ENTERPRISE54 – A South African entrepreneur who has just made megabucks in a US deal has jetted back to South Africa to film the local version of the UK hit reality-TV show Dragon’s Den. Two weeks ago, Vinny Lingham, 35, who grew up in East London but now lives in San Francisco, sold his mobile
ENTERPRISE54 – A South African entrepreneur who has just made megabucks in a US deal has jetted back to South Africa to film the local version of the UK hit reality-TV show Dragon’s Den.
Two weeks ago, Vinny Lingham, 35, who grew up in East London but now lives in San Francisco, sold his mobile wallet app, Gyft, to US tech company First Data for between $50m and $100m (about R1bn).
With this track record, it is not surprising that Mr Lingham has been asked to appear on the show in which successful businessmen spend their own money buying into the business plans of would-be entrepreneurs.
And it is clear that Mr Lingham has come a long way from the small kid who was, in his own words, “beaten up all the time”.
“I think if you do things that you love, money is not actually important. I happen to be lucky because the things I do now are in vogue and I can make a lot of money out of them, whereas 20 years ago I was seen as a little geeky nerd in East London whom everyone picked on because I was a computer geek.”
It may seem easy for Mr Lingham to say all this now, but his road to riches was not an easy one.
As a schoolboy, he loved computers, but he could not get into computer science because his maths marks were so poor. (“I just didn’t take school that seriously,” he said.)
He considered ditching computers because, ironically, there was “no money in it” and pursuing law. He watched a lot of the TV series LA Law at the time, but “my dad said ‘no ways, follow your dream’. That was good advice.”
So he enrolled at the University of Cape Town, where he excelled in information systems. But the cash ran out in his third year and Mr Lingham had to drop out. He went back home to figure out what to do — and the answer was to build three tech businesses, each one more successful than the last.
First was autofinance.co.za, which allowed customers to apply for vehicle finance from the big four banks.
He sold that business to Johnnic eVentures — a division of what is now Times Media — and moved to Johannesburg to help to transition the business. But Johnnic eVentures closed down when the technology market crashed in 2000, leaving Lingham unemployed.
“I must have applied for at least 100 jobs in Johannesburg over two years and gone for at least 50 or 60 interviews … no one would hire me. Everyone thought I was too entrepreneurial or not black enough [to satisfy BEE quotas].”
He eventually found work in online marketing, soaked up what there was to learn and started a business called Clicks-2Customers using money he had made selling his townhouse. With his girlfriend and two good friends, he took it from a business making $20,000 a month in a small home to a firm turning over $10m a year. It is now one of the top 20 independent companies in the world in terms of putting relevant adverts in internet searches.
But Mr Lingham always knew he would never make enough money to retire if he was simply working for a salary.
“You’re never going to save enough money to retire at 45 — I want to get to a point when my kids are out of school [where] I can do whatever I want.”
The 35-year-old is well on his way, already being mentioned in the same breath as Elon Musk and Mark Shuttleworth — both former South Africans who developed and sold multibillion-rand operations.
But, he says, it was never about the money. “I’ve been broke many times in my life — there are lots of challenges between each juncture — but one thing, I’ve seen poor people happy and rich people sad. Having more money does not mean you will be happier.”
Instead, it is the people in his life — his wife and two young children — who make the difference.
“If I went broke tomorrow, I’d be happy. I’ve been a very happy person my whole life, because I’m always working passionately on my dreams,” he says.
Of course, working on your dreams in South Africa can be tricky, considering that funders here are notoriously risk-averse when it comes to tech start-ups.
As was demonstrated when Mr Lingham took his next idea, Yola, to the state-owned Industrial Development Corporation, which is meant to be financing exactly this sort of business.
“They literally laughed at me -they couldn’t understand the technology. It’s a simple concept of having software in a browser window like they have today,” said Mr Lingham.
But Yola was always likely to gain more traction in the US. So Mr Lingham managed to get backing from Johann Rupert’s venture capital business to take Yola to Silicon Valley in San Francisco, California, in 2008.
Then Mr Lingham, Mark Levitt, who helped to build Clicks2Customers, and US entrepreneur CJ MacDonald decided to build a mobile wallet for gift cards.
“It’s as simple as it sounds. It’s a mobile app that stores gift cards and checks balances and allows you to pay,” he said.
So why would this concept not work in South Africa? What is the government doing wrong?
Putting bureaucrats in charge, says Mr Lingham. “You need entrepreneurs to help entrepreneurs, not bureaucrats.
“That’s what I like about Dragon’s Den. I get exposed to how people on the ground are thinking, and the show will be amazing for entrepreneurs to learn how to start businesses, how to present themselves …”
The show is due to start on DStv in September. Other dragons are Lebo Gunguluza, Vusi Thembekwayo, Polo Leteka Radebe, and Gil Oved.
Mr Lingham speaks compellingly of how entrepreneurship can change people’s lives.
“You feel the impact of the work you do. Obviously, if you’re chasing wealth creation for yourself, it’s the best way to do it. There’s always the risk of failure, but if you really want to get to the point where you can retire at an early age, entrepreneurship is the only way,” he said.
Editor’s Note: This post first appeared on BDLive1 comment