Youth entrepreneurship

Thinking out of the box: A serial entrepreneur in South Africa

An ILO initiative in the South African Free State province encourages young entrepreneurs to come up with innovative ideas as a way of helping them set up successful businesses.

Feature | 24 October 2014
BLOEMFONTAIN (ILO News) – When Tebang Motaung, a 26 year-old South African, attended a wedding a couple of years ago, he did not know yet that he would become an entrepreneur.

“I was simply taken aback when I saw the guests passing a hand towel along the buffet line. I imagined the many germs and bacteria on people’s hands were being passed along from one guest to the other,” he says.

Motaung started to think about ways to avoid such unhygienic situations. At the time he was a traffic officer, but he wasn’t earning the income he felt would be necessary to start a family.

So he started to think about a product that would serve a large community of users, particularly in environments where good hygiene practices were a challenge. This is when he decided to develop the product, the Tamikk Vadoek Sterilizer.

The product is sprayed directly onto the cloth and effectively kills more than 400 million bacteria found in a typical home. It also kills the bacteria on the hands of towel users, reducing the transmission of germs picked up when handling food.

Creating jobs


After setting up the business, he was able to create nine jobs involving the manufacture, packaging and distribution of the sterilizer. But despite the good start of his business, he lacked self-confidence. “When I first heard about the ILO’s 2013 enterPRIZE Challenge Business Competition, I was still wondering whether my idea to produce the Tamikk Vadoek sterilizer was worth being submitted,” he says.

The Free State enterPRIZE Job Creation Challenge
 

 
A few days later he was listening to the radio and heard an interview announcing the competition. He decided to submit his idea for consideration – together with 548 other applicants.

He was surprised when he was told that he was on the shortlist, and even more so when he learnt that he had won the first prize in the start-up category.

ILO prize boosts business


The prize and technical assistance gave a boost to his business. In 2014, he signed a contract with the Free State Department of Social Development to supply all 4,590 provincial crèches registered on its database each week with four bottles of the spray. Meanwhile, his production has gone from 1,300 bottles produced per year to an impressive 60,000 bottles per month.

He now employs 15 permanent staff, all of them under the age of 33, to provide customer care, deliveries and sales to customers. He has also moved his operations from Bloemfontein to the northern Free State town of Reitz, which is closer to the laboratory that produces the solution and can bottle larger volumes of the product. This cuts down on transportation costs that would otherwise be passed along to the consumer.

The plan now is to establish a manufacturing and bottling facility in Bloemfontein and he is currently in discussions to provide the necessary financing to do so. Due to the steady growth of the business, Motaung’s turnover has now reached some R180,000 (about US$17,025) per month. This steady income enables him to concentrate on the expansion of the business, as well as starting up other new business opportunities.

“I regard myself as a ‘serial entrepreneur’. I do hope that I can create a string of successful businesses run by others on my team,” he explains. Motaung feels that the ILO competition forced him to think more clearly about how he would develop the business and create more formal jobs. “Without the prize I would not have developed such an effective business model,” he concludes.

The Free State enterPRIZE Job Creation Challenge was launched in 2013 to help young South African entrepreneurs to seize unexploited or under-exploited business opportunities. Last June, a second round of the challenge distributed prizes to 71 winners in 25 categories.

“They were invited to think out of the box and be innovative,” says Jens Dyring Christensen, the ILO Enterprise Development Specialist for Eastern and Southern Africa. With more than 31 per cent of South Africa’s youth neither in employment, education nor training, the enterPRIZE Challenge is a promising means to address the urgent need for entrepreneurship development and jobs in the country.” The competition is sponsored by major companies as well as local business associations, chambers of commerce and universities.

It is based on a partnership between the ILO, the Department of Economic Development, Tourism and Environmental Affairs (DETEA), the Small Enterprise Development Agency (SEDA) and the Flanders Delegation in South Africa.