Empowering SMEs

Yoco founders Bradley Wattrus, Katlego Maphai, Carl Wazen and Lungisa Matshoba

In this modern world where technology reign supreme; where people interact and trade electronically, every second of every minute---every day, it is inevatible that small and medium-sized businesses (SMEs) should align themselves with modern technology to be globally competitive and trade efficiently.

Considering that there are over 78 million banking cards in operation in South Africa, but the fact that over 500 000 small businesses and sole proprietors still cannot accept them (due to high costs of point of sales banking machines) poses a huge problem for doing business in the country, largely also affecting South Africa’s economy.

Missing out on this dominant form of payment sets back a lot of small businesses in the form of missed sales, delayed collections and cash-handling headaches. In addition to offering customers a seamless payment experience, business owners also want to be able to track what it is that they are selling. The traditional point of sale (POS) systems as we know it are expensive and not mobile.

But all this has drastically changed at the end of last year with a new South Africa innovation, Yoco, a cellphone app that will allow any business, regardless it size, to accept card payments---for free!

Developed by the four dynamic company founders, technopreneurs, Katlego Maphai (Managing Director), Carl Wazen (Commercial Director), Bradley Wattrus (Financial Director) and Lungisa Matshoba (Technology and Product Director), the concept of Yoco is about building a platform that gives small businesses easy access to the tools, services and insights that they need to run their business better. “But in addition to offering your customers a seamless payment experience, you also want to be able to track what it is that you are selling,” says Wazen. Yoco chose to make their POS app as useful as possible so that businesses can register what they have sold with every payment and cash up at the end of the day.

The Cape Town based integrated card payment and point-of-sale solution company made international headlines when it announced the app and introduced it to the world four months ago, presenting a big solution to especially businesses in the developing world. Since then the company has seen a substantial growth of clients and reached  over 1 200 SMEs by the end of February.

It also has the security stamp from the card payment networks Visa and MasterCard and has the validation of merchants across South Africa, and is adding over 200 new merchants every month.

Wazen says when you are busy with your business---making things, marketing them, reaching out to your customers and convincing them to buy your product, you need to know that you can complete that sale. “That last mile is everything. But you are not in control of it. If you cannot offer your customer a reliable means to pay, all your work is for nothing.” 

Yoco then loops that back to the customer in the form of insights about their business. Which products are selling the most? What the peak selling times are, it highlights staff member performance, and the list goes on. 

Explaining the origins of their business concept and how they identified the need, Wazen says: “South Africa has a massive payment acceptance gap. There are many cards in the market but not enough places that accept them. Millions of businesses in South Africa still struggle to accept money in a country with over 75% card penetration.” Yoco founders believe that running a small business is difficult enough and that there are a plethora of challenges faced daily; accepting money should not be one of them.

“We first saw the Square concept in 2011 during an annual visit to San Francisco,” comments Wazen. “A year later we saw it everywhere. The light bulb moment or propagation of the seed was seeing an African-American lady running a run-down eatery, take a card payment. With no point-of-sale or till on the countertop, it was the type of place that you wouldn’t expect to have a card facility, but the lady whipped out a square card reader attaching it to a pretty basic Android phone and processed a $40 transaction with ease. The impact this could have on small businesses back home in South Africa became clear. We saw a massive opportunity and we jumped in head first,’’ he says.

He is adamant about the position of these solutions in emerging markets and stresses that the smartphone and tablet plays a bigger role at the point of sale and commerce generally---and that the cloud is accessible through apps; and that the cost of smartphones is low. He says soon every small business owner in emerging markets will be using the smartphone as their primary commerce tool.

“Technology has changed the world from how we communicate, to how we receive basic services.  However, every entrepreneur in every market solves problems that are specific to their market. What this effectively means is that without a good supply of technopreneurs, problems in South Africa will not be solved unless they are perfectly aligned with problems that are being solved in other countries. The technopreneur has an important role to play in the South African economy by creating commercial solutions that solve problems in a manner that has real impact on the local economy,” Wazen says.

He concludes by professing on the future of their invention and the relevant concepts: “Yoco is just at the beginning of the next evolution in the POS landscape. It is taking the shape of a convergence of technology, data and finance. Payments alone, while crucial, are no longer enough. It’s about the business applications that can help a business grow.”

“POS has the deepest level of data on a business’s performance and hence has a crucial role to play in making that data useful so that a business can act on it. The data can also be used by other service providers in their decisions to offer additional financial or marketing services to the business. A very exciting time indeed!”

Anele Malahla

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Issue 83


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