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3 Become 1: The Story Of How IS SME Business, MWEB Business and IS Ignite Merged

Tony Koutakis knows about the complexities of bringing different entities under one roof. Entrepreneur spoke to him about the challenges of merging different companies and divisions into a new business.

GG van Rooyen

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Vital Stats

  • Player: Tony Koutakis
  • Position: Executive Head
  • Company: Ignite
  • Established: 2016
  • Challenge: Instrumental in the merging of the IS SME Business Unit, MWEB Business and IS Ignite to create a company simply called Ignite.
  • Visit: ignite.co.za

Can you briefly explain how the creation of Ignite came about? What was the thinking behind it?

When it comes to growth and capturing market share, merging existing companies is always a solid strategy. We believed that these three entities (the IS SME Business Unit, MWEB Business and IS Ignite) complemented each other in terms of structure and product offerings.

Related: 8 Things Learnt By (Very) Young App Founders of MiBRAND Mobile App

What was it about the IS SME Business Unit, MWEB Business and IS Ignite that made them compatible? How did you know that this was a merger that would actually work?

We felt that each business brought something significant to the table. With all of it put together, we could offer SMEs solutions that are expertly tailored to their needs. MWEB Business, for example, brought with it many existing SME clients.

IS Ignite, which had itself started life as an SME, brought with it an ethos of agility, as well as automation, simplicity and reliability.

That said, there were enough similarities in culture, systems and approach to business, to make us believe a merger would be feasible.

Bringing together three different entities under a new banner must have been daunting. What were some of your biggest concerns?

Change is personal and can be uncomfortable and scary. We did not want crew or existing clients to feel as if they would be left out in the cold. The important thing for us was to include all stakeholders in the process and make sure that everyone knew what was happening.

ignite-quote

How did you manage to put all stakeholders’ minds at ease about the merger?

It’s all about communication. You have to communicate, communicate, communicate. You have to be accurate and clear when discussing change, and you have to ensure that people believe in the direction that the business is taking. You need buy-in from everyone.

Importantly, this sort of process should be highly consultative. You can’t just talk to people — you also need to listen to them. This means not only sitting down with different divisions, but even with individual employees. You need to take note of all concerns and answer all questions.

Related: Why Head of Van Dyck Carpets Believes To Innovate You Must Question The Status Quo

What was your single biggest challenge in bringing the three entities together?

We were merging three companies, which meant we were trying to bring together three groups of people who were all used to different company cultures.

We also had three different brands, operating models, business systems and product sets that we somehow needed to unify. We had no less than 300 different product offerings.

How did you successfully merge the companies and create a new business that felt like a single unit? In other words, how did you create a new enterprise with its own culture?

It’s an ongoing journey — I wouldn’t say that we are done. However, for us it started with bringing everyone together under one roof, which is why Ignite operates from its own offices in Sunninghill.

We believed that we needed to create a new space where all the different groups could become one.

It was also important to focus on the culture, which is why we created a ‘culture club’. We organised an open ‘opt-in’ session where the importance of creating a cohesive organisational culture was shared with those that attended.

Six initiatives (social club, wellness, new crew buddy programme, client experience, thought leadership & CSR) were agreed upon by the employees who opted in to the culture club (approximately 50 people) and as a result six ‘tribes’ were self-organised, with employees signing up to the tribe or initiative that they felt the most connected too.

Apart from the high-level issues that one would pay attention to when doing your due diligence, what are the smaller things that you don’t always pick up on, but which can be problematic?

It’s those small operational differences amongst divisions that you only notice once you’re up and running.

It’s those habits and systems, such as when suppliers are paid and how admin is managed, that will differ across organisations. These ‘teething’ problems will always exist — you just need to deal with them as they come up.

Related: Efficient R&D Puts Product Of The Year SA In The Pound Seats

How do you deal with operational issues within a newly created entity? How do you make sure that the merger goes smoothly and everyone gets settled relatively quickly?

Well, you need a plan. You need to look at what is important in terms of getting the company up and running, and prioritise the crucial things. That said, you must be adaptable — be willing to accept it if something isn’t working out.

You also need people who care — surround yourself with people who actually care about what the company is doing. You need those ‘true believers’ to drive the success of the business.

About Ignite

IS Ignite, MWEB Business and the IS SME Business Unit joined forces in April 2016 to bring their combined experience to SME clients, united under the Ignite brand.

The Ignite ecosystem is made up of four parts essential for SME growth:

  • Whether it’s emailing your clients, collaborating with teams across locations or promoting your company, effective communication is key to your success.
  • A connection to the Internet needs to be strong, reliable and of good quality. That’s where Ignite comes in.
  • Cloud services have simplified the management and control of IT environments, making it easy for you to have the right infrastructure for the applications you use to communicate, share content and do business.
  • Business Applications. From recruitment, payroll, accounting and productivity and collaboration tools Ignite enables you to manage your business administration, so you can focus on achieving your purpose.

Remember this

Mergers can be difficult. If you want disparate groups to become a new cohesive entity, you need to actively manage the process.

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#Wealthiest List: 8 Self-Made Millionaires On How They Built Their Wealth

These inspirational self-made millionaires built businesses with nothing less than hard work and sheer determination.

Catherine Bristow

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1. Nick D’Aloisio Wrote a Million Dollar App At Age 15

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At the age of 15, Nick D’Aloisio wrote an app while sitting in his parent’s bedroom in the UK. At the age of 17, D’Aloisio sold his app Summly – a mobile news summarisation app to Yahoo for a staggering USD 30 million.

As one of the youngest millionaires, D’Aloisio is also the world’s youngest entrepreneur to be backed by venture capitalists – having secured seed funding from Sir Li Ka-Shing, Hong Kong’s billionaire, as well as raising USD 1.23 million from celebrity investors, including Yoko Ono and Ashton Kutcher.

“The number one thing I did that I think was wise was to get, through some of my advisers, was a Chairman; basically someone who was a very experienced business person, an industry veteran — Bart Swanson, who had been at Amazon and then Badoo. Then, myself and Bart really started finding people and growing the team.”

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7 Cannabis Industry Millionaires Making It Big In The Marijuana Business

These entrepreneurs have capitalised on a new market set to continue to grow rapidly as more countries legalise marijuana across the world.

Catherine Bristow

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1. Brendan Kennedy

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Brendan Kennedy worked on job sites as a carpenter to pay his way through university, with his eyes set firmly on becoming an architect, until the allure of Silicon Valley changed the course of his direction. While working at technology start-ups Kennedy began thinking about the possibilities that medical marijuana provided.

“I was really sceptical of medical cannabis,” he says. “It took a year of having conversations with patients and physicians and hearing the same story, repackaged but essentially the same, over and over and over again, where my scepticism eroded and I became a believer.”

In 2013, Kennedy and his partners applied for a licence from Health Canada and launched Lafitte Ventures, which was later renamed Tilray. Today, the company is a global leader in medical cannabis research, cultivation, processing and distribution.

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Lessons Learnt

Scaleup Learnings From Our Top Clients – What The Most Successful Entrepreneurs Do Right

So, how do our successful clients move through these constraints to scaling up? We see four key drivers of success, and they are: people, strategy, flawless execution and finance.

Louw Barnardt

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You’re out of your start-up boots, staff is increasing, your client base is growing, revenue is up and you’ve proven your case to the market. Now it’s time to scale up. The challenges of this vital growth phase are different and it’s a time that demands different mindsets and different actions. In a world littered with small business failures, it helps to be well-prepared for scaling up using a proven methodology. At Outsourced CFO, we get an inside look at the success factors of our clients who are mastering the transition.

On the one hand, scaling up is a really exciting phase; this is what moves you into real job creation and making an impactful contribution to economic growth. On the other hand, it is really hard to scale up successfully. We see three major constraints that limit companies’ transition from start-up to scale-up:

Leadership

The business has to have the leadership that can take it to the next level. When you start scaling up, especially rapidly, the founders can no longer do everything themselves. The team must grow and include new leadership talent that can take charge and execute so that the founders are working on the business instead of in the business.

Infrastructure

The processes, procedures, networks, systems and workflows of the business all need to be scalable. This is imperative when it comes to your infrastructure for the financial management of your business. You’re only ready for growth when your infrastructure can seamlessly keep pace.

Market access

Scaling up demands more innovative marketing and storytelling so that you can more easily connect and engage with the new employees, clients, network partners, investors and mentors that need to come along with you on your scale-up journey.

Businesses that build a market conversation and a compelling brand narrative during their start-up phase are better positioned to have this kind of market access when they need to scale up.

People

It is critical to have the right people on your team. Our successful entrepreneurs have what it takes to attract, inspire and retain top talent. A strong team of smart, ambitious and purpose-driven people who love the company and want to see it succeed contribute greatly to a world class company culture. They are adept at communicating a compelling vision and establishing core values that people can take on. These entrepreneurs are tuned into the aspirations of their people and focus on developing leaders in their teams who can in turn develop more leaders.

Strategy

It is planning that ensures that the right things are happening at the right times. At successful scale-ups strategies and action plans are devised to ensure that the most important thing always remains the most important thing.

Strategy includes input from all team members and setting of good priorities for the short, medium and long term. Goals are clear and everyone always knows what they are working towards. The needle is continuously moved because 90-day action plans are implemented each quarter to achieve targets and goals that are over and above people doing their daily jobs.

Flawless execution

Top entrepreneurs are not just focused on what operations need to achieve, but how the business operates. They have the right procedures, processes and tools in place so that everyone can deliver along the line on the company’s brand promise. Frequent, quick successive meetings ensure the rapid flow of effective communication. Problems are solved without drama. There is no chaos in the office environment. Everyone is empowered to execute flawlessly to an array of consistently happy clients.

Finance

Everyone knows that growth burns cash. A rapidly scaling business faces the challenge of needing a scalable financial infrastructure to keep the company healthy. Our successful entrepreneurs pay close attention to finance as the heartbeat of the business, ensuring that everything else functions. They look at the tech they are using for financial management and for the ways that their financial systems can be automated so that they can be brought rapidly to scale. The capital to grow is another vital finance issue.

The best way to finance a business is through paying clients on the shortest possible cash flow cycle. However, when you are scaling up and making heavier investments in the resources you need for growth, it is likely that you will need a workable plan for raising capital. Our scale-up clients know the value of accessing innovative financial management that provides high level services to drive their business growth.

Navigating the scale-up journey of a growing private company is one of the hardest but most rewarding of careers to pursue. Having people in your corner who have been through this journey before helps take a lot of pain out of the process. No growth journey looks the same, but there are tried and tested methods that will – if applied diligently – lead to definite success. Happy scaling!

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