How to build a commercially viable business – Meet Kenneth Kayser

By Koketso Mamabolo

Kenneth Kayser knows better than most how to build a digital business. His twenty years of experience includes time in the financial, mining, telecommunications and public sectors. The PhD candidate at the Johannesburg School of Business has founded and invested in various tech startups in fields ranging from finance, medicine, education and property.

The young executive has found success across the African continent, having been involved with numerous Fortune Global Top 2000 corporations. We find out from him what the keys are to a successful startup, how to build a commercially viable business, some of the lessons he’s learnt from working with top corporations, and more.

What are the keys to starting a successful start-up? 

I have been fortunate to have started two successful startups over the years. I gained a lot of exposure while helping Techstars (US tech accelerator) establish its presents on the African continent while at Barclays working with different fintech startups (helping them grow and scale). There are many success and failure contributors but the ones that stand out for me from a success perspective are: 

• Your value proposition: Know exactly what problem you are trying to solve through the start-up and what skills, expertise and tools you have as a founding team to solve this problem. Being honest about your shortcomings as a founding team is key to determining what intervention needs to be put in place to close these gaps), previous failures also play a key part in success as they guide you on what not to do or what can be done better. 
• Your team and ecosystem: People, this is probably the most important success and failure element. It’s the people that build the products, and technology and help the business grow and scale. Know what your strengths and weaknesses are, as well as those of your founding team members. Startups operate within an ecosystem thus it’s key to understand the value being created by the start-up within their specific ecosystem as well as how best to partner with the ecosystem participants.
  
  

How does one build a commercially viable business? 

Good question, this is a work in progress for both startups and corporations. Starting with Minimum Viable Tests (MVTs). An MVT is a test of an essential hypothesis. Before building a Minimum Viable Product (MVP), get immersed with the industry, customer and ecosystem in which you are planning to build your business. Then use customer development techniques to validate your hypothesis and de-risk your product and business from failure (as best as possible). Only then launch your MVP once you have worked through your MVTs. Failure forms part of the success process thus you must learn how to fail fast. 

What challenges are South African startups facing and how can they be overcome? 

Let’s start with the positives before we focus on the challenges. South Africa ranks 61st among the 132 economies featured in the Global Innovation Index for 2021. The Global Innovation Index (GII) ranks world economies according to their innovation capabilities. The GII framework model looks at innovation from an inputs and outputs perspective through 80 selective indicators. 

South Africa over the past three years has improved its ranking from an innovation inputs perspective (from 63 to 61). Innovation inputs include our institutions, human capital & research, infrastructure, market sophistication and business sophistication. These all speak to South Africa having both developed and developing economy attributes thus creating a perfect launch pad for startups to launch their businesses to both developed and developing markets. This must be seen as a big plus for South African startups. 

 Our innovation outputs such as knowledge & technology outputs and creative outputs have ranked 68th in the world for the past three years meaning that even though we have what it takes to be an innovative economy, there are challenges that are keeping us from thriving. 

Some of these challenges as listed by the GII include; ease of starting a business, graduates in science and engineering as a percentage of the overall graduate population (education), and gross capital formation as a % GDP, just to name a few. These are all challenges that then impact the start-up ecosystem. I do believe that work being done through the Start-Up Act will help improve South Africa’s start-up ecosystem and improve our innovation outputs as a country.

What does the future look like for entrepreneurs? – How can they adapt to what’s coming? 

My perspective on this question is taken from a digital one as that is where most of my experience and expertise are derived from. The concept of digital colonisation (cited from a 2019 research paper by Danielle Coleman of the University of Michigan) is something that both entrepreneurs and corporations in South Africa and Africa’s digital economies would have to become acquitted with should measures not be put in place to improve the innovation outputs of our innovation economies. Both private and public sector partnerships will be key to growing and supporting South Africa and Africa’s digital economies, entrepreneurs and intrapreneurs.

Please share some of the lessons you’ve learnt from working with top corporations. 

South Africa has world-class corporations that compete with the very best in the world. I’ve been fortunate to have worked in several industries like financial services, telecommunication, government ICT and mining. One thing that stands out across all industries is our competitiveness, and because of the competitive nature corporates invest in their staff as well as create environments that cultivate world-class best practices. 

This could be one of the reasons why South African workers are sought after the world over. As noted in my previous statement about South Africa’s economic attributes of having both developed and developing market characteristics, this allows our corporations the ability to create holistic solutions that have global appeal.

What are local and international investors looking for from entrepreneurs? 

Think Carefully About Your Business Model (I noted the importance of an MVT framework to test the business concept)

• Think Clearly & Communicate Succinctly
• Demonstrate Intellectual Integrity
• Balance Risk with Responsibility

How can we attract more investment into the country?

As noted in my previous comments on our innovation outputs as a country and the challenges that exist with it, if both the private and public sectors work closely together to solve those challenges, then I think we can obtain the trust of investors and attract more investment into South Africa.

What direction do you see e-Commerce heading in South Africa? What are the current trends:

 As our internet connectivity rates improve across communities in South Africa, this will enable many more people to be part of the digital economy. This potentially will allow for greater levels of e-commerce transactions. An overall omnichannel approach will help both startups and corporates, thus offering phygital (digital combined with physical) experiences will be key. This phygital trend is quite evident, a recent example of this is Meta (Facebook parent company) launching a physical store that complements its digital offering with Google also doing the same.

Please tell us about your story – how did you get to this point, personally and professionally?

I was born in the Cape Flats in Cape Town in the 80s. My parents decided to relocate to Johannesburg in search of better prospects and opportunities just before the first democratic elections in South Africa. I completed my schooling in Johannesburg and landed my first job at age 14. So, I’ve been balancing work, studies and family responsibilities for many years now (25 years to be precise). I completed my first degree through correspondence (while working), then an MBA in the UK (also while working) and now a PhD. I was also blessed to study at Harvard in the US.

Do you see Cape Town becoming Africa’s Silicon Valley:

Africa’s digital ecosystems are growing with regional hubs emerging across the key regions of Africa. Cape Town is one of the regional hubs with Johannesburg, Lagos, Cairo and Nairobi.

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