Pull up outside 77 Commissioner Street and a doorman in atop hat comes to greet you. For a moment you might think you’ve stepped outonto a Manhattan pavement, but this isCornerHouse in inner city Joburg, headquarters of property development company Urban Ocean.
The once grand edifice – built in 1904 tohouse Barney Barnato’s business concerns – is one of 20 buildings in thefinancial district of Johannesburg’s erstwhile decaying CBD that have beensnapped up by Alfonso Botha and Duan Coetzee. The two, Botha a developer andCoetzee a property marketer, formed Urban Ocean four years ago withthe aim of re-inventing the concept of inner city living in line with globaltrends.“We were fascinated by the challenge oftaking on urban renewal projects,” says Botha. “What others saw as a majorsocio-economic problem, we saw as an opportunity. We were not the first developers to move in,but we put a new spin on city development and that’s what has made our projectssuch a success.”
That new spin is about luxury andtop-quality building standards. To make an impact on the market, Urban Ocean’sfirst project had to be exceptional. It was, and the result was thatCornerHouse, comprising a limited number of apartments, a boutique hotel, arestaurant, and Urban Ocean’s offices, sold outin less than a week from its launch. Those first buyers have since been offeredprices that represent well over 100% return on investment. “Our customers arehappy,” says Botha. “We have created a lot of value for them.”But it wasn’t plain sailing. CornerHouse’stenants owed many months rent to its then owners – which they did not want topay – and they refused to move. Botha smoothed negotiations between the twoparties, making more than a thousand telephone calls to close the deal.
Urban Ocean’s projectsare mostly mixed use buildings, combining retail and residential. They areaimed at business tourists and people who work in the city. Prices range fromR495 000 to R20 million.“Public transport remains a problem in Johannesburg and peopleare becoming more prepared to pay a premium for living close to work. When youconsider that traffic is worsening every month, it’s not difficult to see why,”says Botha.He acknowledges that he expected far moreresistance from the market. “We are now a year ahead of schedule in terms ofour business plan,” he adds.
Like most South African entrepreneurs,Botha and Coetzee invested their own money in the first couple of buildingsthey bought. “The negative perceptions of the city worked in our favour;building owners were initially only too keen to get rid of their property. Butonce interest was sparked and prices rose, we had to look at more creative waysof financing the projects and attracting venture capitalists and outsideinvestors. Our first few successes stood us in good stead.”Urban Ocean’s successhas given rise to competitors, but Botha views competition as his strongestasset. “Our competitors have helped to create value for us.” When asked why Urban Oceanmanaged to make a success of an initiative that many corporate property ownersshunned, Botha puts it down to entrepreneurial versus institutional thinking.
“Companies with too much money at theirdisposal are not always able to think creatively. Entrepreneurs have to be ableto do a lot with the little they have. This makes them more inventive.”A concern that is repeatedly raised issecurity. Botha says the sense of community created by apartment living is thebest form of security. “In the suburbs, people live isolated lives. The richeryou are, the higher your wall, the more difficult it is for anyone to help you.In high-density areas the sense of community is far greater. In addition, allour developments have security guards as well as CCTV and other securitytechnology. Shops are within walking distance and entertainment and night lifeare next on the cards.”
The biggest challenge has been getting allservices and utilities to function. The company has had to work with themunicipality to tackle the culture of dirtiness that permeates the city. “Wehad all graffiti removed from the areas around our buildings, and we employadditional cleaners to support the city’s services. There is no doubt thatcleanliness helps to combat crime and uplift a district.”This co-operation, he adds, is leading to achange in mindset about the city. “Banks and other businesses, as well as thecity council, are all doing their best to improve the surroundings.”His ultimate aim: to help turn Johannesburg into a world-class city that isa tourist destination as well as a business, residential and leisure hub.
Watch List: 50 Top SA Small Businesses To Watch
Keep your finger on the pulse of the start-up space by using our comprehensive list of SA small business to watch.
Entrepreneurship in South Africa is at an all-time high. According to Global Entrepreneurship Monitor (GEM), total early-stage entrepreneurial activity has increased by 4.1% to 11% in 2017/2018. This means numerous new, exciting and promising small businesses are launching and growing.
To ensure you know who the innovative trailblazers are in the start-up and small business space, here are 50 of South Africa’s top establishing companies to watch, in no particular order:
- Livestock Wealth
- The Lazy Makoti
- Mimi Women
- AfriTorch Digital
- Akili Labs
- Native Décor
- Quality Solutions
- EM Guidance
- Kahvé Road
- HSE Matters
- VA Virtual Assistant
- Famram Solutions and Famram Foundation
- BioTech Africa
- Brand LAIKI
- Plus Fab
- Lenoma Legal
- Benji + Moon
- Brett Naicker Wines
- Legal Legends
- The Power Woman Project
- Aviro Health
- AnaStellar Brands
- Data Innovator
- Oolala Collection Club
- Empty Trips
- Vula Mobile
- The Katy Valentine Collection
- Pimp my Book
- ART Technologies and ART Call Management
- The Sun Exchange
How 28-Year Old Entrepreneur Adam Fine Is Leveraging The Global Phenomenon Of Five-A-Side Football
Adam Fine of Fives Futbol discusses how he leverage a global phenomenon and the value of strategic partnerships in business.
- Player: Adam Fine
- Company: Fives Futbol
- Est: 2011
- Visit: www.fivesfutbol.co.za
Nothing about Adam Fine is by-the-book. The 28-year-old entrepreneur describes himself as a slightly big child. He’s the CEO of one of the most exciting start-ups in South Africa, having leveraged the global phenomenon of five-a-side football to start a business that has grown almost as fast as the game itself. Not bad for a venture that was launched with the princely sum of R85 000 — Fine’s life savings at the time.
He started it in 2011, with a strong focus on corporate social investment and making a positive social impact. It was by forming strategic partnerships that Adam really managed to grow Fives Futbol. He’s opened pitches in prime locations that serve both the school and corporate markets, while still being accessible for social impact interventions in local communities.
Pivoting at the right time is key to growth
In the last 18 months, Fives Futbol has trebled in size, and achieved some amazing milestones — it now employs 50 full-time staff, and 80 part-timers. It’s one of the factors that drives Adam, as many of his employees support up to eight family members. It’s now also represented in four provinces and 15 locations around the country. By September, there will be 18.
Quick growth means you have to be able to pivot quickly when things do not go according to plan, and mostly they don’t, Adam says. “If things are not working you should be able to ‘pivot’, to shift your focus. And do it fast. It’s not a sign that things have gone wrong by any means, on the contrary, it means you have the insight to recognise that there is a problem with the assumptions on which you have built your business model. The decision to pivot is a big one, and not something to be taken lightly. It requires you to take a hard look at your reallocation of resources, and to do it with an open mind.”
In Adam’s case, construction delays, councils taking their time to approve, or having to put money into rolling out sites as opposed to marketing, means the promotion of a new site will slow down, for example, because the business does not yet have a large marketing budget.
“When we run behind on the construction of a new site, R40 000 can suddenly become R100 000 — but here’s the thing: If a deal comes along that will probably harm your business in the short-term but enable significant long-term growth, sometimes you have to juggle what you have so you can make it work.”
The Lesson: Choose your investors carefully
Fine says he’s lucky to have a solid group of investors that he has cultivated over six years. “Their input is invaluable. They’ll say, ‘slow down’ or ‘have you thought of this?’, ‘have you factored in that?’ The ability to develop a good relationship with our investors has had a significant impact on the success of the company. Over and above money, they provide wisdom, guidance and connections.”
His relationship with his investors is key. While many entrepreneurs make it just about the money, Adam understood something else — he has a pretty cool brand with a great cause behind it. So, while investors are asked for money all the time, he was able to offer something more than just a business idea — alignment. He generated enthusiasm for the ‘why,’ behind the business. Like most of us, it makes investors happy to know that they are helping to make a positive difference.
And while it’s easy to bandy about the word ‘partnership’, Adam has worked hard to make that a reality. He set out to find like-minded people who are passionate about the business and the cause, which is why they are able to serve as great resources for advice and insight.
Related: Richard Branson’s ABCs Of Business
“The best way to ensure that you and your investors have a valuable and lengthy partnership is to make sure that everyone is aligned on the vision.”
This includes Adam’s team. The internal culture of an organisation is vital to its strength and growth. “Without our team we don’t have a business for investors to support — our people are critical to our success. They’re the executors of the vision at the end of the day.”
The Lesson: The value of strategic partnerships
Much of the growth of Fives Futbol has been fuelled by finding the right sponsorship partners in key industries. To overcome the challenge of a limited marketing budget, Adam has secured sponsorships with big brands like Adidas, Total Sports, Debonairs, and Klipdrift, allowing Fives Futbol to use their access to communities as a marketing platform to derive income as well as scale. And it works both ways.
“Because we have a national footprint and a team of people, we run activations for our partners, which also provides us with an ancillary revenue stream,” he says. “Knowing how to join forces with other businesses has been a key factor in making the business successful. Our strategic partners have enabled the business to leverage their brand to give us more exposure. When it works well, a strategic partnership can be just what you need to speed up the growth of your business.”
Watch List: 15 SA eCommerce Entrepreneurs Who Have Built Successful Online Businesses
The advent and advancement of the online marketplace has led these entrepreneurs to successfully build and grow their ecommerce empires.
South Africa’s ecommerce market is worth R10 billion per year. By 2021, the number of online shoppers is expected to have reached 24.79 million.
“Our recent research on SA shows people are browsing three hours or more on their mobile phones and 25% shop online. They trust local brands,” says Geraldine Mitchley, Visa senior director for digital solutions in sub-Sahara Africa.
These entrepreneurs have cashed in on ecommerce and launched successful online stores that have either established their dominance in the market, or are taking the e-tailing world by storm.
Here’s how these 15 ecommerce capitalists are making money using the Internet:
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