Baubles, bangles, beads – and success
From humble beginnings, Max Lichaba defied the odds by building up Lichaba Creations, which now has an annual turnover of over R240 million
Growing up in a disadvantaged family in Saaiplaais in Virginia, Welkom, the CEO and founder of Lichaba Creations spent his childhood helping his mother sell fruit and vegetables to support their struggling family.
“My parents couldn’t afford to send us to school as transport was very expensive,” says Lichaba. One day his mother told him and his brother that she’d found them a free school which also provided free lunch and transport. “She hadn’t realised that it was a school for children with special needs,” he recalls “Unfortunately the school I was attending only went up until Grade 10 and that’s when I left.”
He eventually studied jewellery-making at Harmony Jewellery School through a programme sponsored by Harmony Gold Mine and became one of its best students, spending three years there before being appointed to join Royal Manufacturing in the
Free State. “There were only two of us chosen to join the company. I worked there until it closed down and we were retrenched,” he recalls.
Armed with this experience and a qualification in jewellery, Lichaba started his own beadwork business, with dreams of developing it into a big enterprise. He invested his last R500 into the venture. “I had to use whatever I had at that time, as I couldn’t afford machines to make jewellery. However, before long, people started buying my products to wear to weddings and other occasions,” he says.
In 20016, after almost four years in operation, Lichaba received funding from SAB Kickstart. He then focused on starting Lichaba Creations, which specialises in precious metals exchange, including silver, gold, palladium, platinum and diamonds.
“After getting the SAB Kickstart deal, we partnered with the Free State Department of Tourism. Whenever they had exhibitions overseas, they’d take our products to display there. Eventually, after people started asking questions about our brand, the department began taking us along to those exhibitions,” he recalls. In this way, he visited France and the USA, which helped his company market itself internationally. It’s since been exporting its products to more than seven countries.
Lichaba’s now expanded his business umbrella to include Lichaba Custom Rides Kwa-Lichaba restaurant in Soweto and Lesotho, a property investment company and plans to start a media production company.
“Lichaba Custom Rides deals in cars, which are a huge passion of mine. We have a warehouse and we buy new vehicles, customise them and sell them. We also refine gold,” he explains.
However, his entrepreneurial journey hasn’t always been smooth. At one point, he was advised to invest in training and provide learnerships for government. He duly used money from his initial business to invest in a school, on the same premises as his venture. However, Lichaba didn’t realise that government doesn’t pay promptly – which caused him such severe cash flow problems that he was forced to put his business up for auction, since he couldn’t pay the rent.
“I invested more time and effort in the school as I was told I’d be paid within 60-90 days of each student enrolling, but that didn’t happen – instead, payment only came through a year later.”
His split focus proved dangerous, as the jewellery business – which was covering the costs for the school – also had a cash flow problem and couldn’t cover the rental expenses. Two months later, the landlord closed the doors and auctioned his equipment to cover the rental costs.
“It was a dark time for me. My family helped settle my debts and get me get back on my feet. I sold my furniture and slept on a matress on the floor, as I was trying to raise capital to buy my old jewellery equipment back.”
He eventually bought his machines back and, eight months later, was able to start trading again, albeit on a smaller scale. Working from his flat, he exported his work to India and the UK.
Matshidzula’s love affair with the Little Barnet Farm in Alexandria, Eastern Cape, began in 2007, when – at just 19 years of age – he was brought onto the beef farm as a training manager. The farm had been earmarked as a land reform project jointly owned by 18 black beneficiaries from the community and it was full of promise.
But six years of mismanagement saw the stock dwindle from 300 cows to just over 120. Through the Barnet Business Trust, Matshidzula and his mentor, Walter Biggs, were brought in to oversee the management of the ailing farm, where their first strategic decision was expanding it into a dairy farm.
Matshidzula, who was studying at the time, wasn’t permanently based there. He officially rejoined the farm in 2013, after acquiring a 40% stake in the business.
By that stage, 16 of the original 18 community beneficiaries had sold their stake to two remaining members who partnered with Matshidzula to form Matshibele (Pty) Ltd.
The farm was delivering a steady turnover, but Matshidzula had big cash flow problems. He was overdrawn with a 25-year loan with the Land Bank and a second loan he’d taken out to buy the business.
With a national drive to create a new generation of black commercial farmers high on the government’s agenda, you’d think there’d be fewer barriers for farmers to access funding, but Matshidzula says this couldn’t be further from the truth.
“If you think about it, this is a 100% black-owned business – I’m the guy who ticks all the right boxes for government to fund. I approached different government agencies, but that funding never materialised,” he says.
In hindsight, however, he believes this was a blessing in disguise, as he was forced to explore alternative options. He sold half of his stake in the business to raise capital that matched the net value of the company. This cash injection enabled him to boost milk volumes from 2 000 litres per day to an impressive 17 000 litres per day.
He’s proud of the string of accolades he’s received over the years, including AgriSA/ Toyota Eastern Cape Young Farmer of the Year and the prestigious Mangold Trophy for the best-conserved farm in the Bathurst region.
He employs 17 permanent workers and seasonal workers – all older than he. He’s also upped the employment criteria, making it mandatory for all farm workers to hold a matric certificate. Little Barnet is the only farm in the area to do this.
He also attributes his success to meaningful mentorship, which is often lacking in local government projects.
Looking to the future, his focus is on improving the quality of the milk he produces. Through the Coega Dairy
Plant, where the milk’s processed, Little Barnet Farm is part of a supply chain for the Shoprite-Checkers Group’s private-label milk.
He’s also completing the next phase of his development strategy – the construction of new production facilities, which will unlock a further 35% growth over the next year.
MILKING IT In just over a decade, farmer Tshilidzi Matshidzula (30) turned a loss-making beef cattle farm into a successful dairy farm that now boasts an annual turnover of R22 million
THE REAL ESTATE DEVELOPER Obinwanne Okeke’s ability to see opportunities in challenges helped him build a business with an annual turnover of $2 million
Born in Nigeria, Okeke has travelled extensively and established his businesses in places facing challenges on many levels.
He founded Invictus Group, a conglomerate in construction, real estate development, oil and gas, agricultural development and energy operating in Nigeria, SA and Zambia with an annual turnover of $2 million. Having started the group with little more than a computer, today it employs hundreds of people.
Within just a few years of existence, the oil and gas operations of the company have made significant strides in Nigeria. They work with energy partners, investors and contractors to assess their assets, portfolios and investment strategies and to develop technologies.
The group has also identified new areas of growth in the agricultural sector through St Kilda Farms, which controls most aspects of its poultry production process. It hatches, raises and processes chickens and turkeys, as well as manufacturing its own feed, running its own refrigerated trucks and operating processing plants across Nigeria.
In the past two years, Okeke’s expanded his profile, becoming one of Africa’s youngest and most sought-after public speakers on entrepreneurship and investment in the continent.
His trajectory began after completing his Master’s degree in international relations and counter-terrorism in Australia, when he returned to Nigeria and identified a massive business opportunity. “I settled in Abuja, but it was extremely difficult to find accommodation,” he recalls. “Houses were overpriced, demand was high and the structures being built weren’t what people were looking for.
“That same year, I went into real estate development on a small scale, with a few projects. The next year, we developed about 17 buildings for residential occupation. By this time, people were becoming aware of the Invictus Group.”
During this period, insufficient power supply was a big challenge in Abuja.
This presented Okeke with another opportunity to expand his business: he began building energy-ready houses powered by solar panels.
“I travelled to China and Germany to do research and find partners who would manufacture these dwellings with me. We then diversified our business to the energy industry [ie, suppliers of solar panels].”
However, he says his entrepreneurial journey has had its share of bumpy patches, including competing with big corporates who had all the resources needed to deal with red tape when doing business in other countries.
“All my businesses had started as a oneman show, but I realised that this wasn’t feasible. I started hiring skilled people who specialised in certain areas.” These included administration, revenue and business law.
His achievements include being nominated for the 2017 All Africa Business Leaders Awards.