Bulls n Bears Entrepreneurship Zone :: African entrepreneurs reveal the toughest situations they’ve had to deal with

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1. Tumi Phake, founder and CEO, Zenzele Fitness Group



Zenzele Fitness Group is a South African gym management business which
operates fully-equipped health clubs for, and in partnership with, various
large companies and universities.

“The toughest situation was being able to source funding and meet my
deadline with a client to be able to open on the specific date. I remember
about a year ago, it was a very tough situation, because banks at the time
had a very slow turnaround time because of my lack of track record and lack
of proven concept. Sometimes it would take three to six months to source
funding – just back and forth of wanting additional information. The client
didn’t even know. From the client’s point of view, everything was perfect.

“How I mitigated it was I spoke to my suppliers who I was buying equipment
from, and they trusted me – so they actually delivered the goods before I
paid them because they trusted that I would be able to pay for the
equipment. On the day the stuff was delivered, I think the money was just
confirmed – I hadn’t physically paid my suppliers. But my suppliers went and
installed the equipment. And normally people wouldn’t do that. I actually
had no deposit, I had put zero deposit on the deal. But they still took the
risk to install the stuff – this was R2m (US$138,000) worth of equipment. I
think I paid them a week later.

“I think it is all about creating good relationships and people trusting
you, because you will find yourself in situations like that where you can’t
deliver things on time and people that trust you will back you up, they will
support you because they know at the end of the day you’ll stick to your
word. When you’re first starting up as a business, when people invest in the
business, they also invest in the person.”


2. Raphael Afaedor, CEO, Supermart.ng




Supermart.ng is an online retailer that allows users to shop from
supermarkets and retail outlets across Lagos, Nigeria.

“It’s difficult to talk about a particular group of experiences being the
toughest because every week comes with incredibly tough challenges. Many a
times, I wake up thinking this week is when it all ends – the week when I
will be unable to make payroll or some other important thing breaks. But I
learned that companies die when the entrepreneurs give up, not when the
entrepreneurs are executing. So I wake up and forge on and somehow things
sort themselves out.”


3. Trevor Gosling, CEO, Lulalend



Lulalend is a Cape Town-based online lending platform for small businesses.

“When I left investment banking to pursue entrepreneurship I made sure I
had a six-month runway in terms of personal cash flow to keep me going.
Little did I know that it would be 18 months before I would see my first pay
cheque from my startup. Those were some dark days but taught me to live
lean, which I encourage every entrepreneur to do.

“Don’t be afraid to eat dirt and get uncomfortable for a couple years
because the pain will all be worth it.”


4. Henri Nyakarundi, CEO, ARED



African Renewable Energy Distributor (ARED) is a hard-tech company based in
Rwanda and Uganda. It developed a business-in-a-box solar kiosk that offers
customers phone charging and airtime top-up services, wifi, an intranet with
free digital content and a Bluetooth printer. ARED leases the kiosks out
through a franchise model.

“The toughest thing for me was finding money to develop the technology.
That was extremely hard. It took a long, long time – it took me almost two
years to get that done. And because the technology was complex it was very
expensive.

“The way we overcame that, and the strategy we implemented, was
partnerships. Because to develop a technology you need grants mostly, you
can’t get a loan to develop a technology because it’s a long-term investment
– there’s no quick return. If you get a loan, they want their money
immediately. If you get a equity investor, it’s a little bit more complex,
because most investors now don’t want to invest in research and development.
They want to invest in an existing company that already has revenue.

“So, the only things we had left were grants and competitions. So those are
the two strategies we did. For competitions, we applied and we won, so far,
10 international competitions. The second strategy was finding grants.
Unfortunately, in Africa there are no grants. And what I mean by no grants,
there are no grants that are financed by African governments. One-hundred
percent of all the grants that exist on the continent are funded by European
or American governments or enterprises, or companies. So, unfortunately,
those organisations don’t give directly to African entrepreneurs. So we had
to partner with European organisations and NGOs, to channel some of that
funding for our research and development. So those are the two key
strategies we were able to implement to solve that problem.


5. Lexi Novitske, principal investment officer, Singularity Investments



Singularity invests in visionary entrepreneurs in technology-enabled,
early-stage companies in sub-Saharan Africa.

“When I first moved to Nigeria I faced tremendous disapproval and biases
from family and friends. My parents worried for my safety while my mentors
were concerned that my promising career in the investment world would shift
into charity work. While these anxieties were driven by genuine care and
unawareness about Nigeria, the lack of support behind my decision to
dedicate my career to growing African investments made the choice much
harder.

“Likewise, driving the launch and growth of Singularity Investments as a
young, female outsider has drawn its own judgment locally. I regularly
encounter questions like: Are you committed to long-term development or just
here to cash in? Will you ever understand the culture where your investee
companies are doing business? Are you strong enough to fight for your
investee companies against difficult regulatory environments and dominant
industry players?

“To be fair, I think all of these questions are completely reasonable, and
every day I believe I grow into being a much better leader who can tackle
these challenges head-on. I have kept a growth mindset, and constantly try
to challenge my own shortcomings by ensuring these bumps in the road are
lessons that make me a better partner to the companies I invest in.”


6. Bruce Dube, MD, Nine80 Digital



Nine80 Digital is a pan-African digital media publishing company. Its
presence includes South Africa, Botswana, Kenya, Nigeria and Zimbabwe.

“Being bankrupt and in debt was a tough phase of my entrepreneurial journey
that impacted many personal and professional relationships negatively.

“I overcame the challenge by adopting a more frugal approach with the
overall business model, [thereby] fostering a business that focused more on
giving value to consumers at lower costs by stripping down all the excess
that doesn’t speak to the core of the business and translate to revenue
growth.”


7. Deepa Dosaja, CEO, Deepa Dosaja



Deepa Dosaja is a Kenya-based fashion house that has dressed global stars,
including actress Lupita Nyong’o.

“There have been many…

“The one that comes to mind immediately occurred during the recent general
election period in Kenya. Many businesses were severely impacted by this,
including mine.

“We experienced a terrible downward spiral in sales from August to December
2017, with this came many challenges.

“I am proud we managed to retain all our staff – both sales and production
– and maintained our headcount.
While the lack of domestic sales hugely affected our bottom line, [we] were
supported by our foreign-based clientele.

“Obviously, the uncertainty during this period reiterated to me the
importance of continually forging strong bonds with clients and the
challenge of converting clients into long-term relationships once they have
left Kenya.”


8. Jason Njoku, CEO, iROKO



iROKO is a multimedia company that provides paid-for, on-demand Nollywood
content to audiences worldwide.

“In 2015, it was abundantly clear that we were ‘losing Africa’. By this I
mean that most of Africa could not stream and therefore watch iROKOtv
content because our customer base couldn’t afford or didn’t have access to
reliable broadband required to watch our content.

“So, as a company, we had aggregated an incredible and peerless catalogue
of Nollywood content – as well as producing our own original TV series and
movies – but the majority of our potential audience simply couldn’t access
it. No access means no subscriptions.

“While we started as a diaspora-focused platform, the goal was to grow our
audience aggressively in Africa, starting with Nigeria. So I had to take the
tough decision of switching off the streaming capability of iROKOtv and
rebuilding the product from scratch into a mobile-focused app that allowed
for downloads.

“This was time and resource intensive – we had to hire and train
international tech teams, go back to the drawing board in terms of product
design and UX, and we also caused some small confusion among our customers,
which led to a drop in numbers, at first.

“It was painful all round, in terms of redirecting resources for the new
app, time and energy spent on building and product-testing, and then the
difficulties of educating our audience about the app. The pain was
short-lived, however, as within a few months, we saw our Africa number soar
and mid-last year, we saw Nigeria become our number one subscriber base.”—
Howwemadeitinafrica 


How we made it in Africa asked some of the continent’s most dynamic
entrepreneurs to share the toughest situations they’ve found themselves in
as business owners, and how they overcame these challenges.

 

Invest Wisely!

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