Rapid expansion planned for pan-African brand
“EVERY STORE’S a big project,” says Jason Lurie, founder and CEO of Moyo. From a small pan-African restaurant that opened its doors in Norwood in 1998, Moyo has grown into a food, entertainment and lifestyle chain with 900 employees and more than 1m customers a year.
That’s the current state of play. Armed with R25m in venture capital from HBD (Here Be Dragons), Moyo (a loose translation from the Swahili word for “soul”) plans to double its turnover over the next year. It will add another 2 500 seats in a new R10m-plus project in Fountains, Pretoria, that’s almost 3ha in size on top of the almost 4 000 capacity it already has in Melrose Arch and Zoo Lake (Johannesburg), Spier Estate (Western Cape) and the recently opened outlet at uShaka Pier (Durban). Another four-storey site at Blaauwberg beach near Cape Town is already under development.
“From the very start my idea was to build a brand. The restaurants are the face of it. I don’t see Moyo competing with other restaurants. We compete with other forms of entertainment,” says Lurie, who is also an accomplished musician and an economics lecturer in his previous life. “People spend a lot of time in our restaurants: we offer a multi-layered experience. We’ve relied on word of mouth for our growth; we’ve never advertised and spend most of our time on people already in our restaurants.”
Expansion doesn’t stop with new restaurants: a hotel in Gauteng – just another menu item, now offering “steaks, eggs, chips and rooms,” jokes Lurie – and a move into international markets are next on the agenda. International visitors make up as much as 20% of patrons in the Cape and, given the many South Africans who bring along friends from overseas, the proportion is probably higher.
Says Lurie: “Opening up in markets such as Germany and Britain would make sense. Moyo is already something of an unofficial African embassy – a portal into Africa. The United States is also a possibility – the US is Africa-mad, especially now with Barack Obama. It would be great if Africa weren’t always seen with a begging bowl in the West. I’d like to see a Moyo take a place down Fifth Avenue in New York.”
“We’re very site dependent – it has to have iconic status. There are many opportunities: the trick is to know what to say no to. Expanding overseas is a steep learning curve. You don’t want to end up on the wrong end of the pound,” says Lurie.
Apart from traditional private restaurant patrons, retail and corporate events through Moyo on the Move and functions already make up 40% of the business. Size is important to Moyo: for example, being able to cater to 2 500 guests at the Cape Epic cycle race. Stand-alone retail outlets or markets (creating the vibe of a Moroccan souk as an example) are also being looked at. Despite its aggressive expansion plans, Lurie has seen some slowdown in Moyo’s business, particularly in Cape Town. “Johannesburg on the other hand had a very good December, probably because more people stayed at home than went on holiday. Hopefully, the 2010 Soccer World Cup will smoothe out the curve. I sense much better cohesion and co-operation in the industry in the run-up. It’s always good to talk to your peers.”
Of course there’s competition, but Lurie says the barrier to entry in this business is the people. “We employ people from all over Africa. We have two people just working on mosaics, for instance. It would be difficult to recreate Moyo.”
Moyo and HBD, which apart from capital, are also providing expertise and spending a lot of time figuring out what makes sense for the company. HBD, the venture capital firm founded by Mark Shuttleworth, has moved from a focus on technology to concentrating on companies in an expansion phase and purposefully keeps its investment portfolio small (less than 10 companies), so that it can become strategically involved.
“We’re not sleeping partners – but neither do we get involved with the dayto-day management of the company. We don’t want to lose the outsider perspective or bird’s eye view of the business,” says Julia Long, CEO of HBD.
Over the past 10 years Moyo has picked up a number of shareholders. However, apart from company level investment, various entities also get involved at specific sites. “All head office staff are involved at store level and our offices are on site. Our meetings are held in the restaurants. It’s probably just the chief financial officer who needs to sit behind a desk,” says Lurie.
Asked about his average working day – a pre-breakfast board meeting until restaurant closing time – the answer is straightforward: “I work in the hospitality industry. It’s my life. It’s not a job.”
Wine, food and now rooms. Jason Lurie and Julia Long