Founders share their journey
Power Invest is a stokvel turned investment club formed by a group of black professionals looking to build wealth. Power Invest MD Tshepo Masango says that in the past two years they have raised R500 000 and purchased a residential property in cash, which they will use to grow their business further. They are looking to continue buying more property and build their capital. Masango says that he personally has an appetite for risk, but says they have agreed as a club not to risk by investing in the stock market where there is a chance of losing money if they make the wrong investment decision.
But other investment clubs like Zero-Up invest in the stock market. Kobus Van Eeden is a founding member of this investment club formed in 1999. This is a by-invite-only club whose membership never exceeds 20 people so it’s easy to administer.
Van Eeden says that when they started the club, its members sat down together and drafted a constitution. They took it to a lawyer to ensure that it was legally sound. Club members contribute a minimum of R200 a month, although larger sums are permitted. He says there are a few members with an accounting background in the group who are able to determine the returns according to the money invested in the club. The club also uses a brokerage company to make its investment instead of taking a DIY approach. He says that this has enabled him to see how the state of the economy affects the stock market.
“In 2008, with the global recession, we left the investment untouched and after 2010 we had recovered. People tend to make emotional decisions, so we have also made a template on how to decide on the stocks we want to invest in.”