In KZN, over the few years, entrepreneurs have been tested like never before through the Covid crisis as well as looting that massacred their businesses.
Three Durban entrepreneurs that are part of the peer-to-peer Entrepreneur’s Organisation (EO) recount their experiences, and how being part of a support network was invaluable in their ability to bounce back.
Bradley Porter: formerly of Flexible Workspace and now Connect Space
Bradley Porter of specialist property management company, Connect Space, was tripped up by both the Covid pandemic and an ill-judged decision to expand the business when the commercial property market was already in a bad space.
He explains what happened: “At its peak, Flexible Workspace had 20 full-time employees, supported several partner businesses, managing six centres, split over two regions and totalling over 8000m2. What we didn’t realise was the long-term impact of the Gautrain on the Sandton property market. To recover the massive investment in this project, the city of Joburg increased the bulk allowance to boost its rates base. The result was that the market became a game of musical chairs with big law firms and other head offices moving out of their old stale spaces into flashy new ones. With no new entrants into this market, the vacancies remained high. Couple this with the increasing popularity of serviced offices which meant that brokers and opportunists were fueling a market that could never be sustained. The result was an oversupply of stock and dwindling demand.”
A failed turnaround strategy and unsuccessful business rescue attempt left them facing voluntary liquidation.
“Feeling like our world had just come to an end, we began navigating our way through the liquidation. At the time I envisaged locks on doors, ruined lives, re-possessed equipment, the sheriff at my home, rejection, and alienation. As it happened this was not the case, what we witnessed was love, compassion and support,” he says. They found creditors who were prepared to engage, supportive customers and motivated staff.
“This drove us to find a way out, but we had to get the support of the liquidators. Having presented our case to them, they agreed to indulge in a ‘holding pattern’. In other words, we could continue trading under their administration until we were in a position to wean ourselves. In essence, the old business was dead, but they were giving us the opportunity to birth a new one,” he says.
This was January 2021. His previous business partner took charge of the Jo’burg businesses, leaving him two in Durban.
He says that the COVID landscape has created a unique set of circumstances where the skills he had honed operating in the short-term and small office rental market over the past 15 years were perfect to support landlords.
“Today, we’re a start-up, a new brand and a new business but 100 times more prepared than before. The market has changed and so have we. We’re developing a new model, one that suits the future of space and services and one that will better benefit the user. Our immediate goal is to build the brand and dominate the market with a range of products more suited to the agile, work-from-anywhere workforce.”
He says that, throughout this change of season, their network provided him with a safe space and support base while he was “figuring things out”.
Saskia Hill, owner of MCS Debt Recovery and founder of Connect BPS
Hill’s business was completely destroyed during the July 2021 unrest in KZN.
“How do you react when you are told that your entire business has been burnt down? Not through negligence, but by political unrest, something which is totally out of your control? This is something that you never expect to happen. It was an emotional, stressful time,” she recalls.
MCS Debt Recovery counts American based banks, financial service providers, insurance companies and retailers as clients. It was these clients, together with staff, suppliers and her network of business associates who helped her begin to rebuild her business and, quite literally ‘rise from the ashes’.
“Every challenge you face in business allows you to build resilience and endurance which ultimately makes you stronger. When tragedy struck with the burning of the MCS/Connect building, I had to tap into that resilience to move forward. My inner strength and courage was supported by an amazing group of people.
“It is during these challenging times that you call upon the relationships in which you have invested through the years – your family, friends, industry associates, mentors and business supporters. This includes our “EO tribe”! Members from around the world reached out to me to offer assistance. The members were there to encourage, support and motivate me through the journey of rebuilding,” she says. “When people share their similar experiences, it is a hugely beneficial way to share information and guidance. It’s great to have members to bounce questions off who are often having sleepless nights about the same issues which I am having. The quote which is most apt at this time is ‘I didn’t come this far, to only come this far.’
One year later, the building is still not rebuilt. However, she has been able to re-establish her business and continue her entrepreneurial journey despite the turbulent economic times in which she finds herself.
“As entrepreneurs, we need to have a good understanding of the operations from the shop floor to the disaster recovery procedures (and this cannot be a mere tick-box exercise). It is imperative that you understand all the processes in your business so that, at the moment when you need to rebuild from the ground up, you are aware of all the factors/challenges that need to be overcome,” concludes Hill.
Matthew Fitzsimons: founder BigEye Branding Africa
12 months ago, Fitzsimons and his twin brother and partner realised that, even if their top income projections materialised, they would not get through the prolonged Covid-19 crisis. His now Ireland-based partner had lost his usual optimism and positivity in the wake of a complete fall off in orders and the shrinkage of the marketing sector across the continent.
“Most events in Africa had been cancelled. We have supplied equipment to mainly big breweries and soft drinks companies in 47 countries in Africa – and suddenly none of them was having events. The orders had dried up,” he recalls.
Perhaps the most positive thing to emerge from lockdown, which forced staff to work from home, was that the whole business began operating off the cloud. “We realised that there’s no-one that couldn’t operate from home other than our few warehouse guys. We got rid of our servers and moved all our systems into the cloud. We challenged every single system that we had.”
They also cut costs to the bone. “We looked at every single cost. Is it critical? …. If not it must go? It was an opportunity to cut everything to the minimum. Our staff all agreed to cut their salaries. The one thing in which we didn’t stop investing was our staff culture. We still ate together once a week. In fact, a great way to get staff back to the office was to create an environment that they wanted to come back to. This experience made our company culture stronger than it has ever been in 18 years. Tough times brought out the best in us,” he says.
Another thing that emerged from this crisis was an appreciation for strong relationships with suppliers who are the cornerstone of a business. We had to turn to them in a time of need and they were all there for us!
A turning point came with a decision to merge the business with another operator in the market – a move that added a third partner with valuable financial and analytical skills that the company did not have at that point. As a result, he says, as a combined pan African marketing company, they intend to lead the game in their industry going forward.
Cindy Norcott, marketing chair for EO, comments: “These three fellow EO members have demonstrated an inspirational ability to turn adversity into opportunity during recent tough times. Having a sense of optimism, self-belief and courage despite the odds are important characteristics to have for entrepreneurs considering starting their own business in the unpredictable and volatile South African economic landscape.”
