Business

Changing SA, one entrepreneur at a time

By Mandy De Waal 13 May 2013

Seated at Constitutional Hill, that symbolic custodian of SA’s Bill of Rights, the Awethu Project has a bold plan to create a more equal country that offers better opportunity to micro-entrepreneurs who’ve been disadvantaged by virtue of their education, Apartheid or class. The mission is to seed successful jobs and to create employment - lots and lots of employment. By MANDY DE WAAL.

The queue for William Mphuthi’s kota takeaway store in Soweto is evident long before the shiny tin structure comes into view. It’s a weekday, but still there’s a gaggle of schoolgirls waiting for kota – which in other parts of South Africa is called bunny chow.

Basically, it’s half a loaf of fresh white bread with the centre hollowed out, and filled with spicy meat. At William’s place his secret literally is in his sauce. Here the bunny chow is filled with meat and chips, and then laden with a special homemade sauce and atchar. Pow! The gaggle of girls say that the kota is the tastiest kick in the mouth you’ll get this side of Lenasia.

Mphuthi’s a busy man. On entering his place – a couple of pre-Apartheid type, square RDP houses crowded onto one stand – the kota king is nowhere to be seen. Instead, the small, gated patio of his home is packed with boxes and catering goods. On the floor are buckets and buckets of the whitest potatoes cut into long chips, soaking in water. The gleaming tin shack with the fryer, which faces onto a busy street (with its kiosk), is a spit away.

The chips are looking mighty fine. They’re long and white and perfectly cut and the smell of them being fried in oil wafts over with the dream of brown vinegar. Mphuthi arrives, talking to his branding man, Thatho Ditlhale, who’s not your common or garden Sandton agency man. Ditlhale is a township brander – we’re talking street marketing here.

He’s got a clutch of yellow polystyrene foam boxes with Mphuthi’s takeaway logo on them, and he’s talking about expanding the sales channel for the kotas. “We’ve got to get into the stokvels and get people to start selling your kotas, Willie. I’ve been speaking to these people and they’re interested,” Ditlhale says, delivering his sales spiel.

Photo: William Mphuthi

Mphuthi rounds the corner in his Diesel T-shirt. He’s hustling. The man’s been in business for a year and a half and he’s cooking – literally. His takeaway operation is housed in a tin shed at the front his house, and the queue hasn’t abated. Inside, a woman’s frying up chips and polony for an order, while Mzwaki, an older man walks out of the shed towards the potato chips.

“I only use the best potatoes,” says Mphuthi. “Grade A potatoes that I get from the market. I recently had to hire Mzwaki because the volumes were just getting too much.” Mzwaki holds out his hands – they are nicked and scuffed, but he’s a man who’s happy for the job. Inside, the deep fry woman is asked what Mphuthi is like as a boss. She laughs broadly and says he’s great, but talks too much. And then she laughs some more, and puts another load of chips in the fryer.

“Food’s a brilliant business to be in,” says Mphuthi, who adds that he’s growing month on month. “There’s no credit for the stomach,” he laughs. “When you’re hungry, you’re hungry.” And here in Soweto people are hungry for Mputhi’s kota with their secret sauces and spices.

“What’s the secret to the sauce?” this journalist asks the take-away entrepreneur, who smiles broadly in return.

“If I told you that I’d have to kill you,” he says with a wry grin.

In 18 months Mphuthi has expanded his take-out kota business and fine-tuned it to the smoothest operation you’re likely to see in the whole of Soweto, thanks to business coaching from the Awethu Project. He’s cut his expenses, expanded his business and is now on the verge of building a sit-down where people can chill and enjoy their kotas, instead of taking them away.

The Awethu Project was founded in 2010 (see The Awethu Project: A big vision for growing small businesses in Daily Maverick) but has come a long way since its idealistic start-up days. “When we started I didn’t know anything,” confesses Yusuf Randera-Rees during the car ride to Soweto to visit Mphuthi’s operation. Randera-Rees talks about a photograph he shows people when he does the talk circuit.

Photo: Yusuf Randera-Rees

“I showed people at NetProphet that initial picture of our start-up a couple of years ago,” he says. NetProphet, like the Awethu Project, is all about fostering a culture of entrepreneurship and innovation in South Africa and culminates in an annual free conference where Randera-Rees introduced his dream for a better country to delegates.

“The photograph is of our first day in Alex. We showed up in Alex with my mom’s tablecloth and our beach umbrellas. Our pitch to people was: ‘We can help you get access to world-class resources.’ Wow. Looking like that… it shows you how naïve I was,” Randera-Rees admits.

“All I knew then was that there is world-class talent in South Africa and if we can figure out a way to identify that talent and develop it – not just over a weekend-training course but in a real business partnership over a career – than the returns can be incredible both financially and socially,” he says.

In those days Randera-Rees’ project was three people strong. Today there are thirty of them figuring out how to make Johannesburg (and then Gauteng) the best place for micro-entrepreneurs from under-resourced backgrounds to flourish. “On the business side we have been figuring out the model – how to actually do this. How to take it from an idea to being a business reality,” says Randera-Rees.

Soweto’s kota king is an example of the project working. Mphuthi had a small business when he was found by the Awethu Project. Together they’ve worked on streamlining the business, ensuring that it is up to code, and generating marketing that will pull a steady queue of customers. Besides increasing volume and efficiencies, Mphuthi has worked hard on differentiating his operation and expanding. His sit-down is the next step, and then he’s got a fruit, veg and café type stall around the corner from the kota take-out. Already Mphuthi hires three people, and he’s only been around for 18 months. More importantly, he’s in a sustainable, profitable business.

“Imagine if every country in the world can look at us and marvel at how we support micro-entrepreneurs from under-resourced backgrounds,” beams Randera-Rees.

The 30-year-old, who studied at Harvard and once worked for Credit Suisse Group in New York, chucked in the Madison Avenue lifestyle for an office on Constitutional Hill in Johannesburg, and the audacious dream that he can change conditions for entrepreneurs from disadvantaged backgrounds in this country.

Giving up on the high life – why does someone like Randera-Rees do that and head home to SA, with all its socio-economic challenges? “My dad went off to the UK where he met my mom, but he always wanted to come back, and he convinced my mom in the early eighties to move to South Africa. They had me in the UK so I had a British passport and when I was a year old they returned to South Africa,” says the social entrepreneur, who believes his upbringing is responsible for his philanthropic bent.

“My mom’s first job back here was at the Alex Clinic, and my dad’s was managing all the maternity wards in Soweto. That’s what they did until the end of Apartheid, or post 1995. My mom was this little lady who went to Cambridge, she had no business coming to South Africa in the eighties, but that’s what they did. Who I am is a product of growing up in that environment and growing up in a family where we were continually reminded that South Africa isn’t an equal society,” Randera-Rees explains.

The idea behind the Awethu Project is to plug the gaps. In Silicon Valley in the US people know how the system works – it is more evident, open and accessible to entrepreneurs. In South Africa things are opaque, complex and hidden. Start-ups have to be infinitely more determined to break through.

“The basic idea is that we go into partnership with the entrepreneurs that we work with. We have the same incentive as them to grow their businesses, and if we do we share in the rewards. The current deal is that we go 50-50 on upside new profit. This is a three-year contract, and after the three years they can go back to wholly owning the profit. This is part of our non-profit arm,” Randera-Rees says. The idea is that the entrepreneur and the business mentors are both the bacon – they’re both committed to making the business more profitable and sustainable.

The Awethu Project, despite some good initial grants, wants to create a project where this shared profit is what makes the business sustainable. “Our basic proposition to entrepreneurs is that if you don’t have a business we will help you start one, and if you do, we will help you grow. We are trying to get to equal numbers of both,” the Awethu founder says, and adds: “Our aim is to get to 500 business with an equal split in start-ups and established businesses.”

The bottom line is that this social company that seeds entrepreneurs and accelerates existing businesses (to grow employment) wants to grow an environment that spawns entrepreneurs. The project has been given R20 million by government to do just that, and the delivery to government must be the creation of enough businesses to generate 500 new jobs. This is crucial because unlike the government’s infrastructure and public works programmes which generally spawn work for men (in mining, construction and the like), the Awethu Project creates micro-entrepreneurs in townships that serve locals and employ locals.

“We’re not talking about creating the next Facebook here. We are rather talking about making a very tangible difference to someone’s business by doubling the profits they are making, because most of the businesses we are working with are making in the region of R3,000 to R10,000 a month. So if we can double their profits, this makes a big difference. For the most part we are talking bread and butter. We are talking welders, beauticians and spaza shop owners. These are people whose livelihoods depend on the income that they are making. And if they can change that, then they can make a very real difference to the way that they are living on a day to day basis,” he adds.

“First we are going to do this in Johannesburg, and then Gauteng, and then nationally. And then if we can achieve that, why not replicate it across the continent?” Of the thirty people Awethu employs, fifteen are hard-core business coaches who can mentor between fifteen to thirty businesses each. That’s the current scale the project is at, and it is getting over 3,000 applications from people who want to join each month.

Back at Constitutional Hill, the coaches are taking business start-ups through their paces at an incubator office, whilst in another, bigger room there are about fifty people who are being vetted to see if they are eligible to join the project’s start-up crew. The Awethu Project has already done good things for Mphuthi, but its real test is scale. That’s Randera-Rees’ dream and nightmare – how to make that happen. He’s not making promises; all he cares about is delivery.

“I’ll tell you when I’ve done it. When it’s been achieved,” he says. For SA’s sake, let’s hope Randera-Rees and his team at the Awethu Project can deliver on their dream. DM

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Main photo: Selling kota – the secret’s in the sauce – differentiation and using excellent produce is the secret to William Mphuti’s takeaway success.

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