When multi-award winning US star, Drake, sang “started from the bottom now we’re here”, he must have had General Thembinkosi Mthembu in mind. He is the definition of starting from the bottom.
As we meet, he holds an Africa shaped trophy in hand. Just moments before, he gave a moving speech to a room full of Africa’s business leaders, receiving loud claps and adoration. He has just been named Industrialist of the Year at the the All Africa Business Leaders Awards (AABLA).
It is a long way from Umlazi, a township in KwaZulu-Natal (KZN), the province on the east coast of South Africa, where he was born. Growing up, life was tough. His father was an underpaid truck driver and his mother sold everything she could to supplement the income. It ushered in his first experience as an entrepreneur.
“I remember when I was going to school my mother would give me a packet of biscuits to sell during break time. I had no choice because my mother would say if you don’t sell there will be no money to buy your school uniform,” he says.
On weekends, he would sell fruit at the local railway station. Tough times at home meant after graduating high school, he went straight to work as a packer in a production line at Nampak Tissue where his father worked.
One day, while working the nightshift carrying heavy boxes of tissue, Mthembu broke down.
“The boxes of toilet rolls were very heavy. One of the managers found me crying. He asked me why, I then said to him for ‘how long am I going to do this?’ He said to me ‘if you want to stop doing this type of work, you need to go to university, then have office work’.”
It is advice he took seriously. Although there was no money to go to university, it changed his life.
He noticed that he was always home at 3PM when working the dayshift. He says he wondered what he was doing with his time from then until bedtime at about 9PM.
It ushered in out-of-the-box thinking.
He noticed the clinic next to his home had no food truck.
“I started doing research to know what people would like to eat when visiting the clinic. I went there Monday to Friday asking questions and compiling a list. From there, I had a business plan written by hand,” says Mthembu.
The next week, on his way to work, he went to a bank to apply for a loan to buy a caravan. It worked. Business boomed and he had an employee to help while he was working at Nampak Tissue.
When time came for him to evolve, he bought a pickup truck, installed seats and used it as a taxi. In just two years, he had saved enough to buy a minibus which he operated as a taxi.
He didn’t stop there. In 1995, while still working at Nampak, Mthembu bought a petrol station.
“I would count money in the morning before going to work, take stock from the tanks [and] if I have to place orders I will order the supervisor to phone Shell to deliver petrol and diesel. I remember it was very difficult because I never had an account with Shell. Every time I needed stock I had to pay cash before they delivered,” he says.
At the time, his dedication had earned him a promotion to plant manager at the Durban Nampak plant. But it didn’t last. The plant was running at a loss. Everybody was retrenched and Mthembu was asked to move and manage the Pretoria plant.
“I could not see myself living in Gauteng. I was born in KZN and I don’t believe if you want to succeed you must move to Gauteng because you can progress anywhere as long you work towards your goals.”
It meant he was also retrenched along with about 70 other employees.
“After two weeks, Nampak came back to me and said ‘what about you buying these machines, converting the same product and selling back to them?’”
It was a good opportunity but a hard decision to make.
Mthembu knew the business had been running at a loss of R6 million ($465,000) per year. He also knew that he understood the operations side of the business, which could yield better profits. Before making a decision, he got help from a finance person to make sense of the opportunity.
It took them two months of punching the numbers before he signed on the dotted line. It was the moment, 12 years ago, Mthembu Tissue Converting was born.
After 24 years, he was now an owner and not an employee. It wasn’t easy.
“I tried to recruit people I worked with from Nampak. Most people did not want to join me. They were saying working for a black person will mean they will not get paid. Eventually though I managed to get 36 people,” he says.
It wasn’t the end of the battle. Suppliers Nampak had used for years also didn’t want to work with Mthembu.
“They did not want to do anything with me when I took over the business. They said to me I must make upfront payments before they deliver raw materials, which was so difficult. I was worried that the business might collapse and how I would pay staff in that event.”
Mthembu says he had to be very strict. For three years he worked with no salary.
The worst period came in 2006 when the products they sent to Nampak in Cape Town failed the compliance test. He lost R280,000 ($21,700) as the tissues had to be sold as rejects.
“This was the worst period. To correct this, I had to implement [a standards] system in the plant to prevent it from happening again… The biggest lesson in my entire journey was to be focused and have systems in the business that work well and to always follow business goals.”
In 12 years, Mthembu Tissue Converting, once the Durban Nampak branch, has grown from employing 37 people to 104 people, from making 400 tons of tissue to 750 tons, and operating at a loss of $465,000 to turning over $18.6 million.
Mthembu, like Drake, sure knows how to start from the bottom.
Packing Light In School Bags
Former South African rugby star John Mametsa provides alternative energy solutions for the state. With his wife Tumi, he says their future in the business is bright.
In his prime, former Blue Bulls winger John Mametsa had rugby fans screaming in delight at his try-scoring exploits at Loftus Versfeld Stadium. Between 2001 to when he retired in 2010, he had brought smiles on people’s faces.
Hidden beneath the rugby bravura on display on a weekly basis were Mametsa’s entrepreneurial exploits, which led him to co-found Soltech, a solar technology company he started with his wife Tumi.
Soltech has bridged the gap between solar technology and user-friendly consumer products by creating school backpacks, outdoor umbrellas and lifestyle bags custom-fitted with solar power.
READ MORE | Bryan Habana Swaps Sweatpants For Suits
The smiles are back but Mametsa has brought them in a different form.
Soltech’s main aim is to help companies achieve their corporate social investment targets and make a real difference in the lives of school children who might not have electricity at home, or whose access to electricity is limited.
“Generally, I love giving back. Just to see the kids smile brings joy to me,” Mametsa says.
“It is the best space I could have asked for. Other than when I was involved in rugby, this is the best thing I could have ever been a part of.
Putting smiles on kids’ faces is the best thing. Because we are dealing with children, we have aligned ourselves with people that want to make a difference.
“We don’t stop at just giving them the bags where they can charge phones and study at night but we also educate them about the social ills that come with roaming on the internet and social media.”
During this period of Eskom blackouts, uncertainty about South Africa’s energy and a widening chasm between the haves and have-nots, he says Soltech’s products make a difference in the lives of ordinary citizens.
In a sense, they’ve taken the might of solar technology and put it right in people’s hands. The school bags come with a solar-powered battery, which has a night lamp and cellular phone battery charger installed.
“With everything that’s going on at Eskom now, they (citizens) are using millions of liters of diesel per month, just to keep the lights on,” Mametsa says.
“Hence, it’s coming back to hit our pockets and they (Eskom – South Africa’s national energy provider) are raising the electricity prices again. Such things we have to read about so that, as we grow, we educate the people that we are selling the bags to.
“At some point, you need to convert [to reusable energy sources], you need to start using solar energy. We are still fortunate that there’s an Eskom in the first place. What about those countries that don’t even have electricity at all?
“Yes, we have power cuts but the people that really need the bags are people in the rural areas.”
Admittedly, Mametsa was the pretty face and Tumi conceptualized the idea when they started. But their partnership was perfect in more ways than one. Tumi, just like her husband, had a massive entrepreneurial drive.
While Mametsa was playing rugby, he would dabble in taxi and printing businesses – an uncommon trait among sportsmen and sportswomen who are at the peak of their powers. Tumi was no different. As a student, she would sell hair and cosmetics products, something that sharpened her business senses.
READ MORE | John Smit leaves everything on the field
And despite a successful 11-year career in corporate as an accountant and financial manager for companies such as Alexander Forbes and the Film and Publication Board, Tumi took a bet on herself and dedicated her time fully to building Soltech.
The result was that, in just the company’s second year, they have signed a memorandum of understanding with Finland solar technology company Tespack. Tespack founders Caritta Seppä and Yesika Robles were last year named in Forbes ’s 30 Under 30 Europe.
The joint venture will see Soltech come out, among other things, with a solar-powered, fast-charging power bank, which should totally disrupt the smartphone accessories market.
“There’s going to be skills and knowledge transfer,” Tumi says.
“The DTI (Department of Trade and Industry) is also backing us on the partnership because we need them and their funding to assist us. We will be hiring South Africans to work the machinery, which was something that was very attractive to the DTI.
“The Tespack partnership confirmed my belief that our company could grow from a small tree to a forest someday. Once we manufacture in-house we can streamline the process. And there are so many other ideas for products I have, such as ladies’ handbags and stuff.”
Here at home, Soltech has partnered in CSI projects with Liberty and Exxaro and they hope to grow their client base in the next couple of years. It is a huge endorsement of their products and should see them salve some of the hurt from the country’s electricity crisis, especially to those who need it the most.
‘Worth Millions And Billions’
Terence Terenzo, the award-winning South African hairdresser and founder of hair salon group Terenzo Suites, on his biggest investment decisions and blunders.
What is your investment philosophy?
One of my philosophies is to really analyse ‘is this an investment or is it a money pit… Are you sure you got a good investment and not a liability?’… Over the last 10 years, I’ve tried to invest in things that don’t absorb all my time and energy.
So if someone were to say to me, ‘you can work your butt off seven days a week and we will give you a million rand a month, or you can take it super easy and do the absolute minimum but you can have R400,000 ($27,700) a month’, I would rather take the R400,000 because that would free me up so much more.
I would have time to do things that are important and other projects. So, for me, it is about setting up passive income businesses instead of creating businesses that need huge amounts of management.
What are some of the big investments you have made over the years?
Most of them were in property but this, Terenzo Suites, is one of the biggest investments I have ever made. It was many many millions. And then on the stock market, I’ve played around on the Johannesburg Stock Exchange where we have invested quite heavily. I would use it, then look at the market and sometimes pull the money out and move it. I have also invested in Naspers.
Have you had any regrets?
If any entrepreneur tells you that he hasn’t had that [an investment blunder], he is lying. So, what happened was I bought a property in 2008, just before the [recession]. I was stuck with it for years and even when I sold it, I sold it many years later at the same price I bought it.
I bought it in an absolute inflated stop end, and it was really at an all-time high and I had to sell it at an all-time low… But the main thing for me about those kind of things is that you learn from them and you must not beat yourself up for too long.
Try and see what you learned from them.
Why did you invest in the hair business?
I think the hair industry is going to explode in South Africa and the whole continent, if you just think of the possibilities of wigs, hair pieces, hair colors and relaxers. Millions of women before weren’t so worried about their hair but as the world has changed so much, all of them want to look amazing and they want to look current, fresh, sexy, and that is all a part of the hair industry.
What should you consider first before you invest in your hair?
I think the one thing is to have a professional conversation with someone instead of just doing your own thing and, usually, hairdressers are quite happy to consult with you without charging you before you make a serious investment in hair pieces or wigs.
How big do you think the hair industry is in Africa?
I think it is worth millions and billions… and I think it is an undiscovered industry that is still going to explode. I don’t think we have scratched the tip of the iceberg with this.
A Germ Of An idea
The microbiologist-turned-entrepreneur Babajide Ipaye started making good-looking shoes to fit his size 48 feet but decided to create them for others as well.
Selling shoes was probably the last thing Babajide Ipaye, a microbiology graduate, envisioned doing. But when by the age of 10, he was already wearing his father’s shoes, a size 44, he knew that some day that he would step in that world.
The only child of his parents, who passed away in a car accident when he was only 11, Ipaye was raised by his grandparents and extended family members who shaped the early years of his life.
“I had a lot of people who were trying to nurture me and they had different professions. So for example, one was an artist and I was endeared to him, another one was a medical doctor, so my granddad wanted me to study medicine and another uncle was a computer scientist, so I was kind of confused growing up. I wasn’t sure what I wanted to do, so I kind of lived the life of almost everyone that influenced me,” says Ipaye.
READ MORE | The Story Of The $3,000 Sneakers
That confusion helped Ipaye cut his teeth in various industries early on in his career. His medical doctor uncle influenced his career as a microbiologist where he worked with Ideas International Bio Technology Services, spending his days cleaning up oil spills and bacteria.
Then followed a stint in Information Technology (IT), a move also inspired by another uncle, where he worked with Tranter IT Infrastructure Services and Computer Warehouse as an analyst deploying managed technology services for multinationals like Guinness, Total and KPMG.
“At this point in time, IT was very hip and we happened to be one of the early pioneers in the tech space which was a very exciting time and considering where I was coming from in microbiology, it was a new field for me, I was working with multinationals and the exposure was amazing, it gave me a very broad sense of how organizations function.”
But Ipaye soon became dissatisfied with being put in a silo. There was too much structure and rigor due to the size of these multinationals and he became bogged down with a lot of systems and processes, which ultimately stifled his creative juices. His solution was to start his own IT company, Torque Technologies.
The company began providing IT equipment and technology services in its early days to multinationals before quickly creating a niche for itself in the fiber optics space. In early 2003 to 2005, the Nigerian telecoms era had just started booming and Ipaye and his partner saw a first-mover advantage in fiber optics by providing training to firms in Nigeria, which they did for the next 10 years.
By 2015, Ipaye decided he wanted a new challenge outside the IT world. After parting ways with his partner, he began to ponder about his life-long struggle with footwear.
“So I said to myself ‘why don’t I make my own shoes?’ So I went on the internet, did a bit of research and came across a school in the Netherlands called SLEM. I called them up and found out about the shoe-making course and I said since I was on holiday, why don’t I take some time off the business and explore how to make my own shoes and I went to the Netherlands.”
Keexs was born. The goal was to make shoes that fit Ipaye’s size 48 feet but also looked aesthetically pleasing. But making shoes for him alone would prove to be too costly.
Ipaye decided to make shoes for others as well. He would focus on the athleisure market, which is a portmanteau of ‘athletic’ and ‘leisure’, a market that has grown to the stage where it is no longer a trend but a mainstay in Nigerian fashion.
To stand out in the competitive footwear market, Ipaye decided to add some African elements to his innovative footwear brand and focused on outsourcing the production to a factory in the Netherlands while he focused on the product and design to save on cost.
The aim in the long run was to move production to Nigeria where he could fulfill the brand’s social mission of providing employment and skills training to unemployed youth. However, to make the business viable, he had to make a minimum of 1,000 pairs of shoes to achieve economies of scale. Next came the challenge of securing startup funding.
“From my previous experience of starting my technology business in Nigeria, I came to realize that the cost of funding in Nigeria is very high and also there are a lot of businesses chasing funding and the risk level of most potential investors in Nigeria is very conservative and they don’t want to invest in stuff they are not sure about.
“So I read about crowdfunding and consulted a company in the Netherlands and I came across a site called kick-starter which is a US-based platform that offers a global crowdfunding platform to innovative ideas and projects, hence we started the first innovative and social focused brand in Africa,” says Ipaye.
In just over two years Ipaye has managed to grow the business through leading e-commerce sites like Jumia and Konga as well as via its own website which receives orders from countries around the world. The shoes sell for anywhere from $40 to $60, with over 8,000 pairs of shoes sold till date.
Keexs has about 18 outlets in Nigeria with retail partners in Kenya, South Africa and Guadeloupe and Nairobi.
The company also sells through social media channels where they boast over 15,000 followers on Instagram. The long-term goal for Ipaye is to secure enough funding to set up a factory in Nigeria, which he is looking to raise through an amalgamation of funding sources including grants and loans.
“We realized very quickly that economies of scale is critical to drive the growth of this business therefore there is a need for a lot of capital. There are four sides to this chain; production, design, distribution and retail. The problem with a lot of businesses in Africa is that they are expected to do everything from start to finish along that entire value chain and what that does is, it stifles the growth of the business,” says Ipaye.
The big-time hit when CNN profiled Keexs on its African Voices show. Since then, they have managed to establish themselves as an innovative social brand focused on empowering unemployed youth in Nigeria. Next on the to-do list for Ipaye is establishing a production line in Nigeria, and then taking his brand global.
Investing In The Future: Tanzania’s Blueprint To Become A Middle Income Nation
How Google Is Using AI To Make Voice Recognition Work For People With Disabilities
World’s Highest-Paid Athletes 2019: What Messi, LeBron And Tiger Make
Beyoncé And Jay-Z’s Combined Billion-Dollar Fortune Makes Them One Of The Richest Self-Made Couples
Lionel Messi Claims Top Spot on Forbes’ 2019 List Of The World’s 100 Highest-Paid Athletes
Arts2 weeks ago
Artist, Icon, Billionaire: How Jay-Z Created His $1 Billion Fortune
Wealth2 weeks ago
How Rihanna Created A $600 Million Fortune—And Became The World’s Richest Female Musician
Opinion4 weeks ago
Why Now Is The Time To Invest In African E-commerce
Lists4 weeks ago
The World’s Most Reputable CEOs 2019
Featured3 weeks ago
Executive Protection: Big Bucks, Bullets And Bodyguards
Wealth2 weeks ago
The Big Bank Theory: South Africa’s Banks Of The Future
Woman3 weeks ago
Rallying Young Africa
Billionaires3 weeks ago
MacKenzie Bezos Will Donate Half Her Fortune To Charity