NOMPU SIZIBA: The year 2020 has been a devastating year on so many levels, with global health impeded and lives lost due to the Covid-19 virus, and economies contracting due to what were determined to be essential lockdowns to curb the spread of the virus. Then there’s been the accompanying socioeconomic impact of business failures and the job losses that have followed. In middle-income and poorer nations, more people have fallen into poverty as a result of the effects of the pandemic. Looking specifically at the experience of the entrepreneur, some have fallen by the wayside from the economic pressures, while others have just survived, with others being set to thrive as they adapt to the so-called new normal, or a different economic reality from the one that they were used to before Covid hit.
Well, to share his thoughts and observations on how different entrepreneurs have withstood the pandemic’s test, and how some will thrive beyond it, I’m joined on the line by Pieter de Villiers. He’s a CEO and co-founder of Clickatell. Thanks very much, Pieter, for joining us. Now, when you reflect on the impact of Covid-19 this year, what are some of the observations that you’ve made around how it’s hit the different types of entrepreneurs that you’ve identified?
PIETER DE VILLIERS: Hi Nompu, and hello to your listeners. Covid-19 is fascinating in that it’s almost like a natural disaster. I lived in the US for a couple of years, and we used to see images of hurricanes ripping through the south, and you see these structures being obliterated, but just next to them a school or a church may still be standing. In many ways businesses in Covid, some of them have been utterly destroyed, and even with the best strategy in place you could not have predicted it. And so while all of us feel the impact and anxiety of Covid, it doesn’t really reflect the damage equally.
NOMPU SIZIBA: Now, before we realised it, the digital way of doing life suddenly became an imperative, as some people had to work from home, kids had to study at home and people turned to buying online once the government allowed them to do so. Under these circumstances many entrepreneurs, I suppose, will have had to quickly adapt to doing things digitally in order to remain relevant and to survive.
PIETER DE VILLIERS: Yes, absolutely. And we see this not just in South Africa, but globally. There are different types of entrepreneurs, but if you want to have access to your market, but your market cannot come to you, you are really left with no choice. You have to explore digital channels, and you have to find ways to reach them where they are.
NOMPU SIZIBA: I suppose, apart from the early part of the lockdown, which was extremely prohibitive and disruptive, entrepreneurs are now having to deal with different demand patterns to some extent, because of course many consumers are either without a job, or they’re earning less and becoming quite price-sensitive as a result.
PIETER DE VILLIERS: That’s very true. And you know, supply chains and demand patterns are very difficult to navigate when you’re not sure – is it a six-month or 18-month pandemic, and what investment are you going to [need]. We see the consumer demands in South Africa, in particular, are shifting to first and foremost essentials, and so food and the basics will go up. But then we’ll see a decline in discretionary things like travel, transportation, hospitality. And I picked up on things like TMT – technology, media and telecoms.
NOMPU SIZIBA: How do you see the global supply-chain disruptions that were caused by the series of national lockdowns impacting on those entrepreneurs who have been used to cross-border trade, or exporting or importing. depending on the market that they’re playing in? I suppose that could mean a fairly short time for things to go back to normal, and then for others it could take quite a while, and of course then prove detrimental to their business – which I suppose would mean they’d need to consider pursuing a Plan B?
PIETER DE VILLIERS: Yes, it’s very tough. If you’re a trader – or what we call a local hero-type entrepreneur – then typically you add manufactured goods, which means it’s from China or Asia, as raw material to be able to do that, or you’re already selling goods. But for those industries, again, not being able to receive stock for the limited trade that you can do, it’s very difficult. Now, there’s a massive opportunity for the industry to say, look, we can reinvent ourselves and create manufacturing and new industries. And if the pandemic is 18 months then we’re not going to make that investment that’s a year investment, and really have the confidence to make a capital layout.
NOMPU SIZIBA: So you’re in the tech industry space. Just tell us a bit about what Clickatell does and, over and above that, how have you seen the pandemic affect the industry, especially your small to medium businesses – and what sort of responses have you seen in the sectors dealing with the various impacts that have come around from it?
PIETER DE VILLIERS: Clickatell is a media …… commerce. So it handles large consumer brands to connect, interact, and transact with their customers, where they a. So, for example, on WhatsApp and channels like that. And what we’ve seen in the technology sector in particular, is that the biggest impact has been the ability for these companies to get paid on time. There’s been a big campaign by Endeavor and Business for SA, an SME fund, to help create awareness for larger companies to pay these smaller companies on time, because it’s the lifeblood of the business. So cashflow has been a big thing for these companies to survive.
NOMPU SIZIBA: Yes. Do you think going forward big corporates and even government are going to be a lot more mindful about paying companies within 30 days, because that’s been an issue for the longest time. And, like you say, it is the lifeblood of a company.
PIETER DE VILLIERS: Yes. I think in many ways technology companies have a better position more and more as the landscape changes, because certain sectors become critical and, if you don’t get paid on time, then you can shut those sectors down. But that doesn’t help any party. What really needs to happen is that you need to have efficiencies in the right government procurers and to pay these parties. And that in itself is a massive opportunity for a digital environment to be creative ……
NOMPU SIZIBA: Now, you’re an advocate of businesses in crisis, making sure that they have somewhere to turn when they’re in crisis. And of course the Covid-19 pandemic is certainly one of the biggest crises that the world has faced, including businesses. So just tell us about the work of Endeavor. You did mention them before, but they’re a place that businesses can run to.
PIETER DE VILLIERS: Yes, Endeavor is really an organisation for entrepreneurs who want to pay it forward and create a community of coaching and mentoring, but also then really growing their businesses. During the pandemic Endeavor has been running many sessions and webinars trying to coach and to educate entrepreneurs on how to navigate these crises. And what’s quite fascinating is that while it might be Covid-19 this year, it was the financial crisis in 2008, until there’s a lot of experience that’s been shared of how you survive, ultimately.
And I think the last comment I’ll make on entrepreneurs is that typically they are the best positioned to indeed survive a crisis, because they are problem-solvers. And so a lot of these things help instil in the new generation.
NOMPU SIZIBA: There’s that old expression “adapt or die”. To your mind, which entrepreneurs are going to survive during Covid and beyond it, and who are those who won’t make it?
PIETER DE VILLIERS: Yes, it’s a tough one. …… But I do think if you’re truly an entrepreneur, you will adapt and you will survive. But the trick to it matters. So, unless you …… out of certain sectors, it would be very difficult for you to build great momentum and growth. And if you weren’t a real entrepreneur, and you are just faking it to make it, you definitely will not survive.
NOMPU SIZIBA: That was Peter de Villiers. He’s the CEO and co-founder of Clickatell.