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Women Entrepreneur Successes

Xoliswa Daku of Daku Group’s Top Lessons For Growth To Inspire Yours

Xoliswa Daku believes in creating wealth through property developments. This principle has been her guiding star, helping her take an R18 million business to R100 million in under four years, while building a sustainable base of R800 million in assets under management. Her growth strategy has evolved thanks to intense and continuous personal development. These are her lessons in growth.

Nadine Todd

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Xoliswa Daku of Daku Group

Vital stats

  • Player: Xoliswa Daku
  • Company: Daku Group
  • Launched: 2003
  • Turnover: R100 million
  • What they do: Investment, infrastructure and property development
  • Visit: dakugroup.co.za

Xoliswa Daku completed her law degree knowing she would one day be an entrepreneur. At the time she thought she would eventually have her own law practice, instead of heading up a R100-million property development business, with R800 million in assets under management. These are her lessons for growth.

1. Do what you love

If there is such a thing as the first rule of successful business ownership, it’s this: Do what you love. True passion will not only see you through challenging times, but keep you focused on your ultimate goals as well.

Too many businesses water down their value propositions or get distracted chasing revenue, to the ultimate detriment of the company’s long-term growth strategies.

Xoliswa learnt this lesson the hard way, but has significantly grown her asset base and margins since realising her company was losing its way.

“I began my corporate career at a legal firm, and within a year was head-hunted and offered a position at Wesgro, the official tourism, trade & investment promotion agency for Cape Town and the Western Cape,” says Xoliswa.

Related: (Slideshow) Oprah Winfrey: The World’s Most Influential Woman

“Wesgro was full of economists, but they needed a legal person to assist with policy. The move introduced me to the worlds of business development and marketing, and it was then that I fell in love with the whole process of finding greenfield spaces and packaging an entire development deal, from the investors to other business partners.

“When I left the agency a few years later to join an entrepreneurial business that was in the incentives field, it wasn’t long before I gravitated back to this space. My love for it was the deciding factor, and it’s what has driven me, even when things got tough.”

As with many growing businesses, Xoliswa was so busy chasing growth that she lost her way. “When you start out, you’ll do anything to keep cash flowing into the business. I was consulting as well, and would tackle any needs a client had, from legal issues to BEE and marketing queries. The problem was that it diluted our brand. We had grown to a business with an R18 million turnover, and people were constantly asking me what it was that we actually did. I realised my entire business model was reactive, rather than proactive, and it was entirely my fault. I had no chance of growing a large business if we didn’t focus on our core areas.”

Xoliswa made the decision to offload some of the company’s products and focus. This is where passion played its role, because it helped her determine exactly where she wanted to focus Daku Group’s energies.

The lesson: High-growth organisations are proactive, not reactive. No business can be the master of everything. Choose your niche, focus on which opportunities give you the best margins and above all, ensure you’re following your passion. The more specialist a business, the more successful it tends to be.

2. Capitalise on your base

The most successful businesses (and business owners) are exceptionally good at developing a base and then growing it.

For example, Xoliswa launched the Daku Group when she was approached to join the development team for The One and Only Hotel as the project’s BEE partner and shareholder. The reason the team approached her was because of the reputation she had built at Wesgro. Because she came in while the deal was being structured, she was an active partner throughout the deal and development of the hotel.

“If you’re good at what you do, one partnership leads to another,” explains Xoliswa. “The more a market gets to know you and your reputation, the higher your chances of securing a deal. But you also can’t just sit back and expect work and contracts to flow your way. You have to take that solid reputation and make sure you’re getting noticed by the right people. And that takes planning.

“I started out helping other businesses to grow, and then put those lessons to good use in my own company. I also learnt as much as possible about my sector: The various players, the challenges my potential partners faced, and which opportunities worked and which didn’t.

“There’s so much out there, but you need to understand the landscape and what you have to offer before you can approach potential partners and pitch for deals. No one will come find you and offer an amazing opportunity — you have to go out and find it, and prove that you’re the best fit for the deal. To do that, you need a strong base, and that’s built on knowledge, experience, and successful projects that cement your reputation in the market.”

The lesson: If you’re planning for long-term success, approach every pitch, deal and even research strategically. You need to become the expert in your field; your future partners should benefit from working with you, and you need to be able to prove this.

3. Under-promise and over-deliver

Understand your company’s capabilities, and work within them to ensure you over-deliver, rather than over-promise and then let your clients down.

“We were very strategic about the sites we pitched for within the Prasa tender,” explains Xoliswa. The Prasa deal is everything Xoliswa loves: A greenfield infrastructure development project that called for local developers to pitch their ideas around what could be done with the land around Prasa’s interchanges.

“Prasa published an expression of interest. I always pay attention to what’s happening in the space, looking for development opportunities. Once you find out about a project, you then need to market yourself, and think strategically about what the client needs for the entire project to be a success.

“These pitches are at your own expense, so you want to ensure you’re aligning yourself with their needs — otherwise it’s an expensive act in futility that just wastes everyone’s time. When I was at Wesgro, I was mentored by an economist who was nearing retirement. He was extremely knowledgeable and insightful about what makes certain projects a success, and others a failure. For example, he thought Century City in Cape Town wouldn’t work, because the project didn’t include a transport interchange, or residential and office space. He was right. The original developers sold the project and it’s being reworked.

“This gave me great insight into what Prasa needed to successfully launch a national transport interchange. Whilst Prasa presented various opportunities to developers on an open tender system, I opted for three sites and those were awarded to me. I assessed and recognised that I couldn’t do more than that. I believe it’s important to avoid taking on more than you can chew, even at tender stage. It was important to me that the entire project was a success.

“If I’d pitched for more than three sites, I would have been spreading myself too thin, and I knew it. Remember, all the risk areas of the project belong to you as the developer. You’re bringing three things together: The site, resources and capital. But ultimately the risk is yours — the rewards too — but successful projects are completed because the risks have been mitigated.”

This isn’t to say Xoliswa has any interest in being a small business. She’s always aimed high, and wants to move through Africa and beyond. But she’s building careful foundations to ensure a sustainable business that can handle growth and build on it.

The lesson: It’s always good to aim high. Most entrepreneurs have the mantra that they’ll say yes first and then figure out how to do it. In this way, great things are achieved. But you also have to be realistic. Plan for success, ensure you have all the components in place, and then deliver — but don’t over-promise. If you know you have certain limitations, work within them and deliver an exceptional product, rather than over-extending yourself and only achieving a mediocre result.

Related: Celebrating The Multi-Faceted Woman

4. Learning is the gateway to growth

In 2010, Xoliswa enrolled in an Executive MBA at UCT’s Graduate School of Business. When she entered the programme, Daku Group’s turnover was R18 million. By 2014 it was R100 million. During the two-year programme her company’s turnover dipped. This was expected. Running a company while completing an MBA is no easy task, and there were gaps in the business while she focused on her personal and business development.

It had been a strategic decision — some short-term pain and losses for long-term gain.

“My business was seven years old, and I recognised that something was holding us back. We were experiencing growth challenges, and I wasn’t finding a way to move us forward. We had some incredible projects under our belt, but we had hit a ceiling.”

Xoliswa took stock of what she was facing. “First, I was playing across a lot of spaces: Investment and trade, the legal field, women empowerment, and I was struggling to find mentors. People were coming to me to mentor them. That’s flattering, and I want to give back, but mentors have always been critical for me. I felt that my personal development had stalled.”

Studying further seemed to be the only solution. Xoliswa had already completed her law degree, a certificate programme in Economics, the Management Development Programme (MAP) at Stellenbosch University, and a project management course through Cranfield University. An MBA was the next logical step.

“As a lawyer who structured deals, I understood that growth comes from following a clear path. I’d worked on a lot of different elements and now needed to pull those loose threads together. I believed the tools an MBA would give me would help me do that.

“It’s a tough choice. It’s hard work, and you’re spending hours away from your business. I saw the impact of that first hand. Our turnover dropped. But, without the tools and lessons the MBA gave me, I wouldn’t have reached the next level. My growth had stalled. I’d been working on my expertise, my name and reputation. Now I needed to get the right foundations and systems into place for the business.”

The lesson: Great business leaders never stop focusing on their own personal development. The more you learn — particularly across disciplines — the more you’ll achieve. Business courses, business books, podcasts, mentors and associations are just some of the ways you can hone your skills and learn from your peers.

5. It’s all about the balance sheet

One of the biggest lessons Xoliswa has learnt along her journey is that in many respects, a high turnover is just vanity.

“For a long time we were chasing cash, and it led to far too much diversification in the business. For example, I launched a construction company so that we could build our own developments. The result was two-fold. We diluted ourselves too much, instead of staying niche and focused, and we increased our risk exponentially.

“It’s great to say you’re developing a project worth more that R200 million, but your exposure is R7 million. In those terms, it’s not as valuable. Instead, we made the decision in 2014 to partner with experts, shorten our turnaround time for implementation, focus on maximum returns instead of turnover, and to build our assets under management.

“As a result of this shift in strategy — which is designed to build real wealth — our turnover hasn’t grown since 2014, but we’ve grown our assets under management to R800 million, and we’ve increased our margins. The business is in a much healthier space.”

The lesson: Understand your strategy, and what you’re trying to achieve. A high turnover is meaningless if you’ve got poor cash reserves and limited assets. On the other hand, higher margins can be far more valuable than a high turnover. At the end of the day, it’s all about the balance sheet.

Related: Hold the Testosterone: Must a Woman Behave Like a Man to Succeed?


Lessons from an MBA

MBA

An MBA is a large investment, from both a monetary and time perspective. Given the hours of sleep she was losing, Xoliswa was determined to make the most of her Executive MBA through GSB, and to implement what she was learning in her business.

“The reality is that you can be the darling of your industry, with an exceptional reputation, and a decent business — but then the realities of growth set in. Cash flow is a problem, management issues, client issues. These happen to all growing businesses. The question is, what are you going to do about them?” Here are the key gaps Xoliswa identified for her own business.

1. What’s my unique selling point?

I realised that I’d become a jack of all trades within my industry. Daku Group had no clear selling proposition. In fact, we were often asked what it was exactly that we did. You can’t be the go-to player in your industry if no-one is sure precisely what you do. We needed to pare down what we offered, and be more focused and niche. It’s scary at first, but we’ve built a far more robust business by not taking on anything and everything that comes our way.

2. Delegate

I realised I had a disjointed team, with no clear leadership when I wasn’t around. No business owner can be everywhere at once. I needed a senior management team who was on the ground and could build a competent, efficient team. I was outsourcing too much as well, instead of bringing in specialist talent. I realised that I was boxing the business, but not the people. First you need a great team, and then you can build the right financial systems.

3. Understand your strengths

I have no interest in the small stuff. My focus is on creating long-term opportunities through analysis, and providing the right opportunities to investors in synergistic environments. The problem was that even though I don’t like the small stuff, I wasn’t employing people who excel at the finer details. This affected my capital.

As a business owner, your drive, work ethic and independent approach and offering are so important. But you also need to let go. Your teams are the best tools you have to grow your business, but only if you give them the opportunity and space to thrive. Understand what you bring to the business and where the gaps lie, and then find the best people to fill those gaps.

key-business-insights-for-daku-group

Women Entrepreneur Successes

Erna Basson Of Erabella Hair Extensions On Acting The Part And Finding The Gap

Erna Basson says that building your own empire is one of the toughest things you can do, but also one of the most rewarding. She unpacks the lessons she has learnt that have helped her launch and grow three businesses into sustainable brands.

Monique Verduyn

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erna-basson

Vital Stats

  • Player: Erna Basson
  • Company: Erabella Hair Extensions
  • Est: 2017
  • Visit: www.erabellahairextensions.com
  • Career highlights:
    • Named South Africa’s top entrepreneur under 30 for 2017
    • Global female entrepreneur of the year 2017
    • Top 100 most influential young South Africans 2017
    • Interviewing Grant Cardone — 2018
    • Opening speaker at the Mega Success event 2017 in Los Angeles.

Originally from Bloemfontein, Erna Basson has always been highly competitive. She completed a four-year bachelor’s degree in three years, while holding down several part-time jobs. She was first bitten by the entrepreneurial bug in her second year at UFS (University of the Free State). Her class was struggling with business law, so she read the text book and produced an annotated summary that she then sold to desperate students.

Today, she heads up Erna Basson Ltd, a business coaching and speaking venture; Woman Entrepreneur, a global platform empowering and educating female entrepreneurs from around the world on how they can start and scale their businesses; and Erabella Beauty Global, a premium hair extensions brand available in South Africa and globally.

On acting the part

“I was a cheerleader for the Cheetahs while I studied, and I also worked as a hostess at Cubaña,” she says. “I got the opportunity to do tons of promotions for liquor brands and that experience taught me how important it is to always be on point and professional, as the event sponsors could pitch up at any time to check on what was happening.”

Related: How To Start A Salon And Spa Business

After moving to Port Elizabeth with her now husband, Nellis Basson (who is also an entrepreneur), she started working for Gestetner and was out on a sales call at Distell when she heard the regional manager complaining about bad service from an events company. “I said to him, ‘if I can have a company up and running within 30 days, will you make use of my services?’ and he said ‘yes’. I walked into the company as an employee and walked out of the company with a new life and opportunity, and this has taught me a valuable lesson that I still follow every day. Take advantage of every opportunity, even if it scares you. You need to be out of your comfort zone to grow.”

That was one of the first principles she learnt, and which she speaks about to her global audiences.

“The bigger the problem you are solving for people, the more valuable you are to them, and the more money you will make.”

People are always searching for solutions. They will always look for better, faster and smarter ways to accomplish tasks. Erna knew that to grab her customer’s attention, she had to start by solving their problems. “If you can take a person from point A to point B, by identifying their crucial problem and then offering to solve it, you will be able to create a real business that matters.”

Another important thing happened that day. She went back to her boss and immediately told him what had transpired. “Honesty, loyalty and integrity have always been the three key pillars of my business, starting from then, and it paid off — Gestetner became a client soon after.”

She started the promotions business with no staff and she didn’t know anyone in Port Elizabeth. “I called up a friend of one of my husband’s friends and asked her to give me ten phone numbers, and then I asked each one of those women to give me another ten. I sold my Citi Golf so that I could have a small start-up fund, and then the business just took off. We got clients like SAB, MTN, Sony, Mango, Maybelline and L’Oréal. I was earning R450 000 for ten days’ work at the age of 23.”

She soon had seven permanent employees, and more than 500 promoters working on campaigns across the country. “Within a couple of years, I had created systems and processes, which enabled the company to reach its goals and function independently without having me in the business, making it a perfect opportunity to sell and move on to the next challenge.”

Finding the gap in the market

It was just before Erna got married that she came up with an idea for another venture — while she was looking for venues, dresses and décor ideas. “I kept on wishing there was one place where I could find everything related to weddings, and then I thought why don’t I create one?” That was how website and magazine Majestic Weddings was born, an online directory and monthly magazine. After growing it into a successful wedding planning tool, she sold that company in April 2017, through an international business broker, and used the profits to launch her hair extension company Erabella.

Transitioning from services to products

erna-basson-grant-cardone

Erna had never run a product-based business before, but there’s a first time for everything, right? Problem is, product businesses are extremely hard to build and get traction for. They require upfront capital and investment, as well as a whole lot of excitement. Erna certainly had the latter, believing that every woman has the right to have gorgeous thick hair.

But there were some challenges:

  • The output of a service-based company is intangible, but a product-based business sells goods that customers can see and touch.
  • A services company does not have to keep goods in stock or maintain an inventory. The service is created or sold as and when the customer
  • needs it.
  • Service-based companies do not have to put up capital — they provide a service and the customer pays for it.
  • In the service industry, you have maximum control — when it comes to a product based company, you sometimes don’t have control over certain things (like a late courier, or late imports, or increase of exchange rate) but it serves as a great opportunity to apply more systems and processes to lower the risk.

“I had to buy stock for the first time. Different lengths of hair extensions, and different colours. Suddenly, I had invested more than R1 million, just like that. What’s more, in South Africa, there is a 20% import duty, which immediately raises the price of your product, making it more difficult to compete globally.”

Related: Want To Start An Import Business – Here Are The Importing Terms And Documents Involved

There was another problem too. Erna had decided that Erabella would be an online business, but it didn’t grow as fast as she wanted it to and she quickly had to change the business model. “That’s when I realised that you cannot take business personally. The minute you invest emotionally, you will make mistakes. When something is not working, you need to take immediate action and make the necessary changes. Nearly every successful company since the beginning of time has had to change strategy and direction to survive and grow.”

Reverse engineering

She also learnt about the importance of starting with the end in mind.

“If you want to make $1 million, write that figure down and reverse engineer. If my hair extensions are priced at $250, I will need to sell 4 000 sets per year, which means 11 sets a day. Instead of being dumbstruck by that big figure, I’ve now got something manageable to work with. It’s that old story about how to eat an elephant.”

Two can be better than one

Another key lesson Erna learnt was that you can do anything, but you can’t do everything. “When I started Erabella, I had one staff member in Johannesburg, and lots of competition. I had to do everything, from accounts, social media, business development and so on, but now we have an entire team in each department. The business grew too slowly and I realised that doing it alone was not going to work. I found a business partner in Cape Town, Karel Vermeulen — a very successful businessman who owns a personal care brand — and I knew we would be a great fit. I knew I could trust him with Erabella SA because he was invested, and I moved on to growing Erabella New Zealand and Australia.”

As a result of the partnership, the business is soaring. Today, Erabella hair extensions are available in South Africa, Namibia, Australia, New Zealand, Hong Kong and Dubai, with Canada next on the list.

That personal investment principle is one that Erna has applied in her coaching business. People do not appreciate what comes free, she says. “If I coach you at no cost, chances are you will say the programme did not work. But if I charge $6 000 a day, I can guarantee that you will do the work required to make it a success, because you have skin in the game. You will value and appreciate the process.”

Related: The Glamorous and Sleek GHD Offices


Erna’s key principles

  1. In the words of Grant Cardone, author of The 10X Rule, follow up, follow up and follow up: ‘90% of business lies in the follow up’. “I always do, and believe that you should follow up so much that they tell you to go away, and then follow up again two weeks later. I chased a client in Cape Town for two years. When their promotions vendor let them down, I was top of mind and I got the deal.”
  2. Never focus on the 10% that’s negative; focus on the 90% that’s positive: “We all need to have bad days in order to appreciate the good ones. When a client says no, see it as a new opportunity (take the negative from the word no, and turn it into a positive new opportunity) to recreate your strategy.”
  3. When people say no, ask them why not: “If I don’t close a deal, I ask, ‘What is the reason we did not do business today? Objections are only complaints — find a solution, and you will win all the time.”
  4. Don’t ask how: “Focus on the what and the who. What do I need to do to achieve my objective and who do I need to speak to? The ‘how’ will take care of itself.”
  5. You are 100% responsible for your business: “Don’t blame the economy, the government or your staff. If you are not successful, it’s your fault.”

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Women Entrepreneur Successes

Alphabet Soup Founder Nikki Lewin Discusses How They Compete With The Big Boys

Advertising doyenne Nikki Lewin reveals the importance of personal brands, living your values and finding your niche in the market.

Nadine Todd

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nikki-lewin

Vital Stats

  • Player: Nikki Lewin
  • Company: Alphabet Soup
  • Awards (2017): MOST Awards Winner of Traditional Specialist Media Agency; MOST Awards Runner-up for Media Agency of the Year; the Adfocus Media Agency of the Year Finalist
  • Media Billings: R100 million annually
  • Launched: 2000
  • Visit: www.alphabetsoup.co.za

Why did you choose entrepreneurship over a corporate leadership position?

The decision to start my own business was part of my DNA. In 1999 I was offered two media director positions of multinational agencies. I knew I wanted to make a difference and be in control of my own destiny, and that meant launching my own business instead of joining another big multinational.

It basically boils down to a couple of key factors — your appetite for risk, self-belief and knowing why you would walk away from the safety net of a guaranteed income and a defined job spec.

How are you competing against those same big multi-nationals?

When I launched Alphabet Soup I believed there was a market need for specific boutique offerings. I’d been in contact with numerous clients who wanted to work with uniquely South African companies and keep things local.

Related: Watch List: 50 Top SA Black Entrepreneurs To Watch

The more market research I did and the more I tapped into my network, the stronger I became of this conviction. It’s important to do that legwork before you start anything, and my experience in the industry gave me the insights I needed to be confident in my decision.

That same research revealed that we needed to offer our clients a complete, 360-degree solution, and so we created an agency that covers all aspects of advertising media — from strategy, planning and media owner negotiations, to market analysis, below-the-line, promotions, sponsorships and digital media. We also have clients that need media placements throughout Africa, and have since branched into that field as well.

This broad focus, our independent positioning, and the accolades we have received over the years allow us to be competitive, even though we are relatively small in comparison to many of our competitors. You don’t have to be big to be the best. You just have to punch above your weight.

We don’t aim to be the biggest agency, just an agency that delivers intelligent and professional media solutions. We do this by ensuring we are completely up-to-date with the latest strategic thinking in our industry, and we invest in staff training. It’s up to us to be able to educate, inform and guide our clients through key media knowledge.

How important are awards?

The topic of awards centres around whether they add real value to the business or not. In some cases you are nominated, in others you need to choose to enter. It takes time and effort to enter awards programmes, so there needs to be a strong business case for doing so.

We’ve found that the whole process — particularly winning — builds the agency’s reputation and is good for staff morale. For me however, it’s just one component of the journey.

Client longevity is critical and becoming an intricate part of their business is more advantageous to the agency’s success than any award. That said, awards do lend credibility to your brand if a client hasn’t worked with you before, but referrals and word-of-mouth will ultimately lead to business.

The MOST awards are about peer recognition. How important is this and why?

alphabet-soup-nikki-lewin

I have always set high standards, both personally and for my staff, and the same applies to media-owner interactions with clients. Our relationships with our media partners are based on integrity, respect and a mutually-beneficial relationship that relies on a cerebral output in order for our clients to have successful campaigns.

We have placed in the top three for the past ten years at the MOST Awards, and it was obviously great to win in 2017, but awards should never let you rest on your laurels. You can’t take past successes for granted. We need to continue to focus on building key relationships in all aspects of media.

Related: Watch List: 50 Black African Women Entrepreneurs To Watch

How important is a personal brand in building your own business?

My personal brand and business brand are essentially the same. I try and live to the values that are key to me and those that I try and teach my children. The values of respect, honesty, trust and integrity are paramount in my personal life as well as within my business. No matter where you are or what you do, people are always going to form an opinion about you.

My view is that you need to make sure it counts. Stand up for what you believe in, live with passion and make sure you have educated and informed opinions. It’s important that people know where they stand with you and I generally am pretty forthright in my opinions.

How do you separate yourself from the business brand, so that clients want to work with the business, and not just you?

After 18 years in the market, Alphabet Soup has become a brand in its own right, no longer ‘Nikki Lewin’s agency’. I’m just one part of it. I have a supportive team and we have earned our reputation with clients. I’m still always available to clients though, and I’m intricately involved in every aspect of the business. To be successful you need to have your finger on the pulse of your business.

I have always believed in keeping my work life and personal life separate in order to try and achieve a balance. Of course, this is not easy with two young children. Fortunately, my husband was in the advertising business early in his career and is incredibly supportive, while running his own retail and travel business.

Related: Funding And Financial Assistance For SA Women Entrepreneurs

Is it important to build a reputation in the industry before launching your own business?

I believe your reputation starts with your first day on the job and every interaction you have thereafter. It’s up to you how you manage that reputation. Respect is earned and if you are passionate about what you do and what you believe in, that transpires into your own DNA. If you’ve built a strong reputation, this will obviously give any new venture you embark on added credibility, but you can build your reputation as a start-up as well. You just need to be consistent and hold true to your values.

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Women Entrepreneur Successes

Watch List: 50 Black African Women Entrepreneurs To Watch

These female entrepreneurs are breaking barriers, transforming industries and inspiring change on the continent.

Diana Albertyn

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