Combining fire with passion
‘We wanted to succeed as businessmen, not employees’
THAT THE SPRAWLING TOWNSHIP of Daveyton didn’t have fire and disaster management infrastructure for most of the time Desmond Moloto was growing up there hasn’t stopped him from making a career out of such infrastructure. The fact that some of his co-shareholders deserted him at one difficult stage during the formative years of the company was also not enough to force him to throw in the towel and join the evergrowing numbers of job seekers.
Moloto’s Fire & Emergency Vehicle company is now a manufacturer of disaster management equipment to a growing number of South Africa’s municipalities and some large corporations. The company designs, manufactures and maintains fire engines, ambulances and other disaster management equipment from a small workshop in Edenvale, east of Johannesburg, providing employment to 20 people.
Fire & Emergency’s flagship products include state-of-the-art mobile disaster communications equipment built for the Sedibeng municipality in 2008. “They were going to buy it from Brazil for R4,5m but we did it for R2,5m,” says Moloto. The machine has a mounted camera that can take a photograph from around 12km away and can be used at mass gatherings. Other products include weather prediction equipment, a public announcement system and mobile Internet capabilities.
The company was formed in 2003 after Moloto and 20 of his colleagues lost their jobs when Emergency Services Holdings, which operated a company named Benoni Fire and Emergency Services, went bust. “It had grown too quickly,” says Moloto. When he joined the company in 1998 he was the 12th employee and six years later the staff had grown by 140.
While still employed at Emergency Services Holdings, Moloto and eight of his colleagues started pooling their money – R50/ person/week – to fund the soon to be launched company. They were aware Emergency Services was in trouble, he says. “Elvis Silinda, an older colleague, came up with the idea of starting the company (he’s still part of it).”
The business started in Moloto’s tiny kitchen in Daveyton, on Gauteng’s East Rand, but soon moved to a rented garage nearby. Moloto continued to “visit” his mother during the day with a secret list of telephone numbers to phone when his mother wasn’t watching her pre-paid telephone line.
In September 2005 Fire & Emergency won its first contract – worth R348 000 – from the Nkangala District Municipality. The R45 000 profit went to buy office furniture. Another R300 000 contract came two months later, also from Nkangala.
Through their diverse skills its shareholders tapped their contacts for help. Law firm Bowman Gilfillan came in with its legal services expertise at no cost: while the Business Opportunities Centre pitched in with its expertise on small and medium enterprises. At their previous employer, Dikeledi Letsoko worked as human resources manager, Caiphus Ngidi as production manager and Rudy Moloi as sales and marketing manager, while Nomvula Langa had the financial management portfolio. They’re all from various townships on the East Rand.
But Moloto and his co-shareholders weren’t drawing any wages. Says Moloto: “Four (other) shareholders were employed (elsewhere) and supporting the company financially. That was their contribution.” He says those were people who couldn’t survive without a salary, due to family circumstances. The strategy of “deploying” them outside helped, as the business couldn’t have coped without their financial assistance. As for Moloto, his younger brother and mother were taking care of his family of five children. So there wasn’t any immediate pressure to personally generate income.
Why would a man with such skills as his be happy with no income? After all, he graduated with a mechanical engineering diploma from Vaal Technikon in 1998 and trained as a firefighter and was already employed at Emergency Services Holdings. “It was all about ambition and vision. It was a case of seeing the light at the end of the tunnel,” says Moloto. “We wanted to succeed as businessmen, not employees.”
That’s exactly how things turned out. Moloto and his colleagues dedicated their energies to growing their own business with the skills they’d learned from their previous employer. The results have been pleasing so far. After a “small” loss in 2006, Fire & Emergency Vehicle turned over R2m in 2007 and is looking at R10m turnover in its current financial year. Its biggest contract to date is worth R5m: to build fire engines for the Emalahleni (Witbank) municipality. Moloto designs the equipment with which the company is making a name for itself. Fire & Emergency has won 5% market share in SA (its two competitors with the bulk of the market share have been around for 30 years). “It’s been an uphill battle, but we have come a long way,” Moloto says.
In March 2008 the company began paying salaries and Moloto received his first pay in three years. “That’s the mark of a proper entrepreneur. You forget about all those material things,” Moloto told fellow entrepreneurs at an Umsobomvu Youth Fund gathering of loan beneficiaries in November. “Your passion as an entrepreneur should be the product, the service you provide – not how much money you personally make or what car you drive.”
Umsobomvu provides the company with
bridging finance for the equipment it imports, which is settled when it delivers to its clients. The 36-year-old Moloto says Umsobomvu came in to help when other funders “required lots of papers”. Although Fire & Emergency has had much support from professionals, Moloto says it couldn’t wait to sort out “the many papers”. He says: “We need money to buy parts and materials before we get paid and there are strict delivery deadlines.” Fire & Emergency buys trucks and modifies them into fire engines and ambulances or refurbishes old ones.
Now the company is on its feet – with large corporates Sasol, PetroSA and Eskom, plus some major municipalities (Rustenburg and Cape Town) as clients – the entrepreneur in Moloto is already talking about new chal- lenges. But before that he’ll have to impart his skills to the diverse pool of talent Fire & Emergency has recruited. Of the entire workforce, Moloto is the only trained mechanical engineer. And true to his word he’s busy transferring his skills to his fellow shareholders.
Passion is product, not money.