Findings Show That Entrepreneurs Are Achieving Revenue Growth Despite Challenge
Bridgit Evans – Executive Director, SAB Foundation
These findings were some of the insights uncovered by the SAB Foundation in its most recent impact report, which is conducted with 5 975 entrepreneurs supported within its ecosystem. Interestingly, the report reflects a business survival rate of over 90% after five years in its flagship programmes and these entrepreneurs have achieved a combined increase in revenue of over half a billion rand from 2015 to March 2023.
“Despite the obstacles faced by entrepreneurs, we have encouraging news to share,” reports Bridgit Evans, executive director of the SAB Foundation. “From the individuals that we surveyed, we see that they have somewhat recovered from the damaging years of the pandemic. In addition, our combined annual turnover figures indicate that there has been a return to numbers that are, in many cases, indeed higher than those reported before this period.”
Load shedding is a major concern
“The devastating impact of load shedding on businesses in South Africa cannot be overstated and there was no exception for the entrepreneurs that we support, whether that be from loss of business or by having to invest in costly back up power supply,” Evans says.
Entrepreneurs and small business owners are having to look to alternative solutions to tackle this challenge in order to keep their businesses afloat. In the case of the entrepreneurs that the SAB Foundation supports, this has meant that many have had to use funding from the SAB Foundation intended to accelerate growth for energy solutions just to survive.
Access to growth funding is a challenge
Many entrepreneurs find that access to further funding after an initial start-up grant poses a significant challenge for them. Most business owners pour all of their energy into making their business succeed, only to fall at the final hurdle when they should be scaling and growing their enterprises to the next level.
“Throughout the years, over 55% of our awardees have reported a lack of growth funding as a major challenge that they experience,” reports Evans. “This is not surprising, as numerous studies conducted with SMMEs have identified funding to allow scaling as a key challenge that entrepreneurs are faced with regarding making their businesses a success.”
“There is a national ‘missing middle’ of growth phase funders for social innovation in our country,” says Evans. “We need to make it easier for business owners to access the additional resources they need to scale their enterprises, as well as business acceleration programmes that will help their organisations expand.”
Mentorship and skills development are key
Many entrepreneurs have shared that they often struggle with their cash flow, access to markets, business evaluation processes, costing and pricing, as well as supply chain management.
“Our entrepreneurs reported that they had no one to go to for advice or to encourage them to succeed, and they felt unmotivated, overwhelmed and lonely before working with us,” reports Evans. “We believe that one-on-one mentorship is critical for the business owners we support. In fact, many of them will tell us that while they appreciated the funding, this element was life changing.”
“Mentorship plays a significant role, as entrepreneurs can work with someone who is genuinely invested in developing their business, and a mentor can provide the necessary guidance and skills for growth.”
A success story
One of the many inspiring entrepreneurs in the report is Mampho Sotshongaye, founder of Golden Rewards 1981.
At 19 years old, Mampho entered the Civil Engineering field after being influenced by her own background where infrastructure was scarce. Opting for this career choice, she challenged societal expectations that limited women’s potential.
With ambitions to empower other women, Mampho started Golden Rewards 1981 in 2010. Located in Cape Town, her business specialises in road maintenance and vegetation upkeep. In 2022 Mampho joined the SAB Foundation Tholoana Enterprise Programme, where she received one-on-one mentorship and grant funding of R250 000.
After graduating from the 18-month programme, Mampho was able to overcome challenges that she was facing with the company structures and systems. She also increased the number of employees from 85 to 132 and grew her turnover by more than 55%.
Notable achievements by Mampho include graduating from the Gordon Institute of Business Science. She also won the Womandla Stem Award for Engineering and was selected as a finalist for Women of the Year in the Big 5 Impact Construction Awards in June 2023.
Mampho’s plans for the future include expanding her reach into other provinces, whilst investing in skills development programmes for her employees to support more women in the construction industry.
“Through continuous monitoring of the individual business owners that we support, we are able to respond to the changing and growing needs of entrepreneurs in our country,” concludes Evans. “Through supporting entrepreneurship, we look forward to see more innovative individuals succeed at scaling and growing their businesses further.”