Pretoria – Many start-ups are failing at the embryonic stage of their business because their managers lack knowledge about what they are doing.
This was the take of Professor Joe Haslam, who delivered a talk on growth and scaling up business during a virtual SA Innovation Summit, which began yesterday.
Haslam, executive director of the Owners Scaleup in Spain, was one of the many speakers who participated in the first virtual conference that attracted hundreds of people from across the country and the rest of the world.
He told the audience that anyone could start a business, but keeping it afloat was something else.
He encouraged new entrepreneurs to aspire to scale up their businesses, reminding them that start-ups were just the beginning of their journey.
He said it took a long time to scale up a business, adding that one would required good management skills to achieve that goal. “If you need to have 50 shops you will obviously spend two years with two shops, and up the other 48 in the last year,” Haslam said.
He said that for start-up owners to grow big they ought to arm themselves with knowledge.
“Most start-ups fail because they don’t know what they are doing. The reason why you are fighting with your (business) partner is because your company has not found a business model. The reason you are struggling to raise capital is because your company has not found a business model,” he said.
Haslam alluded to the fact that the age of 45 was the average age for one to succeed in business. “If you’re in your twenties you still have a lot of time,” he said.
Another speaker, Louw Barnardt, co-founder and managing partner at Outsourced CFO, said: “For certain types of businesses it makes sense to expand across different geographies quickly. Others need to be more cautious.”
A member of the audience, Lucy Nkohla, was interested to know what methodologies Barnardt used in creating his product.
In reply, he said: “Testing your product on paying customers gets you very quick, proper feedback on how to improve. Launch early and improve based on feedback as much as you can. Our purpose at CFO is to help founders build world-class finance functions for scale. Each successful entrepreneur creates impact in the world – that’s how we live that purpose.”
Others wanted to know whether it was a good idea to scale up if one’s initial market was not performing well, but one saw a lot of potential in a neighbouring market.
Barnardt said: “I’d like to see pivots and improvements to the offering to fit your initial core market. If you are not solving a problem for the market you know, it may be hard to solve a problem in a market you do not know that well.”