Building more than brawn, Planet Fitness Founder, Manny Rivera has built his Billion Rand health and fitness business from seeing an opportunity he couldn’t resist. Here he shares his seven business lessons he’s learnt over the last 20 years.
1. You need different offerings to suit different market categories
Growth happens when you can enter new markets while simultaneously making your existing markets bigger.
We have one platinum club which is in the heart of Sandton at the Radisson Blu Hotel. It’s high-end, aspirational and blue-chip. It’s a nice-to-have with a huge capex, but President Obama worked out there, which gives us huge bragging rights. The positioning value has been incredible for our brand, but we’re also aware that the market in South Africa is too small for more clubs in this range.
Our mother brand is the traditional offering, and caters to a market that existed before we launched. It’s the high LSM medical aid market. We’ve remained bullish about this category.
We’ve then added two offerings to not only grow our market share, but increase the market as a whole. We realised that our swimming pools and running tracks require much larger real estate and higher membership premiums. Our ‘blue’ clubs are the same as our traditional clubs, but without these two offerings. Members save on their premiums, and we don’t need enormous square meterage to set them up.
JustGym is our most exciting development though. It’s doing amazingly well because it caters to areas that have never had these service offerings before. Thousands of back office workers who can’t afford traditional clubs have embraced JustGym. We’ve cut out all the expenses that make gyms expensive, from swimming pools to mosaic tiles. Most importantly though, we’ve created a new formula around our human assets. Staff need to multi-task. Each employee must be able to host a class, fill in at reception and perform a sales function. It takes more upfront training, but they can then earn more and do more.
It’s improved careers and earning potential, and improved our bottom line.
2. If something works, roll it out across the organisation
We developed a new job spec for our JustGym employees out of necessity, but it’s worked so well that we’re rolling it out as a hybrid model across all of our gyms. When something works, don’t be afraid to adjust your current operating model. Businesses that can adapt survive and thrive.
3. Don’t be scared of competition. Embrace it
We’ve always felt that the more people who are focused on health and fitness, the better it is for all of us. There are a lot of new concepts launching in South Africa, and we believe this just grows the overall fitness market. Plus, people start there and then want more — and that more is us, with our multi-service offerings and training.
4. People are the core of your business
A brand is never more important than people. You’re only ever as good as the people in your business, and this includes partners, friends, colleagues, staff and clients.
5. Access to capital is important
Build a business — and credit record — that financiers will back. We needed to reach a tipping point before the banks would support us, and this is often the case with new business owners. To reach that point though, make sure you never, ever ruin your credit rating or reputation.
Debt in business is good debt, but never go into debt except for the business — don’t ever overspend in your personal capacity.
Forget the fancy cars, you’ll just end up a slave to debt. If you’re going to take debt, use it to make cash by building your business.
6. Always approach things with the end in mind
Take on the big player. Believe in yourself. Know you’ll build a big business that’s profitable. If you have the passion and you’re able to reverse engineer your success with a step-by-step growth plan, you’ll reach your dream.
7. Good businesses are built on great relationships
The right relationships are priceless. We wouldn’t be where we are today if it wasn’t for Discovery, our banking partners and our property partners. Nurture these relationships and always act with integrity, but also understand that they don’t happen overnight. You need to have patience if you want to build an empire.
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These inspirational self-made millionaires built businesses with nothing less than hard work and sheer determination.
1. Nick D’Aloisio Wrote a Million Dollar App At Age 15
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.”
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.
1. Brendan Kennedy
- Company: Tilray
- Website: https://www.tilray.com/
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.
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.
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:
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.
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.
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.
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.
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.
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.
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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