Secrets to tech and online
start-up success
Serial entrepreneurs MICHAEL ZAHARIEV and JAMES GREY divulged some lessons
learnt on their rise to online business success...
African startups are experiencing
positive growth. There's been a year-
on-year increase of 51% in funding
for companies (US$195 million) with
159 startups securing capital on the
continent, according to a 2017 report
released by Disrupt Africa, the African
Tech Startups Funding Report.While the continent has seen positive
advances, locally in South Africa
there's still a reluctance to start our
own ventures. According to the Global
Entrepreneur 2017 Market Report,
only 2.5% of South Africans between
the ages of 16 - 65 established a new
business between 2016-2017.South Africa's "entrepreneurial unicorn"
Michael Zahariev says he can attest
to the difficulties of starting your own
business domestically, but also feels like
he's been able to prove conventional
thinking wrong, by starting B Online, an
online marketing agency, while studying
and establishing HiCarByeCar.com, a
third party car auction website, and a
few more, before the age of 26.James Grey comes from the vantage
point of vast having learnt countless
lessons on his journey as an
entrepreneur that started at the tender
age of sixteen. As an angel investor he
has a deep level of understanding of the
tech space, as well as the retail industry,
and has combined his strengths to
set up Laybycafe.co.za, together with
founding partners. This simplified
online platform makes it both easy
and cost-effective for the consumer to
navigate the layby process, which in a
period of six months since inception
was able to boast over two thousand
merchants and well over one hundred
thousand consumers.South Africa –
a different landscape
Arguably, no sector evolves and changes
as quickly as the tech sector, says
Zahariev. Often local entrepreneurs
latch onto the latest international
disruptive tech model and copy and
paste it into their own offering. These
tech entrepreneurs tend to forget that
the international companies they want
to emulate operate in a completely
different marketplace. Zahariev says that
M-Pesa is an example of what happens
when you don't take into account that
our marketplace is very different, even
between countries on our own continent.M-Pesa is an SMS money transfer system
that was launched in Kenya in 2007. It
quickly become a market leader as access
to smart devices was out of reach for the
majority of the population. However South
Africa is different story with nine in 10
South Africans owning a cellphone with
a third of them being smartphones. The
take-up was extremely slow. This problem
was then compounded when M-Pesa
partnered up with Nedbank, whose main
target demographic is middle-class to high-
income earners. This meant that the target
audience wasn't reached and the audience
who was reached wasn't interested in
using the service because they had access
to services that were easier for them
to use. This disconnect between the
service and target market meant that the
company did not see the growth they were
expecting. M-Pesa can survive because it
is a multinational. If you were just a startup
company and made the same mistake
you'd have to close shop.Copying and pasting an idea, and hoping it
works locally, is a recipe for failure. Make
sure that you've tailored your offeringTECHNOLOGYMichael ZaharievJames Grey