Africa Talks Business had the honour of speaking with the CEO and Founder of Raizcorp.
Allon, a game-changer and an industry leader in the field of small business, has made Razicorp a household name in the names of many small enterprises. Through their programmes, Razicorp has assisted more than 13,000 firms. Allon shares his personal experiences as once a Small Business Owner himself, including the difficulties he had in the beginning, and how this empire was born.
Read this Incredible Interview below:
1. Tell us more about you and how your journey started.
After studying marketing, I worked in my parents’ umbrella factory but realised that I needed to be successful in my own right. So, I approached a friend for a job in his ailing retail clothing chain where I truly found my niche. I redesigned the stores, restocked the shelves and started running innovative promotions.
The stores began to boom and the local press did an article on one of my promotions which caught the attention of a local multibillionaire businessman. In late 1991, he offered me the chance of a lifetime – to start any business of my own choosing while being mentored through the process.
Despite all my advantages – an entrepreneurial family background, a good university education, guaranteed financial backing, an impeccable business mentor and the freedom to choose any business I wanted – a year after my business opened, it was clear to everyone that it was a complete failure.
When I approached my mentor with the intention of somehow paying him back, he said, “I agree your business has failed. Knowing this, what would you do differently?” I’d already put a lot of thought into the things that I should have done and I laid them out for him. He then said something that changed my life: “I didn’t back your business. I backed you.”
He told me he would continue to support me provided I would take the advice of a number of experienced businesspeople he would connect me with, saying that while I may have failed, I had been able to draw lessons from my failure. He allowed me to learn from my failure and try again. This time, paying attention to the team of guides surrounding me, I was able to grow the business into a success.
Having benefited from true support and guidance as an entrepreneur, I wondered what happens to small business owners who don’t have all the privileges I was given?
And so, the idea of Raizcorp was born. Raizcorp is a way of paying forward the support, development and encouragement I received from my mentor and the team of guides he helped assemble around me. At Raizcorp, we’ve duplicated the formula of success my mentor gave me and have created a safe environment where entrepreneurs have people who believe in them, can learn from their failures and are given the chance to succeed and create the wealth they deserve.
2. What was the toughest challenge getting to where you are today?
It was four years into Raizcorp and I was making a loss every single day, every single month. It was getting worse and worse and I was borrowing more and more money. I was trying to believe in myself in that time, despite all the financial feedback, and searching for any positive feedback just to keep myself going. Then, in 2004, my first child was born and things were so bad that I couldn’t even afford the bill to release him from hospital. It was very embarrassing; I had to borrow money from my two brothers-in-law. When I brought my son home that afternoon, I looked down at this little baby and realised I was being completely irresponsible. I literally collapsed to the floor sobbing realising that, until that point, it had just been me but now that I was responsible for a child in the world, what the hell was I doing? This crisis point was the hardest for me. I had to look at the feedback (which was negative) and my responsibilities (I had to do the right thing) but I also wanted to push through and make a success of what I had been building for four years even though it wasn’t succeeding. That was truly the hardest, hardest time on my journey.
3. What value does a mentor have for entrepreneurs?
A mentor is able to offer you different – and very important – perspectives on situations. A good mentor is a sounding board for your thinking. They hold two seemingly contradictory roles – to keep your feet on the ground but also to be the wind beneath your wings. In some cases, they can also provide access to networks. But I believe the greatest value a good mentor offers is a safe place for you to be vulnerable and authentic. Very often in the early years of business, you live behind the façade of success (fake it until you make it) which makes it very important to have someone around you who you can speak to openly and honestly without fear of judgement.
4. Why is the failure rate for small businesses so high in your experience?
In my experience, the reason for the high failure rate in small businesses is the lack of CERTE (a compelling economic right to exist). For any business to succeed, firstly, they have to have something to sell (that is different). In most cases, small businesses have me-too products with very little differentiation and often misguidedly understand differentiation to be personal service or cheaper pricing.
Secondly, they have someone to sell to, in other words, a market. Too many entrepreneurs start their businesses off a few positive buying signals from their friends and family at a braai on a Saturday night. Many small business owners do not take enough time to fully understand the market potential of their product or service and tend to grossly underestimate the competition and the ease of entering a new or established market.
Thirdly, they must have the ability and desire to sell. Most small business owners today misinterpret marketing as selling, fantasising that spending R10 000 on Google and Facebook ads will result in orders flying in. There is a high fear of rejection when it comes to having direct conversations with potential clients and, as a result, most entrepreneurs shy away from it.
Fourth and finally, most small businesses are really, really bad at costing which means they don’t price correctly which leads to a lack of profit which, ultimately, results in business failure.
5. How do you define success?
In my opinion, there is no such thing as success. There is only succeeding. Success is a process and never a destination. There are always improvements to be made and better ways of doing things to be found. The minute you think you’re happy or satisfied, you stop pushing.
6. What one piece of advice, if any, would you say helped you stay strong throughout your journey?
My mentor once told me that there is always a way through and your job is to stand up long enough to find it.
Find more about Raizcorp here – https://www.raizcorp.com/
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