December 27, 2007

In South Africa, lessons in success from a rare entrepreneur

By Danna Harman, The Christian Science Monitor, Johannesburg, South Africa

He was always an A student.

"I went to school without shoes. I knew I had to work hard to make sure I got a better life," says the serious young man in shiny loafers and a well-pressed blazer, owner of a small computer repair and sales company.

But why him? Why has Terrance Mohlala made it when so many others like him in South Africa – one of the least entrepreneurial nations in the world – have not?

Hard work. Courage. Divine intervention. These are some of the factors he lists. But it also takes knowing where to get financing, and how to market, and expand a business. That's where the Business Place comes in. Eight of them are spread around the country: brightly lit, friendly and free drop-in centers where so-called "navigators" walk South Africa's wanna-be entrepreneurs through the stages of starting a company.

The centers, supported jointly by the Investec bank and the government, employ 50 navigators and other staff, and help about 5,000 clients a month try to realize their dreams.

There's certainly a need. South Africa has one of the highest unemployment rates in the world, with approximately 33 percent of the adult population out of work last year, according to the government. Worse yet, the country lacks an entrepreneurial culture. According to the 2006 Global Entrepreneurship Monitor, only five percent of South Africans started businesses in the past four years. The country ranked 30th out of 42 nations surveyed.

Mr. Mohlala ponders his business success, and why it remains elusive to so many here.

"The problem is self-esteem. For so many of us, it is too low," he says slowly, controlling his slight speech impediment. "I think I have a high one. Even when I am stuttering, I think I can stand in front of a group of people ... or in front of congregation in the church and preach."

Self-esteem. It's certainly not a trait that was instilled in him by the apartheid system he was born under, or by his parents, who died when he was a boy. He did not learn it at the mediocre one-room schoolhouse that he attended while growing up with his granny on a farm, or at his first job, as a gardener pulling weeds at age 14. Mohlala suggests his confidence comes "perhaps ... just from the Man upstairs."

And a little help from the Business Place. "There are a lot of people selling odds and ends on the sides of the road. But to translate that into a little business with potential to grow, one needs help and encouragement," says Hilary Joffe, associate editor of Business Day newspaper here. "Something like the Business Place gives you both access and that encouragement."

Delse Dludlu is a senior manager at the largest of the Business Places, in downtown Johannesburg. They have fast speed internet here, a table crowded with the latest business magazines, and shelves filled with files on finance options. Every day, a free or 10 rand ($1.50) seminar is held. On a recent week, Monday was "First steps to starting your business." Tuesday: "Develop and test your business idea." Wednesday, "Market research." Thursday: "Understanding taxes for small businesses."

A well-built woman with a sassy attitude, Ms. Dludlu dreamed as a child of being a professional buyer of auto parts for Chrysler Daimler. "It's very classy work," she explains.

The youngest of 15 children, she learned early about self sufficiency. No one had their own bed in her household, she says, so you had to make sure you tagged one at night. Her dad owned a corner shop. Her mom was an "executive domestic worker."

A what? "Just an ordinary maid," replies Dludlu, laughing. "But presentation, as we say, is everything."

After getting a business degree, Dludlu came to the Business Place, first as a client, then later as an administrator. The work suits her. "There are lots of opportunities in life but people don't always understand that no one is bringing them to them," she explains. "No one will do that. You have to go out and get what you want."

The navigators at the Business Place work one-on-one with clients, and try not to prod or preach but rather move with them through a series of steps. First, they help clients define what they want or need. Then, the navigators direct them to sources of loans or grants, seminars, and to networking meetings that take place every week at the centers.

There are two kinds of people she encounters, Dludlu continues: "Those who sit, complain, give up, and do nothing to help themselves ... and people who realize 'OK. There is not enough employment. Now, what can I do to help myself?' "Attitude, however, is not enough, people need vision. "You don't start a business because you are desperate. You should do it because you have a clue and know what you want," she says.

Mohlala had both the right approach, and vision. As a youngster, he wanted to be a sailor. But his grandmother couldn't afford that class and so he enrolled in a cheaper course – computer training. He spent five years at a computer company, making 500 rand ($83 dollars) a month. "I had ideas about computer sales and repairs, but unfortunately they were not interested in my ideas there," he says.

When Mohlala first walked into the Business Place he mistakenly thought, like so many others, that they would finance his ideas. "I had almost everything in my head. The only thing I needed was capital." He went to workshops, spoke to navigators, applied for loans and government grants, and made contacts. The networking evenings provided a source of future clients (mainly other new businesses that needed computer services), and the landlord who would rent him space for his first shop. Within three years, he was up and running.

Terry's Computers, specializing in training, repairs, sales and business services, now has three locations, a yearly turnover of 350,000 rand ($58,333) and seven employees. "My family thinks I am a hero," says Mohlala. "They are so proud of me because I am the only one in the family who has his own business." His granny, who raised him, now lives in town with him.

Mohlala has also adopted an orphanage in Soweto, donating computers and giving training courses for free. "I feel that other orphans might not have the courage and opportunity I did. So I wanted to expose them to computers," he says.

"If I was to stand in front of God now and he would ask, 'What have you done in your life,'" concludes Dludlu, "I would say, 'Open my record and look at all the successes of others tied up with my name.' There is nothing better."