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Silulo Ulutho Technologies Tackles Tech Target Market

The Rani brothers grew their business from one Internet café to 38 stores with a R22 million turnover by creating a market where none really existed.

Monique Verduyn

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Vital stats

  • Players: Luvuyo and Lonwabo Rani
  • Company: Silulo Ulutho Technologies
  • Established: 2004
  • Contact: rani@silulo.com
  • Visit: silulo.com

Luvuyo Rani knows all about bootstrapping — he launched his business selling refurbished computers from the boot of his Corsa Lite in Khayelitsha, on the Cape Flats, in 2004.

Today, he and his brother Lonwabo have grown Silulo Ulutho Technologies into a 38-branch franchised IT services provider for people living in the townships and rural areas of the Eastern and Western Cape. They employ 178 people and provide ICT training for hundreds of people who would otherwise have no access to PCs.

Related: 10 SA Entrepreneurs Who Built Their Businesses From Nothing

A (very) blue ocean

“The first thing we did right was to service a market that was completely untapped,” says Rani.

“Our target market had been overlooked and was computer illiterate. We found that people were buying computers from us and putting them on display in their dining rooms because they did not know how to use them. That led us to start our first Internet café. Silulo Ulutho — which means bringing value — offered computer training courses, Internet and business centre services, and IT retail and repair. The demand grew quickly and soon we were building a network of stores throughout the community. In 2007, we added training in mobile devices and social media.”

Lesson: This is a classic case of a ‘Blue Ocean Strategy’. Instead of competing in fiercely-contested markets (Red Oceans), it often makes sense to go in search of those untapped market spaces that are ready for growth. You can read more about this in W. Chan Kim and Renée Mauborgne’s book Blue Ocean Strategy.

The stokvel approach to finance

How does a bootstrapped company tap into a market that itself has no access to funding? By being creative in a way that many South Africans understand. “Our first customers were teachers,” Rani recalls.

“We got them to form stokvels in groups of six, and to contribute R400 per month each. Within six months, they paid for their computers.”

Lesson: In order to be successful, you need to really understand your customers. The Rani brothers had the advantage of understanding the culture of their customers intimately, allowing them to tap into a market that outsiders would have found impossible to penetrate.

A strategic partnership

The next strategically important move was to partner with MWEB to launch a store in Ngcobo in the Eastern Cape, the first to provide computer training services in the area. A further seven stores were launched as a result of the partnership, with Silulo Ulutho having received R3,2 million in funding from MWEB over the last seven years.

At the same time, the partnership has given MWEB access to the Rani brothers’ significant and sustainable growth strategy and grown the service provider’s own business in emerging market communities.

Lesson: The Rani brothers managed to secure considerable funding by not chasing outside capital too quickly. They waited until they had something substantial to offer a large partner. Many companies chase funding too quickly, before they have a proven business model.

Related: Meet The 40 Richest Self-Made Entrepreneurs On Earth

Creating a bridge

“We also provide technology services to companies like Telkom with penetration points in communities that don’t have existing infrastructure,” says Rani.

“This opens up new business opportunities both for Silulo Ulutho Technologies and our corporate business partners, creating job opportunities and new value chains. Essentially, we provide our partners with ‘last mile’ access — the portion of the telecommunications network chain that physically reaches customers.”

From day one, Rani notes, the company positioned itself as the bridge between ICT providers and township and rural communities.

“We said, to reach these customers, come through us and we will make it easy for you to build brand presence and grow your market in partnership with us, because we know these communities. As we developed the franchise system, we appointed people with local knowledge in other areas. Understanding the communities in which you operate is critical to success.”

Lesson: Silulo Ulutho Technologies offered outside partners access to a market that they would otherwise have found difficult to penetrate. By doing this, it became more than a supplier or sub-contractor — it became a strategic partner of immense value.

Customers for life

The brothers plan to grow the business to 100 stores, with expansion into Mpumalanga, Gauteng and Limpopo by 2018.

Related: 10 Dynamic Black Entrepreneurs

Rani points out that the business owes its success to a model that goes the distance with the customer. “We take people who have never touched a computer, we train them and help them to become employable. Once they have a job, they return to buy a PC. When they need Internet access they either use our services or they buy data from our stores. If they need business services, we offer those too. We create customers for life.”

Lesson: Silulo Ulutho Technologies has grown beyond its small native market, but it has retained its customer-centric focus. It is aware of the lifetime value of each customer, and therefore focuses on establishing long-term relationships.

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

Lessons Learnt

(Podcast) ‘Bizarre Foods’ Andrew Zimmern: ‘I’m Addicted To The Hustle’

How this week’s ‘How Success Happens’ guest overcame personal struggles and built an empire.

Dan Bova

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I didn’t know what to expect when we scheduled an interview over breakfast with today’s guest Andrew Zimmern. As you may know, the chef, writer, restaurateur and TV personality made a name for himself traveling the world and eating some, well, bizarre foods on his hit travel/food show, Bizarre Foods.

Turns out our breakfast was pretty normal – we didn’t dig into a fresh plate of scrambled brains or anything – but the conversation was anything but typical.

Over the past couple of years, Zimmern has built a true empire around his name with books, TV shows, restaurants (including his new Twin Cities joint Lucky Cricket), and a production company, but as he very candidly told me, the road to success has not been easy. He has gone through a lot of personal pain on his journey, and he says it is a daily endeavour to keep himself moving on the right track.

As Zimmern explained, over the course of his life, he’s had problems with substance abuse, depression – even homelessness – and he was very open about sharing the lessons he’s learned along the way about coping and finding redemption. We also spoke about his dear friend, Anthony Bourdain, and about the struggles of feeling overwhelmed that most of us face.

Related: Gareth Cliff Shares His Tips For Starting Your Very Own Podcast

But don’t get me wrong, he’s really funny, too! There’s nothing “normal” about Andrew Zimmern. Hope you’ll enjoy our conversation, thanks for listening.

This article was originally posted here on Entrepreneur.com.

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How BrightRock Is Disrupting The Insurance Industry With These 2 Pivotal Strategies

Developments in technology, and clear communication are positioning BrightRock to disrupt their industry and transform the consumer experience.

Monique Verduyn

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brightrock

Vital Stats

  • Players: Sean Hanlon, Leopold Malan, Schalk Malan, Suzanne Stevens
  • Company: BrightRock
  • Est: 2011
  • Visit: www.brightrock.co.za

BrightRock was started around a dining room table in 2011 by four people with years of industry experience and — importantly — a diverse set of complementary skills.  They wanted to make changes to an industry with an age-old methodology by allowing customers to co-create a solution that precisely meets their individual needs, and adjusts as those needs change. Today, BrightRock is the fastest-growing insurer in the intermediated individual life risk market. It also provides underwriting management services to funeral parlour businesses and, more recently, has entered the group risk insurance market, offering its needs-matched approach to employees.

The founders of BrightRock, established in 2011, knew the life insurance industry all too well, and they found its methodology wanting. “Traditional life insurance lumps all the individual’s needs into one policy,” says CEO Schalk Malan.

“It’s a methodology that has been around for centuries. We started afresh and looked at how we could design life insurance based on individual requirements. Our cover is designed to exactly match each specific financial need. Because there is no waste, it’s more cost efficient and sustainable. And if circumstances change and our customer needs more cover, it’s easy to get it because needs-matched design enables the policy to change in line with changing needs.”

1. Embracing digital technology to provide needs-matched insurance

Suzanne Stevens, marketing executive director at BrightRock, points out that this type of innovation achieves efficiency (cost savings) and effectiveness (higher returns). “By harnessing digital technology, we have made our operations more efficient, and aggressively lowered costs by up to 30% for our customers. Every rand they spend with us works harder for them. That’s the benefit of a solution designed around the customer.”

BrightRock’s founders took a similar approach. ‘We ditched legacy thinking in favour of creating a product that is intuitive and easy to navigate. An enormous amount of time and effort went into writing and designing that system, and creating the optimal customer journey.”

Related: How BrightRock Is Rocking The (Industry) Boat In Only 5 Years Since Launch

Unlike clunky legacy systems, BrightRock’s platform is modularised, and was built according to the agile principle of rapid delivery cycles. The result is a technology stack with longevity, that is also flexible enough to be tweaked when needed.

“The advantage of the technology available today is that you can plug things in and pull them out as required,” says Suzanne. “That’s one of the enablers of a truly disruptive mindset. To step away from accepted norms and find new solutions requires curiosity and creativity, as well as a lot of courage to go up against large incumbents in the market. There is always resistance to new technology, although we are fortunate in this country to have one of the most innovative insurance sectors in the world.”

2. Effective communication is critical

These disruptors have set themselves above the rest through one surprisingly simple tactic —  effective communication. They agree that it simply doesn’t matter how world-changing your product or service is if you don’t communicate it to the right audience at the right time. New companies that fail to communicate their remarkable new development will quickly be pushed aside by other disruptors. Without a clear communication strategy that reaches the audience in the industry you’re trying to disrupt, you’ll set yourself up for failure. A key question to ask when you are developing your communication strategy is simply whether people understand what you do.

“Because the premise for our product was fundamentally different from anything on the market, communication and clear messaging were critical to convincing our clients to put their trust in us,” says Schalk.

“It was especially important to educate insurance advisors so they would understand what we were doing, why we were doing it, and how it was better than the other options available. That was key to disrupting the individual life market.”

Currently, BrightRock employs 380 staff, has experienced 40% year-on-year growth, and has an annualised premium income of more than R1,3 billion. The company has recently entered the group risk environment with a similar offering that addresses many of the same shortcomings of traditional group risk products. “The inefficiencies of the structuring of group products has meant that, to remain competitive, insurers have cut the benefits offered to employees, undermining their sense of financial security. Change is needed, and we believe our needs-matched philosophy positions us to change the group risk market too.”

‘We ditched legacy thinking in favour of creating a product that is intuitive and easy to navigate. An enormous amount of time and effort went into writing and designing that system, and creating the optimal customer journey.”

Unlike clunky legacy systems, the BrightRock’s platform is modularised, and was built according to the agile principle of rapid delivery cycles. The result is a technology stack with longevity, that is also flexible enough to be tweaked when needed.

Related: BrightRock’s 5 Entrepreneurial Tips For Start-ups

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.

“The advantage of the technology available today is that you can plug things in and pull them out as required,” says Suzanne. “That’s one of the enablers of a truly disruptive mindset. To step away from accepted norms and find new solutions requires curiosity and creativity, as well as a lot of courage to go up against large incumbents in the market. There is always resistance to new technology, although we are fortunate in this country to have one of the most innovative insurance sectors in the world.”

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Lessons Learnt

The 9 Obsessions You Need To Have To Become A Self-Made Millionaire

Here’s how to stay focused on your millionaire goals.

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elon-musk

The ones who succeed weren’t handed a golden ticket; it wasn’t chance that helped them cultivate their fortune. To reach millionaire status, you must be driven to reach your dreams. You must be obsessed in order to be successful.

These are the nine obsessions that give every self-made millionaire an edge in creating success and wealth.

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