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Entrepreneurship Challenges In SA

Maushami Chetty | August 3, 2020

I run two businesses: Aarya Legal, a legal, B-B BEE and transformation consultancy and a legal tech start up.  Aarya Legal has been fairly smooth sailing.  Our reputation for providing affordable, high quality and quick turn-around legal services in the entrepreneurship space is well established. 

The interesting thing about entrepreneurs as clients is that once you develop a sixth sense for trouble clients and put proper processes in place for signed agreements and deposits you rarely have collection issues or long payment terms. Entrepreneurs are pretty good as clients. 

I designed Aarya Legal to be in line with the trend towards virtual law firms.  In other words, low overheads and the ability to provide services from anywhere. This was mostly because I love to travel and want to be able to work from the beach.  Everyone that works for Aarya are black women and do so virtually.  I had the idea years ago of creating a way for Mum’s with legal degrees and experience to stay involved in work while taking time off to raise their children and I’m glad it’s working out.  

Our offices at 22 on Sloane allow us a space where we can meet other entrepreneurs and see clients, but the team is rarely in the same place at any given time.  Few of our clients want to see us face to face either and much of our services are conducted virtually; our largest client being a UK based technology business.  Ironically this made us co-vid19 ready off the bat and we had to do very little to adjust.  This wasn’t by design it was just a stroke of luck. 

My legal tech start-up aims to make legal services accessible to entrepreneurs online and at very affordable rates as well as a legal education in multiple South African languages.  Getting access to market here has been more a of a challenge.  These are some of the challenges I’ve noted:

1. Corruption: This goes for whether you’re trying to do business with the private or public sector.  Its endemic.  You need to go through some middle-man who wants an unreasonable cut or equity and the best product for the market may never see the light of day. This is  dumbing us all down and killing innovation.  I once tendered for a corporate enterprise development (ED) programme under a friends company.  I was approached by a dominant player who knew I had an online legal product. They had not tendered but were awarded the contract and were asked to provide an online legal service based our tender documents. He had no idea he was coming to me with my own idea.  The use of tender projects as free consulting and the awarding of tenders to non-submitting parties needs to end.  Corporates need to know that this damages their reputation and everyone in the industry knows who the culprits are.

2. Employee KPI mentality:  Many people staffing ED programmes have never run a business and don’t know how to advise small business. They are also largely motivated by meeting their KPI’s or taking a great idea to their higher ups. They often scalp ideas of ED programme participants or people pitching their ideas to corporates. You end up with a bad facsimile and entrepreneurs lose out. This is not always the case and you do get very enthusiastic and committed employees, but this happens to often for comfort. 

3. Long payment terms: I do very little work with big corporates outside of ED programmes/ accelerators/incubators but my work with SMME’s shows that 90-120 payment terms are all too normal.  Small business is effectively giving corporates an interest free loan.  If just this practice changed, we would see a dramatic knock-on effect to SMME sustainability. 

Despite these challenges’ entrepreneurs are some of the few people in South Africa that have a generally cheerful outlook and believe they can leave a lasting legacy so it’s best not to get bogged down in negative and find a solution.

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