So impressed were they with local businesses that some of the 50 American business students and academics that recently toured a Cape Town township, vowed to return next year with the promise to help invest in those businesses.
Accompanied by the University of Stellenbosch Business School’s Small Business Academy, they were part of a tour by Virginia-based Darden School.
The aim of the visit was to explore the local township business scene and the unique business models employed by formal and informal entrepreneurs.
Margaret Frank, head of Business Studies at the University of Stellenbosch, says the American approach to startup businesses differs from the one students witnessed in South Africa.
“Some of my students have been so impressed with the local setup that they plan to return in 2015 to invest, advise and employ their skills to local businesses.”
Following the occasional tasting of local cuisine, such as the popular “smiley” (sheep’s head) and umqomboti (traditional African beer), the group listened to a talk by well-known local Information and Technology (IT) entrepreneur and Silulo Ulutho Technologies founder Luvuyo Rani.
The Western Cape Department of Economic Development and Tourism (DEDAT) has assisted Rani with business support and funding to grow his business. in 2010 he received R100 000 in finance through DEDAT’s Enterprise Development Fund. He now owns 15 branches in the Western Cape and eight in the Eastern Cape.
Rani told students that while most township businesses still use conventional business methods, the use of technology and digital platforms by township enterprises has grown among Cape Town’s small firms.
Township companies such as Silulo Ulutho Technologies have gained success by broadening their model to introducing accredited courses in IT and related studies.
Trinity Ying Zang, a second year student at Darden School who hails from China, noted the similarity in the local startup business models to those of her home country.
She was surprised by the unique fusion of traditional and modern methods of making money in the township.
“When I listened to Rani speaking about his transition from an informal enterprise to an established business, I saw the need for more corporate companies investing their services through smaller companies to reach the market in rural and township spaces,” she said.