Secrets of wealth creation
Building a successful business is a remarkable achievement, but it’s no guarantee of sustainable wealth. These three entrepreneurs show that diversification, within and outside your core business, is the key to long-term success
ENTREPRENEURSHIP IS A LONG GAME
Manzini Zungu was raised by his grandparents, who involved him in farming activities from an early age – planting vegetables and selling the harvest around the township. “Those years cultivated the entrepreneur in me quite early, so I always knew that my path would lead to owning businesses,” he says.
Zungu’s career in marketing and communications has spanned more than 25 years and has included leadership roles at companies such as Blink magazine, Quilter International, Hamashe Media, Hamashe Energy and Hamashe Projects. In 2011, he took the leap of establishing his own consulting firm, Pacinamix, using the
R50 000 pension he received after resigning.
“It wasn’t much, but it helped me invest in resources that were crucial to the dayto-day running of the business,” he says. “The company needed its first project to operate and once that was clinched, the wheels started turning. We started as a communications and marketing business, but we expanded because we realised we could offer more to our clients.”
Pacinamix went on to gain the trust of successful brands such as the Association of Mineworkers & Construction Union, McDonald’s SA, the City of Tshwane, Rand Water, Vodacom, the Mandela International Film Festival, BP, Media24 and Absa. “Wealth can only be created if we have ownership of the things we do,” says
Zungu. “For any business-owner to create sustainable wealth, you need to make a point of re-investing in the business and growing it. That includes growing the skills base and becoming part of the global community to remain at the top of your game for yourself and your clients.”
He believes that an insatiable desire to learn is an integral cornerstone of entrepreneurship. “You can’t grow if you refuse to expand your thinking beyond a limited vision. My decision to keep learning has automatically broadened my horizons in a way I could never have imagined. Knowledge always leads to personal and financial growth.”
He advises people entering business for the first time to treat entrepreneurship as a long game. “Know that it’s not a shortterm endeavour. A business needs to pass the three-year mark in order to have a chance of flourishing, but you’re likely to fail at your first attempt. Keep trying. And don’t be hard on yourself if things don’t work out – if you don’t succeed in the entrepreneurial space, there are other opportunities to create wealth.
“From personal experience, I’d also advise aspiring entrepreneurs to remember that the money the venture makes isn’t their own. It belongs to the business.”
“You can’t grow if you refuse to expand your thinking beyond a limited vision. Learning broadened my horizons.”
DIVERSIFY TO BULLET-PROOF YOUR INCOME
The entrepreneurial bug bit Bonnke Shipalana at the tender age of nine, when he started selling popcorn to his classmates in primary school. His mother had encouraged him to start a hobby that she hoped would foster a productive spirit.
He continued to nurture this spirit throughout his schooling and student years. While enrolled for a BCom from Nelson Mandela Metropolitan University,
“For any business-owner to create sustainable wealth, you need to make a point of re-investing in the business and growing it.”
Shipalana worked at the campus tuckshop and later bought 10% of the business. Two-and-a-half years later, he owned four tuckshops.
“When I graduated 20 years ago, I decided to go into the corporate sector to gain work experience,” he says. “But the plan was to work for just 10 years to learn what I needed and then branch out to pursue entrepreneurship on a larger scale.”
Shipalana worked at SABMiller for six years, PepsiCo for 18 months and Cell C for three years. Then in 2008, at the age of 30, he acquired a stake in the MSG Afrika Group and became the CEO of the group’s subsidiary, The Communications Firm (TCF). A three-year business target was set for Shipalana to achieve in order to redeem his business shares.
TCF’s mission under his leadership has been to work on campaigns that create a legacy or make a difference, such as the Nelson Mandela banknote campaign. The company’s regularly been entrusted with managing the campaigns and reputations of entities across NPOs, NGOs, SOEs, parastatals, government bodies and corporates in various sectors.
However, he hasn’t lost the entrepreneurial drive he developed in childhood and has managed to diversify his income streams beyond his main occupation. “Diversification of interests was necessary to bullet-proof my net income and allow me to remain in an environment that challenges me to keep learning and take calculated risks,” he says.
Outside TCF, where Shipalana receives a salary as an Executive Director and dividends as an owner, he’s also the author of four books, a presenter on Capricorn
FM, a public speaker and a shareholder in two commercial radio stations – 1EC and Beat FM.
He believes the process of building a strong business can be broken down into three distinct phases. “In the early years of your business, you need to work harder than any of your partners or employees – it’s your role to lead from the front in order to establish the culture and DNA of the business. The second phase requires you to employ or partner with individuals who are more skilled than you are in certain operational matters, and you might need to pay them more than you’re earning. The third and final phase is to work yourself out of the day-to-day running of the business, freeing yourself to explore new opportunities and diversify.”
FOCUS ON GROWTH AND AUTOMATE THE REST
Matt Clark first entered the business world when he founded IP Solutions, a telecoms company, with two partners. After growing the venture to a satisfactory level, he sold his shares and sought new opportunities.
“My goal was to create a business that would give me freedom to travel the world and make money in any currency I wanted. I started attending wealth-building seminars hosted by successful people from around the globe.”
The most useful insight Clark gained from these seminars was that these successful entrepreneurs were all using a piece of software called Infusionsoft that automated their repetitive tasks, so they could reach thousands of people and have more time to focus on selling. “This piece of software literally did the job of the 60 people I had working for me at the telecoms company.”
Clark bought the software and dived in, studying it for months, before becoming a business strategy consultant and engaging his first client. Fuelled by his success with that first client, he gained several others within months and realised this was something worth pursuing. He did it with almost zero capital.
“I believe that if I can sell, I don’t need money to start a business. In fact, this is my mantra when starting any of my businesses. It does mean that it can take a little longer, but I always start with positive cash flow, rather than owing people money.”
Clark gave his first customer a discount, but as soon as he achieved results with them, he got a testimonial and increased his pricing. He repeated the process with subsequent clients and gained more credibility. He then decided to acquire customers outside SA, through joint ventures in the USA, Australia and the UK. His company, The Virtual Edge, now does business in nine countries and he speaks all over the world to generate more work and expand his network.
However, the real breakthrough came when he realised that the main thing his clients needed was a way of attracting more leads with less cost, so he researched different advertising and social media platforms. Eventually he developed a method to get high-quality clients from LinkedIn without spending a cent on advertising. “I created an online course called LinkedIn Mastery, teaching people how to get high-quality clients and gave 15 people access to the course to test out,” says Clark. “The condition was that they had to give me a testimonial if they got results. And they did. I then started making this a focus, as people really wanted it and my business exploded. I can now take on hundreds of clients while my time is completely leveraged and cash flows in every day. It’s opened opportunities to partner with people I would never have had access to before and got me speaking on stages in front of thousands of people all over the world.”
“I believe that if I can sell, I don’t need money to start a business.”