When youth, guts and dreams collide
The youth bulge. The unemployment divide. These challenges have to be overcome to stimulate South Africa’s economy and break down poverty and inequality.
According to research from the University of Cape Town, 61% of those surveyed thought that starting their own business was too much work for too little money and would consider it only if they were not able to find employment elsewhere.
The latest Global Entrepreneur-ship Monitor (GEM) showed South Africa’s Total Early-Stage Entre-pre-neurial Activity (TEA) rate is 10.6% which is almost 7% lower than Brazil’s. Does this mean young South Africans aren’t interested in being their own boss? The answer isn’t simple.
The GEM report doesn’t highlight that the TEA number has risen -significantly over the past 12 years and that it is above the median of all other participating countries.
“South Africa’s economy has grown at an average rate of 3.3% per year over the past two decades, but this has not been fast enough to alleviate the high rates of unemployment,” says Dr Mike Herrington, executive director of GEM international operations and co-author of the GEM South African report.
The youth population of South Africa places significant focus on the need for employment opportunities and with an impending recession and tightening belts across a globally weak economy, these jobs are not easily found.
Statistics South Africa’s Quarterly Labour Force Survey 2013 put the unemployment rate at 36.7% of the labour force, with six million unemployed graduates.
Has this inspired young people to walk past the unemployment queues and straight into their own businesses?
“I don’t believe it’s the market, but rather more of a culture shift that’s the main driver,” says Allon Raiz, chief executive of Raizcorp, the -company that runs BizCamp, a youth entrepreneurial programme de-signed to teach the youth about the realities of entrepreneurship.
“Starting your own business is now seen as an option and kids feel that they can do this. We need to nurture this shift in the hope that it will enhance entrepreneurial activity in the youth of South Africa.”
Turning dreams into reality
Two trends become apparent when speaking to the experts: young entre—pre-neurs need to find a mentor and they need to be prepared for a lot more than just hard work.
The University of Stellenbosch Business School (USB) started the Small Business Academy that offers sponsored business programmes for entrepreneurs in the townships of Khayelitsha, Langa and Mitchell’s Plain. “The SBA programme has enriched small business owners by giving them the knowledge and practical tools they need to approach their business decisions,” says Edith Kennedy, USB’s stakeholder relations manager.
“What has become apparent is the need to help people accurately -identify the real reason for any setbacks they may be experiencing.”
Avi Lasarow, founder of DNAFit says: “Nothing replaces a good -mentor and young entrepreneurs should find a single person with experience they should meet once a month and use as a sounding board.”
When 26 year-old Jabu Mmela left law school he started a pop-up -barber shop. It has evolved from a simple operation into a successful business thanks to his commitment and sponsorship by Philips.
“I started shaving heads when I was 12 with my grandfather; so I had a lot of experience. Then it just grew from there because people came to my house and word of mouth spread and now we are a success.
“Courage doesn’t know age and you need to look within yourself and when you dream it is just you who can make this happen,” says Mmela. “We work under a tree and Philips gave us a gazebo and tools and this has helped us so much.”
Sifiso Dlamini (26) turned his sneaker-making hobby into a business and partnered with friends Nkululeko Ndlovu and Prince Nkonyane to create Eish Hade, which started out in a back room in Orlando, Soweto.
These three young shoemakers were discovered by the Zinto Market-ing Group and now design and create custom, branded shoes for corporates like MTN and Sasol. Dlamini also emphasises the importance of having the commitment and courage to make it work, and highlights one of the biggest issues facing young entrepreneurs today — their age.
“I have been underestimated a great deal and have overcome my frustration by associating myself with people who are in the same boat,” he says. “I would recommend that aspiring entrepreneurs look to an advisor who they can trust and who can help guide them and mentor them.”
He also points out that partnering with friends needs careful management and that anyone considering this must ensure that their potential partners have the same work ethics and goals as they do.
Stacey Brewer, co-founder of SPARK Schools, agrees: “I would recommend that you work with someone who complements your skill set and an open, honest relationship is required to ensure a successful partnership.”
This is just one of many issues that the young business person has to address and often they are not prepared. Alon Joseph is the founder and director of the Future CEO courses that teach young entrepreneurs and high school students about starting their own businesses and he has found that there are two things that they tend to forget or not be aware of: that failure is a part of growth and that you need to start small to grow big.
“It takes about 10 years to become an ‘overnight success’ and young entrepreneurs need to know what their strengths and abilities are and have confidence in their products,” he adds.
Serial entrepreneurs Gil Oved and Ran Neu-Ner, co-founders of The Creative Counsel, both failed in their first joint venture and believe that it was this failure that led to their success today.
“The first rule of entrepreneurship is that there are no rules,” says Oved and Neu-Ner. “We realised that while our start-up had failed, our partnership was strong and we stumbled into this industry.
“You need to accept that there are lots of pitfalls and nothing is off -limits and that you will fail. Entrepreneurship is about doing things that have never been done before, so failure should be viewed as an obvious ingredient. The -challenge is not avoiding failure, but managing it. That said, there needs to be more support for young -entrepreneurs with mentorships and access to cash and networks.”
There are others who disagree, such as Russell Tandy, founder of Ngage: “I don’t think entrepreneurs need more help; it’s supposed to be difficult so that if you do succeed you have learned a great deal about how to do it again. However, banks and government should assist entrepreneurs with more efficient products and services.”
Young South Africans are facing a rocky economic climate alongside limited employment opportunities, but they are also seen as among the most vibrant and creative of the youth around the globe. While leaping into the entrepreneurial pool is a risk, there is an increasingly rich array of resources at their disposal for advice, support and networking — including the new small business development ministry — that they can take advantage of and which may well change their lives.
This feature has been made possible by the M&G’s advertisers. Contents and pictures were sourced independently by the M&G’s supplements editorial team.