- Player: Mduduzi Luthuli
- Company: Luthuli Capital
- Est: 2016
- Visit: luthulicapital.com
Mduduzi Luthuli and his wife Trudy, both of whom have a solid track record in financial services, launched wealth management company Luthuli Capital in 2016. He left a great job because he wanted to do something he was truly passionate about. Having funded Luthuli Capital with their personal savings, it’s now self-sustaining and turning a modest profit — in less than two years. Mdu says he started the business because, after years in wealth management, he could not find his ideal job, so he decided to create it.
What to do when your start-up can’t get finance
Wealth management companies look after their clients’ money. That alone makes this space supremely difficult for a start-up. How do you find customers and investors willing to bet on you when the business does not have a track record?
For Mduduzi Luthuli, the solution was to build a niche business. But he admits he was fortunate to have developed a strong personal brand over time. “When you are investing offshore for your clients, their primary concern (other than growing their capital) is the person they trust to manage their money. While I was still employed, I let my clients know that I would be starting my own business. Because of the emphasis I had always placed on personalised service — and I am talking about going above and beyond — many of them wanted to move with me. That taught me how powerful a personal brand can be.”
Nonetheless, he says, Luthuli Capital still has a way to go to build its own brand. That’s why Mdu has formed strategic partnerships. “A large part of our investment book sits on Allan Gray’s platform. Because it’s the largest privately-owned investment management company in South Africa, that association is key. We are leveraging off a strong brand while creating and developing our own.”
Finding equity partners
Mdu says that finding the right equity partners has been one of the greatest challenges he has yet had to face. “We found that most venture capitalists and private equity funders simply do not have the appetite for the long-term. It’s extremely difficult to find patient capital — they either want a return on investment in 18 months, or they say they will give you money only if they can take a majority stake in your business. But that would be like working for a boss again, which is what I don’t want,” he says.
It’s for this reason that Luthuli Capital has grown slowly and organically, with profits being pumped right back into the business. At the end of year one, when the business had gone as far as it could with limited resources, one of the top insurance houses offered to provide capital, but there were strings attached — they wanted a majority shareholding. Just as Mdu was about to sign the deal, one of his wealthiest clients agreed to put up the capital required. “She told me she loved what we were doing, and she wanted us to remain independent,” he says.
Mdu has also learnt to stop apologising for being new. “The top performing investment managers did not get to where they are today in 24 months. I cannot magically make the business a decade old. What I can do is use our expertise to build it. I know we are making an impression in the market because lately we have had several offers to buy us out. Clearly, we are heading down the right path.”
It’s for this reason that he advises other entrepreneurs to stay the distance and maintain their independence. “There is no doubt that you will pay for your independence, but when people see that you have made it through the start-up phase, that’s what keeps them coming back. In the beginning, potential funders were laying down their terms; now they are ready to negotiate and take our requirements into account too.”
25 Of The Most Successful Business Ideas In South Africa
Find out who’s making waves in numerous industries and how they managed to differentiate themselves in local and international industries.
“Disruption is all about risk-taking, trusting your intuition, and rejecting the way things are supposed to be. Disruption goes way beyond advertising, it forces you to think about where you want your brand to go and how to get there,” says Richard Branson.
South Africa has its fair share of innovative and disruptive businesses taking both local and international industries by storm. From cutting edge space technology to reimagined logistics, and innovative business models, here are 25 of the most successful business ideas in South Africa:
- I Am Emerge Provides An App For Township Spaza Bulk Purchasing
- Tuluntulu Offers High Quality Video Streaming On Low Data Speeds
- SSG Consulting Developed KEY360: A Cloud-Based And Web-Enabled Platform For Managing Large-Scale Construction Projects
- Pargo Solving Last-Mile Distribution Challenges
- HouseME Is A Digital Real Estate Platform
- Olympic Paints Has Developed A Built-In Paint Tray Causing An Unexpected Industry Shift
- Passion4Performance Developed A Recognition of Prior Learning Assessment Concept
- NewSpace Systems Delivers High Quality Components At Lower Costs
- My Online Presence Creates End-To-End Solutions For Online Brand Presence
- Skynamo Offering Insights To Sales Teams In The Field
- RecruitMyMom Creating A Platform For Job-Seeking Moms
- GAAP Provides A Hardware And Software Point-Of Sale And Enterprise Solution For The Hospitality Industry
- HeroTel Bringing Wi-Fi To Low Income Communities
- Saryx Engineering Offers Digitised Compliance and Safety For Companies
- BrightBlack Is An Energy Providing Innovative Solar Energy Solutions
- Howler Is An Event Technology Platform
- execMobile’s PocketWifi Keeps Business Travellers Connected
- Rhino Africa Provides Online Touring Assistance
- Snapplify Is Offering Students Access To Textbooks
- GoMetro A Commuter-Driven Mobile App
- Domestly Connecting Cleaning Professionals and Homeowners
- NMRQL Using AI To Deliver Consistent Returns
- Colony Live Connecting Users Across Multiple Platforms
- codeX Is Growing The Work Experience Of Coders In Africa
- This Is Me – Disrupting By Offering A Unique Business Model
Colin Timmis Says ‘Position Yourself For Success By Starting With The Numbers’
People pay first who they feel pressure from, so people will pay you when they feel pressure from you.
Entrepreneur Colin Timmis founded South Africa’s first cloud accounting practice in 2011, Real Time Accounting. Then, a few years after being appointed as South Africa’s first Xero partner Colin became Xero Country Manager South Africa. Xero is the emerging global leader of online accounting software that connects small businesses to their advisors and other services.
Two 20 Year Olds Reshape Entrepreneur Landscape With New Social Investment Platform
The Merge vision is to become the ‘go to’, digital meeting place for entrepreneurs and investors, and to truly make a difference in the world.
- Instagram: https://www.instagram.com/mergeconnect/
- Facebook: https://www.facebook.com/mergeconnect/
- Website: http://www.mergeconnect.co/
- Email: Hello@mergeconnect.co
- Number: 072 458 2182
It’s no secret that finding the right investor for your venture is a challenge that most entrepreneurs face. The current process of finding investment is one that is outdated, and limits entrepreneurs due to a lack of time, and network that is needed to find the right investor. But, this doesn’t have to be the case in today’s digital society, says Zander Matthee and Brandon Bate, co-founders of Merge.
“By making the Internet the middleman, we are able to connect with each other much simpler and faster than before” was Zander’s response. “We have taken advantage of this, and have created a digital meeting place for entrepreneurs and investors” added Brandon.
Merge is a social platform that connects entrepreneurs and investors. It aims to simplify, refine and accelerate the process of finding investment for entrepreneurs, and the process of finding investment opportunities for investors. From idea to developed, the platform allows entrepreneurs to present a brief outline of their venture to a network of all investor types. While doing this, entrepreneurs are able to browse through, and connect with investor profiles that suit their requirements.
From Private Investors to Venture Capital, and everything in between, Merge allows all investor types to join. Investors have the opportunity to personalise their feed to suit their investment preferences, and will be able to connect with innovative businesses – that are looking for investment – at their fingertips. Only once there is a mutual interest in each other, are users able to enter a secure private chat where they can discuss further and share documents under the protection of a digital NDA.
The two boys became good friends during their time in high school at St Stithians Boys College. However, it was only in their last year, 2016, that they decided to pursue their dreams and create the platform. They didn’t know how to code, so rather ironically, they needed some form of investment to get the platform off the ground.
“We knew we had a mountain to climb, but we believed in our vision and that we were really trying to make a difference, and if we could get others to see that, they would be onboard.” said Zander.
Chris Peters is one of these individuals that bought into their vision, and became Merge’s first investor. As a successful entrepreneur and part time investor , Chris saw how much value the platform could bring to all entrepreneurs and investors alike. His marketing and strategic background gave him insight into how Merge could play a vital role in a lucrative space, Brand involvement.
“Entrepreneurship and SME development are two key factors that drive economic growth in developing countries like South Africa. That is why brands are currently getting involved, and looking to support entrepreneurs through various means. We have built a platform that allows these brands to successfully market, and execute on the programmes they have created to assist entrepreneurs.” said Chris
Merge was created to assist all entrepreneurs and investors in finding exactly what they are looking for, regardless of age, race, sex, financial position or social status. That is why anybody can sign-up as an entrepreneur. As long as you are determined and willing to work for your dreams. For too long has the investor space been seen as an “elite club for the select few”, and Merge is here to change that. Whether you’ve gotten your bonus at the end of the year and looking for new investment opportunities, or are an active investor, you can sign-up. Whether you’re currently working, or a retired industry leader, you can join as a mentor.
Their vision is to become the ‘go to’, digital meeting place for entrepreneurs and investors, and to truly make a difference in the world.
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