eventually reached a point where we only needed to make small tweaks for new clients.”

Phase 3: 10 to 100

As a business scales, it’s refining its processes, defining what is and isn’t relevant. It’s important to analyse every decision and critically determine if it’s attaining the desired results as well. However, with scale comes problems.

“A bug that would statistically effect 1% of use, went from affecting one client once a month, to ten clients once a day, to 100 clients every hour. This has to be managed without everyone getting stressed and the wheels falling off.”

Your team is also growing — often before a management structure can be put in place (or even afforded). For Clarke and many other business owners, this meant he now went from salesman, tech support and business strategist, to HR manager, sales manager, general manager and everything in between.

“This was one of the hardest lessons I had to learn. We weren’t yet in a position to hire an experienced sales manager, but we did need sales reps, and so I found myself in a position I had no experience in:

Hiring and managing sales reps. Good sales people can drive business growth and have an incredibly positive impact on your growth. We learnt the hard way how destructive one bad sales rep can be though.

“He was excellent at signing new clients, but insisted that he train them personally, instead of letting our on-boarding team do the training. It was against our process, but we wanted to keep him happy — he was a super-star, and we didn’t really see the harm.

“We couldn’t have been more wrong. The product wasn’t sold properly and the sales rep managed to keep us from finding this out as long as possible by blocking any external training. It took us a while to realise what was happening, and it was a painful lesson to learn.”

It’s also an unavoidable step in the growth curve. Customer needs outpace revenue growth, and feet are needed on the ground before a management level can be put in place. Clarke’s advice?

“Don’t take everything at face value. This is still your business, and you need to know what’s happening in it. Until that point I knew every one of our clients. They were the heart and soul of our business. Now I was losing some of the one-on-one intimacy, and the result was that I didn’t know what was happening with our clients. You can’t have a relationship with each and every client as you grow, but until you can put a management structure in place, make it your business to sit in on a few sales calls. Make sure every new hire understands and lives the values of the business you’re building.”

Phase 4: 100 to 1 000

This is the ramp-up phase. It’s when you start hiring middle managers and putting teams in place. You start focusing on managing the company and no longer manage clients.

“Although necessary to the growth of the business, this was a really tough phase to enter for me. My clients were everything. I nurtured them. Now I was putting processes and people in place, and stepping away from those clients, but as an entrepreneur, letting go doesn’t come naturally.”

Instead, Clarke has had to have faith that his staff could handle the day-to-day activities of securing new clients and managing their accounts.

“The one positive about such a bad hire in our previous phase was that I became a lot more discerning about who we hired. I understood the crucial role our people play in the success or failure of our business, and we’ve been building a focused, passionate team ever since.” It’s now a team of 34 people.

“The client management and client on-boarding functions are essential to our growth. This is what keeps customer longevity,” says Clarke.

“Get it right, and we’ve got repeat business. If we do lose clients, it’s at this stage. This is where we make sure our business products and clients speak the same language. They need to understand what the product can do — it’s a complex product, but an incredible tool if used to its full capacity. I also don’t believe in lock-ins. We have a 30-day notice period and if you cancel, we send all your data back to you, in whatever format you want it in. We want to keep you because our product is so valuable to your business you can’t operate at the same level without us — not because we locked you in.”

The next phase: 1 000+

The original idea was to build Honeybee and then start concentrating on other apps. However, the platform was such a success that all of the company’s resources started shifting towards the platform. This hadn’t been the original business model, but the success of the product meant the model had to be adjusted.

“Right now, we’re doubling our turnover every eight to ten months. The business model is based on recurring revenue, so our focus is on building our client base. In April 2016 we signed as many new orders as we did in the first 22 months.

“We’ve taken a long term view on growth. We’re reinvesting all of our profits, and will need to be eight times our current size before we become very profitable. We’ve done the numbers and found our sweet spot — the balance between price and number of users that we need to make this investment worthwhile. Price too high and we won’t get the numbers, so it’s important to do those figures. We’ve taken the long view, and so far it’s paying off.”

The Honeybee story

honeybee-the-field-office-features

Sam Clarke started his entrepreneurial journey in 2007 with a company that wrote software for the design of antennas, an extremely niche market with a business dominated by a few big clients.

When he was bought out in 2012 he knew he wanted to change focus and create a business-to-business product with as broad an appeal as possible. It needed to solve a pain point that every single business felt, regardless of their industry.

His main shareholder in the previous business, EMSS, also wanted to diversify. “They had coders and developers, and the capability to write Android apps. I’m not a coder, but if I could identify a solution to a burning market need, they could create the product.”

Finding a pain point

To find that pain point, Clarke started networking, asking everyone he met similar questions: What was their greatest business need? What pain points did they experience? What solutions had been tried and failed?

“I was looking for something widespread, and before long a picture emerged: SMEs and corporates alike consistently have challenges with their field sales reps. Now that I had a problem, I worked to understand this market from the inside out.”

Four weeks of hardcore research followed, and by June 2012, Clarke and his developers were ready to start building their first app.

“We weren’t the first company in this space, but the competitors I found at that time relied on technology that was expensive and high-tech, but not widespread. We were coming into the market at the perfect time: Smart phones and tablets were just starting to be commonplace. We could leverage off of these devices to create something mobile, simple to use, and most importantly, easy to integrate into daily work schedules and processes.”

Do this

Growth should be planned and follow a predictable path if you want to see good returns.

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

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Entrepreneur Profiles

Jason English On Growing Prommac’s Turnover Tenfold And Being Mindful Of The ‘Oros Effect’

Rapid growth and expansion can lead to a dilution of the foundational principles that defined your company in its early days. Jason English of Prommac discusses how you can retain your company’s culture and vision while growing quickly.

GG van Rooyen

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Vital stats

  • Player: Jason English
  • Position: CEO
  • Company: Prommac
  • Associations: Young President’s Organisation (YPO)
  • Turnover: R300 million (R1 billion as a group)
  • Visit: prommac.com
  • About: Prommac is a construction services business specialising in commissioning, plant maintenance, plant shutdowns and capital projects. Jason English purchased the majority of the company late in 2012, and currently acts as its CEO. Under his leadership, the company has grown from a small business to an international operation.

Since Jason English purchased Prommac in 2012, the company has experienced phenomenal growth. At the time he took over as owner and CEO, it was a small operation that boasted a turnover below R50 million.

Today, Prommac is part of a diversified group of companies under the CG Holdings umbrella and alone has grown it’s turnover nearly ten fold since Jason English took over. As a group, CG Holdings, of which Jason is a founder, is generating in excess of R1 billion. How has Prommac managed such phenomenal growth? According to Jason, it’s all about company culture… and about protecting your glass of Oros.

Jason English

Related: 5 Top Lessons From LAWTrust To Prepare For Super-Charged Growth

“As your business grows, it suffers from something that I call the Oros Effect. Think of your small start-up as an undiluted glass of Oros. When you’re leading a small company, it really is a product of you. You know everything about the business and you make every decision. The systems, the processes, the culture — these are all a product of your actions and beliefs. As you grow, though, things start to change. With every new person added to the mix, you dilute that glass of Oros.

“That’s not to say that your employees are doing anything wrong, or that they are actively trying to damage the business, but the culture — which was once so clear — becomes hazy. The company loses that singular vision. As the owner, you’re forced to share ‘your Oros’ with an increasing number of people, and by pouring more and more of it into other glasses, it loses the distinctive flavour it once had. By the time you’re at the head of a large international company, you can easily be left with a glass that contains more water than Oros.

“Protecting and nurturing a company’s culture isn’t easy, but it’s worth the effort. Prommac has enjoyed excellent growth, and I ascribe a lot of that success to our company culture. Whenever we’ve spent real time and money on replenishing the Oros, we’ve seen the benefits of it directly afterwards.

“There have been times when we have made the tough decision to slow growth and focus on getting the culture right. Growth is great, of course, but it’s hard to get the culture right when new people are joining the company all the time and you’re scaling aggressively. So, we’ve slowed down at times, but we’ve almost always seen immediate benefits in terms of growth afterwards. We focus heavily on training that deals with things like the systems, processes and culture of the company. We’ve also created a culture and environment that you won’t necessarily associate with engineering and heavy industries. In fact, it has more in common with a Silicon Valley company like Google than your traditional engineering firm.

“Acquisitions can be particularly tricky when it comes to culture and vision. As mentioned, CG Holdings has acquired several companies over the last few years, and when it comes to acquisition, managing the culture is far trickier than it is with normal hiring. When you hire a new employee, you can educate them in the ways and culture of the business. When you acquire an entire company, you import not only a large number of new people, but also an existing organisation with its own culture and vision. Because of this, we’ve created a centralised hub that manages all training and other company activities pertaining to culture. We don’t allow the various companies to do their own thing. That helps to manage the culture as the company grows and expands, since it ensures that everyone’s on the same page.

“Systems and processes need to make sense. One of the key reasons that drove us to create a central platform for training is the belief that systems and processes need to make sense to employees. Everyone should understand the benefits of using a system. If they don’t understand a system or process, they will revert to what they did in the past, especially when you’re talking about an acquired company. You should expect employees to make use of the proper systems and processes, but they need to be properly trained in them first. A lot of companies have great systems, but they aren’t very good at actually implementing them, and the primary reason for this is a lack of training.

“Operations — getting the work done — is seen as the priority, and training is only done if and when a bit of extra time is available. We fell into that trap a year ago. We had enjoyed a lot of growth and momentum, so we didn’t slow down. Eventually, we could see that this huge push, and the consequent lack of focus on the core values of the business, were affecting operations. So, we had to put the hammer down and refocus on systems, processes and culture. Today Prommac is back at the top of it’s game having been awarded the prestigious Service Provider of the year for 2017 by Sasol for both their Secunda and Sasolburg chemical complexes.

Related: Establishing The Wheels Of Change In Business

“If you want to know about the state of your company’s culture, go outside the business. We realised that we needed to ‘pour more Oros into the company’ by asking clients. We use customer surveys to track our own performance and to make sure that the company is in a healthy state. It’s a great way to monitor your organisation, and there are trigger questions that can be asked, which will give you immediate insight into the state of the culture.

prommac

“It’s important, of course, to ask your employees about the state of the business and its culture as well, but you should also ask your customers. Your clients will quickly pick up if something is wrong. The fact of the matter is, internal things like culture can have a dramatic effect on the level of service offered to customers. That’s why it’s so important to spend time on these internal things — they have a direct impact on every aspect of the business.

“Remember that clients understand the value of training. There is always a tension between training and operational requirements, but don’t assume that your clients will automatically be annoyed because you’re sending employees on training. Be open and honest, explain to a client that an employee who regularly services the company will be going on training. Ultimately, the client benefits if you spend time and money on an employee that they regularly deal with.

“For the most part, they will understand and respect your decision. At times, there will be push back, both from clients and from your own managers, but you need to be firm. In the long term, training is win-win for everyone involved. Also, you don’t want a client to become overly dependent on a single employee from your company. What if that employee quits? Training offers a good opportunity to swop out employees, and to ensure that you have a group of individuals who can be assigned to a specific client. We rotate our people to make sure that no single person becomes a knowledge expert on a client’s facility, so when we need to pull someone out of the system for training, it’s not the end of the world.

“Managers will often be your biggest challenge when it comes to training. Early on, we hired a lot of young people we could train from scratch. As we grew and needed more expertise, we started hiring senior employees with experience. When it came to things like systems, processes and culture, we actually had far more issues with some of the senior people.

“Someone with significant experience approaches things with preconceived notions and beliefs, so it can be more difficult to get buy-in from them. Don’t assume that training is only for entry-level employees. You need to focus on your senior people and make sure that they see the value of what you are doing. It doesn’t matter how much Oros you add to the mix if managers keep diluting it.”

Exponential growth

When Jason English purchased Prommac late in 2012, the company had a turnover of less than R50 million. This has grown nearly ten fold in just under five years. How? By focusing on people, culture and training.

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Entrepreneur Profiles

Who’s Leading Your Business Billy Selekane Asks – You Or The Monkey On Your Back?

You’re either a change-maker, or someone who is influenced by the shifting conditions around you. The truly successful know how to determine their own destinies. Here’s how they do it.

Nadine Todd

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Vital stats

  • Player: Billy Selekane
  • Company: Billy Selekane and Associates
  • About: Billy Selekane is an author, internationally acclaimed inspirational keynote speaker, and a personal, team and organisational effectiveness specialist.
  • Visit: billyselekanespeaks.com

We live in a world of disruption. We live in a world where Airbnb’s valuation is $31 billion, but the Hilton’s market cap is $30 billion. Airbnb doesn’t own one square kilometre, and yet they’re worth more than the world’s biggest hotel chains with enormous assets. We live in a world where things have been turned upside down.

In this brave new world, you can either thrive, or fight to survive. As a leader in your organisation, the choices you make, the mental mind-space you occupy and how you engage with those around you, will determine your personal success, as well as that of your entire organisation.

“The business of business is people. You can’t just pay lip service to the idea that they are your most important asset. You need to live it. Leaders must be intelligent and honest. You can’t just push people to meet the numbers,” says Billy Selekane, personal and business mastery expert and international speaker.

The problem is that great leaders need to first find balance within, before they can successfully lead their organisations.

“Things can no longer be done the same way,” says Billy. “Success today is defined by people who are driven, are inspired by their own lives and goals, and have the power and capability to inspire others.” But before you can achieve any of this, you need to rid yourself of the monkey on your back.

Related: Billy Selekane

The monkey on your back

“If I continue doing what I’m doing, and thinking what I’m thinking, I’ll continue to have what I have,” says Billy. “That’s the definition of insanity. Are you doing things by default or design?”

Billy’s analogy is a simple one. It’s something we can all relate to, and it’s the single biggest thing stopping us from clearing our minds, focusing on the positive and achieving success. He calls it the monkey on our backs.

“Every one of us is born with an invisible monkey on their shoulder,” says Billy. “Your monkey is always with you. Sometimes they’re the one speaking, and you need to be careful of that.” What you need to be even more aware of than your own monkey though, is everyone else’s monkeys.

“Every interaction we have is an opportunity for what I call a monkey download. You have an argument with your spouse before work, and you end up getting into your car with not only your monkey, but theirs as well. Your irritation level has doubled thanks to the extra monkey. Now you get irritated with a pointsman, another driver or a taxi on your way to work. You’ve just added three monkeys.

“By the time you walk into the office, you’re bringing an entire village of monkeys with you. They’re clamouring, clattering, arguing with each other, and the noise is deafening. Not only does everyone get out of your way, but you can’t hear yourself think. And the more your mood drops, the more monkeys you download from the people around you. This is not the path to focus, achieving your goals or being happy. It’s certainly not the path to great leadership.

“Great leaders know how to keep all those monkeys out. They know how to control their moods, and regulate their own positivity. They understand that they are the architects of their own success.”

Getting out of the monkey business

To be a great leader — and personally successful and happy — you need to start by getting out of your own way, and as Billy calls it, ‘getting out of the monkey business.’ You need to not only shake your own monkey, but everyone else’s as well.

According to Billy, there are four simple areas you can begin focusing on today that will help you become the person (and leader) you want to be.

First, honesty is the foundation of everything else you should be doing. “Be clear and straight. Speak to people simply and honestly, but with respect. Connect with them, not through the head, but with the heart. Don’t play tricks.”

Related: 5 Top Lessons From LAWTrust To Prepare For Super-Charged Growth

Next, be authentic. All great leaders are authentic, and recognised as such. Aligned with this is integrity. “This is sadly out of stock, not only in South Africa, but the world,” says Billy.

“There is nothing as disturbing as a leader without integrity, and on a personal level, you won’t achieve emotional stability if you aren’t a person of integrity.”

Finally, you need to embrace love. “Wish your employees well. Wish your family, friends and connections well. When we are given love, and trusted to perform, we take that and pay it forward. In the case of business, this means your employees are giving the same love to customers, but if everyone showed a little more love, the world would be a better place. When people feel cared for, they show up with their hearts and wallets, and they pay it forward.

“Great leaders understand this. They don’t only focus on making themselves better, but adding to everyone around them. Remember this: In every business, there are no bad employees, just bad leaders. Employees are a reflection of that.”

If you want to build a better future, business or life, you need to start with yourself.


Do this

Stop letting negative thoughts and minor irritations derail you. You are the master of your moods and thoughts, so take personal responsibility for them.

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Entrepreneur Profiles

Shark Tank Funded Start-up Native Decor’s Founder on Investment, Mentorship And Dreaming Big

Vusani Ravele secured offers from every single Shark in the first episode of Shark Tank South Africa, eventually settling on an offer from Gil Oved from The Creative Counsel. Entrepreneur asked to him how this investment has changed his business.

GG van Rooyen

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Vital stats

  • Player: Vusani Ravele
  • Company: Native Decor
  • Established: February 2016
  • Visit: nativedecor.co.za
  • About: Native Decor creates visually pleasing products from sustainable timber. The company’s designs are innovative and functional, with its creations mostly inspired by South African cultures, landscapes and wildlife.

It all started with a cordless drill. In February 2015, Vusani Ravele received a drill from his girlfriend as a Valentine’s Day gift. He immediately became obsessed.

“I couldn’t stop drilling holes in things,” Vusani laughs. “I just loved working with my hands.”

Unlike most people, who lose interest in a Valentine’s Day gift by the first day of March, Vusani’s passion for his cordless drill didn’t dissipate. Instead, it had reignited a spark. Thanks to that cordless drill, he rediscovered a love for design he’d first felt in high school. And one year later, he had started a company called Native Decor.

Related: 6 Great Tips For A Successful Shark Tank Pitch

As a start-up he then made the bold move to enter the inaugural season of Shark Tank South Africa. He was funded by Gil Oved on the very first episode. It was a life-changing experience, but Vusani is keeping a level head. The money helps, but he’s trying not to let it change his approach too much.

I’m doing my best not to think of Native Decor as a funded start-up. The money has allowed me to do certain things, like buy a new CNC machine, but I still try to think like a founder without money. Once you have a bit of money in the bank, the temptation exists to throw it at every problem, but that’s not how you create a successful business.

You need to bootstrap and pretend that you don’t have a cent in the bank. With a bit of lateral thinking, you can often come up with a solution that doesn’t require money. It might require more effort, sure, but I believe it creates a stronger foundation for your business. If a business can carry itself from early on, its odds for long-term success are much higher. You also need to fight the urge to spend money on things like fancy premises or extra staff. The longer you can keep things lean, the more runway you create for yourself.

Vusani Ravele of Native Decor

I didn’t enter Shark Tank just for the money. The money was important, of course, but there was more to it than that. Looking purely at money versus equity, Gil Oved’s offer wasn’t the best, but I knew that I wanted to work with Gil. Stepping into the room, my primary aim was to attract him to the business.

He wanted 50% equity for R400 000 of investment. I wanted to give away 25% for the same amount. We settled on 40% for R400 000 with an additional R3 million line of credit. It was more of the company than I initially wanted to give away, but I was okay with it, since I saw it as the cost of Gil’s involvement, which I knew would add bigger value to the business than just the cash injection.

Related: Shark Tank’s Dawn Nathan-Jones: How Leaders Who Focus On Growth Will Build Successful Companies

Investment comes in many forms. I wanted Gil to invest in the business because I realised that investment isn’t purely about money. I didn’t just want him to invest his cash in Native Decor, I also wanted him to invest his time and energy. You can get money in different places. You can create a business that funds its own growth, for example, or you can get a loan from a bank.

What an investor like Gil offers, however, is knowledge and access to a network. Money can help a lot with the growth of a business, but a great partner can help even more. By giving Gil 40% of the business, I’ve ensured that he has skin in game. He has a vested interest in seeing Native Decor succeed, and that’s worth more than any monetary investment.

True mentorship can be a game-changer if you’re running a young start-up. A great advantage that often comes with investment is mentorship from someone who knows the pitfalls of the entrepreneurial game. With a new business, it’s easy to be sidetracked or to chase an opportunity down a dead end.

Gil is visionary, and he has helped me focus on the long-term goals I have for Native Decor. He has also helped me to think big. As young entrepreneurs, I believe we often think too small. We don’t chase those audacious goals. Someone like Gil, who has seen huge success, can help you push things further and to dream bigger.

You need to dream big, but act small. It’s important to have big dreams for your business, but you should also chase those easy opportunities that can help you build traction. When I started, I wanted to try and get my products into large retail stores, but the fact of the matter was, as a start-up, I didn’t have a strong negotiating position.

There was a lot of bureaucracy to deal with. Gil advised me to focus on the ‘low-hanging fruit’ — those small gift stores that would be keen to carry my products. By doing this, I’m gaining traction and building a track record for the business. Also, I realised the importance of aligning myself with the right kind of stores. Perhaps being in a large retailer isn’t a good idea, since this is where you typically get cheap items produced overseas. Unless you’re purely competing on price, that’s probably not where you want to be.

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


Take note

Funding is great but it’s not all about the money. If that’s what you’re chasing you’re doing your start-up an injustice.

Watch the Shark Tank investment episode here:

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