Hello, I'm Felicity Hannah.
Welcome to Business Daily from the BBC.
Now, how do you make a million before you turn thirty?
In our new series, we're speaking to six entrepreneurs who've managed exactly that.
As long as you keep going there’s hope.
You know, at some point in 2017 we had nothing, like no product, no investor, no money, but we
kept going.
Failure is actually only failure when you stop.
Today, It's the founder and CEO of The Student Hub, Hertzy Kabeya.
Find out how he made his first million and what he's learned along the way.
So Hertzy Kabeya, founder and CEO of The Student Hub.
Hello.
Hi.
Thank you very much for joining us.
Now, your story is fascinating.
Different countries, different businesses.
I wanted to know what skills you've particularly brought to that, so what's your superpower?
Well, I must say that my superpower, I’ll say is really
linked to the fact that, you know, I really know the reason why I exist, right, and then
I can actually stick to my lane.
So, I’m here to solve complex social problems using technology and business and so long
as I do that, I think I'm quite successful, wherever I go.
That's a better superpower than being able to leap tall buildings, isn't it.
That is genuinely useful.
(Laughing) Great.
Okay.
So, you were an entrepreneur from a very young age.
I want to hear about the chickens.
Oh, the chickens!
(Laughing) Okay, cool.
So, I'll go back to, you know, the very beginning.
That's my first business venture.
I grew up in the Congo in Kinshasa, and when I was about fourteen.
I think, right, so we started to receive this bottled milk coming from South Africa, actually,
funnily enough, where I am today.
So, it was bottled milk and we were used to powdered milk, right.
So, when we started to see bottled milk coming in liquid form, it was quite interesting for
me to see that.
And I thought that if we could also do the same with eggs, it will be really, really
convenient for people, you know put them in these bottles and then give it to people with
other ingredients in it already and all they have to do is shake and pour.
So that's how the concept of, you know, selling chickens came in.
So, I used my pocket money to buy chickens, and then made a chicken coop.
And from I think a year later, I was selling eggs, you know, but when I started to contemplate
how to package it and preserve the eggs in the bottles and all, that is when I got stuck,
you know, and in the process I failed my Grade Eleven, you know, the grade
just before you get your matrix result.
So, then I think when I failed my Grade Eleven, my parents decided to put a halt on this,
to say, you know, focus on school.
But yes, that was my first venture for a year and a half.
Okay, so then your parents say put that business to one side and concentrate on your studies.
That is not a lesson that you learned, is it?
Tell me what happened when you went to university.
Right, so I moved to South Africa to do my post school education,
tertiary education.
I really knew I was an entrepreneur at heart, I just wanted to know how to run a business.
So, I came to study business management, and that's how I started my second venture two
months into university.
So, you weren't learning to walk before you could run.
What did you start?
What business did you launch?
I was selling textbooks.
So basically, what happened there is two months into university I remember I saw that students
were actually selling their textbooks, putting posters on noticeboards, right.
So, I saw an opportunity to make it easier for them, right.
So, I started to take the posters off the noticeboards, call the student, and ask them
to actually bring me the books and I will sell it on their behalf.
So that’s how it started.
So, I took my bedsheet, basically, and then put it on a table in front of the library
at university, took all the posters and called students to bring their books
and then I’d sell it on their behalf and then I'd take ten percent and give them ninety
percent.
So that was the first business I started, I was two months into university.
So, it was called Budget Books, you know, so I created logos, and all that, and that's
how I started my second venture.
I do not remember a single day where I actually went to university and just focused on going
to lectures, until I think the second year when I managed to get enough sales
to pay a person, you know, to sit there, and take care of the textbook sales while I was
going to lectures.
You've launched, then, Budget Books and then you found that you had a competitor as you
were trying to expand.
Correct, correct.
So, I went to another university called UCT, or University of Cape Town.
So, when I was visiting, I saw that there was another student doing that, the same thing,
but the person already graduated, also did it when he was a student, graduated
and he had two stores, and it was called Pimp My Book.
It reminded me of Pimp My Ride, you know, and it was cool, you know, students really
were queuing there and I’m like “I love this concept.”
Hertzy, is it possible that Pimp My Book was a better name than Budget Books?
Oh, of course, of course, because I used to compete on price.
Budget Books, you know, like dropped price and all that cheap, cheap, cheap, but with
him, he made it cool.
I loved the concept.
He really made it cool, you know, to come to a second-hand store and sell your books,
and that was really great for me, and then when I saw that I'm like “I want to partner
with him because of the brand”.
So, we merged the two businesses in 2012 and then started to grow Pimp My Book.
And then you left Pimp My Book.
What happened?
Alright, so I left Pimp My Book.
I didn’t want to, but I was kind of forced to.
We started to receive serious competition, right,
from online retailers, right.
They were selling brand new books at second-hand price, so competing on price was no longer
an option for us.
Right.
So, I approached the board at the time, and my partner at the time, to say look guys,
we need to add more value to students, right.
So, whenever a student buys a textbook from us let's offer study support, because I went
on Google and googled the failure rate at university in South Africa.
I was shocked to see it was over eighty percent.
I’m like, eighty percent of students do not actually make it to third year.
So, I decided to tackle the problem, but using our book business as a foundation.
It didn’t go through.
It did not go through.
They said no, we are retailers.
We sell books.
If we have to make more money, we need to add more products in the stores, not build
a tech platform that would do that.
And then I remembered the last meeting, they said “but Hertzy, if you’ve got an idea
that would change the world, go do it on your own.
Not here.”
So, you left the business.
The business that you had helped grow from a tabletop outside a library to what it was.
Did it feel like failure?
No, for me I was a lot more excited because I'm always forward looking, right.
I was a lot more excited by the prospect of solving these problems, and in fact, I’ve
always been willing to pivot.
So, this is what happened.
When Pimp My Book did not work and I could not do it there, I built another vehicle to
do it.
Yeah, it was not failure.
So, at that point you are a man with a vision and not much else.
What did you do?
Yeah, so the only thing I had was the vision.
I wanted to create this world where you know, every single student is equipped to discover
and achieve their purpose.
And I'm like step one, I’ll build a platform that will first equip them to achieve their
purpose, so it means that they need to be able to complete their grades from first year
to third year, have the right technology to support them
and bring all the stakeholders around this ecosystem that I build to service the student,
and that's how the concept of The Student Hub came in.
So, I’ve said that you were a man with a vision and not much else.
What you needed to launch your vision, The Student Hub, was capital.
You were pitching this idea to investors without a product to show them.
Tell me about that.
Yes, I mean, because the only thing that I had was a vision, right.
So, here’s what happened.
I had a friend of mine who was a designer.
Actually, not even a designer, he was still a student.
Right.
So, I asked him to design a screenshot of basically what I had in mind, you know, and
then I was literally going and asking for funding.
So, my friend managed to pitch their mother, their mother wrote us a ten-thousand-dollar
cheque.
And then another friend, I went to their mother, their mother gave us another ten-thousand-dollar
cheque.
So, I had my twenty thousand dollars to start, right.
That's what kept us going.
So that keeps you going.
You start signing people up.
Was it straightforward growth after that?
No, no, no.
I remember 2017, right.
So, I started in 2015, and in 2017 the product started to take shape, and then we were actually
about to get our first dollar, right, from the customer, and then we tried in the meantime,
I'm also trying to raise funds from investors, and then last minute, the fundraising did
not go through.
An investor pulled out last minute, and then I already had a team of 30 people on staff,
and I didn’t know what to do, and half of the team resigned because we were
not paying salaries, you know.
And then we went, 2017, from being the year where we’ll generate our first revenue,
to being the year where The Student Hub basically almost closed down.
You know, so it's reached a point where we almost closed down.
Hertzy, when you say half your team resigned, how come only half your team resigned if you
weren't paying salaries?
How did you keep the other half?
The other half is still here to date.
They're still at The Student Hub.
So, what happened is I kept keeping the dream alive.
Right.
So, you know, they had this hope that when we finally make it, this is going to be the
best company to work for.
We'll solve the lives of so many people.
The vision and the mission kept them alive.
So, I also got very close to the core fifteen at the time, right.
I was buying dinner for them, you know, some of them.
I mean, It was really, really dry and then they had kids and all, you know,
and then they were losing their houses, and it was really bad.
They could not even pay their landlords.
I was sleeping at the office, I did not have a place to stay, all my clothes were in the
car, and at 5 AM before people come to the office, I had to leave.
I’d go to where my sister is and shower, and then come back, you know, to work.
So basically, that was my life.
It was tough, but for me the vision was more important, and what we were trying to achieve,
so we kept the team going.
What happened that meant.
You didn't have to sleep in the office anymore?
In 2018 we managed to get a corporate investor to give us our first big cheque.
That corporate came and wrote us a three hundred- and fifty-thousand-dollar cheque, right.
So, when they gave us a three hundred- and fifty-thousand-dollar cheque, that really
helped us pay some of the debt, free up capacity, hire more people, and then in 2019
we just saw a surge in student sign ups.
More people started to use the platform and made a strong business case for investors.
So, I started to talk to the investors in 2019 and by 2020 we had over three million
dollars that we secured in funding.
So that's how the company got out of the red.
And that's a very important point, isn't it, because this series is called Million By Thirty
and suddenly you're seeing that million dollar, multi-million dollar investment.
How much of it does you think was because your business
is a sound idea?
And how much of it was them investing in you, because you so clearly had this vision?
Well, I think it's both, I would say fifty-fifty.
Although whenever you speak to investors they say “look, we don't bet on the horse, we
bet on the jockey”, right.
So, I think the quality of the person I became through the struggle really attracted investors.
The resilience, the hard work and the ability to keep a team
together, you know, through these struggles and the challenges that we faced was quite
key to investors and I think they were quite attracted to it because they saw in me, probably,
a person that could take them through.
So, I think the vision and the mission was really important to them, and then the traction
was kind of a validation that, you know, I'm not crazy.
What I am talking about is actually a market, you know, that’s willing to pay for it,
and Covid just made it even better because in Covid
we just moved to multi-million-dollar turnover, and now the sign ups just keep going, keep
going, you know.
Summarise for me, then, where The Student Hub is now.
Is it the realisation of your dream or has it got further to go?
Oh, we still have a lot to achieve, right.
So, we still haven’t solved the unemployment problem in South Africa and on the continent
as a whole, so as long as there is this unemployment and skills mismatch, you know,
in the country and on the continent, we haven't achieved much.
I wouldn’t say we have achieved already the reason why we even exist.
So, The Student Hub, where we are right now, we are growing.
We’ve got a strong student community that’s growing, more and more education institutions
are building their courses around our platform, changing the processes and systems really
around our platform.
More and more employers are signing up to join our opportunity portal
there.
We match students or graduates with employment opportunities.
So, the ecosystem that we've built is getting more and more mature, the traction we are
getting is quite strong traction, multi-million-dollar revenue, over two hundred people and staff,
adding in a hundred and fifty people within the next six months.
So that's where we are.
Busy growing, solving these problems, and we do
believe that within the next two to three years we’ll be one of the major contributors
of jobs on the continent, especially in South Africa where we already have a large footprint.
It's quite an ambition isn't it.
I mean, you made the Forbes “30 Under 30” list.
They said your story is one of consistency, resilience and persistence.
How would you describe your life so far?
My life, so far.
Those words, I think, capture that.
I think consistency is definitely the right word to use.
I remained consistent, you know, and I never deviated, because I really know what I wanted
to achieve.
I remained resilient whenever I faced obstacles and a tough time, I just reminded myself of
the reasons why I'm doing what I'm doing.
You know, and that really, I would say is a great summary of my
life.
A story of resilience and consistency.
You've stared failure in the face.
What's your advice to other young entrepreneurs?
I realised over the past ten years, almost, failure is actually only failure when you
stop, right.
So as long as you keep going, there’s hope.
You know, at some point in 2017 we had nothing, like no staff members as I said, no product,
no investor, no money, nothing, is that even a company?
It’s not.
You know.
So, if you have none of this is that even a company?
There’s nothing there, right.
So, we had none of this, but we kept going.
We kept going, and for me, as long as you keep going, you will never fail.
You know, failure is when you stop pushing.
That was EdTech entrepreneur Hertzy Kabeya bringing to a close the first in our Million
By Thirty series on Business Daily.
I'm Felicity Hannah and this programme was produced by Helen Thomas.
If you want to get in touch, find me on Twitter, it's @FelicityHannah, and for more episodes
please download our Business Daily podcasts.