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Updated 29 Feb 2020

Case study: How MXit 'maxed' it

Entrepreneurs not only use social media; they also create it, and South Africa is home to one of the great Web 2.0 success stories: Herman Heunis and MXit.

04 August 2010  Share  0 comments  Print

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Anyone who knows a teenager with a cell phone will be familiar with the addictive power of MXit, the mobile instant messaging service. Used by more than 15 million people in 120 countries, and growing by up to 20 000 new users every day, MXit is a true global phenomenon.

Herman Heunis, founder and CEO, explains that MXit is the result of perseverance, more than luck - and he has the battle scars from previous ventures to prove it. His original idea was an SMS-based massive multiplayer mobile game, but the high cost of SMSs in 2000 put paid to it.

Three years later, however, he had re-assessed the market, adapted the technologies and the first version of MXit made its debut.

"When I developed MXit, there was no data to prove that it would work or even be profitable," he says. "The best decision I made was to not fall into the trap of analysis paralysis, but to rather take the plunge and follow my dream against all logical and financial odds."

Know when to walk away

MXit survived many bad decisions along the way, fortunately most of them short-lived. "The worst decision I made was to stick with the code we used, which was not designed for what we required," remembers Herman. "We bent and moulded it, but eventually decided to write our own code, a move we should have made much earlier."

Herman is convinced that there are make-or-break opportunities for entrepreneurs wanting to compete in the online arena. "But you must be careful not to fall into the development chasm, where a product or service takes months before it reaches the intended users," he says.

"Social networking is like a lucky packet. You can't predict how users will react. Build something small, even if it's not perfect, and ask the user base what they like and don't like about it. Then shape, shave and repackage it, and give it back to them."

Show me the money

MXit might have millions of users, but they all use the service for free. Where, then, does the money come from? Firstly, revenue is generated through the Tradepost facility, where users can buy themed backgrounds, music, greeting cards and more.

Secondly, advertisers are taking up 'splash screen advertising' and creating their own space where MXit users can interact with their brand. Thirdly, corporates are starting to include MXit in marketing campaigns.

Ster-Kinekor, for example, lets MXit users know when, where, and which movies are showing, while Peugeot used MXit as part of the launch campaign for the Peugeot 107.

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