Local start-up proves that slow growth and patience lead to the greatest rewards.
The success of any start-up lies in the entrepreneur’s ability to evaluate market needs and develop a product or service that consumers want; the ability to take that idea to market; and finally the ability to fund the first few months or even years while the business gains traction in the market, achieves breakeven and then starts making a profit.
If you’re able to get all three right, you’re well on your way to running a sustainable business.
As an entrepreneur on his third start-up, Ric Meulemans had learnt these lessons, something his much younger partner, Oliver Bryant, had not.
“That’s been my biggest lesson,” says Bryant. “I’ve wanted to rush our growth every step of the way, particularly when everything started taking longer and costing more than we had first planned for. But Ric made sure we stuck to our original plan, and that patience is the reason why Guzzle is the business it is today.”
In fact, Meulemans and Bryant have the ideal partnership. Bryant, who did some IT work for Meulemans on his other business, Krugerpark.com, developed the idea for Guzzle while still at varisty. Why not create a form of ‘Bonnie’s Best Buys’ for the Internet?
“Oliver pitched the idea of a tech platform that could aggregate deals and help consumers avoid buyer’s remorse,” says Meulemans.
“The information was out there – it was all in the weekly catalogues that the big retail chains print. We just needed to figure out how to make use of that information and get it online.”
Bryant had the idea, but Meulemans had the experience, something that would be needed in the months to come, particularly as their solution was slow and costly.
Catalogues were collected, sent to India where they were digitised and categorised, and uploaded to the site.
Functionality allowed users to search categories, areas and price ranges. And each week, the deals had to be uploaded again once the deals expired - but users started finding out about the site, and embracing the concept.
Slow and steady
“I would have rushed to market, the retailers and even investors much sooner if Ric had let me,” laughs Bryant.
“Launching was a slow and expensive process, and I didn’t have the patience Ric had. If I had launched this business alone, I would never have stuck to the original plan like Ric insisted.”
In fact, Meulemans was happy to fund the start-up through Krugerpark.com as long as they didn’t approach a single retailer until they had 10 000 unique visitors per day. Why be so strict? Because retailers are notoriously difficult to interest in a product, which meant Meulemans and Bryant needed to have a platform that worked to convince them.
“We had two challenges,” says Meulemans. “We had to prove our solution worked, but more importantly, we had to educate the retailers that this was the way to go. Our product promotes complete price transparency.
"A user can sit on their phone, in a store, and compare the price of a fridge across multiple retailers. Consumers are our users, but the site would be monetised by the retailers – those were our clients, and I didn’t want to go to them until we had a product that we could prove the value of and show them that they couldn’t avoid how consumers were behaving.
“Researching offline and buying online (known as ROPA) is common practice today. We needed to educate retailers that even if they didn’t like the idea of complete price transparency, they needed to accept it – and use it to their advantage.”
Taking the time to perfect the product meant that by the time Meulemans and Bryant were in negotiations with retailers, they’d added functionality that was to their benefit.
“Retailers could see who had searched for what and where, and what consumers were purchasing. We’d also added functionality where a customer could purchase off the catalogue, by clicking on the product.
"Adding this functionality to a catalogue can increase conversion rates by over 30%, as the customers no longer need to dig around and search for the product after looking at the promotion.”
It was a slow process, but the retailers started coming around. “You just need to know from the outset that this process takes months, and a lot of meetings,” says Meulemans. “You can’t rush it, so rather plan for it.”
Next level growth
Six months in, Caxton approached the founders to buy the business. “At the time, we only had 5 000 unique visitors, and we knew it wasn’t ready,” says Meulemans.
“Rejecting an offer can be tough as a founder, especially when your business is only costing you money. But we knew we were on the right path, and we stuck to our guns.”
The wait paid off. Naspers approached Meulemans and Bryant once they had secured a few retail partners, and this time, the founders were prepared to talk about a joint venture.
It wasn’t an equity deal, but rather a partnership aimed at disrupting print media and reaching as many unique visitors per month as possible.
“The JV means we collectively reach six million unique visitors through Mweb, pricecheck, News24 and Guzzle, using our platform. It’s meant incredible growth for us,” says Meulemans.
And of course, it proves that patience does pay its dividends.