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Entrepreneur Neo Malefane calls it his “9/11 moment” – his first business crash, which was exacerbated by a R1.8 million bill from the taxman.
“Everything was in a shambles,” the CEO of Leano Solutions told attendees at the Industrial Development Corporation’s youth conference, held over two days this week in Midrand in Johannesburg.
His tax problems came on top of the collapse of a number of partnerships, which had distracted him from his own business. “It was a matter of diversification gone wrong,” he said.
It was then that the 30-year-old realised how little he knew about business. This despite having “grown up behind a till” and started his first business – a marketing concern – during his second year of study at the University of Johannesburg.
Back then, he had no transport or capital. His first loan of R2 500 came from his sister.
His first asset was a computer. It allowed him to prepare quotes from his residence room instead of using the university’s communal computer facilities.
“I sold my business as if I was an employee – as if behind me, there was a big operation,” Malefane said, to laughter from the audience.
“My clients were unaware that I was the only guy they would be dealing with.”
Malefane told City Press that he switched from marketing, which was his field of study, to rehabilitating infrastructure in the construction space – building, plumbing and electrical – after crossing paths with a fellow South African in China.
He ran into this acquaintance back in South Africa and they struck up a conversation, which alerted Malefane to the opportunity in construction.
By the age of 24, his business had achieved a turnover of more than R2 million.
“I thought I knew it all,” he said.
Fast-forward two years and Malefane went through “18 months of pain”, during which he had to choose between making bond or car payments in a particular month.
“I was almost counting the slices in a loaf of bread. I had to go back to my family [for support],” he recalled.
His tenacity paid off.
Today Leano Solutions has 71 employees, operates in two provinces and has received funding from the Small Enterprise Finance Agency.
His advice to other young entrepreneurs?
“The only arrivals terminal you should aim to reach is the one at OR Tambo or any another airport. Make sure that you never reach an arrivals terminal in your entrepreneurial journey.”
